Providing coverage of Alaska and northern Canada's oil and gas industry
July 2019

Vol. 24, No.27 Week of July 07, 2019

AKLNG DEIS published

FERC evaluates, discards alternatives proposed for AGDC project in scoping period

Kristen Nelson

Petroleum News

The Federal Energy Regulatory Commission published a draft environmental impact statement for the Alaska Gasline Development Corp. sponsored Alaska liquefied natural gas project on June 28, beginning a public comment period which would lead to a final EIS and record of decision on the project next year.

The draft EIS assesses potential environmental effects of construction of the Alaska LNG Project in accordance with the National Environmental Policy Act, and FERC said its “staff concludes that approval of the Project would result in a number of significant environmental impacts, but the majority of impacts would be less than significant based on the impact avoidance, minimization, and mitigation measures proposed by AGDC and those recommended by staff in the draft EIS,” although, FERC said, “some of the adverse impacts would be significant even after the implementation of mitigation measures.”

Cooperating agencies included the U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration, U.S. Environmental Protection Agency, U.S. Army Corps of Engineers, U.S. Coast Guard, Bureau of Land Management, U.S. Fish and Wildlife Service, National Park Service, U.S. Department of Energy and National Marine Fisheries Service.

FERC will be taking comments on the draft EIS through 5 p.m. Eastern Time on Oct. 3.

“Alaska LNG holds the potential for significant environmental, energy, economic, and employment benefits for Alaskans,” AGDC Interim President Joe Dubler said in a June 28 statement. “Publication of the draft Environmental Impact Statement represents substantial progress toward obtaining the authorization required to build and operate this project.”


There was considerable interest in alternatives during the scoping period for the DEIS - among the most prominent a different route for the pipeline through Denali National Park and Preserve, running the pipeline to Valdez and building the liquefaction facility there or placing the liquefaction facility at Port MacKenzie rather than at Nikiski.

In discussing alternatives FERC said, “we generally consider an alternative to be preferable to a proposed action if the alternative meets the stated purpose of the Project, is technically and economically feasible, and offers a significant environmental advantage over a proposed action.”

In sequence, FERC said, it looks at whether an alternative meets the project alternative - here, commercializing North Slope natural gas by treating it and liquefying the gas and then exporting it to foreign markets, while also meeting in-state needs.

Then technical and economic feasibility are considered, with technical feasibility generally requiring common construction methods and economic feasibility resulting in an action maintaining the cost-competitive nature of the proposed action.

If those criteria are met, FERC then determines if an alternative “provides a significant environmental advantage.”

But, FERC noted, the Corps of Engineers has a different standard for its permits: it must determine whether the proposed project is the least environmentally damaging practicable alternative, the LEDPA, and “may only permit discharges of dredged or fill material into waters of the United States that represent the LEDPA, so long as that alternative does not have other significant adverse environmental consequences.”

FERC said that while many of the alternatives it reviewed appeared to be technically feasible, “we identified no alternatives that would provide a significant environmental advantage over the Project. Based on these findings, we conclude that the proposed Project, as modified by our recommended mitigation measures, is the preferred alternative that can meet the Project objectives.”

Samples of alternatives considered

FERC said the one alternative that may need to be adopted, based on the Corps’ LEDPA standard, is the Denali Alternative. If that is adopted by AGDC, FERC said, “we conclude that the Denali Alternative would be acceptable from an environmental standpoint and have included relevant information for decision-makers to consider.”

FERC said AGDC worked with the National Park Service to identify an alternative at the Denali National Park and Preserve which would “traverse the DNPP’s eastern portion and minimize the amount of geologically unstable terrain it would cross.” The proposed mainline pipeline route would be just east of DNPP and would traverse rugged terrain with unstable slopes.

Unlike the proposed route, the Denali alternative would cross some 6.1 miles of the DNPP, and under federal law the Secretary of the Interior may issue a right-of-way permit for a high-pressure natural gas transmission line in non-wilderness areas within DNPP. The Denali alternative would not cross wilderness areas within DNPP.

FERC said it found both routes acceptable and is not recommending the Denali alternative. But the Corps did find the alternative route the LEDPA for the Alaska Stand Alone Pipeline project when that was approved, FERC said.

Gas-related alternatives

Two interesting alternatives - neither of which FERC adopted - relate to gas handling.

Feedback at interagency meetings recommended that FERC analyze a gas treatment plant sited away from the North Slope.

FERC said putting the GTP at the pipeline terminus or near the LNG facilities would not meet the project objective of having in-state gas interconnections along the mainline pipeline because there wouldn’t be pipeline quality gas if the GTP was at the terminus of the line.

Moving the GTP off the North Slope also creates an issue with raw gas, which contains water, CO2 and H2S which are removed at the GTP. The water in raw gas can condense, FERC said, reacting with CO2 or H2S to form an acid that collects in low spots on the line and causes internal corrosion.

The U.S. Fish and Wildlife Service wanted an aboveground pipeline on the Arctic coastal plain analyzed, putting the first 60 miles of the line on vertical support members, with the goal of reducing permafrost disturbance during construction.

“AGDC indicates that an aboveground pipeline is likely to experience operational difficulties during winter shutdowns or other operational upsets,” because low ambient temperatures would cause some of the heavier hydrocarbons to liquefy and settle in low spots on the line. Moving the liquid would have to be done carefully by controlling gas velocity and then removing the liquid at compressor stations. “AGDC indicates that this procedure could result in shutdowns of days or weeks, creating disruptions at the Liquefaction Facilities,” FERC said.

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