Saturday, March 28, 2009

The Pitch for more Alaskan LNG

Could the All Alaska Gas Pipeline to Valdez be the option that works?

The Alaska Journal of Commerce posted an opinion article by Bert Cottle (LINK). Bert Cottle is the Chairman of the Alaska Gasline Port Authority.

Mr. Cottle's article lays out the top reasons we need to build the All Alaska gas line now.

It's true that the delivered cost of LNG is greater than pipeline gas, but the market for pipeline gas is restricted to the pipeline system. LNG can be marketed anywhere.

In addition to Mr. Cottle's reasons, let me add a few more:

1) The All Alaska option keeps control of project in American hands. I'd hate to see a gas line to the lower 48 get tangled up in the Canadian regulatory system and courts for decades like the Mackenzie Pipeline. You'll note there is no third flag in the photo at the top of this blog.

2) The All Alaska option is less expensive. Crooked bankers get billions from the Government for producing nothing but a mess. The oil industry funds our projects from revenues earned the hard way. I'd rather see a less expensive pipeline built now than wait a couple of decades for a larger project.

3) Building the All Alaska gas line to Valdez would support the future big line to the lower 48 (or tar sands). The project would complete environmental studies, build roads, treatment plants and train a workforce for work in this environment.

4) Finally - As that great philosopher Mickey Gilley said "All the girls get prettier at closing time" With Henry Hub natural gas prices below $4/MMBTU all Alaskans had better wake up and realize it's getting close to closing time for the gas pipeline. An LNG tanker steaming out of Valdez looks pretty good to me.

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