The Associated Press: Murkowski: Alaska needs economic 'soul searching'

LEGISLATURE: U.S. senator tells lawmakers that state needs to get gas to market.

JUNEAU -- Alaska's economy faces significant threats from environmentalists, federal regulations, and even from within in the form of problems like high student dropout rates and domestic violence, U.S. Sen. Lisa Murkowski said Thursday.

The Republican told a joint legislative session she would do her part in Washington to fight such things as reactive or overreaching federal policies, but Alaska must do some "soul searching" about the future of its economy.

Oil drives Alaska's economy -- nearly 90 percent of unrestricted general fund revenue comes from it. But forecasts call for production to continue declining from the aging North Slope fields, and there's currently a mix of high hopes and unease about the prospects for a major natural gas pipeline to help make up some of the anticipated revenue losses.

Murkowski told legislators she would fight new federal oil and gas taxes and continue pushing for drilling in the Arctic National Wildlife Refuge, an issue her father, Frank Murkowski, pressed as a U.S. senator before her.

She also said she wanted to get Alaska out of the U.S. 9th Circuit Court of Appeals, whose rulings on federal lawsuits she believes are often sympathetic to environmental interests. Murkowski is advocating for $30 billion in loan guarantees for the natural gas line, a project she said has bipartisan support, as well as support from the White House.

But she said the state must do its part, too, if Alaska is to be a major future player on the world energy scene.

"We've got to get our gas to market," she said.

While the window for a gas line remains open, with expectations for natural gas to be an in-demand energy source in the future, "that shouldn't be viewed as an invitation to procrastinate," Murkowski said. "Maybe America can wait for Alaska's natural gas. Perhaps industry can wait. But Alaska cannot wait. We can't wait because other parts of our state's economy are not strong enough -- they're not strong enough -- to carry our state."

Legislators are in the midst of asking what more, if anything, they should do to spur a gas line. Several bills have been introduced that range from tweaking to broadly changing the state's system for taxing oil and gas production, a system created just over two years ago. House Democrats have balked, arguing that the evidence they've seen shows the system works.

Murkowski told reporters the state could further help by understanding what producers believe to be incentives, in the way of so-called fiscal certainty.

"I think that the Legislature knows full well that this is a situation where we as a state can be a participant in this market," she said, "but we've got to be fully competitive."

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Source: By Becky Bohrer, The Associated Press. Originally published in the Anchorage Daily News on February 19, 2010