ANGDA presses onward

Public corporation looking past AGIA loss to open season, possible project partners, in-state use and off-take points, pipeline design

Eric Lidji

Petroleum News

The Alaska Natural Gas Development Authority could be forgiven for appearing to be in limbo as the state and the public examines the results of the Alaska Gasline Inducement Act.

But CEO Harold Heinze said the game is still the same: move toward a spur line and prepare for open season.

“I’m not unhappy at all in the position we have ended up in,” Heinze told the ANGDA board of directors at a meeting on Jan. 23.

Three proposals with different fates

ANGDA saw its proposal for a natural gas spur line to Southcentral rejected under the act for failing to connect directly to North Slope gas fields.

Now, the public corporation is looking to link its project up to any mainline proposal, and faces numerous possibilities as the AGIA process continues.

ANGDA could connect with TransCanada, the only company to submit a pipeline application deemed “complete” by the Palin administration.

Or it could join up with the Alaska Gasline Port Authority, the municipal entity originally rejected by the state but now seeking reconsideration.

Or it might become a part of the ConocoPhillips proposal, submitted outside of the AGIA process, but promised a review by the Legislature.

Open season real goal line

“We never lost sight of the fact that it’s all about the open season,” Heinze said.

Getting ready for the open season requires dialogue with all possible project sponsors, all possible in-state gas users and all possible financiers and regulators, Heinze said.

ANGDA has been holding forums to unravel the open season process, including a computer driven simulation planned for Feb. 13.

But the details of any open season project depend in part on what company is taking the lead, and that’s where the uncertainty comes into play.

Heinze called the ConocoPhillips project a “quality proposal” that handled in-state gas use and open seasons issues “in a very constructive fashion” by directly addressing the concerns of many in-state stakeholders — including local utilities — at a recent ANGDA forum on Jan. 16.

Heinze said he hopes TransCanada will do the same thing in the coming weeks, especially to resolve some questions he and others have about the TransCanada proposal.

“In reading the words, I’m not sure what to think,” Heinze said about the TransCanada proposal. “But that’s the problem with reading something that’s legalistic, as opposed to asking them, ‘What do you think?’”

The Alaska Gasline Port Authority request for reconsideration is currently being reviewed by the state Attorney General’s office, and probably poses the last hope of ANGDA working through the AGIA process, or “the game,” as Heinze put it.

“If it’s accepted, I think we might be back in the game,” he said. “If not, we are out of the game.”

Getting organized for open season

ANGDA has been trying to get local utilities to come together for in-state gas use before design on the pipeline begins, saying without everyone coming to the table the local companies won’t have the “critical mass” needed to make an in-state project work effectively.

“If somebody opts out ... then probably nothing happens,” Heinze said.

ANGDA has already secured a conditional right of way for a spur line from Glennallen to Palmer.

But at the board meeting, Heinze proposed allocating $2 million, or around 40 percent of the total ANGDA budget for the year, on field data acquisition to satisfy U.S. Army Corps of Engineers requirements for wetlands along the entire alignment.

He also proposed $1 million for studying alternative pipeline designs, such as slightly elevated pipe, to “get out in front of” geotechnical issues like ice, discontinuous permafrost and conforming the design to the long term affects of climate change.