Alaska ex-governor plans run to undo pipeline deal

By Yereth Rosen

ANCHORAGE, Alaska (Reuters) – Former Alaska Gov. Tony
Knowles said on Tuesday he plans to seek another term in
office, pledging to undo a deal for a controversial $20 billion
natural gas pipeline contract negotiated by Republican
incumbent Gov. Frank Murkowski.

The proposed contract negotiated by Murkowski with major
oil producers provides no assurance that any gas pipeline will
be built while making sweeping concessions that violate
Alaska’s interests, Knowles, a Democrat, told reporters at a
news conference in Anchorage.

“We just need to start from scratch,” said Knowles, a
Democrat who served as governor for two four-year terms, from
1994 to 2002. “(The state needs) to open it up to all parties
who express an interest, to lay out conditions under which we
want to see it developed and take the best proposal.”

Murkowski negotiated a deal with ConocoPhillips, BP and
Exxon Mobil that proposes to freeze oil and gas taxes
acceptable to the companies for up to 45 years.

The governor argues such terms are needed to give the
companies the financial assurances necessary for such a massive
and risky project. Critics say the deal, being considered by
the state legislature, gives away too much of the state’s
resources and authority.

“I think people are very disturbed that we would attempt to
give away or lock in a set price so that we could induce
somebody to build a gas pipeline,” said Knowles, who did not
run for re-election in 2002 because state law does not allow a
governor to serve more than two consecutive terms.

At Knowles’ side during the news conference was House
Minority Leader Ethan Berkowitz, who had been until Tuesday the
leading Democratic gubernatorial candidate. Berkowitz filed
paperwork to run instead for lieutenant governor and said he
expects to be Knowles’ running mate.