In a Compass piece last Sunday in the Anchorage Daily News, Larry Wood breathlessly declared that AGIA is dead. In fact, he thinks any pipeline to the Lower 48 is dead. Apparently no one told the Denali pipeline team. Poor BP and ConocoPhillips haven’t figured out that a pipeline to the Lower 48 is a no-go. And what’s worse, neither has President Obama and his administration. BP and ConocoPhillips are still moving right along with their Denali pipeline. Both Denali and TC Alaska have been granted pre-filing status by FERC. Both are making construction and engineering plans and anticipating the 2010 open season. So what is Larry talking about? It’s difficult to decipher his reasoning (such as it is). At one moment he asserts that a natural gas bullet line from the North Slope to Southcentral Alaska is essential. I don’t know if anyone has informed him that Gov. Palin agrees that making sure Alaska’s natural gas reaches the in-state market is a top priority. In the op-ed that Larry is apparently responding to, Gov. Palin stated: Ensuring that Alaskans have affordable energy for decades to come is one of the most important jobs on my desk right now. To succeed, the state needs to look at every possible option and make sure Alaskans have all the information to make the right decisions. That’s why I asked the Legislature to fund a thorough review of an in-state pipeline to move natural gas from the North Slope to Fairbanks, through the Railbelt and Southcentral regions, serving as many communities in the state as economically feasible. She went on to state: Our effort complements the progress TC Alaska is making on a line to the Lower 48, using its state license under the Alaska Gasline Inducement Act. Alaskans can look forward to all the benefits the AGIA project will produce. We are not walking away from efforts to promote development of a spur line coming off the “big line” to distribute gas to Alaskans. And we are not walking away from the long-standing hope that someday a gas liquefaction plant may be built in Valdez to ship Alaska gas to ports all along the world’s Pacific Rim. We are reviewing all options to ensure Alaskans know all the facts about progress to flow gas to our homes and businesses. An in-state gas line to serve as many communities as possible is one of the options and would not interfere with plans for the larger interstate pipeline. Geologists say there is enough gas throughout the North Slope for both pipes. There is enough investor interest for both pipes. And there may be enough consumer demand for both pipes. So, Alaska has enough for both. And an in-state bullet line does not negate the construction of a big line to the Lower 48. And a spur line off the big line and a gas liquefaction plant in Valdez are still on the table. Gov. Palin is being pragmatic in moving forward with AGIA and at the same time making sure Alaska is covering in all possible contingencies. No one can predict the future. We can only plan ahead to cover ourselves for all possible outcomes while at the same time pushing forward on the best plan – which is AGIA. Larry is in love with the LNG out of Valdez option. Surely he’s aware that that is still a possibility with the TC Alaska line. It was part of the planning process. You might say, it’s on the map (click to enlarge): Basically, Larry thinks that the discovery of huge natural gas reserves in the Lower 48 makes an Alaska natural gas pipeline irrelevant. Gov. Palin and her gas line team have repeatedly said that Alaska’s natural gas will be a complement to these other discoveries. Ben Casselman had an excellent article in the Wall Street Journal last month about the future of natural gas: A climate-change bill being pushed by President Barack Obama could boost reliance on natural gas. The bill, which could emerge from the House Energy and Commerce Committee in May, is expected to set aggressive targets for reducing emissions of carbon dioxide, the most prevalent man-made greenhouse gas. Meeting such goals would require quickly moving away from coal-fired power plants, which account for substantial carbon emissions. President Obama wants the U.S. to rely more on renewable energy such as wind and solar power, but those technologies aren’t ready to shoulder more than a fraction of the nation’s energy burden. Advocates for natural gas argue that the fuel, which is cleaner than coal, would be a logical quick fix. In addition, billionaire energy investor T. Boone Pickens has been touting natural gas as an alternative to gasoline and diesel for cars and trucks. “The availability of natural-gas generation enables us to be much more courageous in charting a transition to a low-carbon economy,” says Jason Grumet, executive director of the National Commission on Energy Policy, who was a senior adviser to President Obama during the campaign. Environmentalists and resource developers have finally found a common love – natural gas! The growing supply created opportunities for policy makers and environmentalists, who saw natural gas as a possible solution to the nation’s energy problems. Some groups suggested burning more gas and less coal for power generation. Others favor its use in vehicles. Mr. Pickens has spent millions promoting an energy plan that aims to, among other things, convert thousands of big-rig trucks to run on natural gas. Mr. Pickens has large investments in natural gas and stands to benefit if his plan is adopted. In TV ads, Internet videos and speeches, he emphasizes a different goal: reducing U.S. dependence on foreign oil. […] Some environmentalists have embraced Mr. Pickens’s plan as a way to fight climate change. Carl Pope, executive director of the Sierra Club, says he sees natural gas as a “bridge fuel” that could help the U.S. burn less coal and oil until renewable sources of energy are ready to...
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