Report 

Submitted to the 

United States Congress 

by the Federal Energy Regulatory Commission 

Fourth Report to Congress on Progress Made in Licensing 

and Constructing the Alaska Natural Gas Pipeline 

 August 15, 2007 
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Fourth Report to Congress on the Alaska Pipeline 

I. Executive Summary 

This report by the Federal Energy Regulatory Commission (Commission or 

FERC) is submitted pursuant to section 1810 of the Energy Policy Act of 2005 (EPAct 

2005).1

 Section 1810 of EPAct 2005 provides that the Commission shall submit to 

Congress semi-annual reports describing the progress made in licensing and constructing 

the Alaska natural gas pipeline and any impediments thereto. 

 This report describes the events and the progress that has transpired since the 

Commission’s Third Report submitted on January 31, 2007. During the period covered 

by this report, the following key events have occurred: 1) the State of Alaska has enacted 

and begun to implement its Alaska Gasline Inducement Act program; 2) the U.S. Court of 

Appeals upheld the Commission’s open season regulations; 3) the Federal Coordinator 

has been active in discussions with project stakeholders; 4) the Department of Labor 

issued a grant to the state for pipeline worker training; and, 5) the Commissioners and 

FERC staff have continued to prepare for the filing of any applications for an Alaskan 

natural gas pipeline, including a FERC staff site visit to the project area in Alaska. 

II. Status Report 

A. The Alaska Gasline Inducement Act 

In January 2007, Alaska’s Governor Sarah Palin introduced a new bill in the 

state’s legislature, entitled the Alaska Gasline Inducement Act (AGIA). The legislature 

hired several consultants to thoroughly review the AGIA bill and held numerous 

meetings and hearings at which the FERC staff participated as requested. The AGIA was 

enacted in May 2007, and a widely-attended ceremonial bill signing was held on June 6, 

2007. The AGIA is now the state’s vehicle for inducing a project sponsor to proceed 

with the construction of the Alaska natural gas pipeline. 

 Under AGIA, Alaska’s Commissioner of Natural Resources and Commissioner of 

Revenue (Alaska Commissioners) will review competitive applications from qualified 

project sponsors seeking an exclusive and enforceable AGIA license that entitles the 

licensee to state matching contributions of up to $500 million for expenditures toward the 

planning and construction of an Alaskan natural gas pipeline project and other state 

administrative benefits. All project sponsors seeking an AGIA license must agree to 

several requirements, terms and conditions regarding the construction and operation of 

the project sponsor’s proposed project. An AGIA license will be awarded on a 

 

1

 P.L. 109-58, 119 Stat. 594, 42 U.S.C § 15801 et seq. (2005). 
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competitive basis to the project sponsor who proposes a gas pipeline project that will 

sufficiently maximize the benefits to the people of Alaska in accordance with the criteria 

in the AGIA. A more detailed description of the AGIA process and license, supplied by 

the State of Alaska, is attached in an Appendix to this Report. 

On July 2, 2007, Alaska released its Request for Applications (RFA) which 

included the purpose, instructions, requirements, evaluative criteria, and other 

information about submitting an application for the competitive AGIA license selection 

process. Up through July 23, 2007, Alaska received comments and suggested revisions 

to the RFA, and the Alaska Commissioners made certain changes to the RFA in an 

amended RFA dated August 6, 2007 which was posted on the state’s AGIA website. The 

amended RFA includes information intended to help interested parties prepare complete 

applications that comply with the requirements established in AGIA. 2

 

Applications for an AGIA license were originally due by October 1, 2007; 

however, in the August 6th amended RFA, the deadline was changed by a decision of the 

Alaska Commissioners in response to requests for more time from several prospective 

applicants. The new deadline for the filing of AGIA license applications is November 

30, 2007. 

 Governor Palin stated that the state administration’s goal is to submit its preferred 

project sponsor choice for an AGIA license in time for the next legislative session in 

January 2008. Assuming legislative approval, the state will issue an AGIA license by the 

summer of 2008. 3 A project sponsor could begin field work, engineering and design 

studies, financing efforts, and take other steps toward obtaining federal certification 

before obtaining an AGIA license, but many of these tasks are expected to await the 

issuance of the AGIA license. 

