Homer part of long-term gas plan, says Enstar

• Anchor Point could have natural gas in 5-10 years

by Aaron Selbig
Homer Tribune

When Enstar Natural Gas Company announced Sept. 25 that it planned to ship natural gas from a successful new well in the North Fork area to Anchor Point – and not to Homer as had originally been suggested – Homer city officials saw it as bad news.
“The bottom line is it’s good for Anchor Point, but we’re not getting gas here,” said Mayor Pro Tem Dennis Novak at a Sept. 28 meeting of the Homer City Council. “We’re kind of getting the short end of the deal here but … I don’t know what can be done about it.”
However, Enstar spokesman John Sims, who is in Homer this week to speak with city officials about the deal, hopes council members will look at the big picture.
“Really, the entire region should be excited,” he said. “Anytime you’ve got a delivery system, there’s the potential for new reserves to be recovered and developed. There’s potential for that to happen here.”
Enstar’s plan would involve the construction of two new pipelines. One originates from the North Fork well – located about six miles east of Anchor Point off North Fork Road – to Anchor Point. The other would connect Anchor Point to the existing Kenai Kachemak Pipeline at Happy Valley. A consortium of five companies – including well-operator Armstrong Cook Inlet, LLC – would be responsible for building the new pipeline to Anchor Point, whose residents would have an available supply of low-cost natural gas for the first time.
In their Sept. 21 filing with the Regulatory Commission of Alaska – the state agency charged with final approval of the deal – Enstar asked that the approval process be expedited and that the period for public comment be shortened from 45 to 30 days.
The plan has already received the endorsement of Kenai Peninsula Borough Mayor Dave Carey and Alaska Department of Natural Resources Commissioner Tom Irwin.
In a letter to RCA commissioners, Irwin said approval of the Enstar contract “is in the state’s best interest.”
“Exploration in the southern Kenai Peninsula has not been active, due in part to the lack of market access,” Irwin said. “This development extends the pipeline infrastructure and simplifies market access.”
In a Sept. 28 letter, Mayor Carey said the new pipeline would provide “substantial benefits to the public” and “would be a move forward to providing sustainability to a region that has been faced with declining fields.”
The City of Homer should oppose the plan, said City Manager Walt Wrede in a report to council members.
“I would suggest that – at a minimum – the city should oppose this filing unless the RCA removes Homer from Enstar’s certificate to free the city up to pursue deals with other suppliers,” said Wrede.
Since 2000, Enstar has held an RCA-approved “certificate of public necessity,” authorizing it to provide gas to Homer residents. Although the company has conducted engineering work on a possible gas distribution system in the city – and despite a statement last year from then-spokesman Curtis Thayer that “it looks like Homer is the best opportunity for that gas” – the decision was made to send North Fork gas to Anchor Point.
But why?
“To be honest, it was an easy decision,” said Sims. “To serve a community like Homer, you have to have a minimum of 25 to 30 (billion cubic feet) to do it responsibly. You can’t go ahead with all the required infrastructure changes and not have that supply in place. That would be irresponsible on our part.”
While the one producing North Fork well is believed to have enough gas – at least 10 billion cubic feet – to serve 450 to 500 people in Anchor Point, Sims said there is not enough there to serve Homer.
If all goes well, Anchor Point residents could have natural gas in five to 10 years, said Sims. In the meantime, he urged city officials in Homer to reconsider opposing Enstar’s RCA filing.
“If this contract is disallowed, it will hurt the possibility of ever bringing that gas down to Homer,” he said.

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Posted by Newsroom on Oct 7th, 2009 and filed under Headline News. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.

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