Alaska's hope for a natural gas pipeline is about to be in the hands of a hungry energy market. The Alaska Pipeline Project and its nemesis, Denali: the Alaska Gas Pipeline, are this summer offering open seasons, the period during which shippers make binding commitments totaling billions and billions of dollars to buy decades' worth of transit capacity.
"At the end of the day only one gas pipeline from Alaska will be built, and the market will decide," said Dave McDowell with the Denali project.
Recent chatter in the media world has called into question whether McDowell's employer and its foe might be looking to become friends. (On this note, it's also worth remembering the competing projects have pitted Alaska's major oil producers against one another. BP and ConocoPhillips are the parent companies to Denali and a purely private venture, while Exxon Mobil has joined forces with TransCanada to participate in the Alaska Pipeline Project, which is sponsored by the state by way of an exclusive license giving it access to lucrative state-offered incentives.)
Could it be the antagonists are surreptitiously forging an amicable future?
A blog entry in the energy section of the Houston Chronicle Monday cites "a source familiar with the project" that says the two sides are exploring whether to team up and questions whether "BP's growing financial burden from the Gulf of Mexico oil spill may be hurrying along the process."
Yet by the time Dow Jones picked up the "merger" rumor later in the day Monday, Denali's spokesperson was denying talks the rivals were getting cozy, as did an executive from TransCanada.
On this same front, Alaska's allure appears to be intensifying the desires of a Russian investor. On Friday, Russia-based energy giant Gazprom reiterated its interest in Alaska, and specifically in the Denali Project, following a presentation to shareholders. But whether Gazprom is formally in the works as a potential partner is anybody's guess. Mum's the word from Denali and ConocoPhillips, as both companies cited confidentiality and an unwillingness to comment on rumors and speculation when we sought more information about Gazprom's remarks.
The competitors do agree on one thing, however: that pipeline customers are likely to bring offers with strings attached. Buyers of capacity in any pipeline are expected to demand certainty about the state's tax structure, as well as reassurances that undeveloped resources, like those at Point Thomson on Alaska's North Slope, will be brought to market.





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