Data Dump and Walker Talk

This week the Alaska LNG project submitted a series of draft environmental and socioeconomic reports to the Federal Energy Regulatory Commission (FERC).  FERC is responsible for conducting the environmental review of the project.

You can find the files at the FERC elibrary site (FERC LINK) and search docket number PF14-21:

 

I'm still downloading and sorting through the documents - so far I don't see anything shocking or new but I'll post any snippets of interest.

Other project news of interest: Gov. Bill Walker  and his team are in New York explaining how they will manage through the current dip in oil revenues. (LINK to Alaska Journal of Commerce).  Whatever misgivings Gov. Walker may have about the project it is now his job to promote the project and represent the project as a source of future revenue.  We should all wish him good luck on his mission to protect the State's bond ratings.  Those ratings play a huge role in the cost of capital to build the project.  At today's low interest rates no one talks much about financing the project, but stay tuned - the day will come when interest rates matter a lot and the date of first revenue matters a lot. 

Speaking of Gov. Walker's misgivings, this week the Governor spoke to lawmakers and indicated in a conditional sort of way that he would drop his Point Thomson lawsuit  (Alaska Dispatch Link) and quote from Alaska Dispatch story: 

Walker said he will move to dismiss his lawsuit after introducing legislation Friday intended to address his concerns.

We'll see what he expects to get out of this legislation but the story in Juneau should flange up with the story in New York. (LINK TO GOV. WALKERS COMMENTS) 

Finally here's a link to an editorial from my favorite Okie Boone Pickens (FORBES LINK) "To Kill A Pipeline...Or Two: The Sad Reality Of Obama's Energy Thinking"  Boone may be an Okie but understands that Obama's Alaska wilderness plans can will kill Alaska oil.  It's off topic for this Alaska LNG project blog, but what's bad for TAPs is bad for LNG too. 

Boone Pickens on CNBC

I follow T. Boone Pickens because his plan will boost gas sales, increase demand and by extension boost gas prices back to a range that will support development of the Alaska Gas Pipeline.

Today Pickens ranted a bit on CNBC (LINK) today. Aside from his remarks about OPEC funding the Taliban and disparaging remarks about the Koch brothers he also attacked the idea of exporting LNG from the U.S., specifically from Cheniere.

By his logic we are importing dirty oil and exporting clean LNG.

I take issue with this - First we import oil, refine it and use it, but we also export refined products (about 450,000 bbls/day) - good lets build our export economy. Secondly we import a lot of high sulfur "dirty crudes". Many of our refineries are designed and tuned to run on these less expensive feedstocks - another good thing let's use technology to exploit the full range of available feeds. Third - I'm all for exporting U.S.A LNG - it will sponge up excess lower 48 shale gas, boost our economy and help build price support for the Alaska Pipeline.

Speaking of sponging up cheap shale gas - I think the free market is catching on to the idea of converting to cheap gas. Follow this link to see all the CNG fueling stations. It's still early days, but CNG may be the breakout alternative fuel.

The Nat Gas Act

External events may drive construction of the Alaska Gas Pipeline. The NAT GAS Act, pushed by oilman Boone Pickens is gaining momentum in Washington. The proposed law provides incentives for converting vehicles to compressed natural gas. (LINK: Natural Gas Vehicles for America).

Converting vehicles to natural gas will reduce demand for foreign oil and increase demand of domestic gas. Even the President says he endorses the plan (LINK).

If this measure passes, the price of natural gas may climb back to the $5 to $6/MMBTU range and justify construction of the Alaska Gas Pipeline.

Exporting LNG from North America may sponge up additional excess gas supplies (LINK) and help close the unit cost disparity between natural gas ($4/MMBTU) and crude oil ($18/MMBTU).

Natural gas vehicles, LNG export, and gas fired power generation will combine to redefine the energy equation in North America and maybe, just maybe help justify the Alaska Gas Pipeline.