Unocal, Marathon propose natural gas line for Kenai Peninsula

AP Photo/Peter Haley/The News Tribune
ANCHORAGE -- Officials from the Unocal and Marathon oil companies say they plan to apply soon for permits to build a natural gas pipeline to bring gas to the lower Kenai Peninsula.

The companies announced Dec. 12 the completion of a yearlong study that concluded the gas line is feasible. The two companies have formed a joint venture, Kenai Kachemak Pipeline LLC, to build and operate it.

Natural gas retailer Enstar and Homer Electric Association, the Kenai Peninsula’s chief electric cooperative, also participated in the study.

The oil companies still must determine that there is a marketable supply of natural gas reserves before the project gets a final go-ahead, said Unocal spokeswoman Roxanne Sinz. Exploratory drilling is ongoing. The ultimate route and capacity of the pipeline also depend on exploration.

The proposed line would link the Kenai-Soldotna area with Anchor Point and Homer, promising cheap heating fuel to the southern Kenai Peninsula in the short term and the prospect of shipping gas from reserves near Anchor Point northward in the long run.

The first phase of the pipeline, between Kenai and Ninilchik, may be operational by 2004, Sinz said. The line is expected eventually to snake down to Anchor Point, with a feeder line to be built from Anchor Point to Homer.

The project’s goal is to bring natural gas to market in the lower Kenai Peninsula within about three years, possibly sooner, she said.

Unocal sees the line as a big economic boost. "And, hopefully, lower energy costs for the end users. We see this as a big plus for everybody," Sinz said.

The line will likely follow the Sterling Highway corridor, the companies reported.

A large part of Marathon’s capital spending next year in Alaska will be aimed at boosting natural gas production, said John Barnes, manager of Marathon Oil Co.’s Alaska business unit.

12/23/2001 - 8:00pm