 It is not necessary that the sponsors of an Alaskan project participate in the AGIA 

process as a prerequisite to filing an application with the Commission. Moreover, there is 

no certainty that the Commission would impose on a certificate holder the rate and other 

requirements included in AGIA – the Commission will have to make an independent 

determination on these matters. However, FERC staff has testified before the Alaska 

legislature that nothing in AGIA is on its face inconsistent with the Natural Gas Act 

 

2

 A redline tracked version of the amended RFA is on the state’s AGIA website, we 

noted two areas where more detailed technical instructions were provided related to 

assumptions to be used for gas quality specifications and net present value calculations. 

3

 Governor Sarah Palin - Weekly Gasline Briefing #15 - “The Path From Here”, 

May 17, 2007 - http://www.gov.state.ak.us/agia/pdf/WGB15_TVtext.pdf . 
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(NGA), 4 the Alaska Natural Gas Pipeline Act (ANGPA), 5

 or the Commission’s 

regulations. 6

 

To the extent that AGIA requires the holding of an open season within 36 months 

of the issuance of an AGIA license, and that the license holder commit to using the 

Commission’s pre-filing process and to filing an application with the Commission by a 

time certain, AGIA may provide incentives that lead to the timely development of an 

Alaska project. While certificate application pre-filing is mandatory only for liquefied 

natural gas facilities under our regulations, the Commission’s processing of any Alaskan 

natural gas pipeline would be greatly enhanced with the project sponsor’s use of the 

Commission’s pre-filing process. 7 In this connection, we note that the pre-filing process 

should begin as soon as possible after an AGIA license is issued. Given our 

understanding that two summer seasons will be necessary to obtain natural resource data, 

pre-filing work and doing field surveys need not await the open season process or its 

completion. 

B. Status of Three Previously Discussed Potential Projects 

Three potential projects were described in the Commission’s previous reports, and 

these projects are still under consideration by the project sponsors. One of these potential 

projects is the Alaska Natural Gas Transportation System (ANGTS), which is supported 

by the TransCanada Corporation. The second potential project is the Trans-Alaska Gas 

System (TAGS), a liquefied natural gas (LNG) export project which is being promoted in 

some form by the Alaska Gasline Port Authority. The third potential project is sponsored 

by the Producer Group,8 which is composed of BP, ConocoPhillips, and ExxonMobil. 

This project involves an entirely new pipeline which would be authorized pursuant to the 

provisions of section 103 of ANGPA and section 7 of the NGA.9

 The Alaska Gasline 

 

4

 (15 U.S.C. § 717, et seq.). 

5

 P.L. 108-324, 118 Stat. 1220, 15 U.S.C § 719 (2004). 

6

 As discussed below under Commission’s Activities, intrastate projects could be exempt 

from the Commission’s NGA jurisdiction. 

7

 18 C.F.R. 157.21 - Pre-filing procedures and review process for LNG terminal 

facilities and other natural gas facilities prior to filing of applications. 

8

 The conceptual design of the ANGTS project and Producer Group’s project consists of 

a pipeline that would generally parallel the TAPS oil pipeline from Prudhoe Bay to Delta 

Junction, Alaska; then follow the Alaska Highway to the Alaska-Yukon/Canadian border 

and continue through Canada to the Alberta natural gas hub, and ultimately to markets in 

the lower 48 states through new or existing pipelines. 

9

 15 U.S.C. § 717(f) (2000). 
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Port Authority has indicated that it will apply for an AGIA license, but the plans of the 

other two potential project sponsors regarding the AGIA process and license are not 

known at this time. 10 Project sponsors other than these three may also apply. 

The Producer Group has three options regarding an Alaskan Pipeline project. 

First, through the appropriate affiliates, it could apply as an owner and operator of the 

pipeline for an AGIA license and a Commission certificate for a project of its design. 

Second, the producers could become shippers on a pipeline built by an independent 

pipeline company which secures an AGIA license. Third, the producers could forgo the 

AGIA license and apply for a Commission certificate for a project of its design. 

Regarding the first two options, Alaska’s AGIA/RFA Inquiries FAQ website states that 

the AGIA provides the producers with additional royalty, taxes and cost protection 

incentives to commit their gas to the pipeline, provided that their gas is committed during 

the first open season for an AGIA licensed project. 11

C. Related Federal and Alaska Executive, Legislative and Judicial Activities 

1. Termination of the Point Thomson Unit 

In November 2006, the Alaska Department of Natural Resources (Alaska DNR) 

announced that the state is terminating the Point Thomson unit on the North Slope and 

taking back oil and gas leases because the unit operator, ExxonMobil, failed to meet 

obligations for development. The Point Thomson unit, formed in 1977, but never 

developed, covered 106,000 acres and held an estimated nine trillion cubic feet of natural 

gas and 300,000 million barrels of gas condensate and oil. Because the Point Thomson 

unit is located north of 64 degrees north latitude, any production from that unit would be 

Alaska natural gas subject to the Commission’s open season rules for capacity on the 

Alaska natural gas pipeline. ExxonMobil, along with other parties, has sought further 

legal action, and a lower Alaska court ruling sustaining the state’s action is being 

appealed by the natural gas producers. 

