Latest in-state pipeline plan raises questions about gas supply, consumer cost
Published Tuesday, July 8, 2008
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Stumble It!If there is a reason for Fairbanks to support a small-diameter gas pipeline from Fairbanks to Anchorage via the Richardson and Glenn highways, the proponents did not provide one Monday.
Instead, they justified the longer route with vague comments about development of Ahtna lands that might have natural gas potential — an uncertain prospect at best — and providing natural gas to the missile defense system.
Neither of those ideas warrants going the long way around and the extra hundreds of millions, including an unknown state subsidy, that would be required.
We need to hear far more from the Palin administration, as well as from Enstar and the Alaska Natural Gas Development Authority before this largely undefined “partnership” goes ahead.
And the Palin administration should make sure it is not advertising more than it can deliver, pledging “the first phase of a bullet line to bring Alaska gas to Alaskans within the next five years.”
The shortest distance between two points is a straight line. In this case, the straight line is more or less along the Parks Highway, not the Richardson and Glenn highways.
With a state subsidy in the offing, the long route needs a better defense than was offered Monday by the governor.
Also unclear from the announcement is where the gas would come from, who would pay for the construction and what the costs would be to get gas to Fairbanks within the next five years.
The idea advanced by the governor is that by building from the south to the north, this plan would spur Cook Inlet and Copper River basin exploration for gas and by 2013 gas from down south would be heating homes in Fairbanks.
But there already is a shortage of gas in Southcentral that is expected to get worse in the years ahead. A year ago, the state said Cook Inlet natural gas production was expected to drop 64 percent by 2015 and continue to slide in the years after that.
Adding to the confusion is the suggestion from the administration that by 2014 the small-diameter gas line might continue north to the foothills of the Brooks Range, allowing gas to flow from north to south to supply Fairbanks and Anchorage.
As I write this, I am awaiting enlightenment as to just how gas will flow north for a little while and then south. That doesn’t sound like much of an incentive to encourage further Cook Inlet exploration in an era when many projects are competing around the world for exploration dollars and the highest possible return.
The governor’s news release said the idea of building a line to the northern foothills of the Brooks Range, from which gas would be shipped south, is only one possibility.
The governor’s news release said the state “hopes to see new discoveries of natural gas within the Cook Inlet basin and along the in-state pipeline’s corridor” within the next five years.
“If not, the project’s second phase could continue building the line north to access gas supplies in the North Slope foothills or beyond, making them available to Interior and Southcentral Alaska by 2014. If phase two is not needed, the in-state line could be connected to the main North Slope line when it is completed around 2018 to 2020.”
None of that explains why the Richardson and Glenn highways route was chosen.
The state plan leaves out the Doyon prospects in the Nenana area, which, by all accounts, seem to be moving ahead and hold great promise.
At this point, I am more impressed with the original Enstar proposal, which the state said a few weeks ago was still under study. That proposal was to build a pipeline in about the same time period and ship gas south from the foothills, recognizing Cook Inlet supplies are in decline. There was no plan or need to ask for a state subsidy, Enstar said at that time.
We need a better explanation of the logic behind this proposal and, just maybe, a shorter route.
Community Discussion
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Good comments and questions Mr. Cole. It just might be interesting to look into whose rights of way would be used for this round about bullet line north. Remember that Governor Hickel and other powerful Alaskans put together the Yukon Pacific Corporation which in turn obtained certain rights of way for a gas line along parts (if not all) of the route now proposed by Governor Palin. I beieve there was a review of the YPC Trans-Alaska Gas System Permits prepared for ANGDA in August of 2004 that might help you review some of the data. You can find it and other interesting information on the internet. You may remember that Governor Hickel put his 12% share of YPC in a charity or charities that he and his wife control when he ran into an embarrasing state ethics investigation. Well - ever since that time, CSX - the major shareholder of YPC - and the other shareholders have been trying to monitize their permits. For example, the Port Authority spoke of purchasing those YPC permits for millions in order to build one of their varied projects. Could it be that this newly proposed bullet line route is not a coincidence? Could it be that there was some kind of a back room deal with ANGDA/Enstar to purchase these YPC rights of ways and permits so that CSX, Hickel, et. al. can finally get their hands on some easy cash with a state subsidy rolled in? There is an easier route, as you pointed out, that follows the electric intertie between Fairbanks and Palmer. GVEA did all the environmental studies when the intertie was built. It is hundreds of miles shorter. And each additional inch of pipe raises the tariff portion of the price paid by the end user (Fairbanks at this time). You have a reputation for looking into the dark crevasses and finding the truth. Dig a litle more.
Um, the Parks Highway straight line route would have to go through Denali National Park. Put on your logic hat.
Don't kid yourself, this line if built is for Anchorage and surrounding areas. Remember what another article said, 50 miles of gasline in Fairbanks now and any additional would cost $200,000 a mile or 1 million every 5 miles to get gas to homes. What would the final cost be for this community and who would pay it. It will be a cold night in you know where before Fairbanks ever sees gas.
