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Providing coverage of Alaska and northern Canada's oil and gas industry
May 2006

Vol. 11, No. 20 Week of May 14, 2006

Authority to participate in open season

The Alaska Gasline Port Authority said May 9 that it intends to participate in the open season for expansion of Sempra LNG’s Energia Costa Azul liquefied natural gas receiving terminal. The authority’s project manager and general counsel, Bill Walker, attended an open season shippers’ meeting in Ensenada, Mexico, as part of the bidding procedures.

The Port Authority said the expansion volumes at the facility are sufficient to provide start-up volumes for its project. Energia Costa Azul LNG terminal, currently under construction, is 14 miles north of Ensenada on the western coast of Baja California.

MOU with shipper

The Port Authority also said it has received a draft memorandum of understanding from a world-scale shipper of LNG which owns eight U.S. built LNG tankers that would be Jones Act compliant for shipping LNG from Alaska to the Lower 48. The Port Authority said this is in addition to the proposal it received from TOTE several months ago. The TOTE proposal would assist the authority with the building of LNG tankers by a foreign shipbuilder in a U.S. shipyard at rates competitive with foreign built LNG tankers.

“This is an opportunity for Alaska’s gas in LNG form to get into the West Coast market in 2012,” Jim Whitaker, chairman of the Port Authority, said in a statement. The project includes a 48-inch natural gas line which would run parallel to the trans-Alaska oil pipeline to Valdez for liquefaction and shipment to the Lower 48. The project also provides for a future gas line through Canada at such time as the legal and regulatory hurdles in Canada are resolved.

The Port Authority has an exclusive option to purchase Yukon Pacific Co., which spent more than $100 million over a 15-year period to develop an LNG project along the same route, and acquired significant state and federal permits for this project.

—Petroleum News






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