September 16, 2009

Can proposed North Slope gas pipeline take on competition?

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The proposed North Slope gas pipeline hit another bump yesterday when a Calgary-based global energy consultant counted down multiple obstacles hindering the success of the project, reports Elizabeth Bluemink of the Anchorage Daily News.
One of the prime concerns was competition between the proposed pipeline, which is planned to run from Alaska through Canada to the lower United States, and cheaper gas found at basins in the lower 48 near metropolitan areas. The consultant said tight control of costs associated with the pipeline project would be the only way to stay in the competition.
The project is being pursued by two separate business groups with holdings in on the North Slope. BP and Conoco Phillips have partnered in promoting the Denali Gas Pipeline, while TransCanada and ExxonMobil are developing plans for their own Alaska Pipeline Project. Vice President Tony Palmer of TransCanada hopes the two projects eventually will merge, according to the article.
Gas prices are down right now, which means even some drills in the Lower 48 have temporarily stopped. The corporations involved in the project are optimistic. They expect natural gas prices will rise in 2010, making the North Slope project competitive again.
InvestigateWest reported earlier on the proposed Alaska pipeline here.
— Emily Linroth

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