From Sean Cockerham in Anchorage ----

The candidates challenging Gov. Sean Parnell attacked his strategy for pursuing a natural gas pipeline during Sunday night’s KTUU debate in a last ditch push to win over voters in Tuesday’s primary election.

Parnell debated Republican primary challengers Ralph Samuels and Bill Walker. Democratic candidates for governor Ethan Berkowitz and state Sen. Hollis French had a separate debate with each other, arguing over who should get their party’s nomination.

The candidates stuck to positions they’ve expressed throughout the governor’s race and didn’t spring surprises. It was a debate heavy on wonkish oil policy.

Parnell defended the Alaska Gasline Inducement Act (AGIA), which led to a license and $500 million in state money for TransCanada to pursue construction of a natural gas pipeline from the North Slope. TransCanada said this month that that it had received “multiple bids from major industry players and others for significant volumes” of gas.

But all the details of those bids will be kept secret for months, and TransCanada said there will need to be negotiations with the oil companies.

“Three years ago we were high centered, there was no project ongoing, nothing whatsoever,” Parnell said. “Governor Palin put in place the AGIA framework, which said, if you want to protect Alaska’s interests, you want to take gas off for Alaska communities, you want to make sure there’s access to the pipeline, if you want to build a project and do those things for Alaskans, then we will incentivize that project…we’re now in a historic place where major shippers have committed significant volumes (of gas to ship down the pipeline.)

Samuels said the state wasted four years with AGIA. “What has happened is the world fundamentally changed, the shale gas in the United States, in Europe, in China, it has driven down the price… right now I believe that our window for the time being has shut.”

Samuels said the whole point of AGIA was supposed to have been to avoid the state having to negotiate taxes with the oil companies to get a gas pipeline. Now the state admits those negotiations need to happen, he said.

Samuels said what the state can do now is invest in an in-state natural gas pipeline to bring energy to Fairbanks, the mining areas of Livengood and Donlin Creek. (Parnell also said he is looking at a possible in-state line)

Walker said Samuels is right about shale gas eliminating the Lower 48 market. He said the state needs to build a gasline from the North Slope to Valdez, where the gas would be liquefied and shipped to market. He argued AGIA will mean years more of delays.

“The problem is we’re losing the opportunity of the market, the premium Asian market that is being developed all over the world…while we’re over here having a study which will go on for four years and perhaps longer.”

Walker has called for the state to put about $5 billion for a 20 percent equity share of the pipeline, maintaining the rest can be financed through the markets.

Parnell at Sunday tonight’s debate described that as “government writing a check when the private sector is already moving,” saying both the pipeline to Valdez and to the Lower 48 markets are options under AGIA.

Democrats French and Berkowitz also disagreed over AGIA. French said the state has never been closer to securing a natural gas pipeline, while Berkowitz was skeptical. He argued the state should pursue more alternative ways to finance a pipeline from the North Slope to Valdez, like allowing Alaskans to buy a share of the line.

French and Berkowitz are sharply divided over oil taxes. Sunday night's debate moderator, KTUU news director Steve MacDonald, asked if the state should keep the ACES oil tax, which petroleum industry groups argue is far too high.

“Stick with it, it’s working, billions in savings (for the state),” French said. “Since 2007, when we proposed ACES, on the North Slope jobs are up, investment is up and profits remain strong for the oil industry.”

Berkowitz said French is wrong.

“You look at the results of last year, 1,500 jobs lost, production down 13 percent. We have seen Alaska’s continued decline as an oil producing state…we’ve got to be willing to try something new,” Berkowitz said.

Watch video of the debate divided into four parts here (the Democratic debate is first. KTUU divided the Democrats into three shorter videos and the entire Republican debate is included on the fourth video):