Murkowski touts wins for Alaska in infrastructure bill; AK LNG left out

  • U.S. President Joe Biden speaks outside the White House with a bipartisan group of senators after meeting on an infrastructure deal on June 24 in Washington, D.C. From left are Sen. Rob Portman, R-Ohio; Sen. Bill Cassidy, R-La.; Sen. Jon Tester, D-Mont.; Sen. Lisa Murkowski, R-Alaska; Sen. Susan Collins, R-Maine; Sen. Kyrsten Sinema, D-Ariz.; Sen. Joe Manchin, D-W.Va.; and Sen. Mark Warner, D-Va. (Photo/Win McNamee/Getty Images/TNS)

Sen. Lisa Murkowski was at the center of negotiations to craft the $550 billion infrastructure package that she says will make significant investments in Alaska, but it’s unclear at this point where one of the largest potential infrastructure projects in generations fits in.

The Infrastructure Investment and Jobs Act includes roughly $400 billion in baseline formula spending for existing highway and airport programs among others, as well as roughly $550 billion in new spending that will largely go to existing federal grant and formula programs.

Murkowski said the bipartisan package by 10 senators partly negotiated in direct talks with President Joe Biden focuses on rebuilding the country’s core physical infrastructure of roads, ports and bridges with additional investments in broadband and renewable energy and carbon capture technologies, for example.

“It invests in legacy projects for the long-term,” Murkowski said in a July 30 call with Alaska reporters. “The overall benefit to a state like Alaska, I think, is going to be really, really considerable.”

She acknowledged that hard numbers for the state’s share of the spending are difficult to calculate because so much of the funding is formula-driven. It won’t be doled out in lump sums.

The bill currently under debate by the full Senate could have a particularly large impact in improving rural water and sanitation systems, according to Murkowski, who said it adds $180 million to Environmental Protection Agency drinking water and wastewater programs and $3.5 billion to the Indian Health Service for sanitation facilities nationwide.

“This is really going to be a once-in-a-lifetime investment in sanitation facilities,” she said.

The infrastructure spending bill also funds many of the programs established in Murkowski’s omnibus Energy Act of 2020, which passed late last year after six years of work.

Absent from explicit inclusion in the bill is the state’s request for nearly $5 billion in federal funding to jumpstart construction of the Alaska LNG Project.

In January Gov. Mike Dunleavy announced the state’s latest plan to fund the $38 billion Alaska LNG Project that centered on capturing federal infrastructure funding from a then-conceptual bill for 75 percent or about $4.5 billion, of the initial $5.9 billion phase one of the project to the first section of gas pipeline between the Point Thomson field and Fairbanks.

The administration touted it as a way to improve air quality in the Interior — an ever-growing issue for the EPA — by replacing wood and oil burning with natural gas for home heating.

The remaining portion of the overall 807-mile pipeline, the North Slope gas treatment plant and the Kenai LNG facility would be funded separately, according to Alaska Gasline Development Corp. officials.

AGDC spokesman Tim Fitzpatrick wrote via email in response to questions about where Alaska LNG fits in the 2,700-page Infrastructure Investment and Jobs Act that the project “is clearly aligned with national climate, energy, and infrastructure objectives, and we’re closely watching the legislative process as we move this project forward.”

Murkowski spokeswoman Karina Borger wrote that the senator was able to repeal a sunset provision from 2004 legislation that maintains the project’s access to up to $18 billion in federal loan guarantees when asked where the $5 billion request fit into the negotiations and subsequent legislation.

Officials in the governor’s office said they requested an earmark for the project from the delegation but also noted the legislative process is not over.

Senate leaders hope to move the bill to the House quickly, according to Murkowski.

AGDC officials also insisted they didn’t expect a direct appropriation for the project and that it still has commercial interest without the prospect of a federal boost.

AGDC leaders hope to secure commitments from developers, operators and investors in the LNG and gas treatment plants by this fall, with the project’s major financial agreements coming next year.

In late June the Energy Department announced it would conduct a supplemental environmental impact statement on the project to determine its life-cycle impact greenhouse gas emissions.

AGDC President Frank Richards said he believes the analysis will show the Alaska LNG Project would prevent up to 80 million tons of carbon emissions over its roughly 30-year life primarily by displacing coal for power generation in east Asian countries, long a selling point of the project for the state-owned corporation.

Elwood Brehmer can be reached at [email protected].

08/04/2021 - 11:37am