TransCanada only good Alaska gas project bidder
ANCHORAGE, Alaska (Reuters) - TransCanada Corp's (TRP.TO) proposal to build a $26 billion natural gas pipeline from Alaska to Alberta got a big boost Friday after Alaska's governor said it was the only bid out of five to meet the state's requirements.
Four other companies bidding for project as set forth by the Alaska Gasline Inducement Act, including China's Sinopec (SNP.N) (0386.HK) and California's AEnergia LLC, were rejected, Gov. Sarah Palin said.
Alaska launched its competitive-bidding strategy after decades of frustration over the failure to develop the North Slope's natural gas amid staggering costs and an uncertain U.S. market for the fuel.
A deal negotiated by Palin's predecessor, Frank Murkowski, and the major Alaska oil producers -- Exxon Mobil (XOM.N), BP (BP.L) and ConocoPhillips (COP.N) -- collapsed after being widely blasted as a giveaway to the oil giants.
Palin said, however, that the state was still evaluating a separate proposal to bring Alaska's gas to market issued by ConocoPhillips (COP.N) outside of the AGIA process.
The North Slope has about 35 trillion cubic feet of proven gas reserves, enough to supply the United States for a year-and-a-half at current consumption rates, and is believed to hold several times as much in undiscovered reserves.
Other AGIA proposals that were rejected came from the Alaska Gasline Port Authority, which proposed a liquefied natural gas project, and the Alaska Natural Gas Development Authority, which proposed a spur line to Alaska's population centers.
TransCanada's proposal calls for a connection for Alaska gas with its Alberta system, where supplies can be shipped on to Eastern Canada, the U.S. Midwest and Northeast, as well as to California.
The Canadian portion of the proposed project would be built under Canada's Northern Pipeline Act, three-decade-old legislation that the company believes gives it the exclusive right to construct such a pipeline, said TransCanada spokeswoman Cecily Dobson.
"We look forward to working with the state for a successful conclusion of the process," Dobson said. "We'll follow the state's process as we move forward through the 60-day review and the submission for legislative approval."
Up until 2005, Alaska gas producers like BP Plc (BP.L) and pipeline firm Enbridge Inc (ENB.TO) had cajoled Ottawa to say whether TransCanada's plans still entitled it to the rights under the NPA or if there could be a competing bidder for the Canadian portion.
Little has been made public on the matter since.
(Reporting by Yereth Rosen; Editing by David Gregorio)