 

10 The Alaska Natural Gas Development Authority (ANGDA) is a public corporation of 

the State of Alaska. ANGDA is developing an AGIA application “addendum” that 

covers the in-state natural gas markets (Cook Inlet area) that can be attached to any of the 

potential very large North Slope gas export projects (via Canada or LNG). The 

addendum is being developed in a public, transparent process and will be available for 

inclusion by any project sponsor with no exclusivity. ANGDA has completed significant 

project definition work including obtaining a “conditional right-of-way” from the State of 

Alaska for a particular intrastate pipeline route. (See www.angda.state.ak.us).

11 See http://www.rfainquiries.com/FAQ.aspx?Page=1, Question #12. 
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 2. Federal Interagency Memorandum of Understanding 

As discussed in the previous reports, in June 2006 the Federal Interagency 

Memorandum of Understanding for the Alaska Natural Gas Transportation Project 

(MOU) was signed and executed by senior executives and heads from 15 federal 

departments and agencies, including the Commission. The signing of an MOU by this 

large number of federal agencies demonstrates that the federal government is prepared to 

expedite the permitting and construction of an Alaska natural gas pipeline project. 

3. Congressional Research Service Report on Alaska Project & Steel Markets

 On March 28, 2007 the Congressional Research Service (CRS) released an 

updated November 2006 report about the Alaska pipeline project and its interaction with 

the natural gas and steel pipe markets.12 CRS explained how market conditions and costs 

in the natural gas and steel markets will continue to be key factors in the private sector’s 

capital investment decisions about whether or not to build an Alaskan natural gas 

pipeline. The CRS Report described how innovations in steel pipe technology and pipe 

production will have an important impact on an Alaska pipeline project. 

 4. Operations of the Federal Coordinator 

 In accordance with section 106 of ANGPA, Drue Pearce, the Federal Coordinator, 

is responsible for: (1) coordinating the expeditious actions of all federal agencies 

regarding an Alaska natural gas transportation project; and (2) ensuring the compliance of 

federal agencies with the provisions and deadlines of ANGPA. 

 The Office of the Federal Coordinator (OFC) has been established in Washington 

D.C. and is staffed by the Federal Coordinator and several detailees from the Department 

of the Interior. To conduct its business, the OFC has entered into several Interagency 

Agreements to obtain human resources, payroll, contracting, legal and ethics officer 

services. 

 The OFC detailees include two Department of the Interior employees: 1) an 

Acting Director of Communications and Policy Support and 2) a Deputy Federal 

Coordinator and General Counsel. The OFC has advertised for a Director of 

Communications and Policy Support and for a Director of Administration. The OFC 

anticipates making selections for these positions in the third quarter. In addition, the 

OFC has issued a Request for Proposals under an Alaska Services Agreement. Work 

 

12 CRS Report to Congress, “Alaska Natural Gas Pipelines: Interaction of the Natural 

Gas and Steel Markets”, Updated March 28, 2007; Order Code RL33716. 
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under this contract would provide a local Alaska OFC presence pending establishment of 

its Alaska office and general Alaska-based services. 

 On May 22, 2007, the Federal Coordinator appeared before the Senate Energy and 

Natural Resources Committee Subcommittee on Energy regarding S.1089, a bill to 

amend the Alaska Natural Gas Pipeline Act, which is intended to provide more flexible 

personnel practices and cost reimbursement authority for most OFC operations. 13

 

In response to the AGIA, on July 13, 2007 the OFC announced the creation of a 

Senior Intergovernmental Management Team for the project(s). This Team will meet at 

least once a month and will be composed of U.S. and Alaska government officials. Drue 

Pearce, the Federal Coordinator, will represent the United States and Marty Rutherford, 

Deputy Commissioner of Natural Resources, will represent the State of Alaska. A 

representative from Canada has been formally invited to participate, but not yet named, 

so the appropriate international protocols will be in place if the chosen route goes through 

Canada. 

