Single Page
Rumors swirl about looming Alaska natural gas project announcementRumors from Fairbanks to Anchorage are flying about some sort of imminent announcement by the big three oil companies operating in Alaska -- Exxon Mobil, BP and ConocoPhillips -- involving liquefied natural gas (LNG) and a pipeline to Cook Inlet or Prince William Sound. It couldn't be confirmed, but some in the know contacted by Alaska Dispatch weren't surprised by the rumors, which be warned, are just rumors. But these rumors didn't just spring out of the air. Alaska Gov. Sean Parnell recently started laying the groundwork for a shift in the state's direction on marketing its natural gas. Instead of a pipeline to Canada, as is the current plan, Parnell is pushing for an LNG project. The idea would be for an 800- to 1,000-mile-long pipeline from North Slope oil fields to the Kenai Peninsula on Cook Inlet or the Prince William Sound town of Valdez, where the gas would be liquefied and shipped on refrigerated tankers, most likely to Asian countries. At a Dec. 15 press conference, Parnell said there was a “six-week window” in which he expects to see new “alignment” between companies involved. But what does “alignment” mean? Perhaps the companies have agreed with Parnell that an LNG pipeline and tanker terminal is the answer to developing Alaska's gas reserves -- the largest conventional natural gas deposits in America. Alaskans have been struggling to persuade Big Oil to invest in a multibillion-dollar effort to tap the North Slope's vast natural gas reserves since the 1970s, when the state's Arctic oil fields were first developed. Under former Gov. Sarah Palin, the state offered up to $500 million in subsidies to TransCanada Corp. -- the same company spearheading the controversial Keystone XL Pipeline project in the Lower 48 -- to design and begin construction on an Alaska natural gas pipeline. The plan originally was to build the line from Alaska's Arctic oil fields to Alberta, Canada. It's important to note that any new "alignment" by the companies, though, in no way changes the current economics or state policy in order to realize the fabled Alaska natural gas pipeline. Even if such an announcement takes place in coming weeks, it means only that the "big three" might think about building it. And that, in turn, probably means more years of studies, more years of haggling over how much the state should tax the natural gas on its lands that the companies want to develop. Remember "Denali: The Alaska Gas Pipeline"? That was a deal BP and ConocoPhillips announced in 2008, in the heat of the state's political debate over Palin's efforts to produce a gas line. The companies proclaimed they would be building a gas pipeline to Canada. BP Alaska's president at the time dismissed skeptics, saying essentially, "Let our actions speak for themselves." BP and Conoco gave up on Denali in mid-2011. Perhaps the only tangible result that an announcement from BP, Conoco and Exxon would have on Alaska is to vindicate those who throughout the years have been saying that the LNG option was the best way to get Alaska’s gas to market. The "LNG crowd," as some circles once referred to those who proposed an all-Alaska gas line. They were often dismissed with a roll of the eyes, called "wing nuts" for daring to propose such a project. But maybe the three big oil companies have another reason for some announcement, timed just before another contentious session of the Alaska Legislature, as Parnell rolls out his State of the State address. The companies think that a Palin-era tax levied on them is too high. Parnell has been trying to get the tax lowered but has run up against resistance from Democrats and Republicans alike in the Alaska State Senate. The oil companies could be taking a stick and carrot approach: "We'll build you a damn LNG project, but you must lower our oil taxes." And Parnell -- who could use a big project before his term ends, especially if he wants to run for a second term or another office (watch out, Sen. Mark Begich) -- may be pushing them along in this direction. Indeed, the last time all three companies agreed to build a pipeline together was under Gov. Frank Murkowski in 2005-06. But for them to build a pipeline, they demanded that the state not raise oil and gas taxes for decades. Even then, they were only committed in principle to build a line. There were no construction dates. And look where that got Alaska. Contact Amanda Coyne at amanda(at)alaskadispatch.com Still waiting for some hard numbers here: What is the current spot market rate for LNG in Asian countries? Has Trans-Canada spent the entire half billion ($500,000,000) that Palin gave them yet? -TomClark Just Amanda peddling Clap Trap again to you nincompoops who think a gasline is a possiblity. I wonder how much the big three pay Amanda? Boobus, I would ask you to think a gasline, any gasline, through but you are not capable. Amanda why don't you play pied piper and lead all of the gasline nuts to to North Dakota where oil production id down 74 barrle per well. What else is tied to oil? Numbers from the Alaska Economic TRENDS reports from 2000 and 2011 and a local Fairbanks grocery store. •Gas has gone up 189 percent from $1.38 to $4.00 gallon as has fuel oil Great for the State of Alaska but their RIK profits are killing us in the villages and the Interior. LNG exports to Asia is the only market. Current lower 48 prices are about $3 mcf with Asia nations paying around $12-14mcf for imported LNG. I will believe there is a project when the Caterpillars are digging earth. I'm beginning to wonder about Gazprom (Russia's huge energy company). These folks seem to have a history of leveraging their gigantic resources to benefit themselves/ Russia's political portfolio. If I recall correctly, Russia has in the past manipulated (cut off) natural gas supplies to Europe for political