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Northern Gas Pipelines, (Alaska Gas Pipeline, Denali - The Alaska Gas Pipeline, Mackenzie Valley Gas Pipeline, Alaska Highway Gas Pipeline, Northern Route Gas Pipeline, Arctic Gas, LNG, GTL) is your public service, objective, unbiased 1-stop-shop for Arctic gas pipeline projects and people, informal and rich with new information, updated 30 times weekly and best Northern Oil & Gas Industry Links on the Internet.  Find AAGPC, AAGSC, ANGTL, ANNGTC,  ANGDA, ANS, APG, APWG, ANGTA, ANGTS, AGPPT, ANWR, ARC, CARC, CAGPL, CAGSL, FPC, FERC, GTL, IAEE, LNG, NEB, NPA, TAGS, TAPS, NARUC, IOGCC, CONSUMER ENERGY ALLIANCE, AOGA,AOGCC, RCA and more...

2009 LINKS: FERC Reports to Congress, 1, 2, 3, 4, 5, 6, 7....; USGS Arctic Gas Estimates; MMS hearings: RDC, Our NGP, AJOC, DH, ADN, KTUU; Enstar Bullet Line: Map and News Links; ANGDA; Alaska Energy Forum; Prosperity Alaska

2008 LINKS: Shell Alaska OCS Study; Mackenzie Gas Project EIS; Join the Alaska Gas Pipeline Blog Discussion; Governor Sarah Palin's AGIA Links; 2007 ACES tax bill links; Department of Revenue 2007 ACES tax documents;  2007 ACES tax Presentations; 2007 ACES tax news; Alaska Gas Pipeline Training and Jobs; Gas Pipeline and Economic Development; Andrew Halcro; Bjørn Lomborg; FERC's Natural Gas Website Links

WASHINGTON: Alaska Natural Gas Pipeline Act; History of H.R. 4; DOE Energy Bill Position, 6-02; Daschle-Bingaman Energy Bill (Alaska, Sec. 1236 & tax credit, Sec. 2503 & H.R. 4 Conferees), Tax Credit; See amendments, "Energy Policy Act of 2002";  "Alaska Natural Gas Pipeline Act of 2001 (Draft)" & Background Paper, 8-9-01;Alaska Legislature Joint Committee position; Governor's position; Governor's 10-Point Plan; Anadarko Analysis; U.S. Senate Energy Committee Testimony, 10-2-01 - text version;  U.S. Senate Energy Committee Testimony, 9-14-00; Report on the Alaska Natural Gas Transportation Act of 1971, prepared by staff of the Federal Energy Regulatory Commission, 1-18-01

ALASKA: 1-23-03, Governor Frank Murkowski's State of the State Speech; 2002 DRAFT Recommendations to 2003 Legislature; '02 Alaska Legislation; Alaska Highway Natural Gas Pipeline Policy Council; Joint Legislative Gas Pipeline Committee; 9-01 Alaska Models: Canadian Routes, LNG, GTL; HR 4 Story; Cook Inlet Supply-Demand Report: AEDC; Commonwealth North Investigation & Our Article; Report: Backbone; Legislature Contacts; State Gas Pipeline Financing Study; 5-02 Alaska Producer Update; Kenai: "Oil & Gas Industry Issues and Activities Report, 11-02"; Alaska Oil & Gas Tax Structure; 2-27-02 Royalty Sale Background; Alaska Gas Pipeline Office opens, 7-01, and closes, 5-02; Betty Galbraith's 1997-1998 Chronology Our copy.

CANADA: 1-10-03, "Arctic Gas Pipeline Construction Impacts On Northern Transp."-Transport Canada-PROLOG Canada Inc.-The Van Horne Institute;Hill Times Reports, 8-30-02; 9-30-02, Cons. Info. Requirements; CBC Archives, Berger Commission; GNWT Economic Impact Study, 5-13-02; GNWT-Purvin & Gertz Study, 5-8-02; Alberta-Alaska MOU 6-02; Draft Pan- Northern Protocol for Oil and Gas Development; Yukon Government Economic Effects: 4-02 & PPT; Gas Pipeline Cooperation Plan Draft & Mackenzie Valley Environmental Impact Review Board Mackenzie Valley Pipeline MOU Draft, 6-01; FirstEnergy Analysis: 10-19-01; Integrated Delta Studies; National Post on Mackenzie Pipeline, 1-02;Northern Pipeline Act;  Haida Nation v. British Columbia; Indian Claims Commission; Skeena Cellulose decision -- aboriginal consultations required, 12-02; Misc. Pipeline Studies '02

COMPANIES: Alaska Gas Producers Pipeline Team Newsletter, 7-27-01; APG Newsletter: 5-02, 7-02 & 9-02; ArctiGas NEB PIP Filing Background; NRGPC Newsletter: Fall-02;  4-02 ArctiGas Reduces Field Work; BP's Natural Gas Page; Enbridge Perspective; Foothills Perspective; Williams Perspective; YPC Perspective, 7-02

 MEDIA REFERENCE: Alaska Journal of Commerce; Alaska Inc. Magazine; Anchorage Daily News; Canadian Broadcasting Corporation; Fairbanks Daily News Miner, Juneau Empire; Northern News Services; Oil & Gas Reporter; Petroleum News Alaska; Whitehorse Star, etc.

EXTENDED CONFERENCE NEWS: Alaska Support Industry Alliance, Anchorage Chamber of Commerce Canadian Institute, Insight Information, Inuvik Petroleum Shows, International Association of Energy Economists, Resource Development Council for Alaska, Ziff Energy Group











Northern Gas Pipelines: Please scroll down for July news.

7-31 Updates: 01:55, 02:17, 11:59, 12:54 ET.  Financial Times, by David Buchan and Tobias Buck-Lord John Browne (RDC Photo), chief executive of BP, has been asked to stay on at the helm of the world's second largest oil company for another six years.  Although he has an employment contract with a two-year notice period, Lord Browne, 54, revealed that the board of BP had asked him to continue to lead the company until he reaches the compulsory retirement age of 60.  "The board has asked me if I would stay and I said, 'yes I will', so I will," Lord Browne said.  (Report of John Browne's recent Anchorage visit.)   *    FT-BP's 2nd Quarter recovery.   *   Williams Energy News Live-(Today) marks the release of the Federal Energy Regulatory Commission's Standard Market Design proposal. FERC Commissioners believe the proposal will establish clear rules of the road for the nation's power markets for the first time.   *    FOR OUR WASHINGTON READERS-According to Bill Wicker, today beginning at 9:30 a.m., the Senate Committee on Energy and Natural Resources is holding a business meeting in room SD-366 to consider various non-Alaska energy items, including: S. 198; S. 1028; S. 1069; S. 1526; S. 1638; S. 1846, To prohibit oil and gas drilling in Finger Lakes National Forest in the State of New York; S. 1865; S. 1883; S. 1925; S. 1939;  S. 1943; S. 1944; S. 1999; S. 2018; S. 2033; S. 2196; S. 2222, To resolve certain conveyances and provide for alternative land selections under the Alaska Claims Settlement Act related to Cape Fox Corporation and Sealaska Corporation, and for other purposes; S. 2388; S. 2482; S. 2519; S. 2571; S. 2576; S. 2595; S. 2598; S. 2727; H.R. 37; H.R. 38; H.R. 107; H.R. 695; H.R. 706; H.R. 1712; H.R. 1776; H.R. 1814; H.R. 1870; H.R. 1906; H.R. 1925; H.R. 2109; H.R. 2115; H.R. 2828; H.R. 3048, To resolve claims of Cook Inlet Region, Inc., to lands adjacent to the Russian River in the State of Alaska; H.R. 3954.    *    Cousin Roy Orton of Welch's fame (Photo-r) and brother Doug (Photo-l) helped us harvest halibut this summer and eat them.  Roy asked for the Halibut Olympia recipe, fine-tuned by daughter-in-law Lorie.  We thought our family of readers might enjoy it, too, as we've never tasted better.  What does this have to do with gas pipelines?  Over the dinner table, Roy said he would listen to more gas pipeline history if he could have another helping. Enjoy!  -dh

7-30 Updates: 00:47, 01:11, 11:46, 14:23 ET.  ANCHORAGE-Wadeen Hepworth of Petroleum News Alaskaaacaskey5-14-01.png reported this week that Netricity's Mike Caskey (NGP Photo, 5-01) and Alaska Gas Producers have failed to reach agreement on gas supply for a $1 billion North Slope Data Center that could have employed several hundred people on the North Slope.  See earlier references here and here.  -dh   *   CBC, OTTAWA - The Canadian lumber industry and government officials say Friday's World Trade Organization ruling on softwood lumber has seriously undermined the U.S. position. (See our earlier string of news and editorials.  We believe this issue impacts Arctic gas pipeline policy more than American policy makers understand, could benefit that policy and wish U.S. State and Commerce Department executives would communicate with their Canadian peers before undertaking such harmful, unilateral actions.  -dh  IN DEPTH: Softwood lumber)  *  Whitehorse Star by Jason Small-The Yukon’s premier has laid down her law to her colleagues when it comes to U.S. subsidies for natural resources. (See our related references.) Going into this week’s national premiers’ conference in Halifax, Premier Pat Duncan (NGP Photo) has been contacting some of her fellow premiers to indicate she does not want them to link U.S. subsidies for softwood lumber with those for energy, specifically the Alaska Highway natural gas pipeline. ...  The premier said energy is an area where the two countries can work together.  The issue of U.S. subsidies for lumber, agriculture and energy were major topics of discussion during the western premiers’  conference last month in Dawson City.  All the premiers at that conference were collectively against the U.S. government subsidizing its softwood lumber and agricultural industries. However, they were not in agreement over subsidies that have been proposed that would encourage the construction of the Alaska Highway pipeline.  The Northwest Territories, which wants a pipeline built in its Mackenzie Valley first, opposes the U.S. subsidy and has been lobbying the federal government on that issue.  Recently, Prime Minister Jean Chrétien told U.S. President George Bush he wants to let the businesses decide where the pipeline is built. Because of this, Bush’s energy secretary recently wrote he doesn’t support the subsidy as it has been proposed.  But since then, the Bush administration has indicated it would not be opposed to a more traditional subsidy for the Alaska Highway pipeline construction.   ... Duncan will leave (today) for the conference, which will start in the Nova Scotia capital Wednesday and wrap up Friday.

