Conditional ROW for spur line approved

ANGDA gets right of way for Glennallen to Palmer line; 24-inch Southcentral line would be built before North Slope mainline

Alan Bailey

Petroleum News

On July 19 the Joint Pipeline Office announced that Michael Menge, commissioner of the Alaska Department of Natural Resources, had signed a final decision granting the Alaska Natural Gas Development Authority a conditional right-of-way lease for a gas spur line between Glennallen and Palmer. And on July 18 Harold Heinze, chief executive officer for ANGDA, signed the conditional lease. Petroleum News has heard from DNR that the lease is now in Menge’s office awaiting the commissioner’s signature.

The ANGDA board met on July 17 and authorized Heinze to sign. At that board meeting Heinze said that Menge had signed the commissioner’s decision on the lease on July 13.

ANGDA originally applied for the conditional right-of-way lease in April 2005. And in May 2006 DNR found the spur line project to be consistent with the Alaska Coastal Management Program.

Heinze told the board that applying for the conditional right-of-way lease had involved substantial work, including the determination of a pipeline alignment and preparing a description of the project.

“With the acquisition of this (conditional lease) we will have an asset,” Heinze said. “Whatever happens on whoever, whenever, however this pipeline gets built, this is a document of some significance.”

24-inch line

If the North Slope line follows the Alaska Highway route through Canada, ANGDA is prepared to construct a connecting pipeline to Glennallen from the North Slope line at Delta Junction. If the North Slope line carries gas to Valdez, as proposed by the Alaska Gasline Port Authority, that gas line route would connect with the ANGDA spur line at Glennallen.

In the 1980s Yukon Pacific obtained state and federal rights of way for a North Slope gas line to Valdez and the Alaska Gasline Port Authority has since optioned Yukon Pacific’s permits for the Valdez line.

“As far as moving gas around the state (is concerned), we very clearly identified this linkage between Glennallen and Palmer as the missing link,” Heinze said at the July 17 board meeting. “It was the one piece of the puzzle that nobody had ever worked or advanced. … We are as advanced as a number of other rights of way in the state at this point.”

Heinze said that the conditional right of way for the Glennallen line consists essentially of a list of to-do items, including specifying the detailed pipeline alignment, providing proof of financial ability, developing an adequate project plan and developing a conceptual pipeline design.

“There is nothing in here that is over, above and beyond what a good project would already have to develop,” Heinze said.

Obtaining the actual right-of-way lease will depend on developing and delivering all of the items specified in the conditional lease. And any preconstruction activities on state land will require the appropriate permits.

State lands

Heinze said that in processing the right-of-way application there had been questions regarding how ANGDA, as one arm of the state, should satisfy the needs of DNR, another arm of the state. But ANGDA requested that the right-of-way lease be written in terms that would work with a non-state entity.

“It has been our position that we would prefer the conditional right-of-way lease to be written as if we were a third party. … That way if we ever bring in partners … the lease is written in such a way that it would apply to a non-state entity,” Heinze said.

Heinze also emphasized that substantial contactor effort will be required to meet the requirements of the conditional lease. ANGDA has previously stated that it plans to start work on the right of way within weeks of approval of the conditional right-of-way lease.