"Nothing goes ahead until Exxon is happy with it."

More details came out this week outlining the agreement between TransCanada and ExxonMobil for work on the Alaska Gas Pipeline. (Link to Alaska House Resources Committee Meeting Documents).

High points from the TransCanada presentation:

• TransCanada (TC) and ExxonMobil (EM) have reached agreement to work together to progress TransCanada’s Alaska Pipeline Project
• Immediate EM participation and project support
• TC / EM will jointly advance all aspects of the project–technical, commercial, regulatory, financial, etc.
• EM contributing prior study results, existing Alaska ROW data
• TC Alaska and Foothills remain the AGIA Licensees
• AGIA rights / obligations are unchanged and remain with Licensees
• EM is ready to work with the State to enable full participation in the AGIA license
• Project Schedule unchanged- Initial Open Season target completion by July 2010
  
• AGIA Project Scope unchanged: GTP and pipeline from Prudhoe Bay to Alaska delivery points, LNG via Valdez, or Lower 48 markets via Alberta Hub.
• TC / EM will also advance an upstream gas transmission pipeline from Point Thomson to GTP to be included in the Open Season Outside of AGIA project and ineligible for AGIA reimbursement
• Current TC / EM alignment not contingent on any commitments by State
  
• TC can progress project independently, if it so elects, using all jointly developed assets /

Almost everyone gets what they want, the notable exception being CononcoPhillips and BP - (Link to the Denali Pipeline progress report).

TransCanada gets Exxon gas, Point Thomson gas, Exxon data, Exxon cost sharing and upto $500 million AGIA cash for project development. Exxon gets into the AGIA process, benefits from the AGIA cash and transforms the entire project to serve their needs.

TransCanada chief executive officer Hal Kvisle inadvertently coined the project motto when he said "Nothing goes ahead until Exxon is happy with it." Every future hurdle should be measure by the Exxon happiness metric.