7-29 Updates: 01:44, 11:43, 14:32, 15:28. 16:48 ET.  Reuters By Tom Doggett -Senate and House lawmakers on Thursday moved forward with broad energy legislation, approving language to boost energy efficiency in public buildings, help poor families pay their energy bills and raise oil production on Indian lands.  …  FATE OF ALASKA DRILLING UNCLEAR   When lawmakers return in early September from their month-long summer recess, negotiators will address the bill's controversial issues. … The single most contentious issue is whether to allow drilling in the Arctic National Wildlife Refuge (ANWR).  The Republican-led House voted to give oil companies access to the refuge in its energy bill, but the Democratic-controlled Senate agreed to keep ANWR closed to drilling.  The Bush administration wants to tap the refuge's possibly 16 billion barrels of oil to help reduce U.S. dependence on foreign crude imports. Environmentalists argue there is not enough oil in the refuge to justify disrupting the area's polar bears, caribou and other wildlife.  Senate Majority Leader Tom Daschle has said a final bill that allows ANWR drilling will be rejected by the Senate.   Last week, a senior Energy Department official involved in negotiations suggested the administration may be able to accept a final bill that kept ANWR closed as long as the legislation increased overall U.S. oil and gas supplies.  (See earlier coverage.)    *     Northern News Services by Terry Halifax, Yellowknife - One of the key players supporting an Alaska gas pipeline withdrew that support last week.  (See our earlier stories on Duke and Williams.  -dh)  Duke Energy announced they would no longer officially support an eight-month-old agreement between themselves and eight other energy and pipeline firms.  A non-binding memorandum of understanding (MOU) signed in Calgary on Nov. 15 detailed an agreement between Duke, Enron, El Paso Corporation, PG&E Corporation, Sempra Energy International, TransCanada Pipelines Ltd., Westcoast Energy Inc., and Williams Gas Pipeline. Sarah McIntosh, manager of public affairs for Duke Energy, said they are still in support of the concept, but felt the project wasn't moving fast enough.  "We've withdrawn our participation of this non-binding MOU, because it did not achieve the objectives agreed to by the parties within the targeted timeframe," McIntosh said.  "But in no way does it signal an exit from Alaska."   "We are fully-committed to working with producers and other stakeholders to develop a successful Alaskan project," she added.   McIntosh said she could not comment on the exact details of the timeframe as that information is "confidential and proprietary."   Duke Energy are joint owners of Foothills Pipe Lines along with TransCanada PipeLines. Foothills holds the permits for the Canadian portion of the Alaska natural gas transportation system. ….  Globe & Mail, Reuters-OTTAWA -- The federal government, under fire for dragging its feet on whether to ratify the Kyoto climate-change accord, says it will use tax breaks to encourage investment in renewable energy and energy conservation projects.  Deputy Prime Minister John Manley has announced two proposed changes to income tax rules that he said will make it financially attractive to build wind turbines, and ensure that renewable energy projects could raise financing in the same way as non-renewable energy projects. "I am confident that Canadians will support our efforts to encourage the production of more renewable energy," he said.  In the latest federal budget, which was presented in December, 2001, the federal government said it would give $260-million to the wind power industry to increase current production of 200 megawatts to 1,000 megawatts by 2016.  (Note: In recent months, the Canadian federal government has vigorously opposed tax incentives for an Alaska gas project.  -dh)

7-27-28 Weekend Updates:  WASHINGTON, Reuters - Recent credit downgrades and stock price declines could keep energy companies from building new power plants and transmission grids to ensure adequate electricity supplies, industry officials warned a Senate committee on Wednesday.  …  "The investments are simply not being made," said Alaska Republican Sen. Frank Murkowski. "It's a bleak picture."  …  Meanwhile, merchant energy companies have lost over two-thirds of their equity value over the last 18 months, said Lawrence Makovich, a senior director at Cambridge Energy Research Associates, with "an investment retrenchment roaring through the power industry."  (Comment:  Up to six months ago, Cambridge and other analysts had predicted steady growth in demand and price of natural gas through 2002, largely owing to residential and industrial conversions to natural gas.  The phenomenon of the last few months could well exacerbate demand, making for much stronger projections in the coming year.  Ironically, the downturn in energy company fortunes over the last year--beginning with Enron--could be precisely the catalyst that makes all Arctic gas projects more marketable.  -dh)    *    EEDaily-The House late Tuesday unexpectedly held a roll-call vote on a pipeline safety bill, passing the measure overwhelmingly, 423-4. The vote ends a three-year House impasse over how to toughen federal oversight of 1.6 million miles of U.S. oil and natural gas pipelines, perhaps bringing to conclusion a movement started after several fatal explosions brought the issue to light.   *    
Northern News Services
by Mike W. Bryant-Yellowknife (July 26/02) - Dozens of families in Yellowknife will be moving on up now that the NWT Housing Corporation plans to expand its down payment Assistance Program in the city.

7-26-02 Updates: 01:31, 02:16, 12:20, 12:40, 14:21, 15:12, 15:46, 16:04, 17:18 ET.  WHITEHORSE – The Yukon government is taking measures aimed at ensuring northern Canadian gas is not stranded or otherwise disadvantaged as northern pipelines are constructed.  “The Yukon government has been a strong supporter of building two northern pipelines and access to pipelines is a critical requirement for the Yukon’s oil and gas industry and for the economic well being of the Yukon,” said Energy, Mines and Resources Minister Scott Kent (NGP Photo).  “That is why I delivered a letter today to Imperial Oil Ltd., and to the federal government, about the risk of stranding Yukon gas and the opportunity for delivering gas from north central Yukon to a Mackenzie Valley pipeline.” The letter was written following consultation with Yukon permit holders.   (Download the full release.  Download the letter.  "We probably saw it here first.")     *     Associated Press, ADN-David Welch, president of BP Alaska-Canada Gas Pipelines, told Whitehorse reporters that the desire to build a pipeline through Alaska, the Yukon and British Columbia to central Alberta is still very much alive in the hearts of BP, Exxon Mobil and Phillips Petroleum.  (See our earlier reports here.)  *      David Woodruff (Photo-r), Director of Communications for the Senate Energy and Natural Resources Committee, told us last night that the Energy Bill Conference today concluded work on "...a number of Tier II issues, adopting agreements that the staff had worked out. The issues primarily focused on efficiencies."  He said that Chairman Billy Tauzin also spelled out a schedule for the balance of the conference.  On September 9th, the conference will meet again to adopt any remaining staff negotiated deals on other Tier II issues. On the 16th the Chairman will convene another meeting to begin work on Tier I. "At that point," Woodruff said, " we will meet every day until a bill is reached, wrapping up on September 30th.  ANWR and oil and gas production will be discussed the week of the 23rd."  Following the meeting, Senator Frank Murkowski said that by securing our nation's energy supply, we can better secure America."  He said the September deadline for concluding conference work was challenging but necessary.  "The true test of whether we deliver on the expectations of the American people," Murkowski said, "will come when we address the issues to increase our domestic production."  Murkowski, of course, was mainly referring to ANWR and gas pipeline issues, currently undergoing extensive White House-Congressional negotiations.   *    From Rhea DoBosh (NGP Photo, with pipeline worker, Monica.) at the Joint Pipeline Office (JPO) in Anchorage-This year's scheduled annual maintenance shutdown is July 27 and 28. JPO will station staff at Pump Station 5, Remote Gate Valve 39, Fairbanks, Pump Station 12, Valdez Marine Terminal and Operations Control Center, and Anchorage to oversee various work activities.  She also reports that several groups have submitted requests to extend the public comment period for review of the Draft Environmental Impact Statement (DEIS) and the Department of Natural Resources Commissioner's Statement of Reasons and Proposed Written Determination. The requests are being considered at this time. The documents are available in electronic format here.

7-25-02 Updates: 01:00, 01:30, 12:49, 14:40 ET.  Harvi Andre, Chairman of ArctiGas Resources Corp. (NGP Photo, 2-8-02), proponent of the 'northern route' yesterday sent us the attached report by Campbell Ryder, an Edmonton based economic consulting firm, which evaluates the 100% debt financed pipeline project his company has proposed.  The Tulita District Land Corporation commissioned the work.  As fall Congressional action approaches, gas pipeline scholars would also do well to review other recent gas pipeline reports from Alaska, Northwest Territories, Yukon, and gas producers, here.  -dh   *      For our Washington friends-The Energy Conference mark-up began at 9:30 a.m. today in Rayburn 2123.  Gas pipeline or ANWR issues should not take center stage until fall, following much more negotiation.  According to Bill Wicker, Communications Director, Senate Energy Committee, "Conferees will consider a host of provisions in the House bill and the Senate amendment. The agenda includes issue areas such as energy efficiency programs, energy assistance programs, energy security matters, Indian energy, nuclear energy, housing efficiency and miscellaneous other topics. Chairman Tauzin also intends to seek input from Members on the resolution of the Price-Anderson and electricity provisions of the Senate bill."  Wicker said Chairman Tauzin has told conferees that he does not anticipate any roll call votes, "but there is no guarantee that they will not occur." Tauzin said he intends to conduct the meeting under the general guidelines of the House's so-called "five-minute rule," in which conferees will be recognized for five minutes only in support of or opposition to specific matters before the conference.  -dh     *     Alaska Oil & Gas Reporter by Tim Bradner-Persistent questions continue to be raised as to whether there are adequate reserves of natural gas on the North Slope to support a gas pipeline….  One of the most persistent questioners is Tom Marshall, the retired state geologist who led the team that originally selected Prudhoe Bay-area lands for the state of Alaska.   … His math shows that, based on proven and known gas reserves, there isn't enough gas to support 30 years of supply for a pipeline and to meet needs for oil production. "Marshall's math is essentially correct," said David MacDowell (NGP Photo, 4-4-02), in the natural gas group in BP Exploration Alaska Inc.  "If you take 4.5 billion cubic feet per day (the daily gas throughput on the pipeline planned by the producers) and multiply that by 365 days a year and that by 30 years, it's almost 50 trillion cubic feet," he said.  "We only have 35 trillion cubic feet (TCF) of proven reserves, with eight TCF in the Point Thomson field with most of the rest in the Prudhoe Bay field," MacDowell said.    *     CBC, Whitehorse, Yukon - … The president of BP's Alaska Highway pipeline company is meeting with First Nation leaders in the Yukon.  David Welch has a $400-million decision to make.  As president of BP Alaska Canada Gas Pipelines, Welch estimates he'll have to spend at least that much on the next phase of design work for the proposed pipeline.  But he says without some certainty from governments, including First Nation governments along the route, that work isn't going to go ahead.  "We can't leave out the risk of getting halfway spent through the project and some lawsuit coming in that delays the thing for 10 years," says Welch.  However, he says the big question right now is in the hands of the American federal government.   Welch says unless the U.S. offers some sort of financial incentives soon the project will be delayed indefinitely.  That decision is expected this fall.  "If we don't have something within the next year or two we could be running the risk of this project being deferred for some significant amount of time," he says.  Welch spent the last few days meeting with the Yukon government, the Council of Yukon First Nations, the Kaska, and the Kwanlin Dun.  He says his company is interested in doing things right, and dealing with the concerns of people along the route before committing another $400 million.  ***  A related CBC, CKRW report says that “Welch … was also lavish in his praise of the understanding that Premier Pat Duncan and Energy Minister Scott Kent have of the proposed pipeline project.”  ***  Whitehorse Star version by Chuck Tobin-There is a risk the three major companies pursuing an Alaska Highway pipeline could lose interest in the project if they don’t see movement toward their goal in the next year or two, says a top-ranking BP official.       *      ANCHORAGE, Alaska, July 24, 2002--- Phillips' newest state-of-the-art Endeavour Class double-hulled tanker, the POLAR RESOLUTION, sailed into the Port of Valdez, Alaska, this week where it loaded its first cargo of Alaska North Slope crude oil.  The vessel is operated by Polar Tankers, a Long Beach, Calif. -located subsidiary of Phillips Petroleum Company [NYSE:P].   

