Tuesday, February 24, 2009

FERC Reports to Congress

(LINK) Quote:

Two proposals for an Alaska natural gas pipeline from Alaska’s North Slope into Canada have emerged and advanced to the detailed planning and project development stage. At this point in project development, both Denali and TC Alaska are now fully working towards obtaining quality information to conduct their respective open seasons (the formal process to obtain shippers for their pipeline).

In this commercial development stage of the process, both Denali and TC Alaska are expected to keep most of their information and decisions internal, yet they will also continue to work with, and inform, various levels of government, other stakeholders, and the public about their projects.

The Commission stands ready to do its part and reminds all stakeholders that construction and operation of an Alaska natural gas pipeline is the ultimate goal.

Pt. Thomson Update

Some leases are still in jeopardy as Exxon moves forward with work at Pt. Thomson. (LINK)

The state maintains that, on most of the leases, the companies have breached their contractual obligation to develop and that exploration and development rights are terminated.

"Exxon has two leases. That's it," Banks said. (acting director of the Alaska Division of Oil and Gas.)

Irwin has yet to make a final ruling on the administrative appeals to keep the other leases, and the earliest he would decide would be April, Banks said. In all, the companies filed eight administrative or legal challenges to the state decision to terminate the Point Thomson unit and cancel the leases.

Monday, February 23, 2009

Obama In Canada

Here's the transcript of the Obama/Harper press conference. (Link).

No mention of the Alaska Gas Pipeline that Obama once called "Promising" and that he claimed he would "Prioritize"

Sunday, February 22, 2009

Natural Gas Rig Count Drops

The number of rigs drilling for natural gas has dropped by about 25% since the 2008 high.

(LINK at Bloomberg). See the raw data at Baker-Hughes.

What does this mean to the Alaska Gas pipeline? - not much in the short term, but it will increase spot gas prices building the case for the pipeline. On the flipside drilling in the lower 48 is easier to ramp up if and when natural gas prices increase.

In the game of being first-ist with the most-ist a firm Alaska Gas Pipeline project could suppress lower 48 drilling programs. This would increase gas prices on the front end of the pipeline project and improve the economic performance.

The Bloomberg article points to lower rig counts out to 2012.

Wednesday, February 18, 2009

Denali Starts Work in Canada

From the Financial Post: (LINK)

CALGARY -- The U.S. pipeline group competing against TransCanada Corp. to build the Alaska natural-gas pipeline is cranking up operations in its rival's backyard, with plans to start field work here this winter, expanding its staff and recently opening its own office in Calgary.

"We're starting field work [in Canada] this winter," said Bob Bleaney, Denali Canada's general manager, integration. "It hasn't started yet, but the planning work is underway here in the offices. The groundwork will commence a little later on this winter."

Monday, February 16, 2009

Natural Gas Value

Here's a link to a Chesapeake Energy presentation on their natural gas projects in the lower 48. It makes good reading and puts the value of Alaskan natural gas in perspective.

Here's the short version: There are lots and lots of new large scale natural gas plays in the lower 48 :Haynesville, Marcellus, Fayetteville and Barnett shales.

The upside: Natural gas will experience increase demand as all things coal are demonized in the new world order.

Perspective / Opinion: There's still a role for Alaskan Natural gas. Current shale gas production is 600 bcf/yr (1.6 bcfd) (data source) vs. 5.0 bcf/d for the Alaska Gas Pipeline (data source).

Saturday, February 14, 2009

A Pipeline Prioritized

Back in November I wondered about Obama's level of support for the Alaska Gas Pipeline (link).

Also - the phrase "Prioritize the Construction of the Alaska Natural Gas Pipeline" could mean placing the Alaska Gas Pipeline at the bottom of the list. What's wrong with saying "Build the Alaska Natural Gas Pipeline"?
I haven't found any evidence that the "Priority" given the Alaska Gas Pipeline was a very high one. (LINK to Stimulus Bill Text)

I'm a huge fan of private enterprise. Government, including anti-industry Republicans, should keep their noses out of the way of people who create real jobs and real wealth. I'm not suggesting for a moment that the stimulus bill should have shoveled money at the gas line project. It's important to note that when Obama had a very long very expensive list of projects - the Alaska Gas Pipeline got stiffed. No loan guarantees, no funds for training the next generation of craft and engineers.

Note to self - This guy parses his words and he's no friend of the Alaska Gas Pipeline.

What's next? - Well I doubt Obama will do anything that would benefit Alaska and by association reflect well on Sarah Palin. The stimulus bill is rumored to have slashed military construction and spending on our veterans - Essentially shutting off the gusher of Federal money that Uncle Ted was so adeptly provided for years.

Note to Sarah: Good luck - Red State, three votes in Congress, possible rival in '12. Yep - you've been served.

Wednesday, February 11, 2009

Engineering Firms Hired

The Denali Pipeline awarded the first major contract to Fluor-WorleyParsons-CH2M Hill:

Read more at their website (LINK)

Scope: Design Phase of the Gas Treatment Plant:

The contract covers the services required during the initial design phase of the project for the GTP. Major contract elements include a series of technical studies, development of the project design basis, project execution planning, cost estimating, schedule development and other services.
Dollar value: Unknown.

Good work Denali - Putting engineers to work to get the pipeline built.