 The Federal Coordinator has conducted numerous stakeholder meetings for the 

Alaska natural gas transportation project in both Alaska and Canada since our last report. 

The OFC anticipates continuing stakeholder outreach. The OFC also has met with 

delegations from Alaska and the Yukon, as well as with Jim Prentice, Canada’s Minister 

of Indian Affairs and Northern Development, Canadian Embassy and FERC leadership, 

and the private sector representatives. The OFC expects that during the next reporting 

period it will conduct a meeting of the federal team (approximately 20 agencies), initiate 

efforts to contract for a gap analysis to evaluate regulatory “gaps” in the gasline permit 

process and advance federal, Alaskan and Canadian coordination efforts. 

 5. U.S. Department of Energy 

 The U.S. Department of Energy’s (DOE) program office for the federal loan 

guarantee process for the Alaskan natural gas transportation project is monitoring the 

progress of Alaska’s AGIA process, and when a commercial project emerges from the 

AGIA process or otherwise, DOE will proceed with structuring the loan guarantee 

program. 

 

 

13 This bill is also included as an amendment to the CLEAN Energy Act of 2007 by 

SAMDT.1513 to HR.6 which was approved by the Senate on June 21, 2007; also 

included in HR.2950, introduced on June 28, 2007. 
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6. U.S. Department of Labor 

 The U.S. Department of Labor made a federal grant award of $ 7.5 million for 

the Alaska Department of Labor and Workforce Development to spend over the next five 

years on skill training programs for jobs in pipeline construction and maintenance; a state 

administered workforce training plan is required by AGIA. The federal grant targets 

training for more than 2,500 Alaska workers involved in the state's pipeline maintenance 

and construction activities, with an emphasis on preparing the workforce as pipeline 

activity ramps up over the next several years. 14

D. Commission’s Activities

1. Potential Jurisdictional Legal Rulings 

 Under Alaska’s AGIA process, project sponsors seeking an AGIA license must 

document in their application any claim that they make that their project is exempted 

from the NGA with an opinion letter from the project sponsors’ legal counsel or a 

declaratory order from the Commission. The Commission will take appropriate action on 

any timely filings it receives in connection with that process. 

 2. Open Season Regulations 

ANGPA directed the Commission to issue regulations governing the conduct of 

open seasons for Alaska natural gas transportation projects, including procedures for the 

allocation of capacity. The orders, which the Commission issued promulgating 

regulations governing the conduct of open seasons for Alaska natural gas transportation 

projects, including procedures for the allocation of capacity, were affirmed in all respects 

by a July 27, 2007 ruling of the U.S. Court of Appeals for the District of Columbia 

Circuit. The court acted on these “purely legal” matters and recognized that, “[d]elaying 

their resolution would only increase the petitioners’ costs and hence diminish the 

likelihood they will pursue a certificate of public convenience and necessity for an 

Alaska Pipeline, the construction of which is a priority of the Congress.” 15

 

14 U.S. Department of Labor / Employment and Training Administration News Release, 

June 29, 2007; http://www.dol.gov/opa/media/press/eta/ETA20070984.htm and 

Alaska’s Governor’s Office Press Release, July 19, 2007; Number 07‐166 

http://www.dog.dnr.state.ak.us/agia/labor_award.pdf. 

15 ExxonMobil Corporation v. FERC, Case Nos. 05-1299, 05-1300, & 05-1301 

(consolidated); Slip Opinion, citation pending, Decided July 27, 2007, Argued 

December 5, 2006. 
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On appeal, the North Slope Producer Group had challenged certain specific 

aspects of the part of the Commission’s Alaska natural gas transportation regulations 

adopted at 18 C.F.R. 157.36 and 157.37.16 The regulations at 18 C.F.R 157.36 concern 

pipeline design changes that the Commission might require of the pipeline operator after 

reviewing the record of a proposed voluntary expansion of the project in order to provide 

the opportunity for the transportation of gas other than Prudhoe Bay or Point Thomson 

production. The regulations at 18 C.F.R 157.37 concern pipeline design changes the 

Commission might require of the pipeline project applicant after reviewing the record of 

any application for an Alaska natural gas pipeline project in order to promote competition 

and offer a reasonable opportunity for access to the project. 

