Alaska Governor Parnell Reveals Details of Proposed Large-Diameter Natural Gas Line
JUNEAU — The proposed large-diameter natural gas pipeline will be 42 inches in diameter, run about 800 miles, have five take-off points for in-state use and will cost between $45 billion and $65 billion.
That’s according to a letter signed by North Slope producers and TransCanada in response to a deadline set by Gov. Sean Parnell to select concept design for a large-diameter natural gas pipeline.
Speaking to the Fairbanks Economic Development Corp. annual investor luncheon, Parnell called the development a critical next step in bringing Alaska’s natural gas to market. The event was broadcast live on the Internet.
“It’s very good news; it’s the first time in the state’s natural gas history that the companies who can build, fill and operate a large-diameter pipeline have come together and selected a pipeline concept,” Parnell said.
It was what the letter was missing — the route of the pipeline, where it meets tidewater and where the take-offs would be located — that left some lawmakers and pipeline experts dissatisfied with the announcement.
“I want to know where the endgame is,” said Sen. Click Bishop, R-Fairbanks. “There’s a lot of gas so maybe Valdez will be the terminus, but at 800 miles, it could be Point MacKenzie or Valdez.”
Last year, TransCanada and Exxon said it was considering 22 possible endpoints, including Cook Inlet, Prince William Sound (including Valdez) and other places in Southcentral. It was hoped Friday’s announcement would have settled it.
“I’m still cautiously optimistic,” Bishop said. “I’ve been down this road before. We’ve all been down this road before. I’m truly enthused that the producers and TransCanada have met the governor’s goals and that they’re in lock step.”
Bill Walker, the general counsel to the Alaska Gasline Port Authority and vocal advocate for a large-diameter pipeline ending in Valdez, had harsher words about the announcement.
“There’s no announcement to do anything,” he said. “There’s so much that’s not said that it’s sad. This is what we’ve been waiting for?”
Walker said the pipeline announcements are generic to the point of telling Alaskans practically nothing. The letter also lacked an update on the project timeline or the market for gas.
The letter details a 42-inch pipeline with a capacity of between 3 billion to 3.5 billion cubic feet, will run 800 miles and will require up to eight compressor stations. It calls for a 150- to 250-acre treatment plant on the North Slope and five off-takes for in-state gas usage.
As far as an export terminal, it does say such a plant will require between 400 and 600 acres, two 160,000 cubic meter storage tanks and one loading jetty with two berths.
The letter, which is signed by Exxon Mobil, ConocoPhillips, BP and TransCanada, also makes mention of gas and oil taxes, a contentious issue of the session and one of Parnell’s top priorities.
“As outlined in our October 1, 2012, report a competitive, predictable and durable oil and gas fiscal environment will be required for a project of this unprecedented scale, complexity and cost, to compete in global energy markets,” the letter states.