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Peninsula celebrates with governor
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CLARION
Sunny 19/5 More weather on Page A-2
P E N I N S U L A
THURSDAY, FEBRUARY 5, 2015 Kenai Peninsula, Alaska
Vol. 45, Issue 108
50 cents newsstands daily/$1.00 Sunday
Health care panel OK’d
Question Would you like to see Sarah Palin run for president in 2016? n Yes n No To place your vote and comment, visit our Web site at www. peninsulaclarion. com. Results and selected comments will be posted each Tuesday in the Clarion, and a new question will be asked. Suggested questions may be submitted online or e-mailed to news@peninsulaclarion.com.
Borough to look for potential savings By KELLY SULLIVAN Peninsula Clarion
In the news Walker appoints Fleener as next in line to Mallott
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JUNEAU (AP) — Gov. Bill Walker has appointed his one-time running mate, Craig Fleener, to serve as successor to Lt. Gov. Byron Mallott should that office become vacant. Fleener had been running as a lieutenant governor on an independent ticket with Walker last year. Mallott was the Democratic candidate for governor, and his running mate was Hollis French. But after the primary, and in a bid to mount a greater challenge to Republican incumbent Sean Parnell, Walker joined with Mallott as part of a so-called unity ticket. Fleener has since been named a special assistant to Walker, advising him on Arctic issues. By law, a new governor is to appoint a successor to the office of lieutenant governor should that office become vacant. Fleener’s appointment is subject to legislative confirmation.
‘The start of Pueblo is an enormous step forward to a world free of chemical weapons.’ ... See page A-5
Index Opinion.................. A-4 Nation/World.......... A-5 Sports.....................A-7 Arts........................ B-1 Classifieds............. B-3 Comics................... B-6
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See WORK, page A-8
See HEALTH, page A-8
Photo by Rashah McChesney/Peninsula Clarion
On the river The sun sets over a bluff on the Kenai River on Sunday near Sterling.
Enstar begins pipeline work Natural gas utility working along Bridge Access Road By BEN BOETTGER Peninsula Clarion
Enstar Natural Gas company has begun work on a gas transport pipeline alongside Bridge Access Road in Kenai. According to Enstar communications manager Lindsay Hobson, the 16-inch diameter pipeline will lie four to five feet underground and run four miles, connecting Enstar’s Cook Inlet facilities to the CINGSA gas storage area
in Kenai. Approximately 3,000 feet of the pipeline will run beneath the bed of the Kenai river. Enstar currently transmits gas between these facilities through the Kenai-Nikiski pipeline owned by Hilcorp, to which Enstar pays a transport tariff. Enstar’s director of business development John Sims said that the new pipeline will help Enstar’s business and infrastructure.
“It’s something we’ve been planning for the last year,” Sims said of the pipeline. “It’s about a $10 million project, and it should provide some good efficiencies, redundancies, and also some potential savings for customers.” Sims said that the currently frozen ground in the normally muddy area bordering the Kenai River will make it easier for crews to dig the trench and lay the pipe. Freezing tempera-
CIRI settles long-running Kenai Loop gas dispute By ELWOOD BREHMER Morris News Service-Alaska/ Alaska Journal of Commerce
Inside
tures will also aid construction by allowing Enstar to drive its trenching machinery into the area on temporary ice roads, which are now being created with water from a CINGSA well. “Having the flexibility to operate on the ice as opposed to the summer when it’s muck and wetlands makes it significantly easier for trenching,” Sims said.
