Politics & Government

Alaska's Stevens now opposes gas pipeline he promoted

Former U.S. Sen. Ted Stevens said Friday there's not enough market for Alaska natural gas in the Lower 48 to justify a pipeline through Canada, and that the state should instead pursue construction of pipelines to Kenai and Valdez to export gas to Asia.

Stevens, giving an Anchorage speech before the public policy group Commonweath North, called for the state to invest half the money it would take to build a multi-billion dollar natural gas pipeline from the North Slope to the Kenai Peninsula. Gas not needed for use in Alaska could be liquefied at an existing plant there, Stevens said, shipped in tankers to countries such as Japan, China, India and South Korea, where he said there's a better market than in the U.S.

Stevens said a bigger pipeline should go to Valdez, long promoted as a potential port for export of liquefied natural gas to Asia. He called on the state to give "emergency power" to an official dedicated to work on making it happen.

The 86-year-old Stevens has made few public appearances since he lost his re-election bid in 2008, shortly after his conviction on federal charges of not properly reporting gifts. The conviction was subsequently overturned by a federal judge.

Stevens told the Commonwealth North luncheon crowd that he asked to come and talk about why he's changed his mind on the gas pipeline project. While in office, he championed the proposed gas pipeline through Canada and helped pass $20 billion in federal loan guarantees meant to help bring Alaska gas to the Lower 48.

"It's only in the last six months that the realization has come about that's not the market our gas can take," Stevens said.

He spoke of the large new supplies of natural gas in shale rocks in the Lower 48, and said demand there isn't rising as much as previously predicted. The supply will likely more than meet demand through 2030, Stevens said. But forecasts show the natural gas demand in Asia badly outstripping supply in three years, Stevens said, giving Alaska a short window to come in and meet the demand.

Stevens called it a magnificent opportunity and said "this is something we should put every talent we've got in the state on." Stevens refused to answer when a reporter after his speech attempted to ask him about the details of his proposal, and the economics of building gas pipelines to both Kenai and Valdez.

Larry Persily, confirmed by the U.S. Senate this week as the federal coordinator for the Alaska gas pipeline project, said there's a lot of competition to supply natural gas to Asia.

"I respect his knowledge and experience, I just disagree," he said. "I think there's still a way to make it work to serve the North America market, which is a much larger market in terms of how much gas they consume every day."

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