Oil Sands Truth: Shut Down the Tar Sands

"Pipeline race is on" (Mackenzie/ Alaska Highway)

It's important to know their rhetoric, but given the lack of other natural gas sources available and the massive energy needs for the expansion of the tar sands as planned by the Governments of Alberta, Canada and the US (along with the major oil corporations and the Department of Energy) this is going to be used by one pipeline to prod the other, to get concessions, and to overall "grease the process" in order to make this pipeline or that pipeline happen faster. Remember this to get the point: as of a few months back, TransCanada has become the major proponent of both pipes-- would they promote one if it would kill the other? Does that sound like "good business sense"?


Pipeline race is on
Paul Bickford
Northern News Services
Published Monday, April 14, 2008

YELLOWKNIFE - A joint effort to build a natural gas pipeline in Alaska has Mackenzie Gas Project backers admitting that an NWT pipeline must go first, or face serious consequences.

On April 8, BP and ConocoPhillips announced they have combined resources to start Denali - an Alaskan gas pipeline.

Pius Rolheiser: Imperial Oil spokesperson says Mackenzie Gas Project would have labour and equipment needs similar to those of Alaskan pipeline.

The pipeline would move approximately four billion cubic feet of natural gas per day to markets.

Bob Reid, president of the Aboriginal Pipeline Group (APG), - one of the partners in the Mackenzie Gas Project - was contradictory in his opinion of the effects the Alaskan project could have on the Mackenzie Valley Pipeline.

"My view is it does not have an impact," said Reid.

However, he said timing of the two projects may be crucial.

Reid suggested if the Alaska pipeline is built first, the Mackenzie Valley pipeline might never be built, which makes the head start of the NWT project important.

The Alaska project would access a natural gas basin about 10 times larger than the Mackenzie Delta, and it alone would meet North American needs for natural gas, he said.

"The Mackenzie Valley pipeline is more advanced in the process," Reid said, adding the Alaska project has not even started the regulatory approval process.

"I think eventually two pipelines will be built, but it's very important Alaska would be second," added Reid.

Increasing the chances of the Mackenzie project going first is the fact the proposed Alaskan pipeline is more technically complex than the Mackenzie Valley pipeline, according to Reid.

"It's a much larger and more challenging project," he said, adding it would have to cross at least two mountain ranges.

Reid said the prospect of an Alaskan pipeline will not deter investors in the Mackenzie Valley pipeline. He said $600 million has already been spent on the $16-billion NWT project.

"I would suggest when investors have that much on the line they want to see the gas flow," he said.

"We believe and continue to believe the North American marketplace is large enough for both projects."

Pius Rolheiser, a spokesperson for Imperial Oil, said he believes two pipelines are feasible.

"My initial response is it will have no effect on the work going on for the Mackenzie Valley project," he said.

However, Rolheiser added, if both projects happened to be built at the same time, they would have similar labour and equipment requirements, which would increase both project's costs. They would also put pressure on TransCanada Corp.'s existing pipeline capacity in Alberta.

The Mackenzie Valley project is still awaiting regulatory approval, and work is continuing on benefit agreements and a fiscal framework.

Rolheiser said a regulatory decision can realistically be expected in 2009, and, if the project goes ahead, it would require several years of preparatory and construction work. It would not be completed earlier than 2014, he said.

"That would be the absolute best-case scenario," he said.

BP and ConocoPhillips plan to spend $600 million to reach the Alaskan project's first major milestone - an open season - before the end of 2010. An open season is a process of seeking customers.

Afterwards, the companies plan to obtain Federal Energy Regulatory Commission and National Energy Board certification and move forward with construction.

The project would consist of a gas treatment plant on Alaska's North Slope and a large-diameter pipeline through more than 1,100 kilometres of Alaska, and then into the Yukon and British Columbia to Alberta.

The project may also include a large diameter pipeline from Alberta to the Lower 48 states.

The announcement of the initiative gave no target date for the project's completion.

ConocoPhillips is also involved in the Mackenzie Gas Project as majority owner of the Parsons Lake natural gas field, 70 kilometres north of Inuvik.

Reid said it is not possible natural gas from Alaska would ever be carried to market on a Mackenzie Valley pipeline, explaining Alaska's Arctic National Wildlife Refuge sits between the two projects.

TransCanada Corp. has also proposed building a 2,700-kilometre pipeline to move Alaskan natural gas to North American markets. Its subsidiary, Foothills Pipe Lines Ltd., has been working on the project since it was first proposed in 1976.


Arctic Gas and Tar Sands

I ran the numbers on planned tar sand projects and it turns out that the Alaska Gas Pipeline and the Mackenzie Gas Project are both needed to supply the gas needed to produce tar sand oil.


There's a misperception that Arctic gas is headed to the lower 48 to supply "clean" low carbon foot print fuel.

At $115/bbl for oil the gas lines will be the enabling technologies for further tar sand development.

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