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Vol. 18, No. 1 Week of January 06, 2013
Providing coverage of Alaska and northern Canada's oil and gas industry

Amid pressure of ‘fiscal cliff,’ Senate moves Alaska gas line bill

In the wee hours of New Year’s Day, the U.S. Senate approved a hard-fought deal to stave off the dreaded “fiscal cliff.”

But that wasn’t the only order of business for the bleary-eyed senators.

They also passed, by unanimous consent, a bill that someday could prove an important piece of a plan to bring energy security to Southcentral Alaska.

The bill (S. 302) would allow for construction of a natural gas pipeline through Denali National Park and Preserve.

The planned pipeline would run 737 miles overall, from the rich gas fields of the North Slope to the area of Anchorage and Cook Inlet. S. 302 would authorize the Interior Department secretary to issue a right-of-way permit for a short section of the pipe to pass through nonwilderness areas within the Denali Park boundary.

Specifically, a seven-mile segment of the line could be laid along the George Parks Highway, which runs through the park.

The idea has drawn support from the state, the National Park Service and environmental groups as likely the least disruptive route for the gas line.

‘Clear legal path’

U.S. Sen. Lisa Murkowski, R-Alaska, sponsored S. 302, introducing it on Feb. 8, 2011. Her Democratic colleague, Mark Begich of Alaska, was co-sponsor.

Murkowski, the ranking member on the Senate Energy and Natural Resources Committee, welcomed the bill’s last-minute passage. It otherwise would have died on Jan. 3, when the 112th Congress ended.

“It is important for Alaskans that our North Slope natural gas has a clear legal path to market,” Murkowski said in a Jan. 2 press release. “This bill clears a key hurdle to constructing a pipeline along the Parks Highway and allows decisions on the best route to be based on economic and commercial grounds, rather than out of fear of lengthy permitting delays to win access rights across federal lands. Getting our gas to market is vital for the future of Southcentral, the state’s economy, and all Alaskans.”

After the Senate’s passage, the bill went over for consideration in the House of Representatives.

In-state gas needs

An Energy Committee report accompanying S. 302 explained that Cook Inlet gas fields, long the major energy source for Southcentral Alaska, are declining, and that Alaska is considering a pipeline to carry North Slope gas to the region to meet local needs.

This would be a different, smaller pipeline from large-diameter export gas line long under consideration by the state and oil companies. That line would run into Canada, or to a liquefied natural gas export facility at Valdez, terminus of the trans-Alaska oil pipeline.

The worry is that construction of the big line is too many years away to help supply local gas to Southcentral. And so a state agency, the Alaska Gasline Development Corp., has been working toward the smaller line, sometimes referred to as a “stand-alone” or “bullet” line, to shoot gas from the Slope to the Anchorage area, with a lateral line to Fairbanks in the state’s Interior.

Though much smaller than the export line, the stand-alone line nevertheless would be a megaproject costing billions of dollars. And so there’s no guarantee it will ever be developed.

The U.S. Army Corps of Engineers in October issued a final environmental impact statement for the Alaska Gasline Development Corp. project.

The EIS considered route alternatives, including one that would allow a short segment of the pipe to pass through the huge Denali Park.

Gas pipelines may be permitted through a national park only if authorized by an act of Congress.

Stephen Whitesell, a National Park Service official, provided testimony at a May 11, 2011, congressional hearing on S. 302, saying the Interior Department had “no objection to the bill as written.”

He noted that the bill not only would allow for granting a Parks Highway right of way, but “provides authority for the Secretary to permit distribution lines and related equipment within the park for the purpose of providing a natural gas supply to the park.”

A coalition of environmental groups including the National Parks Conservation Association sent a Jan. 30, 2009, letter to Enstar Natural Gas Co., the major gas utility for Southcentral Alaska, saying it seemed logical to route the pipeline through Denali.

“This would seem to make the most sense from both an engineering and an environmental perspective as going around the park would necessitate construction in currently undeveloped lands,” the letter said. “While the signers of this letter agree that bringing the gas pipeline along the Parks Highway through Denali seems to be the environmentally preferable alternative, we reserve final judgment until completion of the environmental review.”

A gas supply could allow the park and local transportation providers to reduce their use of diesel.

Bill provisions

S. 302 would permit a natural gas pipeline to be buried in the shoulder of the Parks Highway for the seven miles that the highway runs through Denali Park.

According to Murkowski’s press release, the legislation would:

• Allow any high-pressure pipeline to run through the existing utility corridor at the entrance of Denali Park, provided that no compression stations are placed inside park boundaries.

• Allow distribution and transmission pipelines to be placed inside the park at the request of the National Park Service to provide natural gas to park facilities.

• Require the Interior secretary to issue a permit for a line if it clears a required National Environmental Policy Act review.

“A natural gas pipeline route through the park would not only be less expensive to build, but could also take advantage of the existing utility corridor, preventing disturbances to wildlife and environmental impacts on undisturbed lands further to the east or west of the park boundary,” Murkowski said.

—WESLEY LOY



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