Legislature(2015 - 2016)BUTROVICH 205
02/05/2015 01:00 PM Senate SPECIAL CMTE ON ENERGY
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| Audio | Topic |
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| Start | |
| Overview: Interior Energy Project and Potential Purchase of Pentex Alaska Natural Gas Company, Llc | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
ALASKA STATE LEGISLATURE
SENATE SPECIAL COMMITTEE ON ENERGY
February 5, 2015
1:02 p.m.
MEMBERS PRESENT
Senator Click Bishop, Co-Chair
Senator Peter Micciche, Co-Chair
Senator Lyman Hoffman
Senator Bert Stedman
Senator Dennis Egan
MEMBERS ABSENT
All members present
OTHER LEGISLATORS PRESENT
Senator Cathy Giessel
Representative Jim Colver
Representative David Talerico
COMMITTEE CALENDAR
OVERVIEW: ALASKA'S INDUSTRIAL DEVELOPMENT AND EXPORT AUTHORITY
(AIDEA) - INTERIOR ENERGY PROJECT AND POTENTIAL PURCHASE OF
PENTEX ALASKA NATURAL GAS COMPANY, LLC
- HEARD
PREVIOUS COMMITTEE ACTION
No previous action to record
WITNESS REGISTER
GENE THERRIAULT, Director
Energy Policy Outreach
Alaska Energy Authority
Anchorage, Alaska
POSITION STATEMENT: Provided information on the Interior Energy
Project.
TED LEONARD, Executive Director
Alaska Industrial Development and Export Authority (AIDEA)
Anchorage, Alaska
POSITION STATEMENT: Provided an AIDEA overview and an update on
the potential Pentex purchase.
MARK DAVIS, Chief Officer
Infrastructure Development
Alaska Industrial Development and Export Authority (AIDEA)
Anchorage, Alaska
POSITION STATEMENT: Answered questions about the potential
Pentex purchase.
DANA PRUHS, Chairman
Alaska Industrial Development and Export Authority Board (AIDEA)
Anchorage, Alaska
POSITION STATEMENT: Was available to answer questions on the
potential Pentex purchase.
ACTION NARRATIVE
1:02:38 PM
CO-CHAIR PETER MICCICHE called the Senate Special Committee on
Energy meeting to order at 1:02 p.m. Present at the call to
order were Senators Egan, Stedman, Hoffman, Co-Chair Click
Bishop, and Co-Chair Micciche.
^ OVERVIEW: INTERIOR ENERGY PROJECT AND POTENTIAL PURCHASE OF
PENTEX Alaska NATURAL GAS COMPANY, LLC
OVERVIEW: ALASKA INDUSTRIAL DEVELOPMENT AND EXPORT AUTHORITY
(AIDEA) - INTERIOR ENERGY PROJECT AND POTENTIAL PURCHASE OF
PENTEX ALASKA NATURAL GAS COMPANY, LLC
1:03:40 PM
CO-CHAIR MICCICHE announced the committee's agenda would be an
overview of the Alaska Industrial Development and Export
Authority (AIDEA) and of the Interior Energy Project and the
potential purchase of Pentex Alaska Natural Gas Company, LLC.
CO-CHAIR MICCICHE recognized Representative Talerico. He listed
today's presenters.
1:04:55 PM
CO-CHAIR MICCICHE announced that the committee will stand at
ease.
1:08:21 PM
CO-CHAIR MICCICHE called the meeting back to order.
1:08:55 PM
GENE THERRIAULT, Director, Energy Policy Outreach, Alaska Energy
Authority (AEA), briefly appeared on teleconference.
1:09:24 PM
CO-CHAIR MICCICHE announced that the committee will stand at
ease.
1:09:51 PM
CO-CHAIR MICCICHE stated a common goal to do something
substantive to provide reliable energy to the Interior at a
reasonable cost in order to provide relief to residences and
existing businesses, but also to potential businesses, and to
increase development. He cautioned to carefully evaluate new
options. He said today's hearing would look at a possible
substantive solution.
