TPT May 2009

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From the AmericaS
May 2009 76 ›
projects have roughly equivalent time-lines for completion. Both rest
on hopes of a bright future for natural gas.
A company formed by ConocoPhillips (Houston, Texas) and
Britain’s BP Plc is proceeding without incentives from Alaska.
By the attenuated standards of pipeline building, the plans for its
Denali project are well advanced. TransCanada Corp won an
exclusive state license to build a pipeline under the Alaska Gasline
Inducement Act (AGIA), and with it up to $500 million in state
incentives for its $30 billion project. The Canadian company has
met with rougher going.
The Denali project
› A ConocoPhillips executive said at the company’s analyst
meeting 11 March, in New York, that his company and partner
BP expect to begin accepting bids next year for gas transportation
along their pipeline. The plan is to bring Denali into service by
2019, said Ryan Lance, the company’s president of exploration and
production for Europe, Asia, Africa, and the Middle East (Dow Jones
Newswires, 11 March).
BP and ConocoPhillips are third- and fifth-largest, respectively,
among the six ‘supermajor’ private-sector energy corporations
worldwide. They envision a 2,000-mile pipeline that would bring
2 billion cubic feet of gas a day, or 6-8 per cent of total US daily
consumption, from Alaska’s North Slope to the Canadian province
of Alberta. A 1,500-mile pipeline extension, from Alberta to Chicago,
is also being considered.
The Keystone project
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› The competing TransCanada proposal is for an expansion of the
company’s Keystone pipeline system to serve existing natural
gas refineries and markets on the US Gulf Coast. The 1,900-mile,
36" crude oil line would originate in Alberta and extend southeast to
a final delivery point in Texas.
On 12 March, two Alaska legislators introduced a resolution that
would call on the administration of Governor Sarah Palin to revisit
the generous financial terms awarded Calgary-based TransCanada
last year. On 18 March it was reported in the Chicago Tribune that
Alaska state lawmakers received “mixed messages” at an energy
conference in Washington DC, where the merits of Governor Palin’s
hallmark project were examined.
The strongly pipeline-minded governor, who also favours an in-state
small-diameter line to deliver North Slope natural gas to urban
Alaska markets, defended the TransCanada deal in advance of the
first hearing on the reevaluation measure.
As reported by Anne Sutton on chicagotribune.com, state
Republican Jay Ramras, co-sponsor of the resolution asking for a
review, answered the governor’s defence by citing a ‘plate tectonics
shift’ under way in the energy world. In this view, the global
recession, together with the exploitation of new sources of natural
gas, are creating surpluses in the Lower 48 (states of the US)
that could depress prices for years to come. “Only a government
is capable of going on autopilot and staying put,” Mr Ramras said.
“In the private sector, we revisit.”
Dorothy Fabian, Features Editor (USA)