|
Murkowski, Wyden on Alaska energy tour Senate energy leaders express need for bipartisan approach to energy in Alaska and U.S.; comment on gas exports & other issues By Alan Bailey Petroleum News
After a 48-hour “mini-tour” of some Alaska energy projects and facilities, Sen. Lisa Murkowski, R-Alaska, and Sen. Ron Wyden, D-Ore., spoke to reporters on Aug. 28 about what they had observed on the trip, and about some of the energy issues facing Alaska and the United States.
The two senators are lined up to become the chair and minority ranking member of the Senate Energy and Natural Resources Committee after the November election. Last year Murkowski visited energy production facilities in Wyden’s home state of Oregon and met with energy executives there.
The energy tour, focusing on the Interior and Southcentral Alaska, involved a visit to Chena Hot Springs, to attend the Chena Renewable Energy Fair and to see the geothermal facilities at Chena; a visit to the permafrost tunnel near Fairbanks; a visit to the liquefied natural gas export facility at Nikiski on the Kenai Peninsula; and a visit to a Hilcorp offshore oil and gas platform in the Cook Inlet.
Wyden expressed what he sees as a need for a more bipartisan approach to energy policy in the U.S. Congress, with party gridlock impeding progress towards U.S. energy independence.
“The two of us … understand the cost of this gridlock back in Washington, D.C.,” Wyden said. “It’s hurting us and our efforts to become energy independent. Energy independence and creating more good paying jobs go hand-in-hand. I certainly saw that over the last couple of days.”
LNG exports Both senators commented on issues relating to the export of liquefied natural gas, or LNG, from Alaska.
Murkowski said that she had spoken to people in ConocoPhillips, the owner of the Nikiski LNG facility, about the situation regarding the current contract for the export of LNG from Cook Inlet to Japan. She said that she hoped that new exploration and development activity in the Cook Inlet basin would lead to further opportunities for LNG exports, but that at the moment there are only about five more shipments to export. The current contract for the sale of LNG to Japan expires next year and ConocoPhillips has yet to determine what to do beyond that.
“They’re still in a decision making process,” Murkowski said.
Commenting that evidence from the Alaska experience suggested that LNG exports should not hurt domestic gas prices in the way that some people fear, Wyden said that the people at the Nikiski LNG facility “had made some good arguments for why they ought to be able to continue to export natural gas.” People in Alaska have told him that, given the glut of shale gas in the Lower 48, Alaska gas will not have much of a market for its gas without the ability to export, he said.
“This country has to come up with a sensible policy with respect to energy exports,” Wyden said.
North Slope gas Murkowski, commenting on the continuing saga of how to find a market for North Slope gas, said that people outside of Alaska cannot figure out how, with so much resource in the state, it has not been possible to “thread the needle” of bringing the gas to market. With talk about everything from an in-state “bullet line” to the construction of a gas-to-liquids facility, people in Alaska are “all over the board” on this issue, she said.
“We recognize that we have great opportunities but how we are able to come together as a state with a project that will allow us to deliver gas to market, whatever that market may be? We have not yet been able to advance that,” Murkowski said.
Alaska needs to make a commitment to a project and facilitate that project while there still is a market to sell into — Japan is actively looking for gas at the moment but Alaska is not ready to step up, to help meet the need, Murkowski said.
Revitalizing fields In terms of how to increase Alaska oil and gas production, Wyden said that he had been particularly impressed by what Hilcorp is doing in Cook Inlet to produce more resource by revitalizing existing fields through operations such as well workovers. Hilcorp is “putting the dollars into it, enabling increased efficiency, increased productivity with no additional footprint,” he said.
This is the type of strategy that policymakers should follow up on, with respect to energy policy and tax reform, Wyden said.
“I want to learn more about this. … This struck me … as something that has the potential to bring both sides together — environmental folks and industry people — because you wouldn’t be talking about drilling a new well or building another platform. You’d be talking about making better use of an existing resource,” he said.
‘Big ideas’ And, when it comes to renewable energy, people who think that there are no “big ideas” left to pursue might want to talk to Bernie Karl, owner of the Chena Hot Springs Resort, Wyden said. Karl has been pioneering the use of geothermal energy at Chena.
“He’s got more big ideas in three or four minutes than you could possibly pick up on,” Wyden said.
Revenue sharing Asked about the sharing with Alaska of oil and gas revenues that come from industrial activities on the federal outer continental shelf, Wyden said that there had been a challenging debate on this topic this year in the Senate Energy and Natural Resources Committee; that debate had not reached a vote. Wyden said that he was going to work closely with Murkowski and some other senators with an interest in revenue sharing, to seek opportunities to bring both sides of the debate together. There is a chance of finding some common ground, especially with an election closing the chapter represented by past debates and allowing people to move on, he said.
|
