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Northern Gas Pipelines is your public service 1-stop-shop for Alaska and Canadian Arctic energy commentary, news, history, projects and people. It is informal and rich with new information, updated daily. Here is the most timely and complete Arctic gas pipeline and northern energy archive available anywhere—used by media, academia, government and industry officials throughout the world. Northern Gas Pipelines may be the oldest Alaska blog; we invite readers to suggest others existing before 2001.

 

May 2010 Archives

Mackenzie Good For Canada - President Obama Squeezes Domestic OCS Exploration and Production - Shell Stands By Alaska

28 May 2010 8:41am

Vancouver Sun by David Finlayson.  The economic benefits of the Mackenzie Valley gas pipeline will far outweigh the cost,NWT Premier Floyd Roland attends a luncheon at the Edmonton Chamber of Commerce on May 26, 2010.and it must move ahead quickly or lose out to the rival Alaska project, Northwest Territories Premier Floyd Roland (Photo: Jimmy Jeong) said Wednesday.  The 1,220-kilometre pipeline from Inuvik to the Alberta border has as much potential to boost the economy as the railways that opened up Canada, and the Hibernia offshore gas field in the East, Roland told Edmonton Chamber of Commerce.

President Conducts Successful Press Conference

27 May 2010 1:36pm

President Obama conducted an effective press conference (at this writing) in that he was well studied on BP and federal government responsibilities and responses.  He was articulate and patiently answered probing questions.  He took on the role of, "the adult in the room".  He set forth a series of lease sale and exploration delays and access withdrawals to OCS areas that could later be viewed as a tragic and unjustified overreaction to the GOM events.  In particular, suspending Shell's Alaska program is illogical, infair and damaging to the state and the country.  Suspending activity for even a short time could well derail this entire summer's exploration program and put Shell's investment at ultimate risk.  Since the U.S. has no intention of curtailing its use of oil and gas, it is to the benefit of American consumers that all effort be applied to stop the damage, clean up the damage, compensate the appropriate people and institutions for their damages, understand what caused the damage, determine how to avoid such damage in the future, then, go forth and continue to--more responsibly than ever--develop our domestic resources as opposed to sending our wealth, jobs and technology to other exporting nations.  Whether the result of the President's action over the next few months is to cost our country hundreds of thousands of jobs, trillions of dollars in economic impact and a diminishing of the economic recovery efforts is yet to be seen, but likely.   (Written in some haste but with sincerest prayers, at the Lexington Airport, 1:35 EDT.  -DH)

Today, President Obama Will Eliminate Hundreds of Thousands of US Jobs, Increase Dependence on Foreign Oil and Retard America's Economic Recovery

27 May 2010 1:07am

 Commentary:  Anyone who has reviewed the University of Alaska and National Association of Regulatory Utility Commissioners studies will realize that Barack Obama's expected action today--combined with other Moratoria actions earlier taken by Interior Secretary Ken Salazar--could further slow America's recovery and endanger national security!  This summer's Alaska exploratory program has successfully overcome huge obstacles...only by the dogged determination of Shell, the expenditure of billions of dollars, survival of a gauntlet of legal challenges and--finally--by the recent approval of federal regulators.  The Alaskan exploration would occur in about 150 feet of water, unlike the mile deep water column which is the subject of current Gulf of Mexico grief.  The Alaska exploration company, Shell, wrote a letter to the Department of Interior's Minerals Management Service explaining how -- in wake of the Gulf of Mexico tragedy -- its operations were 1) inherently safer and 2) supported by the addition of even more safety precautions than had been proposed.  The Administration, instead of carefully considering the differences in technology, location and precautions may over react and put the entire U.S. economy in jeopardy.   Your author is headed for the airport now and hopes that the President's press conference about to occur sets a more reasonable course of action.   -DH, 11:30 a.m. EST  (See Wall Street Journal, Washington Times, N.Y. Times)

 

