Today’s Key Takeaways: Enstar/Furie contract a win for Southcentral Alaska. Biden restrictions on ANWR lease sale “kneecap potential development.” Study says: Alaska LNG will cost less than imported LNG. Optimism that Trump will allow access to Alaska copper district. SCOTUS looking to curb “overly aggressive” reviews via NEPA.
NEWS OF THE DAY:
New contract between Enstar and small producer could help delay natural gas shortage in Southcentral Alaska
Alex DeMarban, Anchorage Daily News, December 10, 2024
Enstar Natural Gas has signed a supply contract with a Cook Inlet producer that could provide some breathing room as Southcentral Alaska utilities face a critical shortage of local gas.
John Sims, the president of Enstar, told the Alaska House Resources Committee on Monday that the five-year gas supply contract with Furie Operating Alaska is set to begin in 2026. As the contract enters its second year, it is expected to provide significantly more gas than Furie currently sells to Enstar.
About 150,000 customers rely on Enstar gas that heats homes and buildings across Anchorage and Southcentral Alaska. The company uses more gas than all the electric utilities in Southcentral combined.
OIL:
Biden administration includes restrictions in Arctic refuge oil lease sale
Andrew Kitchenman, Alaska Beacon, December 9, 2024
The federal Bureau of Land Management finalized the restrictions on an oil and gas lease sale in the Arctic National Wildlife Refuge on Monday, aimed at protecting wildlife and other environmental resources, while complying with a 2017 law that mandated the lease sale.
In its decision, the BLM limited the lease sales to 400,000 acres, which is one-quarter of the coastal plain section of the refuge. That amount is the minimum mandated by the Tax Cuts and Jobs Act of 2017.
Voice of the Arctic Iñupiat, a regional group that has generally advocated for oil development across the North Slope, criticized the restrictions in the documents issued Monday, known as a record of decision and notice of a lease sale.
“Though our communities welcome the potential for a successful lease sale, we are clear eyed about the administration’s intent and flawed process that got us here,” said Nagruk Harcharek, Voice of the Arctic Iñupiat president, in a news release. “This final ROD and notice of a lease sale is a deliberate attempt by the Biden administration’s Interior Department to kneecap the potential of development in ANWR.”
GAS:
Study says pipeline would be better for economy than gas imports, cost $11 billion
Jacob Dye, Peninsula Clarion, December 10, 2024
The study was triggered by a request from the Legislature for an independent third-party review of a project proposal
A study by Wood Mackenzie is being touted by the Alaska Gasline Development Corporation as indication that the long-gestating Alaska LNG pipeline project should move forward, and the corporation earlier this month received backstop funding for design from another state-owned corporation.
The Wood Mackenzie report says that a completed pipeline would deliver natural gas at a cost lower than imported gas and lower than current production, while generating “additional industrial and economic benefits to the state.”
A memo by Gov. Mike Dunleavy, attached to the final report and dated Nov. 12, says the study was triggered by a request from the Legislature for an “independent third-party review of a project proposal.” That request included “intent language” saying that if the analysis showed “a positive economic value to the state, all parties would work toward … a pipeline project.”
The report describes “Phase 1” of a gas pipeline project that would stretch from the North Slope to Southcentral Alaska. It says that a 765-mile pipeline with a diameter of 42 inches would cost $10.8 billion, but could provide gas as soon as 2031 at a cost lower than importing gas, also providing more jobs than an importing terminal.
The report doesn’t describe how the cost of creating a pipeline will be met or how gas needs in Cook Inlet will overcome shortfalls projected as soon as next year by Enstar.
MINING:
South32 hopeful Trump will allow access to Alaska copper region
Bloomberg/Mining Weekly, December 11, 2024
South32 is optimistic the incoming Trump administration will open up access to a copper-rich region in northwest Alaska, where the Australian miner has development rights.
If the building of a controversial industrial road to the Ambler Mining District is approved, South32 and its venture partner Trilogy Metals would be able to mine high-grade copper from an already identified deposit and ramp up exploration work for new resources, according to CEO Graham Kerr.
“It’s a long-term play, but in a couple of years we’ll know the size of the resource,” he said in an interview. “The challenge is in exploring up there, because the seasonal window is narrow,” but discovering another big deposit could be a “game-changer”, he said.
The US Interior Department blocked the development of the proposed 340-km road earlier this year on environmental grounds, opting to protect 28-million hectares of federal land from minerals development. Plans to immediately approve it are outlined in documents from Project 2025 – a conservative blueprint for a second Trump term that he distanced himself from during the campaign.
Major new copper finds are rare, and have become highly coveted by miners in anticipation of surging demand for the red metal in the coming years due to the energy transition. Kerr said the geology in Ambler indicated clusters of sizable resources. Shares in Trilogy almost doubled last month following Trump’s election victory.
POLITICS:
Scotus Likely to Curb NEPA
Rachel Frazin, The Hill, December 10, 2024
The Supreme Court appears likely to weaken one of the nation’s bedrock environmental laws, after justices heard a key case on Tuesday.
During oral arguments, several of the court’s conservative justices signaled that they could support at least some limits on the scope of which environmental impacts need to be considered in government decision-making.
Justice Brett Kavanaugh argued that courts, which have struck down some environmental reviews as insufficient, have taken an “overly aggressive” role and incentivized agencies to take on sprawling environmental reviews.
The outcome of the case could have major implications: Limiting such consideration could impact a range of decisions including whether to approve oil and gas drilling, mining projects, pipelines, logging, highways and more.