1:11:43 PM
TED LEONARD, Executive Director, Alaska Industrial Development
and Export Authority (AIDEA), introduced himself.
MARK DAVIS, Chief Officer, Infrastructure Development, Alaska
Industrial Development and Export Authority, introduced himself.
DANA PRUHS, Chairman, Alaska Industrial Development and Export
Authority Board, was introduced by Mr. Leonard, as was Mr.
Therriault.
MR. LEONARD stated AIDEA's goal to bring low-cost energy to as
many customers as possible. He said that the Interior Energy
Project (IEP) intends to supply natural gas at the lowest cost
to as many people as possible as soon as possible. Secondary
goals include that IEP's investments will compliment a natural
gas pipeline from the North Slope and will lower fine particle
matter (PM2.5) in the nonattainment areas of the Interior.
1:13:41 PM
CO-CHAIR MICCICHE asked if there would be an overview on AIDEA.
MR. LEONARD understood he was to do an overview on the IEP. He
offered to provide information on AIDEA.
CO-CHAIR MICCICHE requested a verbal explanation of AIDEA and
examples of investment that have encouraged projects that may
not have occurred without state support.
1:15:17 PM
MR. LEONARD explained that AIDEA is the state's development
finance authority and its mission is to promote, develop, and
advance economic growth and diversification in Alaska by
providing various means of financing and investment. AIDEA does
this by actively partnering with the private sector, businesses,
and communities. AIDEA provides access to low-cost capital in
order to make projects affordable. It looks at how investments
through project ownership, investment, and loans will promote
economic development through Alaska. It is about a $1.5 billion
corporation and is one of the top three development finance
authorities in the country in size, capacity, and tools
available with working with the Legislature over the past five-
to-six years.
MR. LEONARD said since FY 2000, AIDEA has made about $1.5
billion in investments, projects, and loans and in the use of
its conduit bond authority. He noted that AIDEA is proud of the
fact that the state's investment of about $333 million start-up
money has been paid back in the amount of $355 million by the
end of 2015, and it has grown assets over $1.5 billion.
1:17:40 PM
He noted that AIDEA has not had to write-off a project in any
incremental amount since FY 2000. He maintained that AIDEA has
been a good steward and has worked very hard to promote economic
development.
He listed key assets owned by AIDEA that have promoted economic
development as follows: Skagway Ore Terminal, Ketchikan Shipyard
operated by Vigor Alaska, Snettisham Dam, AEL&P partnership in
Juneau, Federal Express Hanger in Anchorage, Coast Guard Armory
in Anchorage, and DeLong Mountain Transportation System - a
flagship asset since the early 90's. He said since that time,
AIDEA has provided $744 million in loans, and issued
approximately $1.5 billion in conduit bonds to businesses and
projects in Alaska.
1:20:08 PM
CO-CHAIR MICCICHE noted the job of the committee is to ask
questions. The Legislature is proud of AIDEA's accomplishments
and none of the questions is a challenge to any of them. He
thanked Mr. Leonard for his presentation.
CO-CHAIR BISHOP asked for the amount of AIDEA's last dividend
payment to the treasury.
MR. LEONARD replied the last dividend of $10 million was
slightly less than usual due to market conditions. In FY 2016
the dividend will be $17.5 million. The average dividend over
the last 12 to 15 years has been approximately $20 million to
$21 million a year.
CO-CHAIR MICCICHE requested information about the SB 23 finance
package.
MR. LEONARD described the Interior Energy Project (IEP)
financing as $125 million in SETS [stock exchange] financing,
$57.5 million in a capital budget appropriation, and $150
million in AIDEA bonds. Under the current SB 23, the definition
of financing is to provide financing for a North Slope LNG
facility and to finance distribution and affiliated structures
in Fairbanks and the greater Fairbanks area; that includes
natural gas supply and liquefaction, transportation - trucking,
LNG storage and regasification, and a natural gas distribution
system.
