Blog: Dermot Cole
Exxon deal moves project ahead, state officials say
Published Monday, June 15, 2009
The deal between TransCanada and Exxon moves the gas pipeline project forward because it improves the chances that BP or ConocoPhillips or both may see an advantage to be gained by joining the fold.
That's one of the ideas that two key Palin administration officials shared with us in a meeting today.
We met for more than 90 minutes with Department of Natural Resources Commissioner Tom Irwin and Joe Balash, an aide to Gov. Sarah Palin, about the latest news regarding TransCanada and Exxon.
It was a good discussion. I still think it's too soon to say exactly what the Exxon agreement will mean in the long run, but I think Irwin and Balash convinced me that this does change the dynamics among the three oil companies as they look out for No. 1.
The two Fairbanksans said the state learned all the details of the TransCanada and Exxon deal over the past several weeks.
Irwin said that the companies are keeping the financial facts secret because they don't want to put themselves at a disadvantage when trying to get the two other oil companies involved in the project. That information would never be shared in a commercial deal, he said.
BP and ConocoPhillips are backing the competing Denali project.
Exxon’s involvement elevates TransCanada’s position in the corporate jockeying that takes place out of the public eye.
Just about everyone has said that in the end, there will probably be just one project going forward. The ingredients of the package are subject to change, however.
Regarding the oil companies’ desire for a long-term guarantee on taxes, Irwin said there is a difference between what the companies want and what they need.
The state will know more in a year or so about what the companies need.
In the meantime, the pipeline studies will continue to add information to help pin down costs. Negotiations about “tax certainty” will eventually take place when far more information is available than was the case during the Murkowski era, Irwin believes.
Asked about the negative comments from Enbridge on the economics of Alaska gas, Balash said the company is a TransCanada competitor and that shale gas is not the grave threat Enbridge is making it out to be.
Plus, shale gas is not going to be a bargain. Enbridge says it would like to join the Denali project.
Did they talk about how the state of Alaska will be paying Exxon (thru Transcanada/AGIA) for their old studies done back in early 2000 or that Transcanada expects the Mackenzie pipeline will be built first?
A cat and mouse game between Enbridge/CP/BP and Exxon/Transcanada. They will play out their chess match (probably more for sport) while Alaska painfully watches the decline in TAPS production, and have us on the ropes in a few years willing to settle for anything.
Since 1959 we've heard some variation of this news. Here's a recital of the recent past:
Jan 22, 1997- ADN, "Slope gas profitable by 2010" BP sees gas startup by 2008- 2010.
Dec 28, 1998- PNA (Petroleum News), "Project looking for best combination of pipeline, plant, ships, financing" ARCO describes how first LNG delivery should begin in late 2007.
Jan 28, 1999- PNA, "Developer says plans proceeding toward bulding Alaska gas pipeline". ARCO says, "A good targt date is 2007 for the first gas deliveries to the Asian Far East".
March 4, 2000, "BP, ARCO merger summary". "BP will make Alaska a centerpiece of its global gas activities to commercialize North SLope gas."
Sep 16, 2000, ADN "Gas line backers eager". Three North Slope Corps testify before the Senate. They describe gas flowing by 2007, and FERC filings by 2001.
Sep 21, 2000, ADN, "BP aims for gas by 2007". BP executive describes how project is being planned "aggressively".
Jan 27, 2001, ADN "Gas line no done deal". BP's Richard Oliver, says that BP and other major oil companies are commited to building by 2007 a gas pipeline- BP, Exxon Mobile, and Phillips Petro have put "75 of our best people" in a special downtown office to study the gas pipeline project.
Feb 16, 2001 ADN "Juneau hot spots- gas line plan..." Governor assumes right of way application to be filed in 2001.
Sep 11, 2001, ADN "Gas producers spurn tax breaks". "We're not seeking fiscal incentives, says Dave McDowell- BP, Exxon, Phillips consortium manager. Article describes a 100 million dollar effort to investigate building a gasline to the Lower 48.
Feb 16, 2002 ADN "BP's gas pipeline plans go on hold". When describing when the gas line would go on-line: "It might be 2008, but its perfectly liekly in 2009 and it could be in 2010," said Dick Oliver, BP head of upstream oil operations.
Huge Win for sarah and Alaska!!
Fasten your seatbelt, your about to be taken for a ride
by these scheming, crooked big oil companies, to the
cheerleading of silly sarah and her coharts.
Let's pay for another study!
Lets fund a study to figure out the Guv!
Jaybird's campaign was that Fairbanks would have gas in 5 years. I have not seen any input from him ever to help this pledge. Don't get near his backside with a match, that is for sure.
What I do not know is 'who actually voted for Jaybird, I know I did not. The people that are in his district need to "look and see" what he has done for the Interior before once again voting for him. All I heard from him back then was "First gas to Fairbanks Wins". So what is the consolation prize Jaybird? It's obvious we have no gas yet, but what role are you playing Jaybird in helping get gas to Fairbanks in the near future? I hope the next session you have is better than the lasst one!
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