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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,
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gas pipeline projects and people, informal and rich with new information,
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Internet.
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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
LEST WE FORGET!
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Northern Gas Pipelines:
Reviewing
Pac
Com Expo
1. Pac Com Expo 2002 Program.
Above, you may link to the entire program. Herein, we cover the Oil & Gas
Track featuring several references to Arctic gas projects.
Click here for the Oil & Gas agenda.
Click here for our report on the
event.
2. You may view our
Pac Com Photo Gallery here.
3. Below is a brief report of
a related good-will reception hosted by
Rod Johnson, Consul & Sr. Trade Commissioner, office of the Canadian
Consulate General, Seattle.
2-21-02: Northern Gas Pipelines today sings, "O
Canada", in
 honor
of the many distinguished
 Canadians
visiting Alaska this week. Last night, Rod Johnson (Photo) hosted a good-will reception at the
Captain Cook Hotel. Invited Alaskans included: Bill Stamps, Peak
Oilfield Service Co., Charlene Stamps, DANZAS/AEI-Alaska; Craig
Honeycutt, Phillips Alaska Petroleum Company; Jackie Honeycutt, Cook
Inlet Region, Inc.; Dave Haugen, Lynden Inc.; Dave Harbour,
Northern Gas Pipelines; Larry Houle, Alaska Support Ind ustry
Alliance; Chuck Becker, Alaska Export Assistance Center; Greg Wolf,
Alaska Department of Community and Economic Development; Rada Jones, Pac
Com Expo; Ronda Thompson, Alaska State Legislature; Roger Chan,
Veco Corporation; Karen Brand, Alaska State Chamber of Commerce.
Canadian guests included Honourable Mark
Hlady-MLA (Photo, 2-21-02); Lindsay Smith, Dura Energy Inc.; Gordon Guenette, Deryk Anderson and Sam Quisenberry of
Mammoet Canada Western Ltd., Don Byers, North Alberta Institute of
Technology; Owen Gilbert and Dan Kohut, GLM Tanks and Equipment Ltd.;
Mike Mrdjenovich, Nova Builders, Inc.; Marvin Molzan, Leduc/Nisku
Economic Development Authority; Neil Windsor and Sue Evison of the
Association of Professional Engineers, Geologists and Geophysicists of Alberta;
Paul Godfrey and Wendy Boje, Alberta Economic Development. A special guest was a long-time friend of Alaska, Galina
Pavlova, Director of Shelf Department (Shown right with House Speaker Brian
Porter, 7-01), Sakhalin, Russian Far East.
Special Report: Pac Com Expo, Oil
and Gas Track (See photo gallery here)
Alliance
 General
Manager Larry Houle opened the Oil & Gas Track by welcoming the
panel and participants, first introducing U.S. Senator Frank Murkowski.
First recognizing former Alaska House of Representatives Speaker, Gail
Phillips and Senator John Torgerson (Photo-left) Chairman of the
Legislature's Joint Pipeline Committee, Murkowski then addressed visiting
Russian executives in the audience including Galina Pavlova, Director of
the Sakhalin Shelf Department (Note, a progressing $25-30 billion development
employing a variety of Alaska companies.) "We can learn from each other,"
he said, "We hope we can offer you a gateway across the Pacific...."
Murkowski reminded
 the
audience that "...the wealth of North America is in the Arctic," referring to
Prudhoe Bay's potential which expanded from 9.6 Bbs in 1975 to current recovery
estimates of 13Bbs, attributing much of the increase to new technology. He
said that from an environmental viewpoint, Prudhoe Bay is the best oilfield in
the world. Referring to an upcoming Senate debate on the President's
energy plan, Murkowski emphasized the importance of reducing dependence on
foreign sources. He said that while the country is currently about 57%
foreign dependent, the Department of Energy is forecasting that percentage to be
over 65% by the end of the decade. ANWR estimated reserves of 5.6-16Bbs
would help offset the growing reliance on external energy sources, he said.
