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ExxonMobil in Alaska: Exxon partners with TransCanada in gas line
Kristen Nelson Abbreviated story from June 14, 2009, Petrole
TransCanada has a partner in the Alaska gas pipeline project, announcing June 11 that it has reached an agreement with ExxonMobil to work together on the project. TransCanada will be the majority partner.
ExxonMobil, a major working interest owner at Prudhoe Bay and the operator at Point Thomson, is the largest owner of North Slope natural gas. The other major owners, BP and ConocoPhillips, are partners in the competing Denali gas pipeline project.
“ExxonMobil and TransCanada have the experience, expertise and financial capability to undertake this project,” said ExxonMobil Production Co. President Rich Kruger. “We have on-the-ground knowledge of Alaska and Canada, experience working in the Arctic, a strong history of technology and innovation, and the proven ability to build and operate projects of enormous scale in the most challenging environments.”
Tony Palmer, TransCanada vice president of Alaska development, said that TransCanada and ExxonMobil will jointly advance all aspects of the project, while TransCanada and Foothills will remain the AGIA, or Alaska Gasline Inducement Act, licensees. The companies will jointly staff project teams; Palmer said TransCanada would take the lead on the pipeline while ExxonMobil will take the lead on the gas treatment plant.
Best way to advance pipeline Martin Massey, ExxonMobil Production Co.’s U.S. joint interest manager, said ExxonMobil is eager to work with the State of Alaska so the company can become a full participant in the AGIA license.
Massey said ExxonMobil did an analysis, evaluated a number of options and determined that aligning with TransCanada and progressing the project under AGIA provided the best chance of success and the best opportunity to bring all the parties together.
Alignment between all parties — the North Slope producers, TransCanada and the State of Alaska — will be required for project success, Massey said, but TransCanada and ExxonMobil can advance the project for many years.
ExxonMobil is not asking the state to enter fiscal discussions now in order for ExxonMobil to align with TransCanada, he said, but predictable and durable terms are required, and AGIA is the vehicle to address those terms. For ExxonMobil to become a full participant in the license would require dealing with issues of predictable and durable fiscal terms, Massey said.
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