Dunleavy calls 2nd special session as senators weigh smaller Alaska LNG tax break - EUROPE SAYS
Gov. Mike Dunleavy spoke about the proposed Alaska LNG pipeline project during press conference in Anchorage on Monday, May 4, 2026. (Bill Roth / ADN)Gov. Mike Dunleavy on Friday called a second special. . .
Gov. Mike Dunleavy spoke about the proposed Alaska LNG pipeline project during press conference in Anchorage on Monday, May 4, 2026. (Bill Roth / ADN)Gov. Mike Dunleavy on Friday called a second special session for Alaska lawmakers starting Saturday morning to continue their effort to pass a multibillion-dollar tax break for the Alaska LNG megaproject. Theproclamationcame shortly before the Senate Finance Committee, on the final day of the current special session, began discussing increasing proposed taxes on the project to a level that’s higher than a bill passed by theHouse last week. Dunleavy and project developer Glenfarne had said they supported the House-passed bill, which cleared that chamber in a 34-5 vote. Changes to the bill approved by the Senate Finance Committee on Friday would double the House’s proposed alternative tax rate on the project after 10 years, and do so again in 2060. The alternative tax rate would tax gas volume, replacing the current much-higher property tax rate in state law for petroleum infrastructure. The move to an “alternative volumetric tax” was originally proposed by Dunleavy, in the bill he presented to the Legislature in March. Lawmakers in May failed to pass a version of that bill, leading to the first special session on the topic, and now possibly the second. The bill amended by Senate Finance is a committee substitute of that original bill. Senate Finance also altered the bill to set strict timelines on the project, including that construction of the pipeline must be completed by the end of 2032, or the project loses the tax break. That’s shortly before the state’s largest natural gas company, Enstar, is set to see its contract for gas supply from its largest suppliers, Hilcorp, come to an end. This is part of a looming gas shortfall in Alaska that could require utilities like Enstar to import natural gas at a high cost. The Alaska LNG megaproject could fix that by delivering long-stranded gas from the state’s North Slope, if it can be built. Alaska LNG has proposed delivering gas in-state starting in 2029, and with exports to large Asian buyers starting in 2031. The Senate Finance approved its committee substitute in a 7-0 vote. Two members of the Republican Senate minority protested some of the changes but voted to move the measure to the floor, where it is expected to be amended. Senate Minority Leader Mike Cronk said that the construction timeline is “very damaging” and may hinder the project from being built. “There are really substantive changes in here,” he said of the bill. “I think that’s all of our goal, is to have a bill that allows (the project) to work,” he said. But, he said, “I’m really concerned a couple of the things in here might just be the poison pill. ”Sen. James Kaufman, an Anchorage Republican, said he believes the construction deadline for the project is a “deal killer. ”The Senate Finance proposal also requires the project developer to make a final investment decision — giving a green light for construction — by Jan. 1, 2028. Friday’s action came after members of the bipartisan Senate majoritymet behind closed doorsdebating changes to the House-passed bill in the days leading up to Friday. The Senate has sought a less generous financial incentive for the project amid concerns about a lack of information about its costs, and the possibility that the tax break will mean the state and municipalities won’t receive sufficient revenue to provide services that will see increased demand as a result of the flood of workers and activities associated with construction. Supporters of the project have said that if built, Alaska LNG would bring in billions of dollars of revenue to the state and local communities, employ thousands of workers, and provide a stable supply of natural gas to Alaskans. The Senate has until midnight Friday to avoid going into a second special session on the project’s tax break by passing a bill that the governor and Glenfarne believe would make the project financially feasible. It wasn’t clear whether the new version of the bill advanced by the Senate Finance Committee would meet that threshold. Dunleavy spokesperson Jeff Turner did not immediately respond to a question about why the governor chose to call the new special session hours before the Legislature is set to gavel out of the first. The second special session would start at 10 a. m. Saturday, June 20. This is a developing story. Please check back for updates.