7-24-02 Updates: 01:54, 09:43,10:00, 11:33 ET.  Washington-Our friends tell us the energy bill conference will meet tomorrow with H.R. 4 on the table, but will deal only with Tier II issues, leaving gas pipeline and ANWR provisions for action this fall, possibly as early as September.  Between now and then many negotiations are occurring as outlined in our report yesterday.  Stay tuned.  -dh   *      CBC, Whitehorse, Yukon - A major player in the Alaska Highway pipeline proposal is pulling out of a group of companies that hold the Alaskan permits to build the pipeline.    (See our earlier Duke and Williams stories, the most detailed anywhere.)     *     Insight's 4th Annual Far North Oil & Gas Conference, Calgary: 9-30 to 10-1.   *   Note:  We have heard it said that the producing companies will develop projects in Arctic North America because, "that's where the oil and gas is."  As local pressure increases to provide oil and gas exploration and development 'BENEFITS' to local governments, one would be well advised to keep one eye on the competition.  While Northern Gas Pipelines does not focus on other international projects often, from time to time it is well to reflect on the world market.  Phillips Petroleum filed this SEC statement this week: "BARTLESVILLE, Okla.,  --- Phillips Petroleum Company [NYSE:P] and the other contracting companies in the North Caspian Sea PSA have declared the Kashagan discovery commercial, in conjunction with KazMunayGas, which represents the  Government of the Republic of Kazakhstan.  The two-year appraisal program undertaken by the  contracting companies indicates a preliminary estimate of the producible reserves from the Kashagan field in the range of seven to nine billion barrels of oil.  ...The contracting companies involved in the North Caspian Sea PSA are: Eni, operating the project through Agip KCO, with an interest of 16.67 percent; BG, 16.67 percent; ExxonMobil, 16.67 percent; Inpex, 8.33 percent; Phillips, 8.33 percent; Shell, 16.67 percent; and TotalFinaElf, 16.67 percent."  -dh    *     CBC, Tuktoyaktuk, N.W.T. - … The Snapper, a large boat that's been docked in Tuktoyaktuk's harbour for the winter, will embark on a two-week mission. People aboard will take readings of the ocean's floor.  That information will tell Anderson Exploration if there's potential for off-shore natural gas in the area.   … Western Geco is the company that's performing the seismic work, and captain Craig Feeney says the ship is ready to go.   "We've been mobilizing in a small way since the end of May," he says. "We had a marine crew come up and working on a rotational basis trying to get the ship ready." … the Snapper will be out to sea for about two weeks. Then it will continue on to the Gulf of Mexico for another job.     *     Ref: Oil & Gas a time when the U.S. Congress is having difficulty permitting modest and highly regulated exploration of ANWR, some project that Russia with its lower level of environmental regulation, may become America's 2nd largest crude oil supplier.  -dh

7-23 Updates: 01:04, 02:21, 02:38, 03:40, 04:01, 11:27, 11:34, 12:01, 12:51, 13:45, 14:15, 17:47 ET.  TODAY IS A VERY FULL GAS PIPELINE NEWS DAY.  SOME DAYS FIND CANADIAN NEWS DOMINATING; TODAY, THE MAJOR STORIES COME FROM ALASKA:

  • Yesterday, Michael Smith (NGP Photo-right, 7-22-02), Assistant Secretary for Fossil Energy for the U.S. Department of Energy spoke to the Anchorage Chamber of Commerce:  "Alaska – An Essential Component in America’s Energy Plans".  Governor Tony Knowles (NGP Photo, 6-02) introduced Smith.  The two had become acquainted during the time both served in the Interstate Oil & Gas Compact Commission.  "As America's attention is focused on energy," Knowles said, "we are fortunate to have with us a professional who knows Alaska and who advises the Secretary of Energy."  (Please review our complete story here and download the Secretary's speech.) 
  • Alaska Highway Gas Pipeline Project Update.  Last week, we alerted readers to the withdrawal by certain pipeline companies from the memorandum of understanding applying to the Alaska portion of the Alaska Natural Gas Transportation System (ANGTS), operated by Foothills Pipe Lines, Ltd.  This Alaska segment is promoted by the Alaska Northwest Natural Gas Transportation Company component of the project.  Please see our report on Duke Energy’s withdrawal here.  After questioning other parties, Peter Thomas, who heads up the Williams Arctic Project Team, was kind enough to respond.  “The Williams Arctic Project Team has been working under a memorandum of understanding ("MOU")....(Please see balance of our story here.)
  • This week, Alaska Governor Tony Knowles is sending a four-page letter to 61 members of the  House and Senate, highlighting two elements of the energy bill, H.R. 4 now being negotiated between the House, the Senate and the Administration.  The letter supports prohibition of the northern route and financial incentives for the southern route.  As we have stated here for over a year, ANWR is involved since environmental lobbyists hope to trade their opposition to ANWR development for support of gas pipeline legislation.  The House version of the bill includes modest ANWR activity with the President's support; the Senate bill does not.  The House and Senate versions both prohibit approval of a Northern Route for Alaska North Slope (ANS) gas; the President and leadership of Canada oppose legislative route mandates.  The Senate version, providing regulatory enabling legislation gas producers say they need, will likely win House and Administration support.  The Senate version also contains a $10 billion loan guarantee and a Federally guaranteed 'floor price' for ANS gas; the Administration, Canadian Federal government and some House members object to those provisions.  In his letter, Knowles expresses to Congress the rationale for supporting ANWR development and the various gas pipeline provisions.  Readers may download the letter here.  After reading the above, readers are correct to assume that such a complicated, contested web of interests--along with all the other controversial energy bill issues--give the important legislation a barely even chance of passage by this election year's end.
  • Opinion:
    • Anchorage Daily News on Alaska's fiscal gap.  We have argued that the dividend should be phased back to help fill the state's billion-dollar-a-year fiscal gap and to forestall the need for draconian taxes. We have argued that the dividend should be preserved, to help protect the Permanent Fund itself, and ratcheted down gradually, to give people time to adjust to the change.

    • Voice of the Times: on Federal gas pipeline incentives.  Phillips Alaska President Kevin Meyers said here a week ago that risk-reduction measures in the pending federal energy bill would "go a long way" toward making a gas pipeline possible. ... Without such incentives, Meyers said, the pipeline is not economic. With them, the project just might be attractive enough to potential investors and could move ahead. The Bush administration opposes the incentives, but Alaska's congressional delegation is fighting hard to keep them in the bill. Let's hope Alaska wins this one.

    • Op-Ed writer Ken Thompson (Former President of Arco Alaska, Inc.) writes in the Anchorage Daily News yesterday: I see a different reality for the Alaska energy industry....

7-22 Updates: 00:02, 10:46, 17:55 ET.  2nd Arctic Gas Symposium, Houston, November 18-19.      *   Weekend update on Congressional/White House gas pipeline negotiations.    *     “America’s Energy Puzzle – Where does Alaska fit?” was the topic for Today’s Anchorage Chamber of Commerce weekly forum.  Department of Energy’s 9th Assistant Secretary for Fossil Energy, Carl Michael Smith (Photo-l), was in Anchorage from Washington D.C. to make the presentation.  Governor Tony Knowles, a friend of Smith, introduced him.  "Given the impact federal policies have on Alaska, we are fortunate to have one of the Bush administration's highest ranking oil and gas officials coming to Alaska," said Knowles.   "I have known Secretary Smith for many years, and have always been impressed by his extensive knowledge of Alaska issues.  As we continue the push for opening ANWR and developing an Alaska Highway gasline project, I am confident Secretary Smith will play a role in helping Alaska achieve success."  As Assistant Secretary, Smith serves as the primary policy advisor to the Secretary of Energy on federal coal, petroleum and natural gas programs, including extensive research and development efforts.  He will specifically address the importance of our domestic supply of oil and gas and also domestic energy security.   We will provide a report to NGP readers later tonight or first thing tomorrow.    *     Kenai Peninsula Clarion re: Rep. Mike Chenault-"He also talked about making sure a future gas pipeline includes at least a spur to the Kenai Peninsula. He told the chamber that the area's major businesses depend on the gas to survive. "In order for those facilities to stay in business, they need a reasonably priced source of gas," he said.      *     Comment: Supporters of a trans-Alaska pipeline/LNG mode of transportation for North Slope gas created a citizens initiative which received more than sufficient signatures to have it appear on the upcoming November ballot.  As the election approaches, expect the pressure to rise for political support of this alternative, Ballot Measure #3.  Absent an as yet unidentified opposition effort, the initiative could pass handily.  According to the elections office, "The Authority would acquire and condition North Slope natural gas, and construct a pipeline to transport the gas. The Authority's powers would include buying property or taking it by eminent domain, and to issue state tax-exempt revenue bonds. The gasline route would be from Prudhoe Bay to tidewater on Prince William Sound and the spur line from Glennallen to the Southcentral gas distribution grid.  The Authority would operate and maintain the gas pipeline, ship the gas, and market the gas."  (Yukon Pacific Corporation map.)  -dh

7-20/21Weekend Updates, Sat. 12:21, 15:17, 17:17, 17:39, 18:00 ET:   Anchorage Daily News (AP), Fairbanks -- The Bush administration wants to replace a proposed tax credit for Alaska natural gas sales with some other type of incentive that doesn't set awhitehouse gas price floor, Sen. Frank Murkowski said Thursday after a meeting at the White House.    (See our story from yesterday.)  Sen. Ted Stevens and Rep. Don Young also attended the meeting.  The Senate version of a national energy bill proposes a tax credit that would kick in when gas prices fall below $3.25 per million British thermal units at a hub in Alberta, Canada. The amount taken off the gas owners' tax bill would be the difference between $3.25 and the actual sale price.  Murkowski said the Alaska delegation pointed out that the tax credit would have to be paid back when prices rose, but that didn't allay the administration's worry. He said other gas producers fear they won't have the same safeguard that Alaska gas would have.  The gas provisions will be the subject of negotiation in a conference committee formed to work out differences between the House and Senate versions of the energy bill.  Administration officials suggested that a combination of other incentives would be less harmful to other gas sellers, Murkowski said. Those incentives could include: ***Tax credits similar to those already in place for development of oil and gas that is technologically difficult to extract. ***Loan guarantees.  ***Changes that allow the value of the pipeline to depreciate faster than normal for tax purposes. "What we agreed is to continue to work in an expeditious manner to address the various ways the federal government could participate in this process," Murkowski said.  "The feeling was that, yes, it's in the national interest," Murkowski said. "The question was, 'What is the meaningful role of the government?' Is it limited to tax incentives, accelerated depreciation, tax credits and so forth?"   Stevens had to cut his White House visit short because of work on spending bills Thursday, so he declined comment on the meeting.  Murkowski said White House officials attending the meeting included Larry Lindsey, the president's top economic adviser; Glenn Hubbard, chairman of the Council of Economic Advisors; Karen Knutson, an aide to Vice President Dick Cheney who used to work for Murkowski and hails from Ketchikan; and Marcus Peacock, associate director for natural resources in the Office of Management and Budget.       *     Greenwire-Alaska's glaciers are thinning at twice the rate scientists previously thought and contributing more than any other icy region to sea level change, according to a study in (this week's) issue of Science.   *   This weekend, we invite readers to contemplate the greater joys of life as they determine future paths of northern gas pipelines.  Enjoy these photos from the Alberta farm of NGP readers, Peter and Leslie Jalkotzy.  Left: sunrise on July 18.  Right: from Leslie's rose garden.

NOTE: An Alaskan reader with close ties to Washington D.C. decision makers reports this morning that staff consensus in Washington now seems to be that the energy bill has a 50% chance of passage this year.  We have supported this view for sometime.  Accordingly, efforts to bring opposing viewpoints together will require extraordinary effort.  -dh