purposes. Some North Slope producers are involved in current or potential partnership projects with Gazprom. There are huge and potential projects, like Yamal Peninsula, that vastly dwarf the scale and scope of North Slope operations. (I think) Gazprom may want to control the supply of LNG to Asia as much as they can, and I wonder if they could do a lot of arm twisting of North Slope Producers (like telling them to not export LNG from Alaska to Asia) if Alaska production competed with Siberian Arctic or far eastern Russian operations like Sakhalin and Kamchatka. We may need Gazprom's permission before we try to export natural gas to asia. Here are a few perspectives. (I was looking for more specific articles mentioning a dispute that may have occurred between Gazprom and one North Slope Producer involving export of natural gas to Asia from the producer's Sakhalin or Kamchatka operations, but I haven't found it yet-- Gazprom/ Russia may have already forced a North Slope Producer to terminate exports to Asia from operations in Russian territory). http://www.mfa.gov.ge/index.php?lang_id=ENG&sec_id=512&info_id=1809 http://streetwiseprofessor.com/?p=967 http://seekingalpha.com/instablog/504668-oilprice/46174-gazprom-angel-or-demon I'm wondering if some of our North Slope Producers may have a lot more at stake in Russia than in Alaska, and if that could affect their decisions on whether to develop North Slope production or export North Slope natural gas to Asia-- they might not want to make the Queen Bee mad. Here we go again, right before the start of the legislative session. What a coincidence. Next we will hear that none of this would ever happen unless Alaska enters a binding agreement to reduce North Slope oil taxes for the next 40 years. Of course North Slope producers wouldn't be able to guarantee a pipeline. The only guarantee on the table would be that oil taxes would be reduced. Now I know what Spring will bring-- ads on TV and intense lobbying for reduced oil taxes coming from a creatively new angle with a new carrot on the stick. The continuing gridlock on developing Alaska's gas makes NO SENSE for anyone involved, including the oil companies. New data has come to light regarding the amount of gas that is simply being WASTED, flared off, every day, contributing to pollution and not serving any human need. It is a shameful and ongoing betrayal of Alaskans who are paying some of the highest energy prices on earth and using three and a half times more energy due to the transportation costs of shipping goods here and the severe climate. There is no sense whatsoever in rewarding the oil companies for their bad behavior. What they need is a good boot in the butt. Remember all the whining about Cook Inlet gas? Oh, we were running out of gas, we were running out of gas....and Escopeta comes up here, drills a single hole, and whoops! There's a gusher big enough to supply the Anchorage Bowl for many years to come. Chevron knew the gas was there. They had the equipment and resources to develop it. The Pigs just weren't motivated. So, it's time to motivate them. Production quotas haven't been invoked since the Second World War, but the ACES tax seems to have finally kicked in and be doing its job in that regard. People don't realize it, but the oil companies have been slacking off for years, letting the world supply dwindle, and price gouging the consumers. ACES is the State's way of getting its cut of ill-gotten gain, and also "encouraging" the oil companies to get moving again. ACES takes away the profit incentive of the oil companies to continue gold-bricking. It's a GOOD thing for Alaska and for all energy consumers. Keep ACES. The only other alternative is production quotas and you can bet the oil companies would like that answer even less. What is the current spot market rate for LNG in Asian countries? The only worse idea than to build an LNG plant in Valdez is to hoodwink Alaskans into sponsoring it through State ownership. -TomClark Crude-Oil is OBSOLETE.. google: horse manure crisis 1974-Fairbanks, I started advocating for fully hydrogenating and gasifying all N-Slope crude in-situ.. I knew then that the easiest way to bring a civilized level of comfort to Fairbanks/railbelt was to continue the 8"Alyeska-fuelgasline alongside TAPS all the way to railbelt.. I knew a small gasline like this could do much more than just power the first four pump-stations.. At the same time I realized 250,000gpd LPG-propane could be moved to railbelt in 6" polypipe.. Electrochemistry Rule-#1: Hydrogen is electricity in storage-stable state. Australia is gasifying coal underground, then making LNG out of this syngas and selling it to China.. and China is rapidly expanding LNG-cryofuels for trucking and fleet-fuels [think reefer-trucks hauling produce in a hot climate] A tunneled LNG-cryopipe will move only 2% two-percent of total soils compared to ditching for a big messy-muddy steel-CNG boomerwhopper. DT You are starting to make too much sense. Don't let the politicians get wind of this. I still think your idea about building a polypipe manufacturing plant is the way to go. 1) Provides jobs 2) Lowers cost of building the pipeline by not importing pipe 3) Lowers cost of installing utility grids. Cheaper infrastructure. 4) Provides additional revenue base for State and local governments 5) After building the pipeline and infrastructure Alaska could export 6) People would realize lower delivered energy costs because of the above savings Istead of a chicken in every pot I'd settle for a propane regulator handing off my house. I'd like to interview you about all the above and see if we could put together a popular pamphlet for people---engineers, politicians, and plain average folk who are interested in modern answers to these needs. It's long overdue. What do you think? Want to start a revolution in thinking on these issues? |
Comments