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Reporter’s notebook: Point Thomson tour

By Rhonda McBride Photojournalist: Rachel McPherron - 2:46 PM August 2, 2014
POINT THOMSON –

Reporters have asked to see Point Thomson for a number of years. Ever since the natural gas reservoir was discovered in 1977, it has been a field of dreams, holding one of the richest untapped sources of gas in North America.

But Point Thomson has long been mired in controversy and legal wrangling between the state and ExxonMobil over the pace of development of the company’s leases.

When the oil company began in earnest to develop the reservoir in 2009, interest in Point Thomson grew. Yet glimpses of the work going on there have been highly controlled, especially where the general public is concerned.

Exxon has occasionally released a few photographs of the work and provided Anchorage television stations some aerial footage–but otherwise, Alaska’s media has had no access to Point Thomson.

But just 20 days before the August primary and the vote to repeal Senate Bill 21, last year’s oil tax reform, Exxon flew a group of reporters to Point Thomson for a tour. A first.

Kim Fox, the public and governmental affairs specialist for ExxonMobil Alaska, said there was no connection to the vote on the referendum. She said the media tour had been in the works for a long time. One of the holdups, she said, was the lack of an airstrip. Also, a system of safety procedures to host visitors, such as journalists, wasn’t in place.

But on Thursday, Exxon was clearly ready for us. Reporters from the Alaska Dispatch News, the Fairbanks Daily News-Miner, two Anchorage TV stations and a national news outlet, EnergyWire, were all on board a Rav’n Air charter.

I must say the highlight of the plane ride was the flight attendant, Diane Ross, who gave the most entertaining announcements I’ve ever heard.

Ross, an Alaska Native from Aleknagik, kept us laughing, cracking jokes as she took to the microphone. This is one of the few times I’ve actually listened to everything a flight attendant has had to say.

Only in Alaska.

I guess it’s a reminder that we live in an amazing state and what an honor and a responsibility it is to be the public’s eyes and ears for a project like Point Thomson.

For the last few decades, it’s been like a promised land, one the best hopes for getting Alaska’s stranded natural gas to market.

From the air, we could see Point Thomson rising up from the flatness of the marshy ground below.

It was slightly overcast and windy but still a powerful first impression.

Nate Sanborn, Exxon’s project manager for the Point Thomson project, remarked on the landscape.

“The most exciting part for me is just to be on the north coast of Alaska,” said Sanborn. “It’s been very exciting just to see the beauty of Alaska on the North Slope.”

The Brooks Range is off in the distance, about 60 miles away. The silty waters of the Beaufort Sea lap at the shore.

It is a grand, quiet beauty. But unfortunately for us reporters, there wasn’t much time to experience it. In fact, there was no time in which we were alone or unsupervised. We were driven from place to place on a bus. We saw only what Exxon wanted us to see. In essence, this was a staged media event. Then again, that’s not unusual for a corporate tour.

I don’t want to sound ungrateful. I know our hosts went through a lot trouble to make this trip go smoothly. Given our modern world of corporate realities, they were limited to how much free reign they could give us, so we saw only a small part of the picture. Despite the limitations, we managed to see a lot.

We arrived at about lunchtime and were whisked to the cafeteria, treated to a fully loaded buffet.

I had halibut, salmon and a big helping of Caesar salad on my plate. Now I understand the oil patch’s reputation for good eating–and Point Thomson is no exception.

Next, a safety briefing. I put on a pair of brand new, steel-toed boots as I listened to the instructions. The boots were a requirement for visiting Point Thomson. We were given hard hats, bright orange safety vests as well as safety glasses.

Throughout the tour, Exxon emphasized its culture of safety. It was impressive. We saw several examples of steps taken to protect employees and the environment. Exxon takes pride in the fact that pipelines built as part of the Point Thomson infrastructure are seven feet above the ground to protect the caribou.

It’s sometimes hard for Alaskans to reconcile the company’s history in our state with the present. Over the years, I’ve heard from people who work for Exxon and other industry observers about the impact of the 1989 Exxon Valdez spill. They say the company did a lot of soul searching in the wake of the spill, and the legacy is the company’s almost obsessive attention to detail.

And the logistics of working a field like Point Thomson is no small task.

It’s one of the most highly pressurized reservoirs in the world. Pressure is maintained at about 10,000 pounds per square inch.

Steve Butt, Exxon’s manager of the Alaska Liquefied Natural Gas (LNG) Project, compares the force of the pressure to balancing two pickup trucks on the point of your finger. Another way to look at it: the tire on your car is inflated to 30 pounds per square inch.

Despite Point Thomson’s relatively small footprint–about 55 acres built upon layers of gravel–more than two million cubic yards of the stuff was hauled from a mine on site to give the infrastructure a foundation.

When you look at photos of the site taken a couple of years ago and compare them to today, the transformation is amazing. It went from nothing to almost a small village, with an airport, a barge landing, permanent living quarters and four giant diesel tanks, which hold more than two million gallons of fuel. The tanks and just about everything else had to be barged up here during a short window of open water.

At the heart of the development are two wellheads, painted blue, which stick out of the ground. To the uninitiated, they really don’t look all that impressive.  But they’re the rock stars of the reservoir.

“We’re standing basically on the Point Thomson reservoir, which holds about 8 trillion cubic feet of gas,” said Sanborn.

