Alaska quietly drops trans-Yukon natural gas pipeline

Alaska appears to be quietly giving-up on a six-year old plan to fast track a natural gas pipeline through the Yukon, down to the lower 48 states.

When the Alaska Gasline Inducement Act was first introduced in 2007, it was sold as the state's best hope of getting a pipeline.

The Act gave TransCanada, the company behind the controversial Keystone XL Pipeline, a licence to start developing the project. It also gave the company up to $500 million dollars for planning work.

But the State budget proposed by Alaska governor, Sean Parnell, last week included a bombshell. It has no money pegged to the Alaska Gasline Inducement Act, and also zeros out the $4 million that funded the gas pipeline project office, shutting it down altogether.

Larry Persily is the federal pipeline coordinator in Anchorage, Alaska.

"People are getting cranky because it's been six years since [former governor Sarah] Palin said this is the path forward, and we may be closer to a pipeline, but people don’t see steel.”

For now, TransCanada doesn’t have a public position on the Parnell administration's desire to shift away from AGIA.

In an email, a spokesperson wrote that the company is continuing to work diligently with the Alaska North Slope Producers and the State to advance the Alaska liquefied natural gas project.