7-19 Updates: 00:15, 01:17, 02:00, 11:41, 12:06, 13:00, 14:31 ET.  Senator Frank Murkowski  (NGP Photo, 11-3-01) after a gas pipeline meeting at the White House yesterday afternoon said, "The White House expressed some concerns over the specific price mechanisms in the Senate Energy bill.  However, they expressed their commitment to work to develop a proper role for the federal government to help move this project forward expeditiously."  Murkowski met with Energy Secretary Spencer Abraham (Photo-l) and senior Administration officials to seek resolution of policy allowing for transportation of Alaska natural gas reserves.  The Administration has recently joined with Canadian leaders in opposing price guarantee language in the Senate version of H.R.4 and language prohibiting a northern route in both Senate and House bills.  "While the Administration expressed concerns about the current proposal they did commit to find common ground," Murkowski said.  He added that without "...federal safeguards, Alaska natural gas will stay in the ground for a very long time."  Murkowski said the President recognizes the importance of Alaska gas to meeting future energy needs of the country.  "I am encouraged by the overwhelming willingness of each of the Departments to move forward on this project," he said.     *     WASHINGTON, Oil & Gas News, Reuters, by Christopher Doering  - The American Petroleum Institute said on Wednesday it remains optimistic that Congress still has enough time this year to pass an energy bill that may allow drilling in an Alaskan refuge-a controversial issue that Senate Democrats have sworn to block. … Senate Democrats have promised to block Alaskan drilling, with Joseph Lieberman of Connecticut saying such a provision "will be dead on arrival."  However, John Felmy, chief economist with API, an industry group, told Reuters: "I think with a cautioned, reasoned approach, a discussion of the facts, it has a good prospect." It "absolutely" has a chance of being part of the energy bill, Felmy said.  "I remain very optimistic that we'll have a good energy bill this year," he added.  "The president has really made it a priority, American citizens believe it's a priority, and I think legislators understand that," Felmy said. … The Republican-controlled House already has passed an energy bill that would allow drilling in the refuge, which may hold as much as 16 million barrels of oil. ….    *     Calgary Herald by Chris Varcoe - Yukon Energy Minister Scott Kent says comments by a senior executive with Phillips Petroleum Co. prove the Alaskan Highway pipeline project is moving ahead in the race to build the first Arctic natural gas pipeline.  … The bill, under consideration by a joint committee of the U.S. Senate and the House of Representatives, contains "certainty and expediency" for the regulatory and permitting process, said Kevin Meyers, president of Phillips Alaska Inc.  The bill also contains a floor price for natural gas, which would mitigate the "substantial risk for fluctuations in future natural gas prices and potential cost overruns," Meyers said.  The government of the Northwest Territories, which backs a rival Mackenzie Valley gas pipeline, has fiercely opposed the subsidies plan.  But the Yukon government -- a proponent of the Alaskan project -- said the remarks represent a key move towards building the $20-billion US pipeline, which would run south along the Alaskan Highway into the Yukon and extend into northern B.C. and Alberta.   "It's a big step. The producer has put governments on notice they will be moving to a permitting phase, provided that these tax incentives are in the Senate energy bill," Kent said…. In Alaska, BP spokesman Ronnie Chappell said there are more matters to settle than just the U.S. Energy Bill before the three producers move ahead on the proposed line.  BP is seeking a sufficient regulatory regime in Canada and the United States, along with fiscal certainty in Alaska "so we know the rules won't change" if the companies make massive investments.   "In our view, it'll take more than federal legislation to get the project moving forward," he said.  (See related stories.)       *        Anchorage Daily News (AP)-Anadarko Petroleum plans to drill three wells on the North Slope this winter -- two gas hydrate wells and one conventional oil or gas well. … The location of the third well has not been decided, Anadarko spokesman Mark Hanley said, but Anadarko has several options in the form of existing permits for wells in the Brooks Range foothills, the National Petroleum Reserve-Alaska and the western North Slope.  Anadarko also is in the process of filing 15 permits for other Foothills wells.   *   CBC, Yellowknife, N.W.T. - The N.W.T. government is considering a carbon tax to persuade diamond mines to buy hydroelectric power.  Finance Minister Joe Handley says he sees development of hydro electricity as an engine of economic growth in the Northwest Territories.    *     CBC, Inuvik, N.W.T. - The federal government is trying to crack the American art market for northern artists. Representatives from three Canadian consulates have brought gallery owners from California, Texas and Michigan to Inuvik for the Great Northern Arts Festival. … The cultural and academic relations officer for the Canadian consulate in Los Angeles, Pam Johnson, says it's a matter of educating the public about the art. … Bruce Kapson's gallery in Santa Monica specializes in art from North and South America. … "People are looking for work that reflects things made by hand, and even more importantly, that reflect the land and its people," says Kapson.  (See our Inuvik photos: Art, Murals, Town.)   *   Enjoy a visit to, an independent effort of Whitehorse citizen Brett Chandler to support his favored Alaska Highway Natural Gas Pipeline Project.  We are delighted that Brett links to Northern Gas Pipelines here.  We encourage all northern citizens to become more knowledgeable of the many, complex gas pipeline issues as Brett is doing.  Scott Heyworth in Alaska runs a similar site for his favored projectHere is a listing of all sites we know of that link or have sometimes linked to NGP.     -dh

7-18 Updates: 01:30, 02:43, 11:14, 11:39, 13:09, 13:47, 14:35, 15:27, 16:04 ET.  Thursday's breaking news-Northern Gas Pipelines learned this week that the Memorandum of Understanding (MOU) between the "withdrawn partners" and the existing Alaska Northwest Natural Gas Transportation Company (ANNGTC) partnership has possibly been rendered ineffective due to the withdrawal of more than one of the participating parties.  (Note: Please see our 11-15-01 report.  Also, see related, recent developments.)  For any companies withdrawing from the non-binding MOU, the action signals an end to their formal relationship in developing the ANNGTC project under the MOU.   ANNGTC is the Alaska portion of the Alaska Natural Gas Transportation System (ANGTS).  In November 2001, a group of major energy firms - Williams, Duke Energy, Sempra, Enron, PG&E, El Paso, TransCanada Pipelines and Foothills Pipe Lines (at that time jointly owned by Westcoast Energy and TransCanada Pipelines (TCPL), and now Duke Energy and TransCanada Pipelines) signed a non-binding MOU related to the Alaska State portion of the Alaska Natural Gas Transportation System. These signatories to the MOU included the current partners as well as the other partners who had previously withdrawn from the Alaskan Northwest Natural Gas Transportation Company, which holds the permits for this Alaskan segment of the system. Permits for the Canadian segment of the system are exclusive to Foothills (again jointly owned by Duke Energy and TransCanada).  Duke Energy has notified the MOU parties of its intention to withdraw from the non-binding MOU because it did not achieve the objectives agreed to by the parties within the targeted time frame. "Duke Energy will continue to work with Alaska producers and other stakeholders to develop a successful Alaskan natural gas pipeline project", Wayne Soper, Senior Vice President, Governmental & Public Affairs for Duke Energy Gas Transmission said today in response to a query from Northern Gas Pipelines.  Soper emphasized the following "key points" related to Duke's action:

  • "While we have withdrawn from the MOU, Duke Energy is continuing to work diligently to develop a commercially viable Alaska Highway pipeline project.

  • "The Alaska Northwest Natural Gas Transportation Company is otherwise not affected (Note: the Alaska segment of the project.  -dh).

  • "The Canadian section of the pipeline is not affected.  Foothills, Duke Energy and TCPL are the sole permit holders for the Canadian segment of the pipeline. The MOU addressed the Alaska State portion only. 

  • "Finally, I would emphasize that Duke Energy remains fully committed to working with producers and stakeholders to successfully develop an Alaskan natural gas pipeline project."      

While Northern Gas Pipelines has learned of other potential company withdrawals, no statements have been issued.  When more information is made available it will be provided here.   -dh

  *     Anchorage Daily News, AP-The president of Phillips Alaska Inc. said the company is prepared to begin the permitting process for a North Slope natural gas line if an energy bill passes Congress with two critical components.     *     Yesterday afternoon, U.S. Senator Frank Murkowski (Photo) conducted a Capital Hill press conference including Teamsters and U.S. Chamber of Commerce leaders.  Invited to participate were: Majority Whip Tom Delay, Chief Deputy Whip Roy Blunt, Energy and Commerce Committee Members George Radanovich and Joe Barton, and Energy and Natural Resources Committee Member Craig Thomas.   The conference emphasized a reliable and affordable energy plan with Alaska components our readers understand completely.  Murkowski also gave a brief preview of a White House meeting scheduled at 1 p.m. ET today, regarding the gas pipeline. He said the White House was trying to determine how the gas pipeline can be built, is discussing views on how to structure the proposal and determining the appropriate role of government.  After the White House meeting today, Murkowski is scheduled to meet with reporters in the White House driveway.  Follow these links to our earlier reports on White House/Congressional meetings.   (Note: in a statement from Murkowski's office later yesterday, he said, "We're more than 50% dependent on foreign oil.  This past weekend we twice bombed Iraq while enforcing the no-fly zone."  After referring to the Nigerian oil worker hostage stand-off last week, and Exxon's Aceh gas complex siege in Indonesia he said that with a comprehensive energy plan the country can "...better secure our energy supply with American energy.")  *     Anchorage Daily News (AP)-Anadarko Petroleum plans to drill three wells on the North Slope this winter -- two gas hydrate wells and one conventional oil or gas well.   ... The location of the third well has not been decided, Anadarko spokesman Mark Hanley said, but Anadarko has several options in the form of existing permits for wells in the Brooks Range foothills, the National Petroleum Reserve-Alaska and the western North Slope.    *     The Minerals Management Service will hold public hearings on the proposed Beaufort Sea Multiple Sale draft environmental impact statement. The Anchorage hearing will be held on July 30, 2002, from 4-7 p.m. at the MMS Alaska Region Conference Room, Third Floor, 949 East 36th Avenue. Hearings were also held in Barrow, Kaktovik, and Nuiqsut July 22-26, 2002. MMS is proposing to hold three sales in the Beaufort Sea Planning Area Program between 2002 and 2007 under its current 5-Year Program.

7-17 Updates: 00:20, 10:19, 11:12, 17:37 ET.  EE News-Energy Bill Status (See our earlier report)... In separate interviews with Environment & Energy Daily, Senate Energy Committee ranking member Frank Murkowski and Sen. Larry Craig addressed rumors of slow progress and bitter disputes during the first few weeks of closed-door staff debate over how to dispense with less controversial, so-called "Tier II" issues before conferees reconvene. Murkowski described the dissent as predictable because so many people have been involved, with staff from over 60 conferees participating. ...a Democratic aide said his leadership is working on an Oct. 1 scheduled adjournment deadline for a conference report, but he admitted the conference may spill into a post-election, lame-duck session in November and December.     *     Today in Washington, FERC Commissioners are expected to explain their decision ordering a new western spot price cap and consider longer-term solutions to power problems in the West.  (Source: Williams ENL)    *    Whitehorse Star by Jason Small-In total, 69 per cent of the Yukoners queried said they feel the Yukon’s economy was in either serious or critical condition. That’s up from 64 per cent a year ago.    *    Peninsula Clarion, by Hal Spence-Two-term Kenai Peninsula Borough Assembly member Bill Popp announced ... he has accepted a job with the borough administration to promote a natural gas spur pipeline to Cook Inlet and will resign his seat on the assembly effective July 11. ... The job's prime focus will be promoting a gas spur line to the inlet region off whatever route is eventually chosen to bring natural gas from the North Slope, an issue on which Popp already has spent considerable time. ... Popp said he would act as the borough's "point person" on the issue, which among other things, would entail, he said, "Getting the Legislature to keep Cook Inlet in mind when they're working up the financing for wherever a pipeline may go."   (Mayor Dale Bagley NGP Photo 2-20-02), said some people have thought no further than the borough's residential gas needs when thinking in terms of a gas spur line. While supplying Enstar's needs certainly is part of the equation, long-term, the industrial refineries at Nikiski, including Agrium and Phillips, will need huge gas supplies, too, as the inlet reserves they're now using peter out.  "We need to keep natural gas available for those refineries," Bagley said. New discoveries will push the end date out a bit, Popp said, but it is clear inlet reserves are declining. Much depends on a new supply of natural gas. ....