ADN, by Steven Tomma.  The Obama administration today will suspend planned exploratory oil drilling in the Arctic Ocean off Alaska until at least 2011, a casualty of the Gulf of Mexico oil spill.  The suspension will be part of a report that Interior Secretary Ken Salazar will give to President Barack Obama, who's likely to address the suspension as well as other proposals stemming from Salazar's Mark Begichreport, at a Lisa MurkowskiWhite House news conference today.  The move will stop Shell from drilling five wells in the Chukchi and Beaufort seas....  The move will stop for now a controversial expansion of oil drilling in a part of the world that could hold vast stores of oil and natural gas, but which environmentalists warn would come at great risk.  Despite a late appeal from Shell that it would employ new safety measures in the wake of the Gulf spill, Salazar was unconvinced that the exploratory drilling even in the much shallower waters of the Arctic would be safe.  "He is suspending proposed exploratory drilling in the Arctic," an administration official said on condition of anonymity to talk before Salazar's report is officially released today. "He will not consider applications for permits to drill in the Arctic until 2011 because of the need for further information-gathering, evaluation of proposed drilling technology, and evaluation of oil-spill response capabilities for Arctic waters."  Shell, which paid $2.1 billion in 2008 for the leases, had planned to start exploratory drilling in June or July.  The decision was met with a statement of deep unhappiness by U.S. Sen. Mark Begich (NGP Photo).  "I am frustrated that this decision by the Obama administration to halt offshore development for a year will cause more delays and higher costs for domestic oil and gas production to meet the nation's energy needs," Begich said Wednesday night ....  Begich said he would work with fellow Alaska Sen. Lisa Murkowski (NGP Photo), a Republican, the Interior Department and Alaska drillers to ensure operations would resume next year.  A spokesman for Shell said the company would issue a media response today. A spokesman for Murkowski said she would also respond today.


Tomorrow we return; yesterday in Lexington...

26 May 2010 11:50am

...the Interstate Oil and Gas Compact Commission adopted a resolution, "Acknowledging The National Association of Regulatory Utility Commissioners' successful completion of its July 18. 2007 Moratoria Resolution research project."

We hope to provide many photos and extended stories tomorrow, as we return to Anchorage.   -dh

Yesterday in Lexington...

25 May 2010 5:07am

Dan Seamount...your author (l) --on behalf of Moratoria Study Group Chairman O'Neal Lesil McGuireHamilton (S.C.)--enjoyed Craig Johnsonthe honor of presenting Alaska State Legislature citations honoring the Study Group to IOGCC participants: Commissioner Dan Seamount (AK) and Commissioner Victor Carrillo (TX) (Photos courtesy: Paul Atkinson).  Representative Craig Johnson (NGP Photo-r) coordinated approval of the citation with Senator Lesil McGuire (NGP Photo) and a distinguished group of Representatives and Senators from both sides of the aisle.

 

 

Interstate Oil and Gas Compact Commission Convenes in Lexington

24 May 2010 4:23am

Your author is with the IOGCC in Lexington this week, last night presenting to Kentucky Governor Steve Beshear Steve Beshear(NGP Photo with author) an Alaska state legislative citation honoring the Moratoria Study Group.    More coming....

 

 

 

 

ConocoPhillips' Dan Clark Provides RDC Members With Cook Inlet Update

20 May 2010 4:12pm

 

 

Tom MaloneyCommentary:  CH2M Hill's Tom Maloney (NGP Photo) opened the Resource Development Council (RDC) weekly meeting this morning amid an atmosphere of significant energy policy challenges.  These revolve primarily around 1) ANWR oil and gas access, and 2) diminishing Cook Inlet energy supplies and declining 'deliverability' during the coldest, darkest days of winter:

 

 

 

  • Executive Director Jason Brune (NGP Photo-r) inventoried RDC's issues du jour, including:Jason Brune
    • An action alert urging members to provide testimony to the U.S. Fish and Wildlife Service now inviting Ken Salazarcomment on its effort to revise the "Comprehensive Conservation Plan" for the Arctic National Wildlife Refuge (ANWR).  Brune said RDC was concerned about the threat of the USFWS recommending to Congress through Secretary Ken Salazar (NGP Photo-l) and the President that the 1002 area of ANWR be set aside as wilderness.  He then asked your author to collect and mail comment cards on behalf of members and about 100 comment cards were dispatched to the USFWS.  RDC joined numerous members and other organizations in providing testimony and Carl Portmanwritten comment.  Deputy Executive Director Carl Portman (NGP Photo, with Deantha Crockett), provided testimony in Washington D.C., while Brune and Portman testified in Anchorage.  Tara Sweeney(See our ANWR testimony story here.)  Brune also complimented Tara Sweeney (NGP Photo) of Arctic Slope Regional Corporation for her exceptional testimony in support of developing the 1002 oil and gas reserves.  He told members of RDC's support for Gas Supply Agreements (GSA) pending with the Regulatory Commission of Alaska, of Senator Mark Begich's (NGP Photo-lower right) support for federal revenue sharing associated with OCS rents, royalties and bonuses, and RDC's support for the Alaska Resource Education fundraising, Coal Classic Golf Tournament.  
  • Maloney then introduced Dan Clark (NGP Photo-l), who briefed members on ConocoPhillips assets in the Dan ClarkCook Inlet region.  These include 70% ownership of the Nikiski LNG plant; 100% ownership of the North Cook Inlet Unit (50-60 MMSCFD gross production); 1/3 ownership of the Beluga gas field Mark Begich(100 – 120 mmscfd gross production).  Clark went on to discuss LNG export and GSA status.  Access his PowerPoint presentation here.
     

