Alaska solicits independent gas pipeline proposals
January 12th, 2007
alaskareport.com
Anchorage, Alaska - Several energy companies, outside of the three major oil producers in the North Slope region, are eager to build or participate in a $20 billion natural gas pipeline, Alaska's new governor said on Wednesday.
Gov. Sarah Palin, who met with a dozen companies and groups seeking to ship natural gas from the North Slope, said she intends to invite all interested parties to submit proposals for the mega-project.
"We are coming into this with an open mind and open arms in terms of inviting these participants to give their input," said Palin, a Republican sworn into office two days ago, at news conference.
Palin's approach contrasts with the proposal pushed by her predecessor, former Gov. Frank Murkowski, who failed to win legislative approval for a deal he struck with the three major North Slope producers -- ConocoPhillips, BP Plc and Exxon Mobil.
Murkowski had argued that only the three producers had the financial means to build such a huge project.
But critics considered Murkowski's deal with the three producers to be too generous. Palin defeated Murkowski in the Republican primary after sharply criticizing his gas pipeline deal as a giveaway.
A natural gas pipeline has been a decades-long goal of state officials who are seeking a means to ship the North Slope's rich natural gas reserves to markets, but the project's high cost has kept it on the drawing board.
Companies who presented general natural gas proposals to Palin and a team of her advisers were Shell, Chevron, BG Group Plc, MidAmerica Energy Holdings, Enbridge, TransCanada and Semco. The three North Slope producers also made pitches to the new governor.
The Alaska Natural Gas Development Authority, a state-sanctioned agency seeking to build a spur line to bring North Slope natural gas into the state's most populated region, and the Alaska Gasline Port Authority, a coalition of municipalities seeking to build a liquefied natural gas project also made proposals.
Not all of the companies are interested in building or financing the proposed gas pipeline, said Marty Rutherford, acting commissioner of the state Department of Natural Resources and Palin's chief adviser on gas pipeline issues.
All the companies said they wanted to be able to ship natural gas down the yet-to-be-built pipeline at a reasonable cost, assurances of access to the shipping artery and assurances that the line could be expanded to accommodate new natural gas discoveries, Rutherford said.
Palin said that even if they do not help build the line, the independent companies need assurances that it will not be monopolized by the three producers or any other companies.
"Explorers are not going to risk exploration capital in Alaska if they don't believe that they're going to be invited as participants in the gas line. They want access to the gas line," she said.
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