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Alaska weighs natural gas options

July 8, 2011 at 8:09 AM

JUNEAU, Alaska, July 8 (UPI) -- Alaskan officials and executives said they were divided over whether a new pipeline or liquefied natural gas was the best choice for the energy sector.

Alaska is considering a 737-mile, 24-inch pipeline from North Slope fields as an alternative to a 48-inch pipeline planned by TransCanada and Exxon Mobile. Neither company has been able to secure agreements with suppliers for the $42 billion project, however.

The Alaska Gasline Development Corp., in statements before Alaskan legislators, said the 24-inch pipeline could cost around $7.52 billion, down from the 2010 estimate of $8.4 billion, the Alaska Journal of Commerce reports.

AGDC Chief Executive Officer Dan Fauske said the project would cost about half of what it would to import liquefied natural gas as an alternative backstop.

ConocoPhillips, which operates an LNG plant, said it would take substantial investments to upgrade existing facilities in the state, the report adds.

Fauske said his cost estimate could fluctuate as much as 30 percent, however, adding an "aggressive" estimate on the smaller pipeline puts it into operation by 2019.

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