BP Canada says fundamentals in place for gas pipeline

Gary Park

A BP Canada official predicted a pipeline from the North Slope will be flowing natural gas by 2007 to meet a projected rise in North American demand of 15 billion cubic feet per day over the next 10 years.

Brian Uhrich, BP Canada’s northern pipeline project manager, told a Petroleum Society meeting in Calgary that the fundamentals are in place for such an undertaking.

But he said BP has yet to choose its preferred route from the southern, central or northern options.

However, Uhrich said BP favors a two-stage development, starting with development of the North Slope, then shifting to downstream market options that would focus on reservoir optimization and construction of a gas treatment facility to handle the 12 percent carbon dioxide content in Prudhoe Bay gas.

He said neither of the gas-to-liquids or liquefied natural gas options is “currently economic and we need something to help them become economic.”

With Prudhoe Bay reserves estimated at 26 trillion cubic feet, the region could easily support 2 billion cubic feet per day of natural gas sales, Uhrich said.

Although the price tag for a northern pipeline is still in the range of $9 billion to $12 billion, he said advances in high-pressure line and construction techniques have been considerable since the first Arctic project was floated about 25 years ago.

As well, many of the aboriginal land claims that blocked Arctic development in the 1970s have been resolved, although the Yukon Territory still has seven of 14 claims outstanding.

Uhrich said that dealing with various stakeholder interests and untested regulatory powers will be among the sternest challenges facing pipeline developers.