Caucus Tries to Boost Pipeline Assessment Funds
Majority coalition fails to add $2.5 million

Juneau – The Senate Republican Caucus tried unsuccessfully today to add $2.5 million from a crude oil production surcharge to fully fund an independent appraisal of the state’s oil and gas infrastructure.

“Fully funding the risk assessment at $5 million is essential for establishing a credible independent appraisal of the condition of Alaska’s oil and gas infrastructure and its ability to safely operate for another generation,” said amendment sponsor Senate Minority Leader Gene Therriault, R-North Pole. “The integrity of our oil and gas systems must be sufficient to protect Alaska’s environment and ensure uninterrupted production and revenue to the state.”

The amendment to Senate Bill 53 would have added $2.5 million from the Oil and Hazardous Substance Release Response Account to fully fund a comprehensive oil and gas infrastructure risk assessment. The Governor asked the Senate Finance Committee to add the full $5 million, but the committee included only half the needed amount, $2.5 million in general funds.

“Partial funding reduces the scope and thoroughness of the project and leaves the State and industry without an adequate appraisal of the condition of Alaska’s oil and gas infrastructure,” Therriault said. “Full funding is necessary to adequately assess the systems on the scale proposed, and to be able to attract independent nationally recognized firms that have the expertise and capacity to do the work.”

The project would include a comprehensive risk assessment of Alaska’s crude oil production, storage and transportation system including the Trans Alaska Pipeline and Valdez Marine Terminal. It will also evaluate the extent, degree and adequacy of government oversight and make recommendations for continued safe and reliable operation of the system.

This would be the first system-wide risk assessment of Alaska’s complex oil production and transportation system and is anticipated to take from two to three years to complete.

“A thorough, independent appraisal of the condition of the state’s oil and gas facilities is needed to identify the greatest risks of failure; what’s in good shape; what’s not; where, and how serious the risks are,” Therriault said.

“At a time when the U.S. Congress is holding hearings on the maintenance problems and integrity of the Alaska oil and gas system, I am disappointed that members of the majority coalition were unable to vote their conscience to fund this full appropriation,” Therriault said.

The Senate failed to adopt the amendment by a vote of five to 15, along straight caucus lines. The bill now goes to the House for consideration.

A sound actuality can be downloaded from the following link:
http://www.aksenateminority.com/media/25/therriault2007051201a.mp3