1:23:44 PM
He summarized the IEP's current status. He said that AIDEA had
been pursuing the development of a North Slope supply of LNG
with a private partner. It is now evaluating alternative sources
of natural gas.
CO-CHAIR MICCICHE asked whether the IEP "full supply chain
focus" is currently occurring.
MR. LEONARD answered yes. In an attempt to provide the lowest
cost for supply and transportation, AIDEA is now also looking at
alternative sources of supply and transportation while
concentrating on a distribution system in Fairbanks.
CO-CHAIR MICCICHE commented that the business model is occurring
without AIDEA, but as a private firm both in supply and in
distribution.
1:27:58 PM
MR. LEONARD continued to explain that AIDEA is still working on
the financing of the build out of natural gas distribution in
Fairbanks and the North Pole.
CO-CHAIR MICCICHE announced the presence of Representative
Colver.
MR. LEONARD addressed AIDEA's financing route of the North
Slope. AIDEA utilized a private/public partnership through a
concession agreement where AIDEA provided financing and would
own the asset and the concessionaire would provide financing,
and would build and operate the LNG plant. Several conditions
were required for financial close: AIDEA had to agree to project
costs and commercial terms, the project developer would provide
construction and operating agreements, would negotiate and
secure LNG supply with utilities, and develop a financial model
with an agreed LNG price.
1:30:25 PM
CO-CHAIR MICCICHE noted there were two private firms involved
with Pentex [Alaska Natural Gas Company, LLC]. He asked for the
timeline of AIDEA's interactions with Pentex - where the idea
came from and the timing of the other entities who were
considering the purchase of the project.
MR. LEONARD explained that when AIDEA went through the public-
private partnership evaluation, there were three potential
project developers: FNG, Spectrum, and MWH Global with GVEA
(Golden Valley Electric Association). There were no discussions
during the public-private process about purchasing Pentex. Two
companies were looking at purchasing Pentex, but he did not know
their names.
He said the current process did not begin until January 10-15,
2015. It was initiated based on the fact that the public-private
partnership on the North Slope did not meet the community goals
in the IEP. AIDEA then looked at how it might bring the parties
together and move forward. During last year there was no
discussion regarding purchasing Pentex as part of the plan.
1:33:46 PM
CO-CHAIR MICCICHE noted that Harvest Alaska entered into a
purchase and sale agreement to purchase the facility from Titan
- Pentex on November 5, 2014. He noted AIDEA entered into the
discussion two months later. He opined that the purchase
agreement was an attractive offer and requested more information
about the process. He said the committee's job is to evaluate
the project, but also to ask questions about value for the state
and the rate payers.
MR. LEONARD explained that more information is forthcoming. He
related as AIDEA looked at optimizing the Pentex sale, it
concentrated on the sales of certain assets of Pentex, such as
FNG, which are related to the distribution system in Interior
Alaska.
CO-CHAIR MICCICHE said he understands.
1:36:00 PM
MR. LEONARD turned to the concession agreement results. He said
in looking at the North Slope process, AIDEA worked with MWH and
the project component, but the concession agreement was
terminated due to higher capital cost than projected. Also, low
oil prices were a challenge to the project and the utilities
could not commit to buy sufficient LNG at commercial terms
presented to them. Finally, the delivered projected prices
didn't meet community price goals.
He highlighted positive progress achieved on the North Slope
project. He noted that there is now a detailed design and cost
for a North Slope LNG facility. He detailed that an LNG plant
operations team was formed, costs for transportation and storage
were refined, and progress was made on system planning and
utility work in the Fairbanks area.
1:39:41 PM
He said, based on the North Slope public-private solution not
being able to meet the requirements of SB 23 and to the
community, AIDEA has taken the approach to re-evaluate what
would be the best source of gas, type of liquefaction, and
transportation method to the Interior, at the lowest cost.
SENATOR STEDMAN requested that Mr. Leonard convert the targeted
cost of $13 to $14 per Mcf to kilowatt equivalents.
