Marathon brings new gas to market

Posted: Tuesday, November 11, 2003

It's been about three years since Marathon and Unocal announced new natural gas finds in the Ninilchik area, and today that new gas is moving to market through a new pipeline from Ninilchik to Kenai.

John Barnes, Marathon Oil Company Alaska Business Unit Manager, recently addressed the North Peninsula Chamber of Commerce and complemented the labor force that has brought the project to completion. "It's a huge sense of accomplishment, my compliments to all the Marathon people, Unocal people, and all terrific work force that supported the project. It feels good to know that we are now on production. There has been a lot of activity, a lot of support from the community and various local contractors and overall it's a good step forward for the Cook Inlet gas business," said Barnes.

According to Barnes, Marathon plans to continue development and exploration in the Ninilchik and Kasilof areas plus continue to look at other exploration opportunities on the Kenai Peninsula. New legislation enacted last session is beginning to have an impact in stimulating exploration interest among oil and gas operators in the Cook Inlet basin. "House Bill 61 was an investment tax credit geared toward this activity and there were other bills that were passed in the last legislative session that will encourage activity hopefully. The supply and demand curve will also create price need for gas and that will also be an encouragement for others to look because the gas is now worth more than it was in the past," added Barnes. As the price increases in the Cook Inlet and becomes equal to other areas, companies will look at the best geological opportunities, infrastructure and regulatory environment to decide where they will spend their money, and Barnes now feels that Alaska may have some things to offer in those areas. Barnes cautioned that the recent successes on the Peninsula does not signal a windfall that people might be looking for from a gas development on the North Slope or a LNG plant at Valdez and that it represents only a small amount of the work that is needed to address the demand issues of the Cook Inlet.

During the development and construction of the new pipeline Marathon put great efforts into keeping the community informed and answering questions of property owners. "We appreciate the opportunity to work with our neighbors down there. We've leased some land from individuals for our facilities, on average we've done our best not to adversely impact any of the people that we're working with. We've had several public meetings and have employed people in the area from various trades and professions and I think there will continue to be activity down there that will support the local economy," said Barnes.

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