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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: 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 agendaClick 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 Industry 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 " 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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