MR. LEONARD agreed to provide that information.
CO-CHAIR MICCICHE noted the decrease in cost of heating oil and
diesel fuel from $30 per million Btu to $13-$14 since the
beginning of the project evaluation. He said it has to impact
the project as well.
MR. LEONARD agreed. He said it affects projects across the
country. He noted that the project's goal is for a long-term
solution. It is a challenge to the project, to the people
converting to gas, and to the build out.
CO-CHAIR MICCICHE opined that the cost situation bought the
state some time.
1:44:28 PM
SENATOR STEDMAN requested the addition of an efficiency factor
to the conversion information he requested.
CO-CHAIR BISHOP pointed out that in Fairbanks, fuel oil is not
at $2.74 today, at least not at the burner tip. The number of
degree days are substantial.
MR. THERRIAULT addressed the full supply chain now that the
concession agreement with MWH has timed out. There are two
supply contracts on the North Slope for natural gas. The new
effort allows for a look at purchasing low price Cook Inlet
natural gas. The capital cost of an LNG plant on the North Slope
is known and now costs of new LNG capacity in Cook Inlet will be
explored.
He said known trucking transportation costs can now be compared
with railroad costs. Depending on location, both trucking and
rail may be needed. The railroad provided an update a year ago
to the AIDEA Board and continues to refine their numbers.
Conversations continue with the railroad regarding low
transportation costs.
1:48:50 PM
He said AIDEA is working with FNG on a storage project in
Fairbanks that was cancelled. Through new efforts, service
territories will be coordinated to optimize and expand storage
that will serve both utilities at the lowest possible cost.
He addressed distribution noting that AIDEA has provided
financing in the last calendar year that was used by FNG to put
an additional 30 miles of pipe in the ground. The Interior Gas
Authority (IGU) used their original loan money to do the final
design work on their build out starting in North Pole. IGU also
used a portion of their funds to order miles of pipe and is
working with AIDEA on an expanded loan package that will allow
them to cover the construction of the Phase 1 build out in the
core of North Pole.
1:51:36 PM
He explained that the conversion working group that was formed
in July 2014 is a combination of the Fairbanks North Star
Borough, the two distribution facilities, mechanical
contractors, and boiler manufacturers looking at a conversion
assistance program at the local level for local households.
CO-CHAIR BISHOP asked whether the mechanical contractors in the
conversion working group have any concerns about meeting the
demand for natural gas.
MR. THERRIAULT replied that there is some concern about the
ability to ramp up; however, the contractors say they are up to
the job and will have quite a bit of forewarning that the
project is moving forward. AIDEA worked with the boiler
manufacturers to determine how many households will need an
energy system replacement versus those that can be easily
converted.
1:55:14 PM
CO-CHAIR MICCICHE used Homer as an example of a community that
could be weighed for its rate of gas conversion. He suggested a
valuable effort by AIDEA would be to determine lower cost
assistance for the residential level.
MR. THERRIAULT noted the collection of valuable information from
the Homer conversion. He added that for the volume rate that is
needed, an estimated conversion rate in Fairbanks would be 70
percent to 75 percent. Local lenders have said they may be able
to provide assistance to converting homeowners in the form of
loans.
He addressed the next steps to providing natural gas to the
Interior, such as evaluating alternative sources of natural gas
supply in a deliberate and public process, led by AIDEA and AEA.
There is a new Project Charter that includes Interior utilities
and communities. He stated that potential LNG sources will
include both the North Slope and Cook Inlet.
1:58:30 PM
He reviewed the members of the Conversion Working Group, noting
that Alaska Housing and Finance Corporation (AHFC) is an
important member. Through AHFC's Retrofit Energy Rebate,
consumers can qualify for a rebate. He concluded that the goal
is to have a comprehensive program using existing programs to
assist people in the conversion of their homes.
He reviewed highlights of items AIDEA financed in 2014. He said
the AIDEA Board approved IGU's application for $30 million for
Phase 1 construction in the North Pole area. In 2015, FNG plans
to build out approximately 26.2 miles of pipe in Fairbanks.
