About the Alaska Pipeline Project
Alaskans have high expectations for their natural gas resource. It means opening up the North Slope basin for gas and continued oil development. It means jobs, infrastructure and numerous other benefits that derive from the value added from having a vibrant resource base. Oil and gas are the life blood of state government and the source of the billions of dollars of critical spending required to keep our cities and state healthy, our roads maintained and our schools funded. Historically, payments from oil and gas production have provided approximately 90 percent of Alaska's unrestricted state revenue.
A large pipeline is also our best opportunity to meet another critical need for Alaska - instate gas. TransCanada's Alaska Pipeline Project (APP) represents the best opportunity to realistically meet Alaska's instate gas needs. This project will consist of:
- The Alaska Pipeline Project is a world-class undertaking in all of its aspects.
- The gas transmission pipeline between the Point Thomson field and the GTP consists of a 32-inch pipeline, approximately 58 miles in length, with no compression. The initial capacity of this pipeline has been set at 1.1 billion cubic feet per day (Bcf/d) and is expandable.
- The GTP as currently envisioned would be made up of four trains for the Alberta option, with an initial design to treat up to 5.3 Bcf/d of raw gas and the ability to deliver into the pipeline 4.5 Bcf/d of treated gas.
- The Valdez option would have three trains and treat up to 3.5 Bcf/d of raw natural gas and would have the ability to deliver into the pipeline 3.0 Bcf/d of treated natural gas.
- The Alberta option would include an approximately 1700-mile, 48-inch diameter pipeline (734 miles in Alaska and 966 miles in Canada). The initial capacity would be 4.5 Bcf/d, expandable with compression to 5.9 Bcf/d
The APP, under the requirements imposed by AGIA, has proposed five gas off-take points and two routes: one through Alberta, and a separate route to Valdez IF there is commercial interest by potential shippers of gas to explore an LNG option.
As part of the preparation leading up to open season an in-state demand study conducted by Northern Economics, ISER and SAIC found that residential/commercial demand will be 260 mmcf/day by 2020. In addition to gas off-take points the AGIA legislation and the state's agreement with the AGIA licensee reserves the prerogative for developing a pipeline for in-state needs, provided such a project does not exceed 500 mmcf/day. Additional information regarding the specifications of the APP-proposed gasline are available online at: http://www.thealaskapipelineproject.com/project_description.
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To ensure the most jobs for Alaskans during pipeline development, construction and operation, AGIA requires TransCanada to commit to the following:
- An Alaska headquarters for the project. AS 43.90.130(14).
- Hire qualified residents from throughout the state for management, engineering, construction, operations, maintenance, and other positions on the proposed project to the maximum extent permitted by law.
- Contract with businesses located in the state to the maximum extent permitted by law; establish hiring facilities or use existing hiring facilities in the state; use, as far as is practicable, the job centers and associated services operated by the Department of Labor and Workforce Development and an Internet-based labor exchange system operated by the state. AS 43.90.130(15).
- Negotiate, before construction, a project labor agreement to the maximum extent permitted by law. AS 43.90.130(17).
The Alaska natural gas pipeline will be the largest private sector project in the history of the United States and when completed will provide eight percent of the U.S. natural gas supply. It is hard to conceive of projects on a similar scale. The best comparison might be the construction of the Trans-Alaska Pipeline System (TAPS), which created 28,000 jobs in Alaska as well as many more in the lower 48 states. The oil that came out of Prudhoe Bay was a catalyst that helped pull the nation out of that economic recession similar to the one we are currently experiencing. Once again, Alaska's abundant natural resources provide an opportunity to put our nation's economy back on its feet and put Americans back to work in well-paying jobs.
Earnings and Employment:
On a national perspective, construction of the pipeline and potential expansions could create a jobs boom with direct, indirect, and induced employment. Some of the more compelling figures in this regard include:
- an estimated 250,000 to 303,000 U.S. Jobs
- $220 - $650 billion in savings to U.S. natural gas consumers
- $10 - $14 billion in earnings to U.S. workers
- $40 - $60 billion increase in GDP, and
- $50 - $70 billion in gains to U.S. treasury
Supply - What Alaska has to offer
Underlying the North Slope of Alaska is 36 trillion cubic feet of natural gas, and the U.S. Geological Survey estimates that another 127 trillion cubic feet of technically recoverable natural gas remains to be discovered on the North Slope.1
Prudhoe Bay has at least 24 trillion cubic feet of natural gas, which has largely been injected back into the ground for storage, and to increase oil production from the field. Point Thomson, located between Prudhoe Bay and the Arctic National Wildlife Refuge (ANWR), is Alaska's largest undeveloped oil field with the potential to contribute hundreds of millions of barrels to TAPS throughput. It is also thought to contain trillions of cubic feet of natural gas. The prospect of building a natural gas pipeline to develop Prudhoe Bay gas - and potentially Point Thompson gas - represents a significant source of natural gas for domestic energy consumption in coming years.
In addition to the known North Slope reserves, tremendous potential exists for responsible oil and gas development of the Outer Continental Shelf (OCS). According to a 2009 assessment by the Minerals Management Service (MMS), the OCS has 27 billion barrels of oil and 132 trillion cubic feet of natural gas. Combining OCS reserves to the rest of the state's oil and gas reserves, and Alaska holds 30 percent of the nation's recoverable oil and gas. OCS oil could nearly double the amount of oil transported through the TAPS and provide more needed energy for our nation.
The world-class potential of Arctic Alaska was also evidenced in the 2008 Circum-Arctic Oil and Gas Assessment (CARA) from the United States Geological Survey (USGS), which highlighted that Arctic Alaska is second only to the West Siberian Basin in total Arctic hydrocarbon potential, and has the highest Arctic potential for oil. The USGS study estimates that Arctic Alaska (state and federal lands, and offshore) holds technically recoverable resources amounting to 30 billion barrels of oil, six billion barrels of natural gas liquids, and 221 trillion cubic feet of conventional natural gas.
1 U.S. Department of Energy, Arctic Energy Office.
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Alaska Pipeline Project