NEWS BULLETIN

August 28, 2008 --- Vol. 14, No. 86August 2008

ExxonMobil begins site work at Point Thomson

ExxonMobil Production Co. said today that it has completed initial barging of equipment and supplies to the Point Thomson drill site.

Barges and tugs operated by Crowley Maritime Corp. transported ice road and drill site construction equipment and supplies to the site on the eastern side of Alaska’s North Slope.

ExxonMobil said it has conducted field operations at Point Thomson for several weeks following issuance of permits and is awaiting additional permits from state regulatory agencies necessary to allow drilling activities to continue.

Craig Haymes, Alaska production manager for ExxonMobil, said in a statement that more than “150 people from more than 30 companies in Alaska are working to progress drilling and development activities for the Point Thomson field. The future availability of Point Thomson gas is essential to the success of an Alaska gas pipeline project.”

A $20 million project is under way to upgrade Nabors Rig 27E as part of the drilling program, including new drilling mud and electrical systems to safely access the very high pressure Point Thomson reservoir.

ExxonMobil said it and the other Point Thomson working interest owners are proceeding with the project while they seek to resolve the dispute with the State of Alaska over the Point Thomson unit and leases.

ANGDA has RFP out for Fairbanks line

The Alaska Natural Gas Development Authority is putting out a request for proposals for a study of the feasibility of a Fairbanks connector pipeline.

ANGDA Chief Executive Officer Harold Heinze told Petroleum News yesterday that the work is in response to Gov. Sarah Palin’s request that ANGDA see how it could help Fairbanks with energy costs. This project begins with the spur line ANGDA has been discussing, he said, and is based on the proposal to pre-build the spur line, intended to connect with a main line coming south from the North Slope.

It’s a spur line pre-build “and you tack on the end of it a plastic pipe and reverse flow the line,” bringing Cook Inlet natural gas to Fairbanks. It’s only about 20 million cubic feet a day for Golden Valley Electric, he said, “but it would make a huge difference in the bills up there,” because electric power could be generated from Cook Inlet-priced gas, rather than from crude oil at prices of more than a hundred dollars a barrel.

The RFP, for work not to exceed $100,000, is to assist ANGDA in determining the feasibility of utilizing a flexible plastic pipe to move natural gas from Delta Junction to the Fairbanks-North Pole area.

Proposals are due Sept. 19, the contract is expected to be awarded Oct. 2 with work to be completed by Dec. 2.

Work currently under way in the field has been expanded to include Delta Junction to North Pole along the trans-Alaska oil pipeline right of way, Heinze said, picking up the area that would be covered by the flexible line extension from the planned spur line to Golden Valley Electric in North Pole.

API joins lawsuit to include Alaska in Polar bear greenhouse gas exemption

The American Petroleum Institute has joined forces with the Chamber of Commerce of the United States of America, the National Mining Association and the National Association of Manufacturers in filing a complaint that, under the U.S. Department of Interior’s interim rule listing the polar bear as a threatened species under the Endangered Species Act, Alaska has been excluded from an exemption from U.S. Fish and Wildlife permitting requirements. That exclusion would mean that any activity in Alaska that creates greenhouse gases would require an incidental take permit, the complainants say.

The complaint was filed with the U.S. District Court for the District of Columbia on Aug. 27.

“The interim final rule issued by the Department (of Interior) needs to be expanded to include Alaska as the Act is implemented,” API said. “API member companies are not challenging the listing of the polar bear as a threatened species.”

See full stories in Sept. 7 issue of Petroleum News, available to subscribers online at noon, Friday, Sept. 5 at www.PetroleumNews.com


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