Sarah Palin's Pipeline Attracts 'Multiple Bids' in Major Market Test

*
The AGIA pipeline, former Alaska Governor Sarah Palin's signature accomplishment, has taken a major step forward Friday in what is seen as a major market test for the 49th State's bountiful reserves of natural gas. TransCanada Corp. announced Friday that it has received "multiple bids from "major industry players and others" to transport natural gas from Alaska's North Slope to market using the proposed pipeline:

Tony Palmer, TransCanada's vice president of Alaska development, said he's encouraged about the line's prospects moving forward as long as "key conditions" are met.

He didn't specify what those were but said the next step would be for TransCanada to work with potential customers to try to resolve those issues in the months ahead.

[...]

The stakes are high and the interest is intense: A gas pipeline has been held out for years as important to Alaska's long-term economic future, because the production of oil, which is largely responsible for keeping the state running, continues to decline.

[...]

TransCanada, which is working with Exxon Mobil Corp. to advance its plan, successfully bid for an exclusive state pipeline license and the promise of a $500 million reimbursement under the Alaska Gasline Inducement Act championed by then-Gov. Sarah Palin.

TransCanada concluded "open season," its 90-day process of seeking shipping commitments for a proposed line Friday and released few details about the bids, as expected. Palmer had cited competition as a reason for the secrecy. A competing project, Denali-The Alaska Gas Pipeline, a joint venture of BP PLC and ConocoPhillips, began its own open season a few weeks ago. But Denali could fall by the wayside if the two companies sign on to the AGIA project, according to sources who say talks which could lead to that eventuality are taking place among the four companies. Although BP and ConocoPhillips had initially not shown much interest in the AGIA project, British Petroleum's recent difficulties in the Gulf of Mexico have strapped the oil giant for cash, and it may decide to join the competing project because the costs would be spread among four partner instead of just two.

Many of Sarah Palin's critics had claimed that the AGIA pipeline would get shelved long before it ever reached Open Season, but with that stage now apparently concluded successfully, she may well have the last laugh.

- JP