National energy policy will also embrace gas pipeline legislation.
Murkowski said the Congress would approve expediting legislation, that a gas
pipeline is "inevitable, and will become a reality at a certain point in time."
Speaking in place of
Shane O'Leary, BP's GTL
program manager, BP's Kenai GTL Project,
Steve Fortune (Photo) said the Nikiski facility is 93% complete and will
be finished by April after a year's construction. Producing "clean
diesel", the project will reflect the latest computer control technology and was
designed for a 5 year life. Via the internet, experts from all over the
world will be able to assist the facility with problem areas and optimizations.
The new facility will also host a prototype, 250KW fuel cell powering the
offices, yard, warehouse...and, surplus supplies for the local electric grid.
Ninety-seven percent of the facility's water use will be recycled. He said
new ideas and new technology are "bubbling" and that there are more innovations
ahead. Forty of the $86 million spend on the facility was spent in Alaska,
he said. The project has employed 220 construction workers and envisions
20 permanent staff members.
Kris Fuhr is Manager of
Phillips Alaska, Inc.'s Projects Group. He began by saying that the
company's Alaska mission is to maintain production volumes and reserves and
emphasized the importance of Alaska to the entire company, contributing 48% of
Phillips' daily production and 42% of its total reserves. Fuhr outlined
the still significant potential of the Alaska North Slope, reviewing satellite
field successes and remaining opportunities. He said the viscous, thick,
cooler oil of the West Sak field at 3,500-4,000 feet under the permafrost layer
requires new technologies but that multilateral wells and other innovations were
progressing toward the goal of freeing the reservoir's billions of barrels of
reserves. He is hoping for corporate approval for "significant" projects
and sees West Sak as a key to the long term success of the Kuparuk field.
In 2002, Fuhr said the company would appraise NPR-A discoveries, identify
prospective leases in upcoming NPR-A sales, continue a successful satellite
development program and drill new wildcat prospects. In the question and
answer period, Fuhr agreed with other company speakers at various conferences
that Alaska's permitting process had "...room for improvement."
Ken Thompson is a leading
proponent of the Alaska Highway routing for a natural gas pipeline. A
former President of Arco Alaska, Inc., he is now president of Pacific Rim
Leadership
Development and a member of Governor Tony Knowles' Alaska Highway Gas
Pipeline Policy Council. Thompson said Alaska's development should
encompass the framework of a broader oil and gas market. He described "two
key factors" supporting economic growth in today's world: people and energy.
Since 9-11, he said Alaska is more valuable than ever and that with global
warming concerns the demand for natural gas is growing. Alaska should
obtain from a gas pipeline revenue and clean energy, he said. "Alaska must
have access to markets now." Thompson offered more urgent demands for gas
producers announcing a gas pipeline project by the end of 2002, covered below in
questions and answers.
Chairman of the Alaska Legislature's
Joint Gas Pipeline Committee, Senator John Torgerson said he meets with
staff, consultants and/or other members every morning at 7 a.m. to assess
status of gas pipeline progress. He discussed his committee's retention of
Washington legal
counsel, his economic
modeling work and interest in retaining tax/bond counsel support. He
said the debate during the next few weeks will be focused in Washington and
indicated his support for producer expediting legislation with some caveats:
a. banning a northern route; Alaskan access to pipeline gas; sharing of
regulatory responsibility between FERC and RCA; protection for new north slope
explorers' access to gas transportation facilities; and, a reaffirmation of the
ANGTA regime. Regarding a voter's initiative intended to support an Alaska
LNG project, sponsored by later speaker, Scott Heyworth, Torgerson said
wondered if it would be worthwhile for the state to support an office to carry
out the initiative's requirements should the voters approve it. He has
developed a business plan for implementing the initiative, requiring a $3.3
million annual budget, and said it would be released next week. He said
his committee will spend the "time necessary" to determine if the
ARR bonding authority can be
used. "I don't know if it will work yet," he said, "but if it does, it
could save over $1 billion in financing costs." He said he would be
exploring the concept of adding price as a component to severance tax
calculations making the tax responsive to higher and lower commodity prices.
