January 06, 1999 --- Vol. 5, No. 1January 1999

Preliminary approval for Nuiqsut gas pipeline

The state said Jan. 5 that it has given preliminary approval to a 14-mile gas pipeline from ARCO Alaska Inc.'s Alpine project west of Kuparuk to the village of Nuiqsut.

Alaska Department of Natural Resources Commissioner John Shively signed an analysis and proposed decision for the pipeline Jan. 4. A 30-day public comment period is required before a final decision and right of way lease for the project is issued.

"Development of the Alpine field provides a tremendous opportunity to provide Nuiqsut families with a cheap and reliable source of energy," Gov. Tony Knowles said in a prepared statement.

"Once complete, this pipeline will greatly reduce the need to import oil to provide heat and electricity for the village and improve air quality through the use of clean-burning natural gas. I commend the partnership between Kuukpik, the Nuiqsut village corporation; the North Slope Borough; and ARCO to make this project happen," Knowles said.

Construction of the aboveground portion of the pipeline is proposed for this winter to coincide with the planned completion of the installations for the Alpine field. The underground portion of the project is proposed for completion by the spring of 2001.

Leases for Kuvlum, Hammerhead relinquished

Oil and gas leases in the federal Beaufort Sea Hammerhead and Kuvlum units have been relinquished.

U.S. Department of the Interior Minerals Management Service spokeswoman Robin Cacy told PNA Jan. 5 that the agency is processing the relinquishments now. The paperwork was complete on Dec. 30, she said.

Cacy said that the first opportunity MMS would have to reoffer the leases would be at OCS Beaufort Sea sale 176 proposed for 2001.

Hammerhead lies in U.S. outer continental shelf waters in the Beaufort Sea north of Point Thomson; Kuvlum is in the Beaufort Sea northeast of Point Thomson.

Last spring, unit operator Chevron U.S.A. Inc. received a five-year extension of the Kuvlum and Hammerhead units to allow for the design, permitting and construction of transportation facilities to the eastern North Slope. Original unit extensions date from May 6, 1993, and were based on uneconomic conditions for the units and the fact that there is no infrastructure available in the eastern North Slope to process or transport production from the units to the trans-Alaska pipeline system.

BP January term oil price $9.37 a barrel

BP America's January term price for Alaska North Slope crude is $9.37 a barrel, down $2.08 a barrel (18.2 percent) from December's term price of $11.45 a barrel and down 42.9 percent from January 1998's term price of $16.41 a barrel.

This is the lowest BP's term price has been since July 1986 when it stood at $9 a barrel. The term price represents an average of spot prices for the previous month.

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