Oil and gas giants look to build pipeline from northern Alaska to BC border.
July 31, 2012
by The Canadian Press
ANCHORAGE, Alaska: TransCanada and ExxonMobil say they are conducting a public process to determine the level of customer interest in a potential new pipeline—the Alaska Pipeline Project.
The large oil and gas pipeline companies say they want to gauge interest in securing capacity on the pipeline that would transport gas from Alaska’s North Slope to a gas liquefaction (LNG) terminal in Alaska, or the border of BC and Alberta.
The process will take place Aug. 31 to Sept. 14.
It will be conducted in accordance with the Alaska Gasline Inducement Act, which requires TransCanada to assess market interest in the pipeline every two years after its first open season.
All of the options for the pipeline provide for a minimum of five delivery points for local natural gas connections in Alaska.
TransCanada has said that as low prices cause conventional Western Canadian producers to slow production, sources from areas like Alaska are necessary to supplant those volumes in the North American market.
TransCanada floated two options when it proposed to build its Alaska pipeline. One would run south to Alberta and connect with its North American system.
The other would end up at the port of Valdez, Alaska, where the gas would be chilled into a liquid state, enabling it to be transported across the Pacific to Asia by tanker.
When TransCanada and partner ExxonMobil Corp. launched their open season to gauge customer interest two years ago, the cost estimate of the Alberta option was US$32 billion to US$41 billion, and the Valdez option was between US$20 billion and US$26 billion.
Both would be in service around 2020.
The three major natural gas producers in Alaska are ExxonMobil, ConocoPhillips and BP.
TransCanada has so far not been involved in LNG—proposals to import the fuel into Quebec and New York in recent years didn’t pan out—but ConocoPhillips, BP and ExxonMobil have extensive experience building liquefaction terminals around the world.
There are also a number of proposals to build liquefied natural gas terminals on Canada’s West Coast to move gas from prolific B.C. shale formations to market.
The furthest along is one planned for Kitimat, BC, on the northern coast. US producer Apache Corp. would operate it with its partners, Canadian natural gas giant Encana Corp. and US firm EOG Resources Corp.
©The Canadian Press