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Governor Parnell Issues Statement on Denali Open Season


October 5, 2010, Anchorage, Alaska - Governor Sean Parnell issued the following statement today on the close of the Denali project's open season for a natural gas pipeline to deliver Alaska's North Slope natural gas to market:

"Today's announcement by the Denali project that its recently concluded open season generated commercial interest from potential shippers is a positive development in the state's 30-year effort to build a natural gas pipeline.

"Two months earlier the Alaska Pipeline Project announced similar interest by potential shippers of gas. The fact that two projects are negotiating precedent agreements to build a pipeline is proof that commercial interest exists to make this project a reality. The implication of two projects moving forward is that competition to reach a commercial agreement could result in the lowest reasonable tariffs.

"Building a project of this scale is no easy task. Project participants and other stakeholders must remain committed to overcoming commercial and regulatory hurdles. After mapping out the engineering and regulatory costs, and determining how those costs will be shared, the greatest challenges to begin construction will be in determining if the cost of steel, gas and labor at the time of construction will still make a project economically viable for all the project participants.

"In the immediate future there are a number of challenges that participants in either project can control. Many of these will pertain to conditional commitments made by potential shippers under either of the projects. Hopefully most of these can be resolved in the course of negotiating precedent agreements."

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