Denali Pipeline Open Season Begins

Dave Donaldson, APRN – Juneau

Natural Gas producers have a choice of ways to get their resource to market as of this morning. The Denali Pipeline began its Open Season – the 90 days when potential users can make long-term commitments to the project.   Dave MacDowell, Denali’s spokesman, says those who respond to the offer show they are willing to buy capacity on the line.

The Denali line goes up against the TransCanada-Exxon pipeline project, which is working with support from the state under a license approved by the legislature.  The two projects are very similar.  Both will feed into North American gas supplies at the Alberta Hub in Canada.  The TransCanada project’s cost is estimated to be between $32 and $42 billion.  And while TransCanada’s projected tariff for delivery to Alberta is between $2.80 and $3.50, MacDowell says the Denali project is expecting a tariff of $2.65.  Also, there is a federal loan guarantee available to whichever project gets final federal approval.

However, there are differences between the two.  TransCanada carries a state-offered freeze on state taxes for those who respond to the initial Open Season.  Also different is Denali’s absence of an alternate route to Valdez where Natural Gas could be liquefied for export.  But MacDowell says such an option is not off the table completely.

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