2:00:56 PM
CO-CHAIR MICCICHE commented that some of the processes expressed
by Mr. Therriault sound like they don't occur every day, when
they do, by firms in the private sector that produce,
distribute, and market natural gas. He said he sees value in
integrating the utilities and in AIDEA's assistance with
conversion, but he is trying to see value in purchasing a
liquefaction. He expressed frustration to see the separation of
private sector investments that are fully functional and
operating at capacity to a public entity.
MR. THERRIAULT replied that Mr. Leonard may be able to clarify
that under the Letter of Intent and the purchasing of the Pentex
assets, AIDEA has also entered into a contract to sell the
liquefaction plant to Hilcorp.
2:02:50 PM
CO-CHAIR MICCICHE thanked Mr. Therriault for the information.
SENATOR GIESSEL asked about the need for a federal permit for
the Alaska Railroad. She noted that it is currently challenged
with positive train control costs. She inquired how much the
permit would cost and how long it would take to obtain it.
MR. THERRIAULT replied that it is not a permit, but an approval
process. The railroad has been working closely with federal
agencies who believe the approval can be secured in about three
months at a minimal cost.
2:04:17 PM
MR. LEONARD turned to the Pentex acquisition proposal. He said
on January 26, 2015, AIDEA signed a Letter of Intent to purchase
Pentex Alaska Natural Gas Company, LLC. He noted it was non-
binding and would allow framework for evaluating the proposed
purchase through a public process. He said there is a private
entity that is providing a small distribution system and a small
gas supply to Fairbanks. Based on the Interior Energy Project
(IEP), AIDEA is looking at how to rapidly expand that system,
get low cost gas into the system, and meet the goals of the IEP.
He assured the committee that AIDEA would continue to provide
information to the legislature and would go through a full due
diligence process to look at how the acquisition promotes
economic development, the risks involved, if it meets AIDEA's
rate-of-return and investment requirements.
2:07:18 PM
He reiterated AIDEA's intent to reduce the total distribution
costs in the Fairbanks area by creating an integrated system
which will accelerate expansion and reduce operating costs. He
noted that AIDEA has tools that can be used in partnership with
the private sector. He pointed out that the AIDEA Board is a
private sector entity; their mission is to assist the private
sector with access to capital and to provide for economic
development for communities.
CO-CHAIR MICCICHE recalled when the Port Authority wished to
purchase FNG a few years ago. He said there was an offer on the
table to purchase Harvest Alaska, LLC. He discussed the value of
integrating the utilities. He detailed the 10-year LNG sales
agreement. He spoke of the potential to expand the LNG facility
had the sale gone through. He said he is struggling with the
purchase of the liquifaction when there was an experienced buyer
on hand. He inquired at what point AIDEA decided to go with the
current option.
2:11:17 PM
MR. LEONARD explained that AIDEA is not saying that the sale
will not go through. Looking at Pentex's distribution system,
AIDEA would be purchasing the membership in the holding company,
if the sale goes through. He specified that the holding company
owns FNG, Titan - the owner of the LNG facility, AET - which
owns the trucking and fueling stations, and Cassini Storage. He
emphasized that the buying of Pentex also includes satisfying
existing contracts or obligations Pentex may have; that would
include the sale of LNG facilities in Point McKenzie.
2:13:17 PM
CO-CHAIR MICCICHE said he does not want to seem confrontational.
He noted the legislature found out at the same time all Alaskans
were told. He suggested better communication in the future.
MR. LEONARD said he appreciated being able to answer the
questions. He understood the concerns and agreed AIDEA could
have done a better job on the timing. He said AIDEA would do
better in the future.
