The Regulatory Commission of Alaska has set a timeline to decide the fate of 14.5 billion cubic feet of natural gas found underground in Kenai. The parties have until May 26th to exchange information on CINGSA’s request to keep the profits from the gas.
CINGSA’s Lindsay Hobson says the reservoir and its contents belong to the stakeholders who purchased the asset from Marathon Oil in 2011….
Hobson: “Much like if a building owner that found a bag of gold in the basement, the profit from selling that would stay with the owner of that building.”
But the State argues the $30 million asset should benefit ratepayers. Steven DeVries with the Attorney General’s Office referenced previous cases where the RCA decided that unexpected benefits from utility sales should go to ratepayers…
DeVries: “There’s significant sums that are involved and if the evidence shows that it’s appropriate that ratepayers share in that gain, then they should not be shut out from that gain by the Commission acting without any opportunity to consider alternatives that would be supported by the facts that we pointed out in our filing.”
Since the reservoir was thought to be empty at the time of sale, the ownership of the gas wasn’t clearly defined.
The state will file a response June 5th, at which time CINGSA and members of the public will again have another chance to comment. A pre-hearing conference is scheduled for August 14th, 2015.