Construction of gas pipeline years away

Posted: Sunday, April 01, 2001

WHITEHORSE, Yukon Territory (AP) -- The three big producers of natural gas in Alaska remain committed to making a route selection for a transcontinental pipeline by the end of the year, if the idea is financially feasible.

Regardless of what route is chosen, however, construction is at least four or five years away, according to John Carruthers, a program manager for the North American Natural Gas Pipeline Group, a group formed by BP Exploration (Alaska), Phillips Alaska and ExxonMobil Production.

Carruthers and other representatives of the group were in Whitehorse for a series of meetings and presentations.

Carruthers, who is charge of overseeing the regulatory issues, and three other representatives were bombarded with questions following their presentation Friday, the Whitehorse Star reported.

Interest ranged from the immediate to the long term:

How much will Yukon benefit from the $75 million the pipeline group will spend this year to study the route selection? How much of the millions of tons of steel required for pipeline construction will be transported by road and how much by water, and are Yukon highways up to the challenge? And can local businesses expect to compete for service contracts with companies from the south?

''We do have a preference for local content, both local labour and local commodities, if we can,'' one representative said. ''We feel it helps our corporate image here and it builds the area, and if the area is strong, it can support us even better. It is sort of a symbiotic relationship.''

A good deal of the money will be spent in the engineering and design offices within the existing corporate structure, and in the offices of companies hired to augment the research and design work, the audience was told.

The representatives said a good deal more will be known about how much of the study money will end up in the Yukon once the general contracts come out.

In an interview afterward, Carruthers said the first of the contract awards for the research work into route selection will be announced any day now.

He acknowledged that some in the territory see economic salvation in the construction of a pipeline through the Yukon along the Alaska Highway corridor.

He stressed, however, that there's been no decision to build a pipeline for transporting natural gas from Alaska's North Slope.

''It is not a certainty,'' he said. ''But I think you can also tell by our commitment that we think it is a serious potential outcome.''

A bill recently introduced to the Alaskan legislature would prohibit leases on state-owned submerged lands in the Beaufort Sea. Sen. John Torgerson, R-Kasilof, introduced the bill, which is getting a lot of support from other Alaska state senators.

The bill would prohibit the northern or ''over-the-top'' route leading from gas fields east to the Canadian Arctic, one of the major routes under consideration. Another is a southern route down the Alaska Highway.

Torgerson, R-Kasilof, said the legislation would go a long way to ensuring that Alaskans get the maximum benefit from bringing the state's natural gas to market.

Carruthers said if the bill passes, the group will have to decide how to proceed, although he doesn't believe the legislature has all the answers on environment and economic issues that it should have before ruling out the offshore option.

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