2:15:10 PM
He addressed key points to the Pentex acquisition. AIDEA is
looking for a strategic investment that can play a critical role
in achieving the long-term success of the IEP and promote the
mission of economic development. The investment is expected to
provide immediate price relief to existing FNG customers. It
will allow integration of the existing system by ensuring
coordination between existing utilities. The investment will
allow AIDEA to restart construction of LNG storage in Fairbanks,
which is critical in creating an integrated and efficient
distribution system. He noted the storage would take about two
years to build.
2:18:08 PM
CO-CHAIR MICCICHE asked if a small-diameter LNG pipeline would
negate the need for LNG storage.
MR. LEONARD replied that AIDEA does not believe so. The storage
could be used as a supply backup for the pipeline.
MARK DAVIS noted the added demand in winter and the need for a
pipeline to have LNG storage.
MR. LEONARD added that the storage would provide an interim
solution until a pipeline to Fairbanks is built, either from the
south or north. He stated a belief that there is a critical need
to supply gas to customers as quickly as possible.
He offered AIDEA's assistance on a pipeline evaluation.
CO-CHAIR MICCICHE asserted that "we all have the same goal."
2:20:35 PM
MR. LEONARD stressed that the investment would be of short
duration with the goal of working with the community to
transition to a single utility serving the Interior. AIDEA would
not directly operate the utility.
CO-CHAIR MICCICHE pointed out that Fairbanks is a lucrative
market. He asked how much government interference has kept
typical providers out of the market. He suggested the government
could get out of the way. He used Homer as an example. He said
the more the government intervenes, the less chance there is of
"lowest cost solutions." The RCA can regulate the gas.
2:24:29 PM
MR. LEONARD agreed in normal circumstances the private sector is
the answer. AIDEA is involved in providing capital to assist in
the promotion of private sector growth and economy in Alaska.
Under today's environment, the private sector has not been able
to provide the needed capital and storage system for the
distribution system in Fairbanks. The private sector has been in
Fairbanks since 1997 and consists of about 1,100 customers and
two distribution systems. The price of gas is at $23.70 and
AIDEA has been charged with bringing that cost down. He opined
that AIDEA's involvement will help the private sector, overall,
as it has done in the past.
2:27:52 PM
MR. LEONARD showed a map of natural gas service areas that would
be assisted by AIDEA. He shared the benefits of utility
coordination and an integrated distribution system. The
investment would reduce construction cost, O&M, and overhead
costs and restart efforts to build storage. There would be a
unified effort to purchase LNG and there would be faster
expansion of service to customers through coordinated build out
of system. He gave examples of efficiencies.
2:32:29 PM
He explained the impact on the pending sale of the Titan LNG.
AIDEA will acquire Pentex as an entity, inclusive of Pentex's
interest to sell the LNG facility and trucking assets to a
Hilcorp subsidiary, Harvest Inc. It would not displace any pre-
existing contractual obligations for asset sale and LNG supply
agreements. AIDEA will carefully review these agreements as part
of its due diligence.
CO-CHAIR MICCICHE asked to verify if there were two sales
agreements under AIDEA: whether AIDEA buys the entire supply
chain and sells off liquifaction and trucking to Harvest; or
where Harvest purchases the liquifaction and that part of the
supply chain, and AIDEA buys the remainder.
2:34:57 PM
MR. DAVIS explained that Pentex wanted to sell all of their
stock to AIDEA. If the Board approves, AIDEA will drive Pentex
and any pending contract for sale, such as the contract to
Harvest would remain in place. There are not two contracts, but
an acquisition of shares, pending approval by RCA.
CO-CHAIR MICCICHE commented that a briefing of that issue would
have been very important. He suggested that AIDEA put the rate
payers first and remain out of the way where they are harmful.
2:36:36 PM
MR. LEONARD agreed with that philosophy. He described AIDEA's
stringent due diligence process that includes a public process
with hearings and solicits advice of local governments. It must
complete a finance plan that shows AIDEA will recover its
investments with a reasonable rate of return. It must examine
the existing agreements with Hilcorp and ensure the proposed
purchase price is reflective of the fair market value. It will
go through a full financial, technical, and legal review of the
purchase. Finally, it will be vetted through a transparent
process as it moves forward.
