alaska north slope gas commercialization

Alaska North Slope Gas Commercialization:

An update from the Alaska Gas Pipeline Project Office

04/10/2023 – Kurt Gibson, Director

04/10/2023 Alaska Statute 43.90.010(1)-(4)

Gas Pipeline Project Office

• Created by legislature in 2007 as part of a broader law -

Alaska Gasline Inducement Act, (AS 43.90) –designed to

expedite construction of a natural gas pipeline that:– Facilitates commercialization of ANS gas

– Promotes exploration & development of ANS oil & gas resources

– Maximizes benefits to Alaskans from development of state oil &

gas resources

– Encourages oil & gas lessees … to commit to ship natural gas

from ANS for transportation to markets in this state or elsewhere

04/10/2023

Gas Pipeline Project Office

• Streamlining of state regulatory process – providing value by reducing project delay

• Coordinate among all State-backed efforts– AGDC is the organization responsible for satisfying in-state energy

needs– ANGDA was created by voter initiative to “construct or cause to be

constructed”

• Coordinate among State agencies directly involved in crafting a balanced and effective fiscal agreement– Department of Natural Resources– Department of Revenue– Department of Law– Others less directly involved

04/10/2023

Gas Pipeline Project Office

• Shared risk during development phase– History of false starts– Lack of alignment among key actors– State’s sense of urgency

• Key State interests– Lowest reasonable transportation rate

• Project cost• Tariff terms

– Access for natural gas explorers• Expandability• Periodic solicitation

04/10/2023

Project State of Play

• Gas Pipeline Project is over 30 years old– Much is known– Much remains unknown– Suite of Project Risks is unique

• Since 2007– First Open Season (APP)– Second Open Season (Denali)– Field work and Resource Reports which support any project

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Project State of Play

• Global Energy Market is Dynamic– Technological progress– Geopolitical uncertainty

• Current alignment among parties is unprecedented– Independent pipeline company - TransCanada– Global energy giants – ExxonMobil, BP, ConocoPhillips– End-user interest?

• Regulatory and Technical work must continue to progress while Commercial alignment develops

04/10/2023

Governor’s leadership

• October 2011 AOGA Address – Pursue “commercial alignment on … a large diameter pipeline to tidewater”

• January 2012 State of the State Address– “harden (the) numbers on an Alaska LNG project (and) … identify a

pipeline project with an associated timeline” by the end of Q3 2012

• March 30, 2012 Announcement– CEO letter affirming the three ANS majors commitment to pursuing the

Governor’s directive– Resolution of Pt Thomson litigation

• Align under an Alaska Gasline Inducement Act framework and examine the potential for consolidation of natural gas transportation infrastructure projects

04/10/2023

Key State Interests

• Open North Slope Basin to broad portfolio of investors

• Lowest reasonable transportation rate• Project cost• Tariff terms

• Access for natural gas explorers• Expandability• Periodic solicitation

Thank Youkurtis.gibson@alaska.govhttp://gasline.alaska.gov

04/10/2023