ANCHORAGE, Alaska, May 18 (UPI) -- An Alaskan natural gas pipeline coalition between BP and ConocoPhillips said it was scrapping a $35 billion project in part because of North American shale.
BP-Conoco venture Denali said it was giving up on plans to build a natural gas pipeline, saying development of shale gas resources in North America "created a very difficult environment" to get financial commitments from potential customers.
Denali President Bud Fackrell said his company was walking away from the project because it didn't have enough customer support.
"Although we have been in discussions with potential shippers for nearly a year and a half, we have been unable to secure the financial commitments necessary to advance the project," he said.
Fackrell said the company spent more than $165 million on the project since 2008.
Denali was designed to deliver about 4.5 billion cubic feet of natural gas from Alaska per year. It was competing against a similar project backed by TransCanada Corp.
Opponents of the conventional gas pipeline said new technology to exploit gas locked in shale deposits in the Lower 48 undermined the need for Denali. U.S. shale deposits are located primarily in Pennsylvania, Texas and Louisiana.