Anchorage utility seeks to block exports of Cook Inlet natural gas
Originally published Sunday, November 9, 2008 at 1:55 p.m.
Updated Sunday, November 9, 2008 at 6:23 p.m.
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Stumble It!ANCHORAGE, Alaska -- An Anchorage utility wants a federal appeals court to block exports of Cook Inlet natural gas to Asia.
Chugach Electric Association generates much of the power it sells by burning natural gas.
The utility's petition - with the San Francisco-based 9th U.S. Circuit Court of Appeals - challenges a U.S. Department of Energy decision.
The June decision would allow oil companies, Conoco Phillips and Marathon, to keep exporting Cook Inlet gas through March 2011.
Chugach's Sept. 26 petition is the latest sign of rising local energy tensions in southcentral Alaska, where natural gas is a critical commodity for heating and powering homes and businesses.
Cook Inlet gas fields once held far more gas than needed for local needs.
But gas reserves have begun to dwindle. Signs of tightening supply have shown up in the form of higher retail gas prices as well as the closure of a gas-dependent fertilizer plant in Nikiski.
"Chugach is the largest electric utility in the state of Alaska," Suzanne Gibson, the utility's energy resources director, said in a statement. "We have an obligation and duty to protect our customers by ensuring that there is adequate natural gas in Cook Inlet and that it is available at a reasonable price. That is why we are involved in this case."
Conoco and minority partner Marathon have been exporting liquefied natural gas, or LNG, from the Kenai Peninsula since 1967. The gas is cooled into a liquid and loaded onto tankers bound for utility customers in Japan.
Historically the process accounts for more than a third of total consumption of Cook Inlet gas.
The DOE's Office of Fossil Energy authorized LNG exports for two more years beginning in April, judging Cook Inlet gas as sufficient to meet both local and export demand.
Chugach's request for a rehearing of the DOE order was denied.
Robert Corbin, a DOE official who signed the export order, said he has been advised by government attorneys not to comment on the Chugach court challenge.
A Conoco spokeswoman, Natalie Lowman, also declined comment.
Gov. Sarah Palin and other export supporters said continued overseas gas shipments could encourage Conoco and others to drill for new gas supplies.
But the Regulatory Commission of Alaska recently raised concern about the DOE decision.
The five-member commission said in an October order that the DOE as well as state officials "could have done a better job in ensuring that local needs were met at reasonable pricing terms before the LNG export license was extended."
The panel at the time was considering two wholesale gas supply contracts for Enstar Natural Gas Co.
Community Discussion
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No worries. Our energy export policy is reminiscent of the British controlled agricultural policies of the 1800's. Apparently the Irish, were allowed to starve while their crops were exported to more favorable markets ("Do you have any idea what that stuff is worth?")
So freeze in the dark, Alaska, but comfort yourself with the knowledge that your gas and oil is going to making cheap fertilizer, and toys for happy meals for other countries, and as an added benefit it helps reduce the balance of trade. So do your part, and throw another stick of wood into the stove.
Don't have a wood stove? Well you had better get one. they make some fine cast iron models in China, using only the best American scrap. Available at a Wal-Mart nearest you.
We need to find a balance between the price of NG and the cost of exploration ,,,,, or should we just let the free market do that?
jonpauls--- Right On!! 'The Alaskan Royalty' thinks Royalty Gas&oil is for their own use....
....the peons can freeze in the dark.
'The Alaskan Royalty' can lose $10billion of Alaska's Sovereign Wealth Fund by being totally asleep at the wheel and nobody seems to think it could have been avoided. Meanwhile there's many Americans who have seen the warning-signs and repostured their investments without losing a dime.
Once the gas is gone then they will monopolize the trees, then No Alaskans will be permitted to cut firewood.
I am not surprised that this is being done. It should be been done by us living in all parts of Alaska. I say that because we have been negligent in exerting our influence on Cook Inlet Gas that we could have been using in all of our communities all of these years. We could be using it today if we could get past the technical problems of delivery to villages and some of our leaders stubbornly holding on to using diesel as our primary source of electricity. I hope that the effort to stop exporting gas we need in Alaska is successful.
Alaska first for gas then the US and then other places.
I agree we need to meet our own demands first, but having knowledge of the issue, there is a problem. Alaska gas demand varies enormously from summer to winter. The problem is that production can not vary with demand. If you turn off the valve on a gas well it might not turn back on in 6 months. To make up for this variance and to keep an incentive for new exploration the oil companies seek LNG exports. The solution is to find a balance and make sure Alaska demand is met first as guaranteed in the Alaska constitution.
Stabilized Gas Production is helped by using skillful use of Gas Storage techniques.
Petro-Geologists have identified stable underground storage in many of the old nearly empty Cook Inlet gas-formations that can hold many BCF of gas.
A statewide polypipe gasline network will hold a large volume of gas internally, and will access many other smaller underground gas source/storage locations...
there's many different methods of gas-storage, some can co-generate heat for homes where needed.
Everyone seems to have taken their eye off the ball again...we have aboundant Hydro resourses in the Cook Inlet area, as well as unknown quanities of Geo Thermal energy available for production and use. First Chakachamna should be brought on line followed by Phase one of Susitna. Chugach Electric, or for that matter all the Rail Belt Utilities, have not done a good job of looking to a long term affordable source of re-new able energy that lies within reach...Alaska should be selling its non-renewable resourses and producing its re-new able resourses for in State use.
We have the Money, we have the Technology, we have the need...all we lack is the Political will to move forward...No one should be talking about cold or dark...only the bright future for all Alaskan's if we choose to move forward.
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