Alternatives for Alaska gas
In-state processing would add value
Bob Thomas, Community Perspective
Published Sunday, July 12, 2009
There seems to be no end of proposals to deliver North Slope natural gas to local and outside markets. But the real angst for the Interior is not which one, but when? A year-and-a-half ago, the Anchorage Daily News published an editorial entitled “Gas line — Lots of questions, but no obvious or conclusive answers,” recounting a stalemate. That message is just as valid today and Alaskans are still watching and waiting. Market conditions for Alaska gas continue to be a moving target. Only a year ago, it appeared the Lower 48 was facing a shortfall and record high prices. But for now and the immediate future, it seems that ample domestic supplies will continue to foster a waning market. Gas to process the Canadian tar sands remains the most promising market for Alaska gas — even though Canada’s arctic gas fields are about 300 miles closer to the tar sands. But the all-Canada proposed pipeline is threatened with indefinite delay because it crosses land fraught with unsettled First Nation claims. In contrast, the Alaska TransCanada route is relative clear of right of way issues and could be on line significantly sooner. However, the high cost of building the proposed thick-walled, high-pressure, 48-inch (or larger) steel pipeline remains an ominous economic hurdle to be overcome before any tar sands scenario can really be viable.
But just how much gas does it take to serve tar sands processing? What would a pipeline designed specifically to serve the tar sands look like? What would it really cost? Is a thick-walled steel pipe really necessary? Could the pipe diameter be less? Could it operate at lower pressure? Could it be constructed using HDPE pipe? And (thinking out of the box) would rail transport be practical — given the many other benefits a railroad to the Lower 48 would offer? Hmmm … I don’t know the answer to these questions, but the governor’s experts should. And I think their answers would point us in the right direction.
Perhaps the foremost benefit of this concept is that the pipeline also would serve all identified in-state gas needs as well as liquefied natural gas exports through various takeoffs.
It is my understanding that the gas’ liquid contents must be removed before the remaining methane can be moved in a low pressure line. That suggests an Alaska petrochemical plant would be needed to take care of these valuable liquids.
A petrochemical industry would produce many construction products that are now being shipped into the state: insulation, HDPE pipe, fertilizer, blasting products and filter fabric used in road construction, to name only a few. It could even provide the energy to manufacture in-state cement for hydroelectric projects. Perhaps even the pipe for a pipeline to the tar sands could be made from these liquids. Further, the resulting propane could easily be distributed throughout most rural areas and provide a much needed price-stable energy source.
Serving the tar sands is an old idea that largely depends on the actions of others. But what if we upped the ante to take it one hypothetical step farther? What if Alaska and Canada were to sponsor an international conglomerate to bring these raw resources together to make and market premium transportation fuels? As partners, both would share profits from refined energy products that will always be in global demand. Together, Alaska and Canada have all the components to make it happen — except for a pipeline.
As the Anchorage Daily News stated two years ago, pundits were trying to sort out all the possibilities and who might do what to get Alaska gas flowing. Alaskans are still at it. And if we are to wait for traditional thinking to get our gas sold, then our senior generation will probably never see it, and the rest will continue to cope with highly volatile energy markets, not knowing from one winter to the next what our heating bills will be. Meanwhile, the quantities of Alaska unrecoverable gas unavoidably lost through oil-field operations, along with the valuable liquids, will continue to mount.
It’s time we find a way to chart Alaska’s destiny and stabilize affordable energy for its residents. It can happen. It has been said that there are only three types of folks: Those who make things happen, those who watch things happen and all the rest who just wonder what happened. I like to think our governor and her able staff are in the first group — with answers.
Bob Thomas of Fairbanks is a professional engineer.
http://newsminer.com/news/2009/jul/12/alternatives-alaska-gas/?opinion