7-16 Updates: 01:59, 02:14, 02:30, 11:04, 11:42, 12:43, 12:57, 15:26 ET.  Alaska Oil and Gas Association’s (AOGA) Kevin Meyers of Phillips Alaska, Inc., Steve Marshall of BP Exploration (Alaska) Inc., David Wight of Alyeska Pipeline Service Company, Charles Pierce of UNOCAL Alaska (NGP Photo-right), Jack Williams Jr. of ExxonMobil Production Company, Jeff Rose of EnCana Corporation and Ron Noel of Tesoro Alaska Company provided AOGA's annual presentation to the Anchorage Chamber of Commerce.   “A Transition Report on Alaska’s Oil and Gas Industry to the next Administration and the 23rd Alaska Legislature,” was this year’s topic.  As our report is finalized, you will find it here along with event photos.    *    Bill Wicker of the Senate Energy Committee reports that yesterday in New York City, Senate Energy Committee Chairman Jeff Bingaman (NGP Photo from Senate energy bill debate, 6-27-02) spoke at an investor forum sponsored by the Public Service Enterprise Group. "America's Energy Future ... A Washington Perspective" offered the financial community an opportunity to hear about energy legislation that currently is being conferenced, and what implications that legislation may have on energy markets.  While Bingaman did not address Alaska gas pipeline or ANWR issues, he affirmed that, "...we strived to produce a bill that balances production with development and incentives for new sources of energy, while making markets more transparent for consumers and encouraging tax incentives to help the energy sector push the envelope on technology and create new jobs over the long term. We tried to take the long view, while also dealing with current "hot" issues. Our overall goal was to pursue stability and reliability in our energy sources over the long haul."  He said, "the issues are complex. In the end, the Senate bill incorporated more than 160 amendments and ran 1,000 pages by the time it was complete."   *   Greenwire, on Energy Bill progress:  A House source, who refused to be identified by party or quoted directly, said internal Senate Democratic divisions have in fact thrown up a number of roadblocks that make progress before the August recess even on less controversial issues improbable.   *     Oil & Gas Journal-HOUSTON, July 15 -- The US energy policy being debated presently in Congress should include provisions that address the oil and gas industry's looming personnel shortage, according to North Dakota Gov. John Hoeven.  (Note: Arctic gas pipelines provide the most immediate stimulus for large scale job creation, putting even more pressure on the skilled labor/professional employment supply.  Governor Tony Knowles was last year's chairman of IOGCC.  -dh)    *     National Post, by Luiza Chwialkowska, KAHNAWAKE, Que. - First Nations should have exclusive power to tax their own people, and native-owned companies should do business tax-free across the country, says a provocative new study presented to a gathering of native leaders this week.

7-15 Updates: 00:35, 01:23, 01:45, 02:08, 11:39, 12:07, 14:26, 14:51, 20:53 ET.   We understand from the Senate Energy Committee that Friday there was a first meeting of key tax staff from the White House, Senate and House.  Objective of the meeting was to work out financial terms for the Alaska gas pipeline.  As specific proposals develop, we shall keep NGP readers informed.  Please note the urgency signified by this communication.  Canadian and U.S. Administrations have been opposed to financial gas pipeline incentives.  Arctic Resources Corporation (ARC), promoters of an 'northern' route, are lobbying against energy bill provisions in Conference that would prohibit that route and provide financial incentives to the 'southern route'.  Alaska's Governor, Legislature and Congressional Delegation have committed to the highway route, though it has not been determined financially feasible.  Federal support could change the numbers significantly, an outcome desired by Alaskan leaders presently dealing with a $1 billion/year revenue shortfall (Reference).  Senate Democrat leadership has an arrangement with environmental lobbyists to approve Alaska gas pipeline enabling legislation in lieu of approving ANWR development.  One would not be surprised to see financial incentives take a somewhat different form in order to achieve sufficient votes in Conference and support from the President.  One would also expect Canada to receive some benefit to counter its opposition.   Earlier related reportRefresher links on studies relating to current issues.   -dh    *    Yukon Pacific Corporation (YPC), promoter of a Trans Alaska Gas System (TAGS) and LNG project changed management last year.  YPC's Project Development Director, Ward Whitmore (NGP Photo-right), has produced a revised proposal for TAGS and is discussing it with a number of industry and governmental decision makers.  Readers will find an abstract of the new Executive Summary here.  The full Executive Summary will be provided here when it is released.  -dh    *     Alaska Oil and Gas Association’s (AOGA) Kevin Meyers of Phillips Alaska, Inc., Steve Marshall (NGP Photo) of BP Exploration (Alaska) Inc., David Wight of Alyeska Pipeline Service Company, Charles Pierce of UNOCAL Alaska, Jack Williams Jr. of ExxonMobil Production Company, Jeff Rose of EnCana Corporation and Ron Noel of Tesoro Alaska Company will present AOGA's annual presentation to the Anchorage Chamber of Commerce.   “A Transition Report on Alaska’s Oil and Gas Industry to the next Administration and the 23rd Alaska Legislature,” is this year’s topic.  We will report.

7-13/14 Weekend Updates: Sat. 13:55, 13:58, 14:54, 18:59 ET.   Dillingham-Alaska Independence Party Candidate for Governor Nels Anderson (Photo) issued a press release today addressing Alaska's fiscal crisis and gas pipeline issues.  Anderson's platform involves establishment of a gas reserves tax sufficient to generate $.5 billion/year and new oil taxes capturing another $ .5 billion to offset the state's current $1 billion/year deficit.  He focuses additional attention toward support of an LNG project for movement of North Slope gas to Lower 48 and Asian markets.  Anderson said in the release that, "The Yukon Pacific Corporation demonstrated to the legislature what the All Alaska Gas Pipeline would cost and how it would be financed. YPC also identified markets that would be ready to take our gas once the All Alaska Gas Line was operational. At hearings in Juneau this spring, YPC made it clear that an All Alaska gas pipeline is not only feasible but that the entire gas pipeline could be owned by the state of Alaska."  Anderson criticized statements of several industrial and political leaders and said, "42,000 plus Alaskans signed a petition to build an All Alaska Gas Pipeline. That is now an initiative on the November ballot. If we build the All Alaska Gas Pipeline," he continued,  "we will have a project on line within seven to eight years. This would get much needed new revenue to our state treasury, employ our Alaskans, and provide a source of low cost energy to all of our communities throughout Alaska.     *     CBC, CALGARY - The federal government and private business gave First Nations entrepreneurs with oil and gas business plans some new venture capital on Thursday.

Though not especially gas related to Arctic oil & gas, we suggest this to be the greatest headline of the year, on a subject that will benefit corporate governance for years to come: National Post-"When Bush Comes to Shove"

7-12 Updates: 00:19, 01:47, 13:08, 18:39 ET.  Whitehorse Star by Jason Small- ... John Katz, Alaska Gov. Tony Knowles’ cabinet member responsible for federal-state relations, took solace from some of the comments made recently by President George Bush’s energy secretary.  A recent letter from Energy Secretary Spencer Abraham pointed out that the presidency is opposed to the subsidies that were proposed by the U.S. Senate to encourage the construction of the Alaska Highway pipeline. ... Katz was heartened by a line in Abraham’s letter that encouraged them to come up with a creative solution to help bring the Alaskan gas to buyers in the continental U.S.  (Note: See our story and download the letter.“The administration urges conferees to develop alternative provisions to bring the gas to market without resorting to similar provisions that would distort markets, could undermine fiscal responsibility, and might jeopardize the expeditious construction of a natural gas pipeline,” Abraham wrote.  Katz said this is an indicator that the Bush administration recognizes the need for a subsidy, just not the one the Senate proposed.  (Note: See our observation below.As well, it was noted the letter said nothing about Bush outright rejecting any bill that includes subsidies.  “We didn’t see the ‘veto’ word used in the discussion of the gas line,” Katz said.  ... The Senate’s plan would give the gas producers tax breaks if the price for natural gas drops below $3.25 US per thousand cubic feet (TCF). The companies would have to repay the money only when the price approaches $5 US per TCF.  The companies that own the natural gas in the state’s North Slope which would be shipped via the pipeline are divided on the subsidy, according to Katz.  He said Phillips Petroleum is “a strong advocate” of the tax break while ExxonMobil’s focus is in a speedy permitting process not in subsidies.  One of the reason’s for Abraham’s condemnation of the aid package was the possibility Canada might not cooperate in the Alaska Highway route’s construction if there was a subsidy.  Prime Minister Jean Chrétien told Bush recently that Canada would rather let the free market decide where a pipeline is built.  ... “There’s a certain irony in advocating, in the U.S. context, against subsidies that have been (used) to create benefits in Canada,” Katz said about Ottawa.    *      Anchorage Times Editorial.  ... BP joins Phillips as one of the two major gas holders favoring an Alaska Highway route. The third, Exxon, has not yet announced a preference. ... Alaska alone cannot make the gas pipeline happen, but it certainly can and should make itself a more attractive investment by improving the state's fiscal stability and offering incentives that would reduce tax-related economic rents as an obstacle.  (Note: Northern Gas Pipeline readers in Washington report efforts are underway to improve acceptability of gas pipeline incentives to H.R. 4 Conference Members and the Administration.  When specific language becomes available we shall immediately provide it to you.  Several of our decision making readers have observed that lack of an incentive package this year will indefinitely postpone an Alaskan project.  If suitable incentives along with expediting language are passed by Congress and receive Administration support, the ball returns to Alaska where essential fiscal and regulatory certainty issues remain unresolved.  This is not to say we are ignoring unresolved Canadian issues, also requiring attention.  See our earlier warning. -dh)   *   CBC, Yellowknife, N.W.T. - ... The Dene Nation Assembly is being held in Fort Simpson, N.W.T., where 1,000 people are expected.  The cost of staging the $120,000 event falls to both the Dene Nation and the host community. However Dene Nation national chief Bill Erasmus says the cost could be as high as $500,000, depending on how many delegates participate. The assembly draws aboriginal leaders, youth and elders from across the territory.  Organizations that are not part of the Dene Nation are asked for a contribution to help cover the costs of the assembly. ... The Dene Nation requested a $10,000 contribution from the Aboriginal Pipeline Group. Its rival, the Northern Route Gas Pipeline Corporation, agreed to pay $5,000.  The territorial government is paying $45,000 in total, including grant funding for the assembly and contributions to the Liidlii Kue First Nation to cover hosting costs and a feast. ... Officials with the federal government make their presentations Saturday, however there is no word on how much they will be paying.    *      RUSSIA-BP announced yesterday that Rosneft has been awarded a five-year exploration license for part of the  offshore Sakhalin V block. This is an important step for the Alliance of BP, OJSC NK Rosneft and Rosneft-Sakhalinmorneftegas, which was formed in 1998 to develop Sakhalin V hydrocarbons.  The island of Sakhalin lies off the east coast of mainland Russia in the often ice-bound and technically challenging waters of the Sea of Okhotsk. BP's 30 years of activity in Alaska will provide unique operating and environmental protection experience in similar climates.  Alaska's political leaders have been active in promoting the expertise of its companies.  Besides Alaskan producers, a number of Alaskan support companies are involved in Sakhalin development.  Sakhalin is considered to be a world-class hydrocarbons province. Onshore production of oil and gas began in the 1920s and in the last 30 years there have been five giant discoveries of more than 500 million barrels of oil and 1 trillion cubic metres of gas. NGP readers wishing further information may contact Peter Henshaw, Director External Affairs, BP Russia, +7 095 787 6009(Note: It does not escape our readers that all oil and gas provinces desire production and revenue.  All require limited investment dollars of explorationists and producers.  Stockholders expect for investment to flow where investment returns seem most likely.  Any hydrocarbon province which believes it can politically dictate terms to energy investors in a competitive world-wide market is likely to produce disappointing results for constituents.  -dh)     *     NGP became familiar with EPIC at the Inuvik Petroleum Show.  EPIC (Electronic Public Interaction Centre) is a planning and management system for emergency response, public notification, land-use conflict resolution, community consultation and other high-impact public contact activities.  The EPIC Centre provides a centralized registry and data center to manage public stakeholder information and communication, oil and gas assets and related documents and information, via an Internet-based Geographic Information System (GIS) interface. EPIC combines the expertise of EPIC Unisource Inc. and TELUS Geomatics to provide a single point of contact for stakeholder-related information & communications and a single mapping window for data layers.  The system is said to enable public, corporate, regulatory and other participants in resource development to document, enhance and extend their relationships, and provide an additional tool to plan economic activities in conjunction with other land users and cooperatively with the communities and individuals whom those activities impact.  Its creators say it will improve the time and cost efficiency with which regulatory and legal requirements can be met, operations monitored and optimized, and public policy factored into decision-making.  NGP readers desiring to test the EPIC system, may LOGIN HERE - user name: epicnorth - password: pipeline. Readers may address questions to: EPIC Unisource Inc.'s VP Business Development Carolyn Martin, at (403) 261-4060 or, Email.  