The Kenai Peninsula community may have a chance to make reforms in local health care. The Kenai Peninsula Borough Assembly appropriated $200,000 for evaluating potential ways to reduce health care costs on the Kenai Peninsula at its Tuesday meeting. The ordinance was introduced by Borough Mayor Mike Navarre. “What I want is to get a hold over ever increasing health care costs on the Kenai Peninsula,” Navarre said. “It will be controversial, but I believe that ought not to dissuade us from putting in an effort. This is important.” Navarre had requested the allocation three years ago, and at the beginning of the 2015 fiscal year, but allowed it to lapse back into the borough’s General Fund. He wanted to bring it before the assembly so the new members could hear his plan
The fight over Kenai Loop natural gas appears to be over. Attorneys for all four parties currently involved in the dispute — Cook Inlet Region Inc., the Alaska Mental Health Land Trust Authority, the Department of Natural Resources, and AIX Energy LLC — signed a joint request for dismissal Jan. 23 of the ongoing hearing in the Alaska Oil and Gas Conservation Commission related to the
case. CIRI Vice President of Land and Energy Development Ethan Schutt said the Southcentral Native corporation had an agreement in place with AIX for a couple weeks. “We’ve been waiting for a resolution between AIX and the other parties,” Schutt said Jan. 23. AIX won an October auction to purchase assets of the bankrupt Buccaneer Energy Ltd., which developed the Kenai Loop pad on Mental Health Land Trust property. Of four
wells on the pad, two began producing natural gas in early 2012. Since, CIRI, which owns an adjacent parcel, filed suit against Buccaneer in state court and sought relief through the state commission for gas royalties it was owed for gas drained from its part of the reservoir. Schutt has said CIRI owns 20 percent of gas produced from the wells and that Buccaneer’s contract was for approximately $7 per thousand cubic feet, or mcf, of gas. Based on AOGCC production records,
the gross value of gas owed to CIRI could be in the neighborhood of $10 million or more. Mental Health Trust Land Office Executive Director Marcie Menefee wrote in a Jan. 28 email to the Journal that her office is still in the process of finalizing lease terms with AIX. However, she wrote that the Mental Health Trust Land Office’s agreement with AIX is independent of DNR and CIRI. DNR represents the State of Alaska’s interest in the case as the primary owner of the resource. The department also
often represents the Mental Health Land Trust. When Australia-based Buccaneer filed for bankruptcy May 31, 2014, it owed DNR about $605,000 for a combination of Cook Inlet oil and gas lease payments and production royalty payments. Overall, the company owed more than $2.1 million to unsecured creditors in Alaska. The bankruptcy proceedings are continuing in U.S. Bankruptcy Court for the Southern District of Texas, located in See DISPUTE, page A-8
Walker appoints 5 Governor proposes $65 million peninsula residents supplemental budget for 2015 By RASHAH McCHESNEY Peninsula Clarion
Alaska Gov. Bill Walker has appointed several more people to boards and commissions in the state. The Governor’s office released a second list of appointments which included Kenai Peninsula residents — five people from the central Kenai Peninsula have been appointed thus far. Some of those appointments have garnered more attention than others. Kasilof resident Roland Maw’s appointment to Alaska’s Board of Fisheries drew so many phone calls and emails to the state’s House Re-
sources Committee that his first confirmation hearing was delayed, according to an Associated Press article. If confirmed, Maw will be serving his first term on the fisheries regulation board. Other appointees, like Soldotna’s Linda Hutchings, have been reappointed to positions they’ve held previously. Hutchings was first appointed to the Alaska Workers’ Compensation Board in 2005. Kenai Police Chief Gus Sandahl has been on the Alaska Police Standards Council since 2011 while Soldotna doctor Craig Humphreys has been on the State Medical Board since See BOARDS, page A-8
By BECKY BOHRER Associated Press
JUNEAU — Gov. Bill Walker has proposed a $65 million supplemental spending bill, including $50 million in unrestricted general funds. The supplemental budget is intended to cover unanticipated costs for the current fiscal year, which ends June 30. Details on Walker’s budget plan for next year are expected Thursday. Alaska faces multibilliondollar budget deficits for this year and next amid a crash in oil prices. While the state plans to dip into savings to C
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get by, Walker and lawmakers have been bracing the public for cuts. Spending levels and oil prices will dictate how long reserves last. In an email to state employees Wednesday, Walker said the fiscal situation “necessitates that we take swift action to trim spending and reduce the footprint of state government to a sustainable level.” He said his budget proposal for next year includes staff reductions “and will initiate a challenging, but necessary, discussion among Alaskans.” The supplemental proposal
for this year includes Walker’s previously announced plan to cut $52 million in one-time education funding approved during the last session for fiscal years 2016 and 2017. That helps offset $92 million in extra expenditures related to accounting issues for advance payments to providers stemming from Alaska’s problem-plagued Medicaid payment system. The budget released on the Office of Management and Budget website Tuesday also includes about $785,000 for the Alcoholic Beverage Control Board, which is charged See BUDGET, page A-8