Natural Resources Commissioner
Pat Pourchot (Photo-left) briefly discussed the
CERAweek
(Department of Revenue consultant Ed Small {Photo-L, with Department of
Revenue
Commissioner Wilson Condon-R, 7-17-01} of CERA addressed the assembly on the
subject: "Canadian Energy Development: Profound Changes Under Way") meeting he
attended recently, saying the Alaska natural gas pipeline window had been pushed
by recent
events (i.e. lower prices and 9-11 economic effects) to 2012-2015. The good
news, he said, is that Alaska gas has a place in the market. Pourchot
reviewed the accomplishments of the Governor's Alaska Highway Natural Gas
Pipeline Policy Council over the past year and its recommendations and
summarized findings into three categories: route, access and risk. He
agreed with Torgerson that most Alaskans favor the southern route and that any
benefit of Federal expediting legislation should apply only to the southern
route. He said access concerns flow to future reserves to be discovered,
not just to current reserves and identified the 1 million acres of North Slope
Foothills leases executed during the past year as having much gas potential.
He said Alaska must be assured it can take its royalty gas in value or in kind
and that Alaskans must have access in Fairbanks or elsewhere. Pourchot
said the state supported minimizing risk and invited producers to "show us the
numbers", saying ideas like backloading property taxes during construction and
ARR tax exempt financing might be responsive to the need to minimize risk.
Acknowledging Torgerson's earlier statement that, he never thought the ARR
bonding authority extended to a project extending into Canada, Pourchot said his
department "kicked the tires" of the idea and found it to be a "unique provision
in Federal law to lower project costs. The Administration is still quite
bullish on a project," he said, "and stands ready to assist and support."
Williams Alaska Petroleum, Inc.
President, Diane Prier, said that cooperation will be required to move an
Alaska gas pipeline project forward. She briefed the audience of Williams'
significant
presence in Alaska and emphasized that value added opportunities in Alaska and
Canada could best be achieved through construction of an Alaska Highway pipeline
routing. She said Williams was encouraged by the ARR tax-exempt bond
concept and added that with other incentives potential existed for "bringing a
project over the top." She said that while the company's study of a
petrochemical facility in Fairbanks is incomplete, it has the prospect for
providing 350-400 technical jobs to Interior Alaska and $20 million/year in fees
to the Alaska Railroad. She cautioned that geographic and transportation
costs for such a facility are high but that results of Williams' feasibility
work and 'some economic viability could be firmed up' by Spring. She said
regarding Williams' participation in the Alaska Natural Gas Transportation
System (ANGTS) partnership that last Fall the partnership's MOA had been
executed, that the partners had presented a proposal to the gas producers, that
meetings are ongoing and that goal of the gas pipeline partners is to jointly
develop the ANGTS with the gas producers.
Foothills Pipe Lines, Ltd. Alaska
representative John Shively, said there continues to be a growing gap in gas
supplies brought on primarily by demand for electrical power generation fueled
by natural gas. Until recently, he said, as U.S. demand increased Canadian
supplies increased. However, Canadian fields are maturing and new gas
wells are more expensive and less productive. He said that while gas
demand was strong, coal served as a key counterbalance on pricing. If gas
demand forces prices too high, he said, coal becomes highly competitive as does
off-shore LNG. On the Mackenzie Valley Pipeline project of so much current
interest, he said, "We have always thought there should be two projects."
Of the Alaska Highway project promoted by his client and their ANGTS partners,
Shively said, "It's important for Alaskans to understand these major gas
companies would not be involved unless they saw the potential of a viable
project." He said the gas pipeline company partners "...hope to deliver
Alaska gas into the market by the end of the decade."
