Alaska North Slope producers say the biggest hurdle facing construction of a natural gas pipeline across the state to a planned liquefaction and export facility on its southern coast is the state's uncertain fiscal regime, US Sen. Lisa Murkowski (R-Alas.) said following meetings in Houston with the three largest ANS producers.
The companies have raised this point repeatedly with the Alaska's legislature, she noted. "I wanted to hear directly from the companies about where they are in the planning and design process, and what they see as the next step to advance the project," said Murkowski, who is the Senate Energy and Natural Resources Committee's ranking minority member.
She added that she was encouraged by the level of cooperation that exists among ExxonMobil Corp., ConocoPhillips, and BP PLC around a single export project for the ANS's estimated 35 tcf of gas.
Murkowski said she met on Oct. 22 with Lamar McKay, chairman and president of BP America Inc.; John Minge, president of BP Exploration Alaska; Matt Fox, executive vice-president of exploration and production at ConocoPhillips; and Rich Kruger, president of ExxonMobil Production Co.
It's important for Alaska gas to be priced competitively in global markets to ensure development of a project that could cost up to $65 billion, the senator said. She also said she pressed the executives to move quickly and seize the opportunity to ship Alaska gas to Japan, South Korea, and other Pacific Rim customers.
"Alaskans have waited 4 decades to see some benefit from their [ANS] gas," Murkowski observed. "While Lower 48 markets may be oversupplied because of the shale boom, places like Japan and South Korea are willing to pay a premium for long-term supply contracts. But that window of opportunity will not remain open indefinitely."