NGI The Weekly Gas Market Report
Alaska state officials said last Wednesday they will not reconsider the disqualification of a gas pipeline application from the Alaska Gasline Port Authority (AGPA) for evaluation under the Alaska Gasline Inducement Act (AGIA) process.
The AGPA’s All Alaska Gasline project proposal was disqualified from consideration, along with three other projects, under AGIA last month for lack of completeness (see NGI, Jan. 7). The state is currently only considering a proposal from TransCanada Alaska Co. LLC and affiliate Foothills Pipe Lines Ltd. In asking for reconsideration of its plan AGPA alleged behind-the-scenes chicanery prevented it from submitting a complete proposal by the AGIA deadline (see NGI, Jan. 21).
“[A]llegations of misconduct by third-party companies in a business arrangement do not justify permitting one applicant, the Port Authority, to submit a substantially modified, materially new application well after the application deadline has expired for all applicants,” the state said in its letter denying APGA’s request for reconsideration.
State Revenue Commissioner Pat Galvin and Natural Resources Commissioner Tom Irwin said Wednesday that the state would not rule out an all-Alaska gasline solution to commercialize the state’s vast North Slope reserves, nor would they rule out a liquefied natural gas (LNG) project. TransCanada has included an LNG option in its proposal. The officials said that commissioners would look at all of the five applications submitted under AGIA and cobble together a potential LNG project, the merits of which could be weighed against the TransCanada proposal during the AGIA process.
“The commissioners recognize the importance to the state of undertaking a thorough evaluation of liquefied natural gas (LNG) project options and are committed to undertaking such an evaluation before determining whether a pipeline that goes through Canada will sufficiently maximize the benefits to the people of Alaska and merits issuance of a license,” the state said. “The information provided by the Port Authority will be valuable components of that evaluation.”
The five companies that applied under AGIA are AEnergia LLC, AGPA, the Alaska Natural Gas Development Authority, Little Susitna Construction Co. Inc. (Sinopec ZPEB); and TransCanada.
Not being evaluated under the AGIA process but available to state legislators for their consideration is a proposal floated by ConocoPhillips for “a gas transmission system from the ANS [Alaska North Slope] to the border of British Columbia and Alberta in Canada. From there, the natural gas will be transported to markets throughout North America by utilizing a new-build pipeline to Chicago, spare capacity available at the time on then-existing pipelines, or expanded capacity on then-existing pipelines” (see NGI, Jan. 14; Dec. 10, 2007).
Also last week, Drue Pearce, the federal government’s Alaska gas pipeline coordinator and a former Alaska Senate president, told lawmakers that progress under AGIA must continue or else the federal government will step in to get a gasline through. “It is likely, under frankly any administration, that Congress might move forward and more proactively to push getting a pipeline built, particularly if we don’t license and see more [liquefied natural gas] plants get built in the Lower 48,” she said, according to the Associated Press.
And former Alaska governor Frank Murkowski showed up on the pipeline scene again, saying he would be meeting with producing companies as well as TransCanada in an unspecified role. Alaska Gov. Sarah Palin told news media that Murkowski’s help would be welcomed by the state.
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