Senate votes to buy out TransCanada, take larger stake in Alaska LNG

Senate Finance co-chair Anna MacKinnon (R-Eagle River) guided the bill through the Senate. She spoke on the Senate floor immediately before the vote. Photo: Rachel Waldholz/APRN
Senate Finance co-chair Anna MacKinnon (R-Eagle River) guided the bill through the Senate. She spoke on the Senate floor immediately before the vote. Photo: Rachel Waldholz/APRN

The State Senate voted 16 to 3 today (Tuesday, Nov. 3) to buy out TransCanada and take a larger stake in the Alaska LNG gas pipeline.

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The vote is a win for Gov. Bill Walker, whose administration has argued that keeping TransCanada as a partner does not make financial sense, and a buyout would give Alaska more control over the proposed megaproject, which the state is developing along with ExxonMobil, BP and ConocoPhillips. The buyout must still be approved by the House, which is expected to vote Tuesday.

Senators Mike Dunleavy and Charlie Huggins of Wasilla and Bill Stoltze of Chugiak — all Republicans — voted no.  Senator Lesil McGuire (R-Anchorage) was absent after the death of her father last week.

Speaking on the Senate floor, Fairbanks Republican Pete Kelly, co-chair of the Senate Finance Committee, said he arrived in Juneau opposed to the bill. But, he said, he was convinced that TransCanada itself wanted out of the partnership, and that buying out the company now will ultimately cost the state less than keeping it in.

“Another thing that it gives us, beside some of the financial advantages, is that we are closer to the project,” he said. “We have a seat at the table, we are involved in decisions as we go forward, and that is of great value as we contemplate a project of this magnitude. ”

The State Senate voted 19-3 to buy out TransCanada on Nov. 3, 2015. Republican senators Mike Dunleavy and Charlie Huggins of Wasilla and Bill Stoltze of Chugiak voted no. Photo: Rachel Waldholz/APRN
The State Senate voted 19-3 to buy out TransCanada on Nov. 3, 2015. Republican senators Mike Dunleavy and Charlie Huggins of Wasilla and Bill Stoltze of Chugiak voted no. Photo: Rachel Waldholz/APRN

Anchorage Democrat Bill Wielechowski said he favors the buyout for the same reasons he opposed the original deal, under former governor Sean Parnell. That deal, in 2014, ended the state’s partnership with TransCanada in the Alaska Gasline Inducement Act, or AGIA, and brought the company into the current Alaska LNG project.

“But the deal that was struck by the prior administration was not a good one,” Wielechowski said. “When the time came to strike a bargain, TransCanada bargained hard. They did what they were supposed to do for their shareholders, and they got a good deal. Unfortunately that deal came at the expense of the people of Alaska.”

Meanwhile, Sen. Mike Dunleavy, one of the three “no” votes, said that after a week and a half of hearings, he still wasn’t convinced the administration has a clear plan for the gas line going forward. He said it seems like different state agencies are working against each other.

“As I stand here today and I speak to this body, I have serious concerns,” he said. “I believe that there were questions that went unanswered. I believe the onus was on the administration to prove to me that we’re headed in the right direction, and personally I think it came up short.”

Dunleavy said he hoped his vote would send a message to the administration about “getting its act together.”

The bill would allow the administration to spend about $157 million to buy out TransCanada, continue work on the project’s early planning phase, and fund state agencies. It’s about $600,000 less than the administration originally asked for, after agencies revised their request.