Rod Johnson, Consul & Sr. Trade Commissioner, office of the Canadian
Consulate General (Seattle) briefed participants on importance of the oil & gas
industry to Canada. He said that
2,300 service company enterprises employed 55,000 citizens. He said the
U.S. imported 25% of Canadian production and that Canadian energy inventory
continued to increase at an annual rate of 12-13%. He suggested that Alaska and
Canadian support companies could provide guidance to the U.S. and Canadian
governments to help move gas pipeline projects forward. Examples of
potential for cooperation included the movement of skilled workers across the
border and development of regulatory standards.
Questions & Answers:
Northern Gas Pipelines asked if panel members knew of any plans for locating
a gas pipeline project corporate headquarters in Alaska or Canada. None
did, but several expressed a desire to see the main office or a "key" office
located in Alaska.
In answer to other questions,
speaker Ken Thompson expressed a number of opinions:
-
If no action is taken by the end of
this year on an Alaska Highway gas pipeline, a reserves tax should be approved
and/or the Alaska Oil & Gas Conservation Commission should develop penalties for
delayed gas production. "A gas pipeline is commercial as we sit here," he
said. "Alaska must define by the end of 2002 a stick...," if no project is
forthcoming, "...and additional carrots."
-
With oil policy, he said, the state
and industry could still communicate in an atmosphere of "peace and flowers";
but, with gas policy discussions, he said, "it could become ugly".
-
Pipeline companies can help with
capital cost reduction.
-
The top 10 gas pipeline companies
don't include one major oil company.
-
Streamlined permitting is needed
along with such Federal incentives as accelerated depreciation, price floor,
etc.
A later speaker,
Scott Heyworth (Photo-summer 02),
told Northern Gas Pipelines that passing the Citizens' Initiative for the
All-Alaska Gasline would lead to energizing both Urban and Rural Alaska. He said
a gas
line to Valdez would allow for a GTL plant at tidewater, thus negating the need
to double-handle product by putting a plant anywhere upstream of Valdez.
"Propane, ethane, and the polys could be extracted and processed in Valdez and
be immediately ready for export. Upstream plants would have to depressurize to
pull of these components, process them and then reinject the gases back into the
line. Also once processed upstream," he said, "polys for instance, would have to
be trucked or railed to tidewater for shipment thus involving expensive double
handling. At tidewater, the process is self contained and cheaper. Asian markets
are hungry for propane and polys, thus dramatically improving the economics of
the Valdez route with a GTL plant at tidewater." He said that with a spur line
to South-central from Glennallen into the existing Enstar grid and the delivery
of LNG, compressed gas and propane from tidewater at Valdez to all of coastal
and urban Alaska, new cheaper and cleaner energy can benefit all Alaskans. The
high cost of propane in Rural Alaska ($4.25 gallon in Dillingham; $1.89 in
Anchorage) "can be reduced dramatically with in-state propane extraction and
shipment to Rural Alaska." He added that the economics of LNG gas into these
Rural communities with deliveries by airplane, barge, and truck open up other
possibilities of bringing cheaper clean energy to Rural Alaska, especially in
electrical production and home heating costs. Heyworth suggested that as the
gas pipeline crosses the Yukon River, "compressed gas can be siphoned off at
that point and shipped to villages up and down the Yukon River. Fairbanks and
Delta and other communities along the pipeline corridor can also receive
compressed gas easily." Heyworth concluded that, "With the Valdez route, the
Energizing of Alaska can begin immediately with a long term plan and commitment.
We do not have to wait to 2010, 2012 or even 2015 which is the new window for
the Highway project to even come on line. LNG to Valdez could be on line in
2007-2008."
Herb Shaindlin,
KFQD's master talk show host covered Pac Com (Photo) ...and
interviewed author on gas pipeline projects in the 1970s for his television
program.
(While
the author endeavors to produce accurate reports from meeting notes, he
encourages all persons and offices named in this and other articles and
readers-at-large to
provide additions/corrections to ensure validity of the historical record.
-dh ...Draft
Revision: 2-25-02)
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Our view of South Central Alaska's imminent Energy Crisis
Linking
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and
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