More event photos below:

ConocoPhillips' Dan Clark Provides RDC Members With Cook Inlet Update

20 May 2010 4:12pm

Commentary:  Tom Maloney (NGP Photo) opened the Resource Development Council's (RDC) weekly meeting this morning amid an atmosphere of significant energy policy challenges:

AOGA Reviews Alaska's Investment Climate - Dr. Scott Goldsmith Adds Investment Climate Perspective

20 May 2010 6:30am

 For remote, northern Alaska it's partly about the resources but mostly about the investment climate!  -DH

Sarah PalinOne can't expect natural resource investment without the resources.  An investor contemplating the risk of placing capital Jay Hammondin a remote, expensive Frank Murkowskiplace with an unpredictable, predatory investment climate will surely be looking for benefits to offset the risk.  We earlier pointed out the 20 years of high investment characterizing a good investment climate that began with Governor Jay Hammond (NGP Photo-r) and republican and democrat legislative leaders, in unison, supporting a moderate tax policy with passage of one bill--which also repealed the personal income tax!  Then the century turned as republican and democrat legislators and republican governors (NGP Photos: Frank Murkowski and Sarah Palin) began to seriously consider the concept of converting a predictable 15% severance tax into an unpredictable net profit tax--made worse by later addition of a progressive rate feature (i.e. 'Heads I win; tails you lose') and deletion of certain business deductions.  

Yesterday the Alaska Oil and Gas Association (AOGA) held its annual public luncheon, this year with a theme:"How Policy Decisions Shape Alaska's Oil and Gas Future".   (Event photos below....) 

 

Scott GoldsmithAlaskanomics by Scott Goldsmith (NGP Photo).  The Alaska economy depends on 14 sectors or drivers that bring new money into the state and account for all the jobs and income of Alaska households and businesses.  These 14 sectors can be aggregated into 3 groups, each of which accounts for about 1/3 of the total.  The first group—Petroleum—includes all activities related to production, the revenues collected by state and local governments, and the Permanent Fund.  The second group—Federal Spending—includes the dollars that flow into Alaska from both military and civilian government activities.  The final group includes all Other Drivers, both the natural resource sectors of fishing, timber, mining, and agriculture, as well as tourism, air cargo, miscellaneous manufacturing and services, retiree spending, non-earned income.  The other economic sectors, like construction, finance, health care and state government, are important for the health of the economy, but they recycle the money that the drivers bring in.  Without the drivers there would be no money to recycle and no role for these other sectors to play.  A new study by ISER (Institute of Social and Economic Research) of the University of Alaska Anchorage, funded through a gift from Northrim Bank, quantifies for the first time, the contribution of each of the drivers of the Alaska economy.  The knowledge that comes from understanding what the drivers are, their relative importance, and their future prospects, is critical for planning for Alaska’s economic future.  

 

 For remote, northern Alaska it's partly about the resources but mostly about the investment climate!  -DH

One can't expect natural resource investment without the resources.  An investor contemplating the risk of placing capital in a remote, expensive place with an unpredictable, predatory investment climate will surely be looking for benefits to offset the risk.  We earlier pointed out the 20 years of high investment characterizing a good investment climate that began with Governor Jay Hammond (NGP Photo-r) and republican and democrat legislative leaders, in unison, supporting a moderate tax policy with passage of one bill--which also repealed the personal income tax!  Then the century turned as republican and democrat legislators and republican governors (NGP Photos: Frank Murkowski and Sarah Palin) began to seriously consider the concept of converting a predictable 15% severance tax into an unpredictable net profit tax--made worse by later addition of a progressive rate feature (i.e. 'Heads I win; tails you lose') and deletion of certain business deductions.  