2:38:38 PM
MR. LEONARD shared AIDEA's next steps in the process. It will
commence a due diligence review to confirm whether the Pentex
acquisition is a prudent investment for AIDEA and meet the goals
of the IEP. It will negotiate a definitive agreement with Pentex
and then solicit advice from local governments. It will submit
due diligence and a finance plan to the Board through AIDEA's
public hearing process, and the proposed transaction would be
considered by the Board and voted on in a public meeting.
He offered to meet again for further discussions.
CO-CHAIR MICCICHE thanked Mr. Leonard. He noted that in order
for the acquisition to be done using funds from SB 23, there
needs to be a legislative solution. He said the committee
received a supplemental budget with the amendment in place from
the administration. He said he would push hard for major policy
changes to not occur in a budget document, but rather through
the committee process. He said he proposed the amendment last
year, but is not surprised at the outcome of the North Slope LNG
project. He noted that he tried to add the words "on the North
Slope" to the amendment last year, but it was blocked. He
concluded that the legislature would be working with AIDEA to
help find a solution for the rate payers in the Interior. He
opined that the state has failed the rate payers in the
Interior. He pointed out that the supply of LNG in Cook Inlet
has changed in the last few years; that makes the Interior an
attractive market. He said his dream is for natural gas to go to
densely populated regions in the state and via pipeline to
challenging places and coastal deliveries. He spoke in favor of
having an overall plan and having AIDEA involved in this
particular project.
2:43:41 PM
MR. LEONARD clarified that AIDEA has the ability to use SB 23
funds for the project but is also looking at other sources. He
said AIDEA would work with the Legislature regarding the benefit
of tools available. A budget change would not be needed for this
transaction.
CO-CHAIR BISHOP noted if the Alaska Railroad is used for
transportation, there could be less need for storage capacity.
MR. LEONARD replied that is true and it applies to larger
trailer trucks, as well. AIDEA is currently researching the
issue.
2:46:32 PM
CO-CHAIR MICCICHE asked if the Attorney General will approve the
sale to Harvest and what the backup plan is if the sale is not
approved. He wanted assurance that the state will not be running
trucking and production facilities.
MR. LEONARD answered that the Attorney General has not been
contacted. He opined that even if something happens to the sale,
AIDEA would not operate assets. AIDEA would look for a private
sector company to do so. He stated that AIDEA does not believe
in running assets, but in financing them. He said they have a
role as a facilitator on the distribution side. They would use
the North Slope model if something happened to the Harvest sale.
2:49:07 PM
CO-CHAIR MICCICHE countered that the comparison of a potential
North Slope model with a currently fully-operating project is
not a fair comparison.
SENATOR HOFFMAN asked if the Letter of Intent was public.
MR. LEONARD answered yes. He offered to provide it to the
committee; it is on AIDEA's web site.
CO-CHAIR MICCICHE requested copies of a fact sheet for members.
He concluded that AIDEA and the legislature have common goals.
He reiterated concern about the timing of some processes. He
said if AIDEA's intent is as communicated, and the right private
entities operate correct portions, and there is movement toward
a distributor, he could "get more comfortable" with the
purchase.
He thanked the presenters.
2:51:18 PM
There being no further business to come before the committee,
Co-Chair Micciche adjourned the Senate Special Committee on
Energy at 2:51 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| AIDEA Senate Energy 2 5 15.pptx |
SNRG 2/5/2015 1:00:00 PM |
|
| IEP Conversion Slide from 2013.pdf |
SNRG 2/5/2015 1:00:00 PM |
|
| Pentex - AIDEA LOI 2015_01_26 executed.pdf |
SNRG 2/5/2015 1:00:00 PM |
|
| ENSTAR Slide.PDF |
SNRG 2/5/2015 1:00:00 PM |
|
| AIDEA Pentex Fact Sheet 2-3-15.pdf |
SNRG 2/5/2015 1:00:00 PM |