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Proposed Natural Gas Pipeline from Alaska to Cost $20 Billion

As winter approaches in the United States, people living in the northern states are bracing for cold weather… and what are expected to be huge increases in home heating costs. Because of high demand and limited supply, prices for crude oil and natural gas have been climbing. The northernmost state of Alaska has been working with energy companies to develop large fields of natural gas in the Arctic region of that state, but transporting the gas from above Canada to the lower 48 states is the problem.

Oil production in Alaska peaked many years ago, but there is an abundance of gas still in the ground. Natural gas is the fuel of choice for many consumers because it is relatively clean burning and, until recently, inexpensive.

The problem is getting the gas from this far-north region to the consumers who need it several thousand kilometers to the south.

The solution favored by energy companies and the state of Alaska is a 5,600-kilometer pipeline that would cross into Canada and eventually link up to a U.S.-distribution system.

It would cost $20 billion to build, but the director of Alaska's Oil and Gas Division, Mark Myers, says it will be a lifeline for the US economy. "The shocks we are seeing with oil right now will be relatively small compared to what will happen if our domestic supply of natural gas runs short."

Mr. Myers says the state wants to push forward with the pipeline plan as soon as possible.

"It is absolutely critical that that gas get to market as soon as it can. We are hoping as early as 2012, and it may be as late as 2015, but really, the country needs that supply."

One of the lead companies working on this project is BP, which already has extensive facilities in the Prudhoe Bay area.

BP-Alaska's Scott Digert says the gas pipeline concept is similar to the already operating trans-Alaska oil pipeline. It was built in the early 1970's, over the objections of environmentalists who worried it would destroy the fragile tundra.

"Fundamentally, this pipeline runs cross-country across Alaska. We have to be above ground, as you can see, on these vertical support members to keep the warm pipeline out of the frozen tundra."

In spite of its exposure, state and federal officials say the oil pipeline has proved to be safe and has little impact on the environment.

The proposed gas pipeline would be even more secure, according to Scott Digert, because it would not be elevated above the tundra. "If a gas pipeline starts here, it would be buried here in the permafrost. That would be a cold line and we would put it under ground to actually help secure it."

Unlike oil, natural gas has to be chilled before it can be sent down the pipeline, so it would pose no threat to the frozen ground of the tundra.

If it is built, the Alaska gas pipeline would constitute one of the biggest private projects in U.S. history. Even if the project were to get underway soon, experts say it will be at least eight years before any gas would move down the line. But, by that time, given the current pattern of rising demand, that gas will be very much needed.