Menge extends Point Thomson deadline

As indicated in his testimony to state legislators May 16, Alaska’s Natural Resources commissioner has extended the deadline for Exxon Mobil Corp. to submit an acceptable development plan for Point Thomson’s natural gas fields. (See story in the May 21 edition of Petroleum News.)

The deadline had been May 31 for the oil company to file a new plan and avoid being in default.

Commissioner Mike Menge said he decided to grant a 90-day extension to give state lawmakers the chance to speak on Gov. Frank Murkowski’s contract proposal with Exxon Mobil, BP PLC and ConocoPhillips.

The contract would set the terms for the three companies to develop the North Slope’s 35 trillion cubic feet of gas reserves, of which Point Thomson is believed to hold 9 trillion cubic feet.

“Until the Legislature acts and the governor acts, I’m going to withhold a final decision,” Menge said.

Former Oil and Gas Division Director Mark Myers last year found Exxon Mobil in default for submitting a development plan that had no specific benchmarks for developing Point Thomson’s gas reserves.

ExxonMobil, the designated operator for Point Thomson, has filed 22 plans of development over nearly 30 years. The company’s last plan said a gas pipeline would have to be built before Point Thomson could be developed.

Myers found that plan unacceptable and threatened to revoke the leases to Point Thomson unless the oil company submitted a new plan.

However, Myers resigned when former Natural Resources Commissioner Tom Irwin was forced from his job by Murkowski for disagreements the two had over the gas contract negotiations.

When Menge took office, he extended Exxon Mobil’s deadline to file a new plan. Menge has said Point Thomson is essential to the development of a North Slope natural gas pipeline and Exxon Mobil was one of the three participants in a contract that could lead to that pipeline to be built.

It is unclear when state lawmakers will be called on to vote on Murkowski’s gas contract. The 90-day extension ends Aug. 29, but Menge can extend it again.

“I have said that I’m not going to allow this thing to linger indefinitely,” he said. “I’m going to move forward, but not until the Legislature speaks.”

—The Associated Press