The Anchorage Assembly on Tuesday authorized the administration of Mayor Ethan Berkowitz to move forward with a bid on ConocoPhillips’ gas properties in Cook Inlet.
With the Assembly’s approval, City Manager Mike Abbott said the administration plans to submit bid documents before a Friday deadline to buy all or some of ConocoPhillips’ interests in the region. Those include a one-third interest in the Beluga River gas field on the upper west side of the Inlet; the North Cook Inlet gas field, operated from the Tyonek platform in the northern Inlet; and 5,700 acres of leased lands in and around the Inlet.
The oil and gas company announced in July it was starting to market the properties. Last month, the Berkowitz administration said it was considering submitting “one or more bids” in a variety of ways, including jointly with other entities.
City officials are not disclosing an offer price or the terms of the bid, which the Assembly reviewed in a confidential memo Tuesday. In a competitive bid process, to “discuss that number openly at this time” would be harmful to the city’s interests, Abbott said. He said officials would discuss the terms once the bidding process is complete.
The city, through its Municipal Light and Power electric utility, already owns one-third of the Beluga River gas field. Under Mayor Rick Mystrom, the city bought the interest in 1996 for $120 million, financed mostly by electric revenue bonds. ConocoPhillips and Hilcorp Alaska split the remaining two-thirds ownership of the gas field.
The Berkowitz administration has calculated that the city’s current interest has saved customers about $239 million in natural gas costs in the last two decades, according to the Assembly resolution approved Tuesday.
The resolution also says Municipal Light & Power has invested $69.1 million in infrastructure improvements in the Beluga River gas field since 1996 without passing on charges to customers. The document cites another $90.7 million available “for the benefit of future ratepayers,” plus the value of gas reserves still in the ground.
“We’re only doing this because, number one, it was a great deal when we did it 20 years ago, and number two, we have every reason to believe it can be a great deal again, for Anchorage ratepayers and taxpayers,” Abbott said.
The Assembly vote was unanimous among the 10 members present, and came after a two-hour closed-door “executive” session with attorneys and administration officials. The Assembly has held executive sessions with the administration at least three other times in the last month on the topic.
Assembly Chair Dick Traini said Tuesday the Assembly is “more than happy” to allow the administration to move forward with a purchase if a deal is negotiated.
This article was written by Devin Kelly from Alaska Dispatch News, Anchorage and was legally licensed through the NewsCred publisher network.