Tuesday, 15 February 2011 10:37
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| Alaska's Next Gas Option |
In 2008, the Legislature at the behest of then Gov. Sarah Palin agreed to a contract with TransCanada that gave the Canadian energy company up to $500 million to help with pre-construction costs of a gas line that could run from Prudhoe Bay all the way into central Canada.
Last summer, both TransCanada and the BP-ConocoPhillips venture solicited bids aimed at gauging interest from customers in shipping gas through the pipeline, Neither has revealed the results of those bids, and TransCanada has said it needs more time to work out conditions. That's made lawmakers and others question whether there is really enough interest and whether the state should continue to subsidize it. House GOP leaders last week introduced a bill that sets a deadline for TransCanada and Gov. Sean Parnell to prove that the gas line is economically feasible.
Then on Wednesday, ConocoPhillips and Marathon Oil told employees at their Nikiski LNG plant the companies would close the facility as soon as April. The market for liquefied natural gas, primarily Asia, is just not there, the companies said, raising more questions about the economic realities of selling Alaska gas Outside.
Lawmakers were quick to point out that at the same time Railbelt utilities are seriously considering importing LNG to make up for a lack of gas needed to keep the lights on in the most populous areas.
Now, proponents of other gas projects are smelling blood in the political waters and they're circling Juneau armed with power points and proposals. Legislators' angst over the TransCanada project, the closing of the Nikiski gas export plant and the notion of importing gas to a state that is supposedly full of it has certainly churned up the talk about other possibilities for getting Alaska gas off the Slope and put to use in Alaska.
Here's a look at some of those ideas and where they're at:
The 'Bullet Line' Proposal
This is the in-state gas line that has generally been viewed as the fall-back plan if the TransCanada pipeline failed to work out. The current vision is for a 24-inch pipeline -- half the diameter of a big gas line to Canada or Valdez -- that would run from Prudhoe to the Fairbanks area then along the Parks Highway to the Anchorage area.
Alaska's Sens. Lisa Murkowski and Mark Begich last week reintroduced a bill that would authorize a right-of-way along the highway through Denali National Park, but a spokesman for Murkowski said that was just coincidental and wasn't intended to be a statement on whether the TransCanada project was in trouble.
Dan Fauske, who heads the state agency spearheading the bullet line option, said last week his agency is "in this kind of weird position" because it's not really in competition with TransCanada or the BP-ConocoPhillips project. He thinks the bullet line could just as easily become a spur line off a larger line and that it's not an "either or" proposition.