Feasibility of N. Slope gas project under study

ANCHORAGE - The Alaska Natural Gas Development Authority is preparing reports on the feasibility of an Alaska liquefied natural gas export project that would market North Slope gas.

• Photos

The reports, however, won't say whether the project is viable, only that prospects are encouraging enough to warrant further work, Harold Heinze, the authority's executive director, told its board of directors.

Tim Bridgman, an Anchorage consulting engineer who is leading the consulting team on the feasibility study, said it will take another year and more money to complete a final feasibility study.

"Only then will we be able to answer the question of whether we really have a project," Bridgman told the board earlier this month.

At that point, the state would have to make a major commitment of $200 million to $300 million to do more detailed engineering studies, he said.

Those studies would take two years to do, and by mid-2007 the state would be in a position to decide whether or not to actually build the project, which would cost about $10 billion and be in operation in early 2010.

The Legislature appropriated $300,000 so that the authority could do an initial feasibility study.

Heinze and his staff reviewed progress on the report, required by a ballot measure approved by Alaska voters in the November 2002 general election.

The report will be published in September and will include the results by work by consultants on the project, Heinze said.

Wood Mackenzie, a U.K.-based international consulting firm, was retained to compare possible delivery costs of Alaska LNG compared with LNG delivered from Sakhalin in the Russian Far East, Indonesia, Australia, Qatar and other places which produce gas and sell LNG in the Pacific region.

Stone and Webster, another consulting engineering firm, was retained to review costs of an LNG plant built in southern Alaska.

Heinze said he is comfortable with information the authority has on costs of building a 36-inch, 800-mile gas pipeline from the North Slope to southern Alaska, but he said the LNG plant estimates the authority has are more questionable.