Dunleavy Slams Lawmakers’ Alaska LNG Bills, Warns They Risk Scaring Off Investors

May 4 — Alaska Gov. Mike Dunleavy on Monday blasted competing bills in the House and Senate, saying they don’t go far enough to support the long-stalled Alaska LNG megaproject — and in some cases, might actually derail it.

The governor’s original proposal, introduced in March, called for a modest 6-cent volumetric tax per 1,000 cubic feet of gas shipped, replacing the existing property tax. But after revisions by the House and Senate resources committees, that figure jumped sharply — to 20 cents in the House version and even higher in the Senate substitute, which could generate around $610 million annually at full operation.

Speaking to reporters from his Anchorage office, Dunleavy didn’t mince words. “Somebody comes in with a 20-cent throughput tax, not going to be financeable,” he said. “We could have the biggest project in the world here in Alaska, providing the cheapest energy you could possibly imagine for a place this far north, and creating jobs and opportunity like we’ve never seen before. It’s in the hands of the Legislature.”

With the legislative session ending in just over two weeks, Dunleavy said time is running out. He pointed to the ongoing U.S. tensions with Iran, arguing that energy security concerns make this a uniquely favorable moment to push the project forward. “Clear and predictable tax policy will improve feasibility, attract private investment, and help secure final commitments,” Alex Meyer, director of White House Intergovernmental Affairs, wrote in a letter supporting the governor’s bill.

But lawmakers on both sides of the aisle pushed back. Rep. Maxine Dibert, D-Fairbanks and co-chair of House Resources, defended the committee’s work. “We want to provide enough tax relief to make Alaska LNG competitive on global markets, while still ensuring Alaskans get enough value from the project,” she said. “The House Resources bill still provides a dramatically reduced tax compared to the property tax levy in state law. We believe it is fair.”

Sen. Cathy Giessel, R-Anchorage, who chairs Senate Resources, questioned the governor’s timing. “If this is the most important bill this session, why did he wait until March 20 to send it to us?” she said. “This is a gigaproject with generational ripple effects. Policies surrounding projects and investments this large are wisely done with a multitude of counselors and a deliberative process. Rushed processes, set by arbitrary political timelines, routinely have poor results.”

Sen. Bill Wielechowski, D-Anchorage, vice chair of the committee, noted that the Senate’s proposal uses figures agreed to a decade ago by oil producers and boroughs, without factoring in inflation. He also pointed out that key potential gas producers — including ConocoPhillips, ExxonMobil and Hilcorp Alaska — have not been part of the committee discussions. “If the governor wants to get a bill finalized, it’s incumbent on him to get all parties in a room together,” Wielechowski said.

The Alaska LNG project, estimated at $46 billion, would move stranded North Slope natural gas through an 800-mile pipeline for local use and export. A gas treatment plant and liquefaction facility would follow, with exports to Asian buyers targeted for 2031. Critics, however, argue the cost estimate is too low, noting that earlier versions of the project came in even higher more than a decade ago.

Dunleavy, who flew to Juneau Monday night to lobby lawmakers directly, insisted his version would still generate $26 billion in state and local taxes and royalty revenue over 30 years. He warned that without the pipeline, Alaskans will face sharply higher heating and power costs — a point he said his administration had even checked with AI chatbots to model.

Community leaders and residents remain wary. Many worry that excessive tax relief could leave Alaskans subsidizing the project through higher local taxes. “We don’t want to give away the store,” said Anchorage resident and small business owner Linda Groves, 58. “If this thing actually gets built, great — but not if we’re the ones paying for it while the big oil companies walk away with the profits.”

Fairbanks-based energy consultant Tom Ralston, 45, took a more measured view. “The governor is right that we need a competitive tax structure, but the Legislature is right to be cautious. A rushed deal could lock in bad terms for decades. This is too big to get wrong.”

Juneau retiree and former state employee Margaret Chen, 72, was blunt: “Dunleavy acts like this is a done deal if only those ‘lazy lawmakers’ would get out of his way. But he’s the one who sat on this bill for two months. Now he’s panicking because the clock is ticking. That’s not leadership — that’s theater.”

The House Resources bill is expected to advance to the House Finance Committee on Friday, with further amendments likely. The Senate version continues to evolve based on feedback from developers and industry groups like the Alaska Oil and Gas Association.