AGDC talks confidentiality, offtake points

All Alaska Gasline Development Corp. contracts would be open to the public under a draft regulation proposed Aug. 13 at its board of directors meeting.

A contract submitted for board approval would be posted on the Alaska Gasline Development Corp., or AGDC, website at least 10 days prior to the meeting at which it is to be discussed, the draft regulations state.

Overall, the five pages of proposals limit what types of confidentiality agreements the corporation and its directors can enter into.

“If the regulations are adopted in this form it is simply going to be fairly open going forward,” AGDC attorney Ken Vassar said. “We’re not going to enter into any contracts that by their terms are themselves confidential. That’s just not an agreement that would be available to us.”

AGDC is the managing organization for the state’s role in the large Alaska LNG Project led by industry. It is also responsible for the smaller, state-led Alaska Stand Alone Pipeline project.

Proprietary and financial information and trade secrets of firms AGDC is under contract with could still be withheld.

AGDC could also still enter into confidentiality agreements; however, the existence of the agreement itself would be made public, Vassar said.

Attorneys with AGDC worked with Attorney General Craig Richards to draft the regulations in attempt to address the tension of making information available to the public, while recognizing the state is in business with businesses that need to keep certain details under wraps.

Gov. Bill Walker fired three AGDC board members in January, citing confidentiality agreements they had signed regarding the AK LNG Project as reasoning. Walker told the new board members he appointed to not sign confidentiality agreements as well.

At the time, Richards said the administration understands the need for protection of certain private information, but that the confidentiality provisions AGDC worked under were too broad.

The plan then was also to have a new policy in place by late spring, Richards said in January.

Some Republican legislative leaders expressed concern over the AGDC firings and the governor’s statements, saying they worried about the message the actions sent regarding the states willingness to work with industry on the $45 billion-plus LNG export plan.

The proposed regulations follow more general state Open Meetings Act guidelines, and lay out a course of action similar to what other state entities involved in business with private firms do.

“Consistent with any confidentiality agreements of the corporation and applicable law, the (AGDC) board will endeavor to limit the amount of confidential information it withholds from the public and the time period for which information is kept confidential,” the policy states. “The corporation shall presume that information is available for public disclosure and is not confidential, absent clear indication or demonstration to the contrary.”

AGDC board chair John Burns noted that confidential information could still be discussed when the board enters an executive session, as is common with other state boards and managing bodies, but no formal action could be taken at that time.

The draft regulations will be put out for a 30-day public comment period before final guidelines are adopted. The hope is to have the draft rule finalized by the end of the year.

Offtake points

Also discussed at the meeting was AGDC’s work to determine how many, and where, gas “offtake” facilities would be located to allow Alaskans access to natural gas from the project.

The guiding legislation for the AK LNG Project, Senate Bill 138, calls for at least 5 interconnection points along the along the 800-mile pipeline. Those interconnection points, or access flanges, can be put in the pipe fairly easily during construction and would then allow a group to add gas to the system or remove it either for industry or residential use.

The offtake facilities themselves, which depressurize and odorize gas for distribution, cost more and are the state’s responsibility. Without associated transmission and distribution costs, the price for an offtake facility is estimated at between $14 million for the smallest and $38 million for the largest capacity offtake the state might need.

AGDC President Dan Fauske said project engineers want to know where the interconnection points will be and that up to 20 interconnection points could be included in the gas pipeline.

“For the point of discussion, it was decided, 20,” Fauske said. “This is an area of contention in the negotiations in terms of spur lines.”

The offtake facilities and any other infrastructure beyond the interconnection points are not considered AK LNG Project costs and would be covered by state or local governments or another entity interested in selling or using gas.

Fauske said AGDC would provide an economic analysis of potential offtake points and let policymakers decide.

Updated: 
08/19/2015 - 10:22am

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