Specifically, the court found that the Commission’s open season regulations fairly 

balance ANGPA’s dual objectives of (1) facilitating the timely development of an Alaska 

natural gas transportation project, and (2) encouraging the exploration for new gas 

reserves by assuring competitive access to the pipeline. In particular, the court upheld, as 

consistent with ANGPA, the regulations at 18 C.F.R. 157.36 and 157.37, allowing the 

Commission to require project design changes. 

 3. Environmental Review – Update

 As described in the preceding Reports to Congress, the Commission is actively 

preparing to fulfill its National Environmental Policy Act of 1969 and certificate 

application responsibilities. Since the Commission’s third report, the FERC staff 

conducted a site visit to the pipeline project areas in Alaska and continued its discussion 

with the Department of Interior’s Bureau of Land Management and the Alaska 

Department of Natural Resources concerning the eventual environmental impact 

statement and project permitting. During the site visit in July 2007, the FERC staff 

viewed previously identified pipeline routes in and around Fairbanks, south of Fairbanks 

to Delta Junction, and north of Fairbanks following the Dalton Highway to Deadhorse. 

The site visit included a tour of the Prudhoe Bay facilities.

E. Developments in Canada

The Mackenzie Gas Project continues to be under consideration by the 

government of Canada. The Mackenzie Gas Project includes development of natural gas 

 

16 Regulations Governing the Conduct of Open Seasons for Alaska Natural Gas 

Transportation Projects, FERC Stats. & Regs., Regs. Preambles ¶ 31,174 (February. 9, 

2005); 70 Fed. Reg. 8,269 (February 18, 2005) (Order No. 2005) and Regulations 

Governing the Conduct of Open Seasons for Alaska Natural Gas Transportation Projects, 

FERC Stats. & Regs., Regs. Preambles ¶ 31,187 (June 1, 2005); 70 Fed. Reg. 35,011 

(June 16, 2005) (Order No. 2005-A). 
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fields, gathering lines, and processing facilities in the Mackenzie River Delta of Canada's 

Northwest Territories, and a transportation pipeline along the Mackenzie River Valley to 

deliver the natural gas to market. This major pipeline project consists of over 750 miles 

of 30-inch natural gas transmission pipeline that would transport 1.2 billion cubic feet 

(Bcf) per day of new Arctic gas to market. The estimated capital cost of this project has 

recently risen to $15 billion, and it is now planned to be in operation by 2015. 

 

Although this project is neither a complement to nor a competitor of an Alaska 

natural gas pipeline, its development presents certain problems and risks to an Alaskan 

project. First, industry reports indicate that there will not be enough pipeline grade steel 

available to construct both projects at the same time. Similarly, there could be a shortage 

of the skilled labor force required to build two technically-challenging Arctic projects of 

such magnitude at the same time. 

Sponsors of the Mackenzie Gas Project have been discussing royalty and fiscal 

issues concerning the project with the government of Canada. The regulatory review 

process in Canada for the Mackenzie Gas Project is continuing, although the schedule has 

been extended. The Joint Review Panel is examining issues and impacts in the areas of 

the natural and human environments associated with the proposed Mackenzie Gas Project 

to determine how the project could affect the land, environment and lives of people and 

communities in the project area. 17 

The National Energy Board (NEB) Panel, consisting of three of the NEB’s ten 

members, is reviewing the technical aspects, such as engineering, economic feasibility, 

tolls and tariffs, and lands issues associated with the proposed project. The NEB Panel 

will consider the Joint Review Panel’s report in deciding whether the project is in the 

public interest. If at the end of the process the NEB Panel decides the project is in the 

public interest, the federal Cabinet must then decide whether to authorize the NEB to 

issue a certificate so that the project can proceed. If, on the other hand, the NEB Panel 

decides that a project is not in the public interest, then no further approval of its decision 

is required. 

III. Conclusion 

 Alaska offers a reliable continental source of natural gas for the Lower 48 States 

that will help the U.S. economy to grow and thrive, and also contribute to the economic 

well-being of the State of Alaska. The federal government is ready to act on any projects 

to transport Alaskan gas to the Lower 48 States. We look forward to seeing if the 

 

17 The Joint Review Panel for the Mackenzie Gas Project is a seven-member, 

independent body that will evaluate the potential impacts of the project on the 

environment and lives of the people in the project area. 
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progress made by the State of Alaska in enacting AGIA and commencing its RFA is 

followed by an AGIA licensee selection process that elicits a viable proposal to make 

Alaska’s natural gas available to U.S. consumers. 
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Appendix 

Alaska Gasline Inducement Act (AGIA) 

Executive Summary 18

PURPOSE: The legislation is intended to encourage expedited development of Alaska’s 

natural gas resources by offering incentives to companies that produce the state’s oil and 

gas resources and to companies that can build a North Slope natural gas pipeline. 

