Port Authority appeal rejected

The state on Wednesday turned down the Alaska Gasline Port Authority’s request to reconsider its gas pipeline proposal. But it will not rule out the prospects of an all-Alaska gas line and liquefied natural gas (LNG) option, which is what the authority sought in a proposal deemed incomplete by the state. Revenue Commissioner Pat Galvin and Natural Resources Commissioner Tom Irwin, both members of the governor’s gas line team, announced their decision during a news conference in Juneau.

The two then briefed both the Senate Resources Committee and House Republicans on pipeline progress. The port authority is a coalition of the Fairbanks North Star Borough, the city of Valdez and the North Slope Borough. It proposed an 806-mile pipeline from Prudhoe Bay to Valdez. From there, the gas would be liquefied for transport on tankers. Gov. Sarah Palin rejected the authority’s plan among four others while touting a proposal by TransCanada as the only conforming application under the Alaska Gasline Inducement Act.

Read the full story at the ADN

Alaska’s Murkowski back to push pipeline

Former Gov. Frank Murkowski wants to be a player again in the high-stakes game of building a pipeline to tap North Slope’s natural gas. Murkowski has re-emerged after a year out of office and the public eye. When he was the state’s chief executive, he couldn’t garner enough legislative support for a deal with Exxon Mobil Corp. , ConocoPhillips and BP that he hoped would eventually lead to a pipeline. Now, Murkowski says he’s planning to meet with oil companies in an unspecified role as the Legislature moves forward on Gov. Sarah Palin’s gas line plan — a rewrite of Murkowski’s failed attempt. Read more

DOE study sees high North Slope potential

Source: Oil & Gas Journal

US oil reserves could more than double by 2050 if commodity prices remain high and leasing restrictions ease on Alsaka’s North Slope, according to a federal government study.

A detailed assessment of the North Slope by the Department of Energy’s Office of Fossil Energy says exploration and development might add 28 billion bbl of economically recoverable oil and 125 tcf of gas during 2015-50. Reserves for all of the US now are 21 billion bbl of oil and 211 tcf of gas.

The forecast assumes continued high oil and gas prices, stable fiscal policies, and access by the producing industry to all areas of the North Slope. Congress has not approved oil and gas leasing of the promising coastal plain of the Arctic National Wildlife Refuge.

During 2005-15, exploration of currently accessible areas will add about 2.9 billion bbl of oil and 12 tcf of gas, the study predicts.

Total reserves additions for the whole study period, including reserves growth in known fields, could reach 35-36 billion bbl of oil and 137 tcf of gas under the least restrictive set of assumptions, the study says.

“For this optimistic scenario, the productive life of the Alaskan North Slope would be extended well beyond 2050 and could potentially result in the need to refurbish the [Trans-Alaska Pipeline System] and add capacity to the gas pipeline,” the study says. A pipeline for North Slope gas production is not yet in place.

The forecast reserves additions decline with changes of key assumptions:

— To 29-30 billion bbl of oil and 135 tcf of gas if the ANWR coastal plain is removed from consideration.

— To 19-20 billion bbl of oil and 85 tcf of gas if the Chukchi Sea Outer Continental Shelf also is removed.

— To 15-16 billion bbl of oil and 65 tcf of gas if the Beaufort Sea OCS is added to the removal list.

— To 9-10 billion bbl of oil if all those areas are removed and no gas pipeline is built.

Governor Sarah Palin Stands by AGIA Process

Alaska governor Sarah Palin released a statement Saturday expressing her belief that AGIA is on track and that she has spoken to Conoco about their alternate (and unqualified) proposal - despite president Jim Bowles’ inference that she hasn’t.

Jim Bowles has been a controversial figure in Alaska's oil politics.

Bowles' name came up on June 6, 2006 during the Pete Kott corruption trial. With the state House of Representatives on the verge of adopting a new 23.5-percent tax on oil production, convicted oil company bagman Bill Allen placed a phone call to Bowles. The FBI recorded every word.

From governor Palin's press release: Governor Sarah Palin today responded to claims made by ConocoPhillips regarding the State's rejection of the company's natural gas pipeline proposal, which was submitted outside the AGIA process."AGIA sets forth a vehicle that delivers North Slope gas to market with certification and construction benchmarks, expansion provisions, tariff terms, and other protections the state, and the nation, need. It is unfortunate that ConocoPhillips elected not to participate in this sensible competitive process as did other fine companies."The Governor also clarified that the state has never refused to work with ConocoPhillips on a mutually beneficial plan to get the producers' gas into a pipeline to market.

Governor Palin on Wednesday spoke with ConocoPhillips president Jim Bowles about this issue.

"While the ConocoPhillips' alternative obviously falls outside of AGIA's terms, we have long sought a way for ConocoPhillips to work with the state and the AGIA licensee toward a mutual goal of getting ConocoPhillips' gas into a line to market. We have had several discussions along these lines, and will continue to do so. Statements to the contrary are simply untrue, and only serve to confuse Alaskans."

Source: The Alaska Report
January 26, 2008

Conoco responds to Palin

Source: KTUU

Conoco Phillips has fired back a letter to Gov. Sarah Palin in response to her rejection of their gas line proposal.

In the letter the company said it is surprised and disappointed by Palin’s negative response.

It goes on to say that Conoco Phillips feels the governor has an apparent misunderstanding of what it really takes to economically support a pipeline - and asserts its proposal, though outside the Alaska Gasline Inducement Act is the best option.

In the letter, Conoco Phillips Alaska President Jim Bowles urges Palin and her administration to meet with his company to discuss the options. Including new fiscal terms the company feels would work well.

“We’ll remind Alaskans that we’ve met many, many, many times,” Palin said. “I’ve met with Jim Bowles. Our gas line team has met many, many times. We’ll continue to do so, so that aspect of the letter kind of caught us off guard.”

Conoco Phillips’ letter to the governor is available here.

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