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Mayor’s Energy Task Force Offers Recommendations to Energy Issues

Crisis Continues to Loom

March 29, 2010 - ANCHORAGE- The Mayor's Energy Task Force Chair Judy Brady today released a
resolution that articulates concerns and poses recommendations for the energy
challenges facing the Cook Inlet.

Upon being elected, Anchorage Mayor Dan Sullivan assembled a group of leading
experts to articulate impending community energy issues. The first work product of the
committee was their contribution to the Transition Report, published in July 2009.
Mayor Sullivan said he was impressed with the work of the committee and he
recognized the need to bring greater attention to the impending crisis and to work toward
solutions. He retained the group and formalized their title as the Mayor's Energy Task
Force. It meets twice each month to receive briefings on timely topics and to make
recommendations to the Mayor.

Today's resolution acknowledges the critical natural gas deliverability issues faced by
Southcentral consumers that if unaddressed could result in rolling blackouts as soon as
2011. The task force recommends that the Municipality of Anchorage support legislation
and proposals that promote natural gas storage in the Cook Inlet, it supports incentives
that will increase development and drilling in Cook Inlet, it addresses streamlining the
heavy bureaucratic processes that has historically plagued investors, it supports the
extension of the Kenai LNG export facility, and it encourages additional conservation
measures.

"The idea that the lights could go out and our homes are left unheated while this was a
clearly identified problem is unconsciousable. I thank the task force for their
acknowledgement of the issues we face in Anchorage and along the entire Railbelt
region, and for their recommendations. I am pleased with the progress in the legislature,
and I look forward to expedited support of the bills that positively impact Cook Inlet
storage, exploration and development."

The Resolution follows:

Municipality of Anchorage
Mayor's Energy Task Force
Resolution 2010-01

WHEREAS, Anchorage Mayor Dan Sullivan has appointed a task force of energy experts
to advise him with respect to gas supply and deliverability challenges; and

WHEREAS, the Mayor and the Energy Task Force (Task Force) have been briefed by
representatives of the State of Alaska as well as by Cook Inlet producers and gas and
electric utilities serving the Municipality and the majority of Southcentral Alaska
consumers; and

WHEREAS, Southcentral Alaska utilities and producers face increasingly difficult
challenges to meet heat, light and power deliverability requirements during peak cold
weather months; and

WHEREAS, there is agreement among all parties that these challenges will escalate in
the next one to five years; and

WHEREAS, if the immediate challenges of meeting deliverability requirements during
peak cold spells are not successfully addressed there is the real possibility of rolling
blackouts or even more catastrophic results as soon 2011, 2012 and 2013; and

WHEREAS, the Legislature, utilities, producers and private parties are all working
toward solutions; and

WHEREAS, the Task Force concludes that storage of all types is essential to meeting the
challenge of gas deliverability and reliability for heating and electric generation for
Southcentral residents; and

WHEREAS, the Task Force concludes that investment in drilling and development for
new gas in Cook Inlet is essential both in the near term and the longer term; and

WHEREAS, the Task Force concludes that a critical component of both deliverability of
gas and new gas development is the timely and efficient action on upcoming gas
contracts by the RCA; and

WHEREAS, the Task Force recognizes the critical role of the LNG facility in providing
storage in Cook Inlet; and

WHEREAS, the Task Force recognizes the critical role of conservation in meeting the
energy needs of Southcentral Alaska; and

WHEREAS, right now incentives for storage and for increased drilling in Cook Inlet are
before the Alaska Legislature; policies affecting the kinds of storage that would be
approved by the Division of Oil & Gas and Department of Natural Resources are being
developed; discussions about the future role of the LNG plant are underway by private
owners and parties; critical new gas contracts are being negotiated between utilities and
producers for 2011 and beyond and either are, or will be requiring approval by the RCA;
and

NOW THEREFORE BE IT RESOLVED that the Municipality of Anchorage encourages
and supports legislation and proposals that promote both proprietary and third party
natural gas storage to ensure deliverability and reliability; and

BE IT FURTHER RESOLVED that the Municipality of Anchorage encourages the
Department of Natural Resources (DNR) to develop leasing policies for storage that are
focused on ensuring reliability and support both proprietary and third party natural gas
storage; and

BE IT FURTHER RESOLVED that the Municipality of Anchorage encourages and
supports legislation that provides for incentives that promotes increased development
and drilling in Cook Inlet; and

BE IT FURTHER RESOLVED that the Municipality of Anchorage encourages and
supports legislation that streamlines or otherwise addresses statutory uncertainties that
delay RCA decisions on gas contracts; and

BE IT FURTHER RESOLVED that the Municipality of Anchorage supports extension of
the LNG export license, if proposed, and any other actions that would allow continued
use of the facility as a support for deliverability of natural gas to Southcentral; and

BE IT FURTHER RESOLVED that the Municipality of Anchorage continue to strongly
support and invest in conservation education and work with the public, utilities,
producers, and all affected parties to ensure an effective and efficient conservation
program.

Passed this 26th day of March 2010 by Energy Task Force Members Judy Brady, Chair;
Gary Carlson; Dan Coffey; Dave Harbour; Tony Izzo; Arden Page; Mary Ann Pease; Bill
Popp; Steve Pratt; Bob Stinson.

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