INCENTIVES FOR PIPELINE CONSTRUCTION: The state offers to match up to $500 

million of the costs the licensee will incur to obtain a certificate from the Federal Energy 

Regulatory Commission or Regulatory Commission of Alaska. The state will appoint a 

pipeline coordinator to help expedite review and coordination of all state and federal 

permits and processes; to ensure that all state and federal environmental requirements are 

completed; and to coordinate with the Federal Coordinator for natural gas transportation 

projects in Alaska. The state will also develop a training program to prepare Alaskans for 

project construction, operations and maintenance jobs. 

INCENTIVES FOR GAS COMMITMENT: The state will adopt regulations to provide 

predictability in the state’s determination of the value of its royalty share of North Slope 

natural gas and also in the exercise of its right to take its royalty share in kind (gas) or in 

value (money). The legislation also offers a production tax exemption for gas committed 

to the pipeline during the first open season equal to the difference between the tax 

obligation in effect at open season (the day the first solicitation ends for commitments to 

ship gas on the pipeline) and any higher obligation that may become effective for 10 

years after pipeline start-up. 

LICENSE REQUIREMENTS: In order for an application to be evaluated for the state 

license and pipeline construction incentives under AGIA, it must commit to the 20 

requirements in the legislation, which include: 

1. Soliciting firm commitments to ship gas on the pipeline (holding an open season) 

within three years of receiving the AGIA license. 

 

18 Prepared by the State of Alaska, Department of Natural Resources, July 10, 2007. 
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2. Providing a firm date by which the applicant will apply to the Federal Energy 

Regulatory Commission or Regulatory Commission of Alaska for a certificate 

authorizing the pipeline. 

3. Agreeing to certain financial provisions to keep pipeline tariff rates low. 

4. Soliciting demand for pipeline expansion at least every two years through a public, 

non-binding solicitation or similar means. 

5. Describing how construction cost overrun risks will be managed. 

6. Agreeing to incorporate at least five gas off-take points along the pipeline in 

Alaska. 

7. And committing, to the maximum extent permitted by law, to hire qualified 

Alaskans for construction and operation of the gas pipeline. 

APPLICATION REVIEW CRITERIA: The commissioners of the Alaska departments of 

Revenue and Natural Resources (the commissioners) will evaluate the applications under 

seven criteria spelled out in AGIA and the Request for Applications: 

1. Proposed project timeline; specifically how quickly the applicant proposes to 

begin construction and commence commercial operations. 

2. Proposed method to manage construction cost overruns that could increase the 

tariff. 

3. Proposed tariff rate structure. 

4. The ability of the project design to accommodate low-cost pipeline capacity 

expansion. 

5. How much of the state’s matching funds will be used and timing of the state’s 

payments. 

6. Whether the project is feasible. 

7. The applicant’s ability to perform. 

PROJECT PROCESS: The process began when the commissioners issued the Request 

for Applications (RFA) on July 2, 2007. The application deadline is November 30, 2007 

(originally October 1, 2007), although the commissioners may extend the application 

deadline at any time by public notice. After the application deadline has passed, each 

application will be opened and reviewed to determine whether it meets the requirements 

of AGIA and the terms of the RFA. The commissioners will publicly release complete 

applications and take comments for 60 days. Applicants can apply to protect any 

proprietary information or trade secrets included in their applications. 

The commissioners will evaluate all complete applications under criteria set by AGIA 

and the RFA to determine whether the application fulfills the purposes of AGIA and 

sufficiently maximizes the benefits to Alaska. The commissioners will forward a written 
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decision recommending awarding the license and the legislature will have 60 days after 

that notice to approve the commissioners’ proposed action. 

After the license is awarded, the licensee must complete an application to the Federal 

Energy Regulatory Commission or Regulatory Commission of Alaska. The licensee 

must sanction the project within a year of receiving a certificate from the appropriate 

regulatory agency if it has adequate financing. If necessary, the licensee has an 

additional two to five years to obtain financing or transfer the certificate and all 

associated work product to another licensee designated by the state. 

If the project becomes uneconomic after the license is awarded, AGIA describes a 

process for relinquishing the license that will enable the state to recover the benefit of its 

investment in the project.