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If gas doesn’t move, Congress could act Federal Coordinator Drue Pearce tells Alaska legislators a lot of questions in D.C. about why gas pipeline hasn’t yet been built Kristen Nelson Petroleum News
The State of Alaska is working through its Alaska Gasline Inducement Act, evaluating an application from TransCanada that the administration deemed complete under the law in a process the state hopes will jumpstart a line to take North Slope gas to market.
Federal Coordinator Drue Pearce got several questions at a Senate Resources Committee meeting Jan. 28 about what the reaction would be in Washington, D.C., if the AGIA process fails.
Sen. Bert Stedman, R-Sitka, told Pearce that a legislative consultant is questioning whether the TransCanada application does comply with AGIA. Sen. Bill Wielechowski, D-Anchorage, asked Pearce, who heads the Office of the Federal Coordinator for Alaska Natural Gas Transportation Projects, what she thinks the federal government would do if the state’s AGIA process fails to get a gas pipeline project moving.
Pearce said when she meets with members of Congress and their staffs, “there’s a lot of interest in why don’t we see a pipeline yet. Why isn’t that pipe in the ground?”
She said she thinks “it is likely” in any administration “that Congress might move forward and work proactively to push getting a pipeline built, particularly if we don’t license and see more LNG plants get built in the Lower 48.”
She said there is a lot of gas left to be found in the Lower 48 and in the Gulf of Mexico “but the demand on the United States is going to rise so I would expect that you would see them look very seriously at whether or not the federal government should step in.”
Resources Chair Charlie Huggins, R-Wasilla, asked Pearce what she hears in D.C. about the possibility of exporting Alaska gas.
Pearce said that while she isn’t aware that the topic has been addressed by any of the cabinet secretaries, “certainly our delegation did. And their opinion was that Congress did not intend for Alaska’s North Slope gas to be exported to the Pacific Rim; that instead they had spent the time trying to get this gas line built to bring gas for domestic supply to the Lower 48.”
Office coordinating AGIA comments The Office of the Federal Coordinator is already coordinating, Pearce told the Alaska Support Industry Alliance’s annual Meet Alaska conference Jan. 25.
In addition to working with federal, state and Canadian agencies in preparation for a federal Alaska gas pipeline application, the office is coordinating federal comments on TransCanada’s application to the State of Alaska under AGIA.
Pearce said the State of Alaska asked her office if federal agencies would be willing to comment during the public comment period and her office is coordinating those comments. Federal agencies have been asked to have comments to her office by Feb. 8, Pearce told Senate Resources. “We will not review them in order to change them; instead we will review them for consistency,” she said, “to ensure that the agencies are speaking with one voice and we don’t have two going in diametrically opposed direction.” The goal is to have comments to the state by the end of February.
She said the office had not begun a review of the ConocoPhillips proposal, but she said she believes ConocoPhillips may ask for such a review, “and if they do, we will coordinate the same for them.”
Office established in 2004 The Office of the Federal Coordinator was created by the Alaska Natural Gas Pipeline Act of 2004 to coordinate the response of federal agencies for the project of bringing North Slope natural gas to market; the office also coordinates with the Canadian government on the gas pipeline, as well as with the State of Alaska and private stakeholders. The office was also delegated the authorities of the former Office of the Federal Inspector, set up to oversee federal coordination for the 1970s-1980s gas pipeline effort under the 1976 Alaska Natural Gas Transportation Act.
Pearce said the office officially began its work when she was sworn in, in December 2006. The office of the federal coordinator is an independent agency reporting to the office of the president.
There are three full-time employees, including herself, Pearce said, and one employee on loan. A general counsel and chief engineer will be the next employees hired in Washington, D.C., she said; other staff will be added as the project moves forward.
There is no Alaska staff yet.
“I am not going to open an Alaska office until we know for a fact that we’re going to have an application in Washington, before the federal agencies,” Pearce told Senate Resources. She said she does expect to open an Alaska office and it is funded in the 2009 fiscal year budget, “but there’s no reason to open one at the moment … until we know for sure we’re going to have an application.”
Michael Baker Jr. first contract Michael Baker Jr. has been hired as the agency’s first contract to build a data management system because one of the lessons learned from the construction of the trans-Alaska oil pipeline was that data needed to be collected along the way.
“Many records were lost” and the Joint Pipeline Office “spent a number of years trying to recreate some things that should have been kept,” she said. Pearce said the system will allow her office to do its work “but also capture all of the documentation that will be needed to be able to hand over to the Bureau of Land Management when they take over the oversight of the right-of-way grant.”
The Argonne National Laboratory is working on a gap analysis for the agency.
There have been changes in agencies’ roles and responsibilities since the original act was passed in 1976 — and even since the current legislation was passed in 2004 — she said. Argonne did the environmental impact statement for the trans-Alaska oil pipeline right-of-way renewal, Pearce said, and is familiar with both the corridor and the players. They are looking at what the agencies already have in place to identify where there are gaps that need to be worked on before permitting begins.
Turnover to BLM The office of the federal coordinator will look a lot like the federal side of the Joint Pipeline Office, Pearce said. JPO has trans-Alaska oil pipeline oversight.
Oversight will be turned over to BLM a year after first gas. And when will that happen? The earliest possible first gas is 2018, Pearce said, and the turnover would be the following year, in 2019.
As for Pearce’s job, the federal coordinator is a “termed” federal appointment, she said, and lasts until one year after construction of the pipeline. The Alaska delegation wrote the language that way to ensure that if the office was dealing with applications at a change in administration the process would continue through the transition.
Pearce is a former Alaska legislator. She served in both the state House and Senate, and then joined the U.S. Department of the Interior under Secretary Gail Norton as senior advisor on Alaska, a position she held from 2001 until her 2006 confirmation as federal coordinator.
Information is available online at www.arcticgas.gov.
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