Yesterday the Alaska Oil and Gas Association (AOGA) held its annual public luncheon, this year with a theme:"How Policy Decisions Shape Alaska's Oil and Gas Future".   (Event photos below....) 

 

Alaskanomics by Scott Goldsmith (NGP Photo).  The Alaska economy depends on 14 sectors or drivers that bring new money into the state and account for all the jobs and income of Alaska households and businesses.  These 14 sectors can be aggregated into 3 groups, each of which accounts for about 1/3 of the total.  The first group—Petroleum—includes all activities related to production, the revenues collected by state and local governments, and the Permanent Fund.  The second group—Federal Spending—includes the dollars that flow into Alaska from both military and civilian government activities.  The final group includes all Other Drivers, both the natural resource sectors of fishing, timber, mining, and agriculture, as well as tourism, air cargo, miscellaneous manufacturing and services, retiree spending, non-earned income.  The other economic sectors, like construction, finance, health care and state government, are important for the health of the economy, but they recycle the money that the drivers bring in.  Without the drivers there would be no money to recycle and no role for these other sectors to play.  A new study by ISER (Institute of Social and Economic Research) of the University of Alaska Anchorage, funded through a gift from Northrim Bank, quantifies for the first time, the contribution of each of the drivers of the Alaska economy.  The knowledge that comes from understanding what the drivers are, their relative importance, and their future prospects, is critical for planning for Alaska’s economic future.  

 
Categories:

Canadian and US Governments Push Pipelines - But What Is Plan B?

19 May 2010 7:04am

We would urge Canadian, U.S. and Alaskan leaders to begin thinking: "If open seasons and economics derail current pipeline plans, what is Plan B?"  -DH

A coloured, illustrated map of the Northwest Territories shows the three anchor fields and the proposed pipeline route which begins north of the town of Inuvik in the Inuvialuit Settlement Region in the Mackenzie River Delta. The proposed route heads south generally following the Mackenzie River through the Gwich'in Settlement Area, near the town of Norman Wells in the Sahtu Settlement Region, close to the community of Fort Simpson in the Dehcho Region where it stops following the Mackenzie River heads south towards the Alberta border. Not all communities along the pipeline route are shown on this map. A small legend on the page identifies the production site and Significant Discovery Licence (SDL) areas: Niglintgak and Taglu are along the coast in the Beaufort Sea, and the Parsons Lake field is further inland in the delta. All these sites are north of Inuvik.Environment Minister's Mackenzie Valley Pipeline Webpage.  The proposed Mackenzie Valley Gas Project (MGP) would involve the development and operation of three natural gas fields in the Mackenzie River delta in the Northwest Territories, and associated infrastructure such as a gathering system, compressor stations and pipelines, to move the natural gas and natural gas liquids southward along the Mackenzie Valley.  

Calgary Herald by Dina O'Meara.  Territorial and federal governments have agreed with fewer than a dozen of almost 200 recommendations made by a panel supporting a proposed Mackenzie Arctic pipeline, according to a new report.

Sierra Club Canada doesn't like the result.  Of the 115 recommendations aimed towards the federal and Northwest Territories governments, only 10 of the recommendations were fully accepted in an interim report released Monday.  The federally appointed Joint Review Panel (JRP) developed a total of 176 recommendations to mitigate environmental damage and socio-economic effects of building and operating the proposed 1,200 kilometre natural gas pipeline.

Pipeline and Gas Journal.  In January, TransCanada and ExxonMobil applied to the Federal Energy Regulatory Commission (FERC) for permission to build two potential Alaska gas pipelines.  The primary project would be a $32-41 billion, 1,700-mile pipeline from Prudhoe Bay to Alberta, Canada that would connect with TransCanada's existing pipeline system that carries natural gas into the U.S. The other project would be an 800-mile pipeline that would ship natural gas to a port in southern Alaska where it would be liquefied for transport to Asia and other foreign markets. TransCanada and ExxonMobil plan to build one or the other project, based on which one gets the most interest from potential customers.