So how much gas is that? About 25 percent of the known gas reserves in Alaska. Or as Sofia Wong, pipeline and infrastructure manager for Point Thomson puts it, it’s enough gas to heat all the homes in Alaska for about 90 years.

The Federal Pipeline Coordinator’s office says there is potentially enough gas to keep a proposed natural gas pipeline from the North Slope to Cook Inlet full for about five years.

Numbers at this point seem to be the best way to grasp the magnitude of Point Thomson.

About 1,200 workers were employed during the winter season. And approximately 900 were employed during the summer. Exxon expects to increase hiring next year.

Although Senate Bill 21, the oil tax policy the oil and gas industry is fighting to save, did not come up in any of the Point Thomson presentations, we were introduced to contractors who told us they have benefited from the work.

“On this project alone, we’ve had over 350 employees this last winter on this project,” said Warren Christian, president of Doyon Associated, a subsidiary of a Fairbanks-based Native corporation.

Doyon Associated built a 22-mile pipeline from Point Thomson to the Badami, field, which lies west of the reservoir.

“We’ve infused over $100 million into the Fairbanks economy,” said Christian.

The pipeline will deliver condensates, a liquid that is stripped out of the gas, similar to diesel.

In a few years, Exxon hopes to produce 10,000 barrels of condensate a day. At today’s prices, that would be worth  about $1 million a day. It would be the largest volume of condensates ever produced on the North Slope.

The 12-inch pipeline to Badami has a capacity for 70,000 barrels, so it’s possible for Exxon to gradually boost production. Or if offshore oil development comes to fruition, the pipeline could play a role in that.

From Badami, the condensates will be routed to the Trans-Alaska Pipeline System, where they will be mixed with oil and sent down the pipeline.

“To me, Point Thomson is a double win for Alaska, because it provides both the natural gas we need for the LNG project,” said Wong. “And it also increases the throughput for TAPS.”

Wong said there’s another benefit. Tapping the condensates will give engineers a chance to learn more about the how the reservoir behaves for future gas drilling.

So how much is 10,000 barrels? Not enough to make a real dent in filling the pipeline. But Sofia Wong says it’s enough fuel for a car to drive around the world 55 times.

The numbers aren’t the only thing that get your attention. It’s the thought process here–even something as unglamorous as the giant white, gravel-filled Kevlar bags that line the shores of the Beaufort Sea.

Randy Greenway, who oversees construction at Point Thomson for Exxon, said the boulder-sized bags are used to fortify the shore against storm surges.

“This is our protection. It protects our gravel from washing away,” said Greenway. “It’s just a big wall of armor. The water can hit it all day long, and it won’t erode away.”

Almost 5,000 bags have been filled with gravel. They also have a strap attached so they can be moved around if needed.

Besides the gas, it’s the spirit of innovation and problem-solving which seems to be an important byproduct of an endeavor like this. As some of these strategies and ideas are exported to other projects across the state, Alaskans will benefit in the long run. They’ll also benefit from having a work force steeped in a culture with a creative mindset.

Speaking of innovation…

The pipeline that Doyon Associated built to Badami posed some unique challenges that had to be solved.

The gas at Point Thomson is loaded with highly corrosive carbon dioxide and requires different pipeline welding techniques.

Doyon teamed up with the Fairbanks Pipeline Training Center to develop new welding procedures.

“It’s cutting edge technology that’s never been used here on the North Slope before,” said Doyon’s Warren Christian. “It’s going to allow for higher strength steels to be welded cross-country up here, so it’s going to allow for more opportunity.”

And from pipes to polar bears…

The bears are due to arrive any day now. And when the weather gets bad, it’s hard for safety patrols on the ground to spot them.

Exxon developed a way to use radar and surveillance cameras to see them in dark and stormy weather.

Dr. Chris Warren, who oversees wildlife issues at Point Thomson, doesn’t think there’s a system like this anywhere else. He believes this solution arose out of Exxon’s focus on safety.

“I see this as one more tool that we’re implementing here that’s helping to keep everyone safe,” Warren said.

The airport control tower was our last stop on our whirlwind, three-hour tour. There, we met a Juneau contractor, Mark Morris, owner of Morris Engineering.

Morris has spent most of his career troubleshooting for airports in Southeast Alaska. Although they operate in a radically different climate than the North Slope, they have some of the same problems as Southeast, including dealing with bad weather and poor visibility.

Morris said he applied a lot of what he learned in Southeast to Point Thomson. He engineered the runway lighting so it could be boosted while also meeting FAA standards.

He said it won’t be long before wintry, unpredictable weather sets in, but pilots landing at Point Thomson will have some of the brightest lights of any airport in Alaska.

“It’s like following a yellow brick road,” Morris said.

There will be even more difficult problems to solve, if Exxon and its partners, including the state, decide to move forward on an LNG project — which will require between $45 and $65 billion to build a gas treatment plant on the North Slope and an 800-mile pipeline to the Kenai Peninsula, where another facility will be built to convert the gas to liquids, so it can be shipped in tankers to ports all over the world.

At this stage, Exxon expects to spend about $4 billion on Point Thomson, the first step in a long journey. And where it ends depends on so many factors beyond Alaska’s control.

When you look at the wellheads, it’s a lot like seeing the tip of two icebergs. Who knows what lurks underneath?

The few hours that KTVA photographer Rachel McPherron and I spent at Point Thomson raised more questions than answers — the sense that the more you know, the less you really know.

Still, it’s exciting to visit a place that could be the prologue to an even bigger chapter in Alaska’s history.

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