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ASRC buys into Alpine pipeline on North Slope Native corporation sets up pipeline company, takes one-sixth position in line Kristen Nelson PN Editor-in-Chief
Arctic Slope Regional Corp., the Native regional corporation for Alaska's North Slope that said in July it is expanding its scope to become an independent oil and gas producer in its own backyard, is anteing up $15.9 million to buy an interest in North Slope oil infrastructure.
ASRC formed a pipeline company, ASRC Pipeline Co. Inc., and has purchased 16.667 percent of the Alpine Transportation Co., the entity which owns the pipeline connecting ConocoPhillips’ Alpine field near the Colville River to the main North Slope pipelines to the east.
Teresa Imm, long-time ASRC land manager, has been named president of ASRC Pipeline Co. Imm is also in charge of the ASRC-BP mentoring agreement signed in March that established a framework for slope producer BP to share data and technical knowledge with ASRC, including information on unit and near-unit oil and gas investment opportunities on the North Slope that the two companies might pursue together. (See cover story in the July 13 edition of Petroleum News.)
ASRC is a royalty owner in the Alpine field, and its oil and gas leases include an option to purchase a portion of the transportation system. The corporation decided to exercise that option, and as the final step, ASRC Pipeline and Alpine Transportation submitted a joint application to the Regulatory Commission of Alaska for approval of the acquisition by ASRC of a minority interest in the pipeline system. Kuukpik Corp., the Native village corporation of Nuiqsut, has an option to acquire a portion of ASRC's interest.
ASRC Pipeline will pay an estimated $15,889,284, 16.667 percent of Alpine Transportation's “rate base capital” estimated to be $95,333,800 as of Dec. 31, 2002, to purchase a minority 16.667 percent of the company. The acquisition has an effective date of Jan. 31, 2003. ConocoPhillips will continue to operate The present owners are ConocoPhillips and Anadarko Petroleum, partners in the Alpine field and the Colville River unit, who own Alpine Transportation, through subsidiaries, in the same proportion as their field ownership: ConocoPhillips 78 percent and Anadarko 22 percent. Once the ownership change is approved by the commission, the ConocoPhillips subsidiary will own 65.333 percent of Alpine Transportation, the Anadarko subsidiary 18 percent and ASRC Pipeline 16.667 percent.
ConocoPhillips operates Alpine Transportation, and that will not change, the companies said.
The pipeline has been transporting crude oil since 2000 on 34 miles of 14-inch outside diameter pipeline. Assets also include: shipping pumps, crude oil metering/meter proving facilities, the Colville River crossing facilities, pipeline supports, metering flow control facilities at central production facility 2 and pipeline pig facilities.
The companies told the commission that ASRC had a right, as a royalty owner at Alpine, to join the transportation company as a one-sixth partner. It notified Alpine Transportation in July 2002 that it wished to exercise that option. ASRC Pipeline and Alpine Transportation told the commission they executed a contribution agreement June 26 to allow ASRC Pipeline to acquire a one-sixth interest. The $15.9 million contribution to capital from ASRC will be distributed to ConocoPhillips and Anadarko.
Alpine Transportation's 2002 gross revenue was $30,833,019, the companies said, earned transporting approximately 35,054,938 barrels of oil.
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