Nowdays the mapping capabilities of the internet makes calculating ROW's easy while yer sittin' in yer sailboat in Hawaii. If you have a route in mind just post it on the net like I did in the slideshow.
I don't mind Wally Hickel finally getting some cash for his old efforts.
Wally is a visionary and generous with his plans..
he has a green thumb, give him some seeds and fertilizer and he'll fill your cornucopia...
...like who has he ever burned?... Richard Nixon??
poor tricky-Dick!
I'd be happy to help Wally lay some plastic pipe on his ROW so he can help some of his old girlfriends to stay warm in the winter.
Where's the gas gonna come from to fill the gaslines?
..the thing I like about shallow-gaslines is they're easy to roll back up and reuse elsewhere.
There's gas all over the place..
there's more gas leaking out of the ground between Salchaket Slough and ClearCreek Butte than most of the houses in Fairbanks need to keep warm in the winter...
but it will take many tons of little gas-gathering lines to collect it all..
Alaska could be the worlds biggest exporter of plastic pipes by now if Juneau didn't get lost on a half-baked squanderlust over the past 30years.
A top-notch plastics industry doesn't have to be big,ugly,and smelly.
A $100million LPG-propane 4" HDPE-gasline from Prudhoe can supply Fairbanks with all of the propane and ethane it needs for the next 100years.. and it will amortize itself in 6months, the rest is gravy for reinvesting in little gaslines all over Alaska.
A little CNG line can be run from Gubik to Anaktuvuk in a jiffy too.
...pretty soon everybody in Alaska will have their own gasline to play with... waterlines too.
I'm waiting for some real-players to drop me a note and start a meaningful dialogue, sorry I'm not a rich philanthropist, but there are angel-investors out there who might play along.
There's very little risk in this plan...
www.fairbanksgas.com
.....flash/rumble....crash/stumble....mash/fumble
FOOD FOR THOUGHT. If ENSTAR can not secure additional Cook Inlet gas from Marathon and ConocoPhillips for the 2009 - 2013 term, ENSTAR will have 2.1 Bcf shortfall come January 1, 2009.
ENSTAR's pre-construction estimate of for the Parks Highway route is $970 million and the cost from Fairbanks to the Foothills is and additional $2.3 Billion for a total project cost of $3.3 Billion for a 20" diameter pipeline.
And as far as the Denali National Park, why not follow the Alaska Rail Road easement? A buried gas line is less visually obstructive than a long train of tanker cars that make the trip about every day.
And for the Richardson / Glenn Highways route; let's start the spur line from Fairbanks-Delta-Glennallen-Valdez, too. That way we have all the military bases and ALASKANS in close proximity supplied with NS Foot Hills natural gas ASAP!!!
Now ConocoPhillips / BP "Denali" and TransCanada gas lines; if you want to get in on the action, you had better start laying your big 48 inch lines tomorrow.
I just don’t understand why we want gas in Fairbanks when there are better solutions to our energy problems. Long term we need electricity generated from water – hydropower. Midterm we need electricity generate from coal to offset the oil burned in North Pole. Short term we need money from the windfall the state is getting on our behalf to offset high energy costs.
Gas has little to do with the solution. We need electricity to heat our homes, light our lights, even warm our cars. Water, the fuel for hydropower, is free, renewable and pollution free. Oil, gas and coal, cost an ever increasing amount of money, pollute our air and are not renewable. We would be better off selling our fossil fuels to the highest bidder. They are far too valuable to burn in Fairbanks, when we are so rich with hydro potential.
I have no real problem building a gas line to the lower 48 or Valdez for the income it would produce. But our state is having a hard time figuring out what to do with the billions they are receiving now. We don’t need more billions anytime soon. There is no need to rush, or subsidize a gas line. Let it happen. Let the private sector do it.
Do provide us our fair share of the billions in surplus now. Do finish the Healy Clean Coal Plant that we have invested nearly $300 million on. Do build the Sustina Dam that we have invested $150 million on. Get them going now.
Fairbanks don’t need no stinkin’ gas.
Steve, finally someone with a little long range thinking. I have said for years, there is NO market in Fairbanks for gas. The cost of getting it here FAR out weighs any profit avaialble. And burning natural gas is the least profitable use of the gas. Feel good programs just get people re-elected, that is all that matters to them...and they are in charge.. stay warm...
Right on Dermot, but you neglected to mention the fish in Juneau and Los Anchorage. The Flounder buisness that is. If you look at how the legislature, with emphasis on the southern part of the state, and how it has responded to needs in the North Star Bourough you are reminded of a newly caught Flounder on the deck of the boat flopping about. And that is about all it does is flop about. This crisis has been going on for some months and still there are no real solutions or proposals. I can see them flopping about, wringing their fins, and hoping they can keep the flip flop game going until after the elections.
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