Flash:  Today at 4:15 p.m. ET Senator Frank Murkowski (NGP Photo, 2-02) meets in S-339 to discuss the GAO response to his questions regarding recent allegations by Rep. Ed Markey (Photo w/Senators) about Alaska's North Slope oil and gas infrastructure.  We have reviewed all of the materials and think you will agree with us that  the allegations were irresponsible.  We are pleased to provide the complete file for your reviewBackground: see our earlier FT link.  Markey news release. -dh


7-11 Updates: 00:12, 01:00, 11:58, 12:39, 15:44, 16:02 ET.  The Energy Information Administration (EIA) is soliciting public comments on a proposed new revision policy for the Weekly Natural Gas Storage Report (WNGSR) in a Federal Register notice published today   *     Anchorage Daily News, (AP) Fairbanks -- An upcoming North American gas study will offer four scenarios under which Alaska natural gas might be developed, according to state Sen. John Torgerson (NGP Photo, 6-02).   The worst-case scenario -- and the most likely of the four -- forecasts that North Slope gas will not enter the market until after 2020, Torgerson said, citing a preview of a Cambridge Energy Research Associates study. ... Torgerson is chairman of the Senate Resources Committee. His remarks came nearly a month after John Browne, BP's chief executive officer, said that an Alaska gas project is not viable under current regulatory and economic conditions Torgerson drew his review from a memo written by Larry Persily, deputy commissioner of the Department of Revenue. Persily attended a Houston meeting with Cambridge staff and 70 industry representatives in late June.  The report looks at North America natural gas supply and demand through 2020 and makes no projections past that year. Cambridge's full report will be released in September. The state is one subscriber to the report. ... Persily's memo summarized four possible scenarios: In the most likely of the four,

  • Cambridge assumes that the United States has a slow economic recovery with a disappointing gas supply from western Canada and the Gulf Coast. Coal maintains its position in energy production. The Northwest Territories' Mackenzie Delta gas goes online in 2009 with Alaska gas entering sometime after 2020. 
  • In a second scenario, the world economy rebounds and there's a surge of new technology, including the ability to find more gas. Governments let the market define the natural gas business climate, and all is well with the world. Mackenzie gas is not needed until 2015 and no Alaska gas is offered until after 2020. 
  • In a third scenario, environmental concerns fill the world and carbon emissions are greatly curtailed. President Bush supports the Kyoto Accord, coal loses ground, and natural gas becomes more highly desired because it burns cleaner. Under the scenario, Mackenzie gas comes in 2013 and Alaska gas follows in 2017.
  • Finally, in a fourth possibility, more terrorism acts cause upheaval in U.S. and world markets. In the midst of economic downturn, Americans focus on security issues. To help reduce dependence on foreign oil, gas-to-liquid becomes king. A large-scale GTL plant is built and is producing in Alaska by 2009. Mackenzie gas goes to market in 2013.

Cambridge is a highly respected consultant, Persily said. "I'd like to say, 'Gee, maybe they're wrong,' " he told the Fairbanks Daily News-Miner. "We still believe Alaska's time will come, but it won't be as soon as we like."  Persily said that the scenarios would be changed if Congress approves tax-break legislation now pending.  Torgerson said passage was most important for a multibillion dollar Alaska gas pipeline project.  "Without the fixed price, there will be no pipeline," he said. ... Torgerson said Alaskans can encourage an Alaska project by supporting a good business climate and stable fiscal regime. The producers have been saying that for months, most recently by Browne.     *    CBC, EDMONTON - Physicians are asking the province to not approve more oilsands projects near Fort McMurray because of the impact these developments have on health-care.  CBC, Old Crow, Yukon -  ... The Gwich'in are opposed to oil development on Alaska's coastal plain where the caribou calve. They say their way of life may hinge on the results of a coming congressional election.  A bill currently before the American congress would allow drilling in Alaska to go ahead. The trek has been timed to end just prior to the fall congressional elections.   The Gwich'in hope to influence the American election in favor of the Democrats. That party is opposing any opening up of the Coastal Plain.  The trek won't cross the entire country. It will focus only on those states where last-minute lobby efforts could swing the vote against the pro-development Republicans.  The trek by the Gwich'in and their American environmentalist allies will start next month in Seattle, ending in Washington D.C. in November.  (Note:  Next door to ANWR, the Central Arctic Caribou herd has grown in size with development of Prudhoe Bay.  While not necessarily due to the protections offered by industry, evidence and logic reveal that regulated oil & gas activity has no demonstrable negative effect on the herds.  Alpine/Caribou photo courtesy Phillips Alaska, Inc.  -dh)

7-10 Updates: 00:09, 11:09 ET. Financial Times by Matthew Jones in London & Sheila McNulty in Houston-  ...US House representative Edward Markey, a Democrat, said companies with interests in Alaska's North Slope oil fields had refused to disclose the full costs of their clean-up liabilities to investors.  His remarks, reported by the Wall Street Journal and Reuters, came as the General Accounting Office, the US Congress's investigative arm, published a report estimating the North Slope clean-up bill at between $2.7bn and $6bn.  The GAO said funds provided by oil companies by way of bonds would cover only a small proportion of the total cost of decommissioning, removal and remediation work (DR&R).  ... A BP official described Mr. Markey's claims as "disappointing and irresponsible" given the current market conditions following the Enron and WorldCom accounting scandals.  He said the group had made easily enough provisions to cover the cost of DR&R work in Alaska.  "We do not report these costs on a segmental basis by region or business activity but globally last year we had provisions of $5.3bn for anticipated decommissioning costs," he added. "Nothing is hidden. The money is provided for."  The GAO investigation was carried out at the request of Mr. Markey, a long-standing campaigner against oil development in Alaska, and House minority leader Richard Gephardt.  Both have been involved in negotiations between the House and the Senate on energy legislation. ...Oil companies have spent more than $50bn over the past 30 years on developing the North Slope, a region about the size of Utah.      *     Northern News Services by Paul Bickford, Hay River - Paramount Resources Ltd. held an open house in Hay River last week to update the public on its Cameron Hills oil and natural gas project. ... Lloyd Doyle, the company's area engineering manager for northwest Alberta, said the open house was to inform the public on the work planned for next winter and what has already been accomplished.  ...  Three of nine proposed wells were drilled and evaluated last winter.  This winter, the company will drill and evaluate the remaining six wells.  It may also drill between one and 10 additional wells.  ... Last winter's work included the construction of a central facility to handle gas operations and the construction of a 15-kilometre pipeline into Alberta.  And six of 21 wells were tied into the system.  The natural gas is moved to Paramount's Bistcho gas plan in Alberta. ... Company president Shawn Carter, who was on hand for the open house, said the project means a lot to the Northern economy. ... The project is approximately 75 kilometres due south of Kakisa, near the NWT/Alberta border.      *     Our Reader Appreciation Prize for our 88,333rd reader goes to Malcolm R. McKay, C.A. CFP, Managing Partner, MacKay LLP, Calgary.  His prize is our Inuvik Petroleum Show conference bag filled with goodies from one of the largest and most useful and exciting gas pipeline trade shows the author has ever attended.  Find the past winners circle here.

7-9 Updates: 00:27, 00:47, 08:39, 09:04, 14:00, 18:09, 19:09 ET.  Here is APG's latest newsletter, (7-02).  NWT Pipeline Training Initiative; Cooperation Plan; APG Website Now On-Line; Governor Tony Knowles' Remarks; Energy Secretary Spencer Abraham Remarks; Fred Carmichael at Inuvik Petroleum Show (NGP Photo); Proposed Mackenzie Valley Pipeline Facilities; Community Consultation.  Here is the last newsletter, (5-02).  *   Our report on the Inuvik Petroleum Show (IPS) is in the final stages and will be uploaded in segments during the balance of the week.  We apologize for the delay but are trying to be current on all projects and issues.  Check here for updates.   *   Alaska Oil and Gas Association’s Kevin Meyers of Phillips Alaska, Inc., Steve Marshall (NGP Photo) of BP Exploration (Alaska) Inc., David Wight of Alyeska Pipeline Service Company, Charles Pierce of UNOCAL Alaska, Jack Williams Jr. of ExxonMobil Production Company, Jeff Rose of EnCana Corporation and Ron Noel of Tesoro Alaska Company will speak at this annual luncheon event…in just an hour!  “A Transition Report on Alaska’s Oil and Gas Industry to the next Administration and the 23rd Alaska Legislature,” is this year’s topic, to be held at the Egan Center.   Tickets are $18.50 per person or $148 for tables of eight.  Pre-payment is required.  Call 272-2401 or e-mail to get your seats now; deadline is Wednesday, July 10.   * by Sandra Cordon-Canada is seeking concessions by 2005 from over 40 trading partners in such areas as oil and gas and mining services, telecommunications, courier and distribution, computers, accounting and other professional services, environmental and construction services.   ***and this*** Calgary Herald by Tom Olsen-The provincial government has joined with aboriginal groups and the oil and gas industry to maximize First Nations involvement in northern energy development, and reduce the risk of challenges over traditional land use.  ... Aboriginal Affairs Minister Pearl Calahasen (NGP Photo, 4-02) said industry took the lead in getting aboriginal groups onside; now the government is helping to co-ordinate efforts.  "They want some certainty," Calahasen said of the energy companies. "As you know, there have been decisions by First Nations on their land and use of their land. When First Nations assert their rights, it can create uncertainty.... "It's like a good neighbour approach. In the city, if you are going to build something, you go and talk to your neighbour," she said. "What we do is make sure they are part of the decision-making. In the long term, we get certainty."... The department of economic development is also involved.  Minister Mark Norris said he's following Calahasen's lead in looking for ways aboriginals can earn long-term benefits from the multibillions of dollars in oil sands investment.  ... Brenda Erskine, spokeswoman for Suncor Energy, said her company is committed to being fair.  Erskine said talks are underway with five First Nations groups in northern Alberta's Athabasca Tribal Council.  "It was always felt very strongly the First Nations and Metis Nation should be able to participate in the benefits of growth," she said. ... Erskine said Suncor's oil sands workforce is about 2,300, with roughly 10 per cent from Canada's aboriginal population. The goal is to increase that to 12 per cent by the end of the year.   *** Links courtesy of Reader Peter Jalkotzy.  *  CBC, EDMONTON - Alberta is considering sweeping changes to the way it uses the Heritage Savings Trust Fund.    *    TAKE A SPRING BREAK IN CAIRO.  For our readers with worldwide interests one notes the similarities between Alaska's and Egypt's existing and potential gas reserves.  Perhaps some will wish to explore those similarities, after attending North American gas conferences, and visit Cairo next March.  Click on the logo for information.

