Route of the proposed Alaskan Highway natural gas pipeline, with two alternatives for a spur line to South Central Alaska

A number of proposals to develop a pipeline to transport North Slope natural gas to the U.S. market have been put forth since the Alaska Natural Gas Transportation Act of 1976. In a move to facilitate action, President Bush signed into law the Alaska Natural Gas Pipeline Act on October 13, 2004. This law, coupled with recently enacted tax provisions, could result in a significant boost to the construction and operation of an Alaska pipeline to bring North Slope natural gas to market. DOE has a key role in coordinating Federal agencies’ activities for the Alaska gas pipeline system, as well as providing loan guarantees to project sponsors.

Two configurations for delivering North Slope natural gas to market are actively being debated within Alaska: the “Highway” route, generally following the Trans-Alaska Pipeline System (TAPS) route to Delta Junction, AK, and then following the AlCan Highway through Alberta, Canada, to link up with the U.S. gas pipeline grid; and a route that generally follows the TAPS route to Valdez, AK, where the gas would be liquefied for shipment to market.

As a part of the pipeline approval process, the Federal Energy Regulatory Commission requires applicants to estimate in-state natural gas requirements, potential take-off points, and possible transportation rates. The State of Alaska does not currently have a forecast for in-state demand or transportation rates. Building on past NETL work, Congress provided funds for AEO to develop such estimates.

A more recent AEO project affirmed the economic viability of a natural gas spur pipeline [PDF-3.71MB] from a takeoff point of the proposed North Slope gas pipeline in Alaska’s interior to South Central Alaska. The spur line would address the coming shortfall of natural gas supply in the State’s most populous, industrialized region.