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Sunday, June 23, 2024

Murkowski and his pipeline headed for defeat

Unpopular Alaska incumbent Gov. Frank Murkowski may not escape Tuesday's Republican primary. If Murkowski is unseated, his deal to smooth the way for a $25 billion natural gas pipeline to Canada will likely go down with him.

Unpopular Alaska incumbent Gov. Frank Murkowski may not escape Tuesday’s Republican primary. If Murkowski is unseated, his deal to smooth the way for a $25 billion natural gas pipeline to Canada will likely go down with him.

Murkowski, whose time at the state’s helm has been rocky since he left his U.S. Senate seat in 2002, is polling last in the three-way race to win the Republican nomination. Two independent polls released this month show former Wasilla mayor Sarah Palin with a lead over former state legislator John Binkley of Fairbanks, and the governor bringing up the rear.

Palin gained notoriety by calling attention to ethical lapses by Republican Party head Randy Ruedrich in 2003 and then Murkowski’s first attorney general, Gregg Renkes, in 2005. She has cast herself as a party iconoclast battling for the nomination after battling for so long against its leaders.

Binkley is a successful Fairbanks businessman who represented rural Alaska in the state Legislature and was a co-chairman of the powerful Senate Finance Committee in the 1980s.

Both Palin and Binkley have fueled their campaigns since Murkowski announced his re-election bid in May by questioning the governor’s leadership and particularly by criticizing his pipeline deal with the three largest oil companies in the state.

BP PLC’s announcement that it was shutting down the Prudhoe Bay oil field, the nation’s largest, has thrown a twist in the campaign’s final days. The event, which crimps the state’s main economic driver, has led Murkowski’s opponents to say his and previous administrations dropped the ball by allowing BP to go years without ensuring proper maintenance of its facilities.

Murkowski says he will hold BP accountable, but state government should not be in the business of physically monitoring the oil company’s facilities.

Whoever ends up winning the heated and expensive Republican primary campaign will likely have to face Tony Knowles in the November 7 general election. Knowles, a well-known two-term Democratic former governor, has been quietly raising cash, saving his resources and waiting for a Republican opponent to emerge.

Murkowski has doggedly tried to turn the election into a referendum on his pipeline contract proposal with BP, ConocoPhillips and Exxon Mobil Corp. His campaign has mainly consisted of telling Republican party loyalists that his plan is the best way of getting a North Slope gas pipeline and that he is the only real obstacle to Knowles reclaiming the governor’s mansion.

“We’re about to embark on the greatest significant event since statehood, and that’s the gas line,” Murkowski said in a candidate debate Thursday. “And I think it’s fair to say that I’m the only one that can beat, in my opinion, the Democratic candidate, and that’s Tony Knowles.”

Murkowski’s effort to cast himself as a tough negotiator who will bring a pipeline to Alaska has fallen flat with state lawmakers, who have put off a decision on the gas pipeline contract until after the elections. So now Murkowski is looking for a mandate from the people to give him the leverage to push the deal through.

But decisions he’s made over the past four years — from appointing his daughter Lisa to his U.S. Senate seat to purchasing a state jet after being denied by the federal government and state Legislature — have put his approval ratings on the skids.

With Murkowski’s fate tied to his pipeline deal, the 73-year-old governor may not get a shot to execute the contract if a different Republican nominee emerges Tuesday.

“I’d say that if the governor doesn’t get the nod from the people, it will be very difficult to get his contract moved forward,” said Alaska House Majority Leader John Coghill, R-North Pole.

Every other candidate save one has panned the governor’s deal and said they would open the pipeline negotiations with the state other groups besides the three companies.

“I thought we conceded too much and then called that a negotiation,” Palin said.

The exception is Democrat Eric Croft, Knowles’ main opponent in Tuesday’s election. Croft wants to use a hammer to give the state better leverage in negotiating a pipeline contract.

Croft is a state representative from Anchorage who is considered an underdog against Knowles. However, Croft’s effect on the election will be felt in November, whether or not his name is on the ballot.

Croft is sponsoring a citizen’s initiative to tax the three oil companies into building a pipeline. If it passes in November, the oil companies that hold the leases to the North Slope’s gas reserves would be taxed $1 billion a year until gas starts flowing to market.

That tax initiative is the reason Murkowski is pressing so hard to execute his gas contract before the Nov. 7 general election. Murkowski said the tax would kill the pipeline before ground is even broken, and his contract proposal includes a shield against the tax for the three companies.

But Murkowski’s call to protect the three oil giants against the reserves tax plan hasn’t created much support for his contract, even among those who don’t want the reserves tax.

“I don’t think we should shield it at this point,” Coghill said. “I think he should have spent more energy telling people what the consequences are instead of trying to dodge the consequences.”

Aside from the governor’s race, Alaska voters also will decide on Tuesday whether to institute a $50 per head tax on cruise ship passengers.

Sponsors of the passenger tax say the industry should pay its fair share with an estimated $50 million a year in revenues aimed at improving ports and harbors and other visitor services.

The NorthWest CruiseShip Association, which represents nine cruise lines, hired a public relations firm to run an advertising blitz that says the ballot measure is risky business for Alaska. The industry has spent nearly $2 million and counting to defeat the measure.