7-8 Updates: 00:37, 11:09, 11:55, 14:14, 15:47, 16:44, 17:18 ET.  Our report on the Inuvik Petroleum Show (IPS) is in the final stages and will be uploaded in segments this week.  Check here for updates.  (Photo, left: Inuvik Logo)   *    Anchorage Times Editorial (ADN)-The problem is this: Alaska's tax and royalty regimen was designed for the glory days of oil production and was written at a time when the rallying cry was for Alaska to get its "fair share" of the value of oil when it moved through the trans-Alaska pipeline at more than 2 million barrels a day. Now, pipeline throughput is half that amount and declining, but the old system is still in place and applicable to new projects. Without changes, many future projects -- including the gas pipeline -- almost certainly will be uneconomic and unlikely to come to fruition.     *   CBC, Edmonton-Environmental group fights to stop new oil sands development.  *   Whitehorse Star by JASON SMALL-The Yukon’s Energy Minister ... Scott Kent was upset with federal Natural Resources Minister Herb Dhaliwal’s comments against the U.S. proposals. But he wouldn’t say anything about the man who told President George Bush that Canada is opposed the tax breaks — Prime Minister Jean Chrétien.  Duncan Fulton, a spokesman for the prime minister, told the Star earlier this week the two leaders discussed the pipeline issue last week at the G8 summit in Alberta.... Fulton said the prime minister said Canada would rather not see anything affect the decision to build a pipeline other than gas prices.  ... Dhaliwal has been saying in recent months that Canada does not want to see any subsidies affect the decision to build a pipeline.  ... The Yukon minister said it isn’t right for Canada to be threatening another country with regulatory road blocks. ... “The federal government should realize that the market didn’t decide for Hibernia,” Kent said, referring to financial assistance for the Newfoundland oil project.  “The Canadian taxpayers through tax incentives, loan guarantees and outright grants” have helped this and other projects. ... A recent study done by a company commissioned by Phillips Petroleum, the main natural gas producer which supports the Alaska Highway project, said the credits wouldn’t cost the U.S. government anything.  But that’s not what Bush’s Energy Secretary, Spencer Abraham, believes.  Abraham wrote a letter last week to the committee of U.S. senators and representatives which is trying to hammer out a single bill.  (Note: Readers may download the letter here.)  ... In that letter, Abraham slammed the subsidies, partly because he thought it could cost $1 billion a year.  ... The government of the N.W.T., which wants to see the Mackenzie Valley pipeline built first, has been hammering the proposed U.S. subsidies. The N.W.T. is afraid that if the Alaska Highway pipeline is built first, its gas would be stranded.  Both the Yukon and the N.W.T. support the idea of both pipelines being built, as long as the line which goes through their backyard is built first.

ANCHORAGE, Alaska – The Bureau of Land Management (BLM) and the Alaska Department of Natural Resources (ADNR) of the federal/state Joint Pipeline Office (JPO) announce the availability of the following two documents regarding the Trans-Alaska Pipeline System (TAPS) Right-of-Way Renewal. The BLM is releasing its Draft Environmental Impact Statement (DEIS) and the ADNR is releasing its Commissioner’s Statement of Reasons and Proposed Written Determination (Proposed Determination) for public review beginning July 5, 2002.  Northern Gas Pipeline readers may download the complete statement here.

7-6/7 Weekend Updates: NNS by Mike Bryant, Yellowknife (July 05/02) - Premier Stephen Kakfwi's worries over a proposed Alaska Highway pipeline route appear to be over.   The premier held a press conference Wednesday to announce he was pleased that the White House was opposed to a Congressional legislation that would have given the Alaskan route a substantial subsidy if it were to pass.  (See other related stories.) U.S. Secretary of Energy Spencer Abraham wrote a letter to the committee chair W. J. Tauzin June 27, saying he was opposed to any subsidy for an Alaskan pipeline.  ... Abraham wrote that the subsidy would "distort markets, could cost well over $1 billion in annual lost revenue, and would likely undermine Canada's support for construction of the pipeline and thus set back broader bilateral energy integration."  (Download the letter here.  Kakfwi said the U.S. administration's opposition to the subsidy all but guarantees that a Mackenzie Valley route will proceed first. ... Natural Resources Minister Herb Dhaliwal told The Canadian Press last week that he was pleased with the U.S. administration's position. ... Kakfwi said he will continue lobbying against it to ensure that it does not pass.  "The ministers in Ottawa have also said they will continue to convey the position to the States, industry and the White House administration," said Kakfwi.

7-5 Updates: 00:15, 10:18, 10: 26, 11:00, 11:20, 12:28, 13:03, 14:48, 15:14 ET.   Anchorage Daily News by Steve Haycox-Lord John Browne of BP reminded Alaskans just a week ago that absentee corporate investment still controls much that happens, and will happen, in Alaska. Despite some Alaskans' insistence that a gas pipeline will be built soon, over a route determined by Alaskans, Browne made it clear that the pipeline will be built when BP determines it should be built. Cost effectiveness measured on a world scale and global supply and demand will be the determining factors, not the Rumpelstiltskin-like foot-stamping of Alaska politicians. Moreover, he implied strongly that the pipeline route will not be dictated by Alaska politics. Rather, it will be a function of economic factors involved, as determined by the developers and marketers of the gas, not the Alaska Legislature. Alaskans will have little effect on the ultimate decision.   *    Whitehorse, Yukon Release–Yukon’s Minister of Energy Mines and Resources Scott Kent (NGP Photo, 11-29-02) is dismissing suggestions that the Alaska Highway Natural Gas Pipeline (AHP) is dead. ... “The project continues to enjoy strong business and political support.  Support that will be sustained and demonstrated as U.S. energy legislation and other initiatives move forward this fall.”  Kent was responding to media reports today that because the proposed tax incentives for an Alaska Gas Pipeline may not be included in U.S. energy legislation the project may be shelved.  Kent pointed out that the North American market will need gas from the Yukon, Alaska, the Northwest Territories and elsewhere to meet the combination of rising demand and declining supply in North America.  “There remains strong bipartisan support for the Alaska Highway project in the U.S., and it is also widely supported in Canada by those who understand the enormous economic benefits of northern gas development,” said Kent.  ...  Kent also called on the federal government to respect Canadian law and regulatory processes. “Threatening to delay projects by manipulating law for political purposes is unbecoming of a G8 nation,” said Kent. “Northern gas pipeline proponents should focus their energies on creating a positive investment climate for northern pipeline projects.”   Yukon has always maintained that market demand will support two northern pipelines in the long run, and continues to support that view.    *    CBC-The Premier of the Northwest Territories says the plan to build a pipeline down the Alaska Highway is dead.  Stephen Kakfwi (Photo) ... said the pipeline dream ended when plans to subsidize a proposed Alaska pipeline were quashed.  (See our earlier report & download Secretary Abraham's letter.)   *   CBC-Whitehorse, Yukon - Yukon Premier Pat Duncan (NGP Photo, 11-02) says a change of heart by the U.S. government doesn't mean an end to the Alaska Highway Pipeline project.  The Bush administration now opposes a tax incentive for natural gas to be shipped along the highway route through the Yukon. Oil producers have said they'll need a tax break from the U.S. government to make the pipeline pay.  Duncan says the policy shift at the White House doesn't mean a pipeline subsidy is dead. Canadian gas producers think such incentives are unfair, but Duncan says they have no business complaining.  "Before Canadian politicians start criticizing how the Americans structure their tax to deal with pipeline construction or oil and gas they had best look in their own back yard first," she said. "The exploration in the Mackenzie Delta in the late 70's and early 80's that proved up is largely the result of a major subsidy."   Published reports from last week's G-8 summit claimed Prime Minister Jean Chrétien tried to pressure U.S. President George Bush to back a Mackenzie Valley pipeline instead of the Alaska route.  However Duncan says she's talked to Chrétien, and claims he supports building both pipelines.  *   Calgary Herald by Frank Dabbs-Billy Tauzin, Jeff Bingaman and George W. Bush are about as different from one another as a trio of Washington politicians can be.  ...  There is a delicate balance to strike, but if anyone can do it, Tauzin with some help from Bush and Bingaman can.     *  Northern News Services by Thorunn Howatt, Hay River  - Alberta's oil and gas industry is sneaking northward, nudging the NWT border, and Conoco Canada wants to be ready. The company is opening a Hay River office next month. "Oil and gas activity is increasing in the North, and having a presence sooner rather than later is important," said Conoco's Ross Papirnick, who will be manning the downtown office....  Conoco will direct Northern business interests like its Fort Liard operations from Hay River as well as northern B.C. and Alberta operations. It is also hoping to help people with oil and gas education. And it wants to be ready for the time when oil and gas exploration is a reality in the Deh Cho region.  "Increased activity is coming. It's just a matter of when and how," said Papirnick. ... Conoco is part of a Mackenzie Delta Producers' Group that wants to build a $3 billion natural gas pipeline down the Mackenzie Valley. Papirnick said pipeline issues won't be dealt with in the Hay River office.   *     Calgary Herald by Scott Haggett-Of the 69 chief executives who responded to the survey, 36 per cent said northern Canada offered the greatest potential for oil discoveries, versus 30 per cent who believe offshore Nova Scotia and Newfoundland have vast untapped reserves. The difference was even more dramatic for gas potential. Only nine per cent of CEOs thought there were large gas deposits waiting to be found off Canada's East Coast, while 64 per cent said northern Canada was the place to explore with 16 per cent choosing British Columbia. "There hasn't been a great deal of success in the last 18 months on the East Coast," said Blair Kraus, a partner in the Calgary office of Deloitte & Touche, which carried out the survey. "As a result, people are focusing their exploration and development activities in other areas."    *     Northern News Services (Norman Wells Report), by Jasmine Budak - "The gas pipeline will help keeps things going as part of the whole system," says former mayor Frank Pope.

7-4 Updates: 00:55, 12:56 ET.  LTG Norton A. Schwartz (NGP Photo) addressed the Anchorage Downtown Rotary Club this week on various issues affecting defense of northern North America.  Schwartz is Commander of the Alaskan Command and oversees NORAD defenses.  His command includes Canadian components.  Defense of national interest energy assets remains a military priority.  Schwartz reminded the audience that protecting "...northernmost borders has been the mission of the Alaskan NORAD region for nearly 50 years."  He said the men and women of the Alaska NORAD region track the movement and purpose of more than 1,600 flights during a 24-hour period.  Schwartz said the region is constantly in training.  "Northern Edge" he said, was "Alaska's largest joint training exercise" last April, designed to protect the Trans-Alaska Oil Pipeline Terminal in Valdez.  In June, he said, the FBI led exercise "Arctic Strike" to advance preparedness for protection of the Valdez terminal and its port.  Readers are welcome to download LTG Schwartz' speech here.  (NGP is grateful to Capt. Brenda L. Campbell, Alaskan Command Public Affairs Director.)                *                The draft environmental impact statement that evaluates three sales proposed for the Beaufort Sea is available for public comment.      The area under evaluation is in the Beaufort Sea, offshore Alaska's northern coast.  It extends from 3 to approximately 60 nautical miles offshore in water depths generally ranging from about 25 to 200 feet. The area covers about 9.9 million acres and extends from the Canadian Border on the east to Barrow on the west.  Northern Gas Pipelines provides readers the full MMS release with contacts here.  (See our 5-17 related story.)   *   Northern Gas Pipelines encourages its Alaskan and Canadian readers to consider this Russian contact opportunity, though we have not researched it.  “Information agency Neftegaz.RU delegation is traveling to Alberta Province to film the oil and gas focused documentary in the period from July 8th to July 14th of this year. The project is held under the patronage of the Governor of the Khanty-Mansiysk Autonomous Region (Russia) and Alberta Province Government (Canada) support.  The project will produce a documentary (5 x 20 min) about the Canadian oil and gas industry, energy issues from G8, and also new invented technologies (Alberta Province and KhMA region).  The Neftegaz.RU schedule includes: An interview with representatives of the Alberta provincial government and corporate executives related to oil extraction and environmental management; meeting with CAPP (Canadian Association of Petroleum Producers) and CEEIA (Canada Eurasia Energy Industrial Alliance); several press conferences; filming of proceedings in Canada; publicity in the local Canadian and Russian media; and filming the production process, the workflow of the oil and gas industry.  Organizers wrote Northern Gas Pipelines that, "The project would be a subject of interest for companies working with Russia and Canada.  If you are interested in meeting representatives of IA Neftegaz.RU in Canada (Edmonton and Calgary) or participating in the project, please register your interest at  or +7 095 705 94 13"     ЗАО "АСУ-Импульс": Бизнес-справочники и базы данных "Электронная библиотека художественной литературы"   *   Juneau Empire By TIMOTHY INKLEBARGER-Abandoning his run for lieutenant governor as a Democrat, Scott Heyworth of Anchorage announced Tuesday his endorsement of Republican gubernatorial candidate Frank Murkowski.  (Note: Please see our earlier story.)      

