TransCanada claims 2-year lead on pipeline
alaskajournal.com
By Tim Bradner
Alaska Journal of Commerce
Web posted Sunday, October 24, 2004
TransCanada Corp., a major Canadian gas transmission company, said it can have an Alaska natural gas pipeline completed and in operation by 2012, two years earlier than a completion date major North Slope producers say they can achieve.
Tony Palmer, TransCanada's vice president for its Alaska pipeline project, told state legislators Oct. 14 that TransCanada has regulatory approvals already in place in Canada for its project. This will give it a two-year edge on the producers, he said.
The Canadian company's approvals and a right-of-way date from a previous effort to build a gas pipeline from Alaska through Canada, Palmer said. In contrast, the producers would have to start from scratch in getting federal and provincial permits in Canada, he said.
TransCanada owns permits and rights-of-way issued to the Alaska Natural Gas Transmission System, a consortium that attempted to build a gas pipeline along the Alaska Highway in the 1980s. The consortium included Foothills Pipe Lines, now owned by TransCanada.
About $800 million was spent by the consortium to do engineering, permitting and right-of-way work, but the project did not proceed after gas prices in the Lower 48 dropped.
TransCanada can also do its project faster because it is taking a more conventional approach to building the pipeline than the producers, using 48-inch, X-80 steel pipe, rather than the larger and thicker 52-inch X-100 steel pipe proposed by the producers, Palmer said.
The more conservative approach will also reduce risks of cost overruns for the project, he said.
Joe Marushack, ConocoPhillips' manager for the Alaska gas project, said a realistic schedule if the producers were to build the pipeline would be nine to 10 years after the companies agreed to proceed with the project.
If an agreement on state fiscal terms is reached with the administration later this year and the Legislature approves the deal next spring, an agreement by the producers to proceed with $1 billion in permitting and detailed engineering for the project could come in 2005, Marushack said.
If that happens, the project could be completed and operating in 2014, Marushack said.
Attempts to rush the project schedule could cause mistakes in project planning, which could be deadly for a project of this scale. There could also be compromises on environmental and safety standards, Marushack warned.
Palmer also gave legislators information on TransCanada's estimates of the number of workers needed if it were to build the pipeline. He said that 6,800 to 8,600 will be needed at the peak of activity on the project.
These will include pipefitters and welders, equipment operators, truck drivers, laborers and supervisors. There will also be construction inspectors, camp and catering staff, electricians and iron workers needed, he said.
Under TransCanada's schedule, pre-construction activity, which would include gravel processing, pipe receiving and right-of-way clearing, would begin in mid-2008. Construction of the pipeline and compressor stations would begin a year later and continue through 2011.
The employment estimate includes only workers directly employed on the pipeline. They do not include additional construction workers needed for a $2 billion gas treatment plant that would be needed on the North Slope. |