7-3 Updates: 01:30, 12:25. 12:51, 15:14, 17:55 ET.  Financial Times by Nancy Dunne- ... Spencer Abraham (Photo), the energy secretary, laid out the administration's position in a letter to Billy Tauzin, the chairman of a House-Senate conference committee, which after weeks of delay, has begun to try to resolve differences in House and Senate bills.  (Note:  see our earlier story and download the letter.  -dh)  ... Mr. Murkowski has vowed to fight on because "this project means jobs for Alaskans, billions for our economy, and great strides toward energy security".  Mr. Daschle has supported the pipeline as an alternative to drilling in the Arctic National Wildlife Refuge, an anathema to the environmental movement. He has also used the proposal to boost Alaskan Democrats with the objective of gaining Alaska's Republican Senate seat for his party.  ... "If this was passed, it would mean the socialization of the energy industry," said Keith Ashdown of Taxpayers for Common Sense, a fiscally conservative advocacy group. "We are happy the administration has taken the lead in eliminating this corporate welfare from the bill."  A spokesman for Arctic Resources Company, which is seeking to build the pipeline through an alternative route, said it would be considerably cheaper building straight south through Canada. "If Congress would get out of the way, we could get it constructed and flowing gas in seven to eight years," said a spokesman said.  ...    *  It was a pleasure to visit with Yukon's oil and gas director, Greg Komaromi, at the Inuvik Oil and Gas Show two weeks ago (NGP Photo).  Yesterday, he commented on a study we announced here on 6-26.  "The Yukon government has welcomed a new industry report prepared by Charles River Associates (CRA) concerning an Alaska Gas Pipeline", Komaromi said. "The report confirms that measures designed to promote development of an Alaska Gas Pipeline will not strand Canadian gas or distort North American energy markets. The report also concludes that a proposed U.S. tax credit will likely cost governments nothing, and that any payments will be temporary owing to unusual market conditions and very small relative to benefits to consumers.  The CRA report puts the proposed tax credit in context by observing that it is not a (cash) floor price, but rather a simple tax credit for profitable companies that produce gas on the North Slope that is only available in exceptional circumstances. It also concludes that the North American market will need gas from Alaska, the Northwest Territories and elsewhere to meet a combination of rising demand and declining supply in North America." (Note: Readers may find various recent studies by scrolling the May and June archives or referring to the bibliography, here. -dh)  *  On the Alaska scene, our politically oriented readers will be interested in yesterday's activities of Scott Heyworth (NGP Photo, 5-24-01), founder of a gas pipeline initiative (Ballot Proposition #3).  If passed, the initiative "...would create the Alaska Natural Gas Development Authority (Authority) as a public corporation of the State. The Authority would acquire and condition North Slope natural gas, and construct a pipeline to transport the gas. The Authority's powers would include buying property or taking it by eminent domain, and to issue state tax-exempt revenue bonds. The gasline route would be from Prudhoe Bay to tidewater on Prince William Sound and the spur line from Glennallen to the Southcentral gas distribution grid.  The Authority would operate and maintain the gas pipeline, ship the gas, and market the gas."  Heyworth told Northern Gas Pipelines today he was in process of withdrawing his candidacy as a Democrat contender for Lieutenant Governor in the Fall elections and endorsing Republican candidate for governor, U.S. Senator Frank Murkowski.  Murkowski said of Heyworth in his news release, “Seeing the potential for a natural gas pipeline from the North Slope to Valdez and an innovative way to make it happen, he collected more than 42,000 petition signatures, so Alaskans can cast their vote in favor of economic opportunity and a brighter future this fall, in the form of the All-Alaskan Gasline Initiative.”  (Readers may download Murkowski's election office news release here.)  *  CBC, Yellowknife, N.W.T. - Oil and gas companies looking for underwater reserves in the Mackenzie Delta are going to have to get environmental approval for their search program first.  ... The National Energy Board and the Department of Fisheries and Oceans ruled Tuesday that a drilling company's program must undergo an environmental assessment.  (Note:  A Calgary reader with expertise in this area writes that the information above is incorrect: he says, "it is a river seismic survey (as it states using air guns) and there would not be any drilling.....on Wednesday in Inuvik (during the show) the Environmental Impact Screening Committee (EISC) also referred the project to the Environmental Impact Review Board (EIRB) for the portion of the project in the Inuvialuit Settlement Region (ISR). This latest news, for the portion south of the ISR, is from the Mackenzie Valley Environmental Impact Review Board, and they have now referred the project to an Environmental  Assessment. The full details can be obtained at the following website:")   *** and, on the lighter side *** CBC, Inuvik, N.W.T. - Volunteers in Inuvik are working evenings and weekends to make the dream of golfing in the Mackenzie Delta a reality.  CBC, Inuvik, N.W.T. - Aurora College officials turned the sod on a new facility for their community. They said the new academic building in Inuvik signifies a renewed commitment to education in the Beaufort Delta.  For more than 15 years a former army barracks has served as home base for the college in the region.   ... Inuvik Boot Lake MLA Floyd Roland (NGP Photo, 6-02) said he's talked with many students over the years that want to continue their education, but aren't ready to leave the Delta to do it.... Roland said this new facility is a step in the right direction for education in the region.  The President of Aurora College, Maurice Evans, said when the new facility is completed, students won't have to travel south to have a comfortable place to learn. ... The project will cost nearly $10 million, and is expected to be completed by the fall of 2003.  (Note, your author had the pleasure of staying in a dorm room at the College during the Inuvik Petroleum Show.  --NGP Photo,  6-02 -- Aurora office staff contributing to a friendly stay:  Una Chinna, Sheldon Bernard, Roberta Cardinal. Other Inuvik Photos here.)

7-2 Updates: 01:00, 01:08, 12:11, 12:45, 13:05, 13:27, 21:19 ET.  Oil & Gas Journal - ... The House bill contains a provision that allows leasing in the 1002 area of the Arctic National Wildlife Refuge in Alaska, a plan not in the Senate document. ... The Senate plan also contains pipeline safety legislation, tax incentives and loan guarantees for a new Alaska gas pipeline, and an ethanol fuel standard not present in the House bill. There is broad bipartisan support in the Senate for both the Alaska gas line and the ethanol fuel provisions. ... President Bush supports opening up a piece of ANWR to exploration but has not said he would veto a bill that does not contain such a provision. But some lawmakers from energy-producing states aren't willing to give up on the issue just yet. House Resources Committee Chairman James Hansen (Photo-right) said he wants to see ANWR be part of the final bill. "We put ANWR on the table and won it in the House last year because domestic oil production was critical to our nation's prosperity and national security. In the wake of Sept. 11, the stakes have only become higher. Making the United States self-reliant in the production of her own energy was important before Sept. 11. Now, it's absolutely vital. It will remain vitally important for the foreseeable future," said Hansen. "I'm going into the conference committed to sustaining America's energy self-reliance, strong national security, and ongoing contribution to a clean global environment through domestic energy production." And perhaps the Senate's most visible ANWR supporter, Sen. Frank Murkowski (NGP Photo, 11-01) called on his colleagues to keep an open mind about the issue.  "Now, more than ever, there is so much more riding on the success of this conference. "There are many contentious issues in these bills: CAFE (Corporate Average Fuel Economy), renewable portfolio, climate change, ANWR, pipeline safety, efficiencies, and other issues. It would be a travesty if we took the position, as some have, that the Senate is going to oppose any provision that is not contained in the Senate bill. We all must be open to negotiation because that is the role we play—to craft legislation drawing elements from both bills," he said.  *  Greenwire by Tim Breen - ... (Energy Secretary Spencer Abraham) also wrote of the administration's opposition to a "processes tax subsidy provision in the Senate bill and any similar provision because it would distort markets, could cost well over $1 billion in annual lost revenue, and would likely undermine Canada's support for construction of the pipeline and thus set back broader bilateral energy integration." At issue is the Senate's apparent attempt to pre-determine a southern route for a natural gas pipeline through Alaska through tax and other provisions, rather than run the risk of the route going through Canada. The administration strongly supports construction of a natural gas pipeline, but "believes market forces should select the route of the pipeline."  On the subject of Alaska, Abraham reiterated that "a national energy policy cannot rely solely on conservation and called for drilling in a "small portion" of the Arctic National Wildlife Refuge. Not only is the House's provision the primary means for increasing domestic oil production, it is the primary means for creating "tens of thousands of new, well-paying jobs for American workers," the secretary wrote.  (See our earlier story along with a download of the letter.)     *  CBC, Whitehorse-Whitehorse, Yukon - Things got a little tougher last week for people pushing for a pipeline down the Alaska Highway. The Bush administration said it will oppose a tax incentive for an Alaska natural gas pipeline project.  *    Realtime News- - US Interior Secretary Gale Norton has approved the Minerals Management Service's five-year program for oil and natural gas lease sales on the outer continental shelf for 2002 to 2007.  A statement today said that the program will schedule 20 lease sales in eight OCS planning areas in the Gulf of Mexico and off Alaska. 

This past weekend, we provided readers with the text of a letter Department of Energy Secretary Spencer Abraham sent last week to Energy Bill Conference Chairman Billy Tauzin & all Energy Conferees (Note: Thanks to Chad Porter.) The letter opposes the route mandate in both versions of H.R. 4 and the tax credit in the Senate energy bill, and supports the House version permitting modest ANWR exploration and development.   See our report on the first Conference meeting.  -dh

7-1 Updates: 01:15, 04:10, 04:18, 04:50, 05:00, 15:32 ET.  Canadian Press by James Stevenson, CALGARY - President George W. Bush's administration is "strongly opposed" to proposed American subsidies for a natural gas pipeline from Alaska, fearing they would jeopardize energy relations with Canada. (Link sent by reader Guenter Bouman; obtain our download of the letter above.) ...  Natural Resources Minister Herb Dhaliwal has repeatedly said the free market - not subsidies - should determine which route is best for a planned pipeline to deliver arctic gas to the lower 48 states. "I think they've basically accepted the Canadian position which is, to subsidize the Alaska Highway (route) really doesn't benefit anyone in the long term," Dhaliwal said Friday from Vancouver.  "I'm very happy to hear this is the administration's position - it's been our position all along."  Dhaliwal has warned that if U.S. subsidies become law, Ottawa would reconsider its position against favouring an all-Canadian line to transport gas from the Canadian North.  "In the end, we've made it pretty clear to them that two-thirds of the Alaska pipeline will go through Canada and it will have to go through Canadian regulatory process and it's the Canadian government who will be involved in that decision." ...    *     AO&GR by Ian McKinnon-CALGARY, Alberta -- Proponents of a C$4 billion Mackenzie Delta pipeline are holding a bidding season to judge interest in Arctic gas development from other producers, part of a strategy to stay ahead of Alaska rivals and be first in the race to use existing pipeline capacity.         *   Anchorage-Friday, Lord John Browne Group Chief Executive, BP, addressed a large combined audience of the Anchorage Chamber of Commerce, Alliance and Resource Development Council for Alaska on a variety of oil and gas policy issues, including those related to an Alaska gas pipeline.  The meeting convened in the Sheraton Anchorage Hotel's Howard Rock Ballroom.  Click here for a report and event photos, including the text of Lord Browne's speech.   *  The Joint Pipeline Office is a consortium of seven State and six Federal agencies with oversight responsibilities for the Trans-Alaska Pipeline System (Photo: Alyeska Pipeline Service Company) and other oil and gas pipelines in Alaska. The JPO came into existence in 1990 and stemmed from a cooperative effort by the Bureau of Land Management and the Alaska Department of Natural Resources.  Regarding the Trans Alaska Pipeline System renewal: the Draft Environmental Impact Statement and the Department of Natural Resources Commissioner's Statement of Reasons and Proposed Written Determination are scheduled for release July 5 for a 45-day public review. Please visit for additional and new information as it becomes available.    *   Anchorage Daily News by David Reaume (Photo)-With the gas pipeline project having been set aside for the immediate future, Permanent Fund dividends on the decline and the rest of the country showing signs of economic recovery, both Alaska's absolute economic performance and its relative economic performance are likely to revert to the stagnation that characterized most of the 1990s.


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