RCA extends Hilcorp pipeline approval deadline

Alan Bailey

Petroleum News

The Regulatory Commission of Alaska has extended the deadline for decisions on applications by Hilcorp Alaska subsidiaries relating to the company’s project to enable oil to be shipped west to east by pipeline under Cook Inlet. The deadline has been extended from March 8 to July 20. The commission says that it needs more time to consider and rule on issues raised by the applications. It is not clear what impact the delay may have on the project timeline.

Hilcorp subsidiaries filed three applications with the commission in September. One was a request to grant Kenai Beluga Pipeline LLC a certificate for the carriage of oil west to east through one of the existing twin Cook Inlet Gas Gathering System pipelines under the inlet. A second was a request for a certificate, allowing Cook Inlet Pipe Line Co. to transport gas around the Tyonek gas pipeline system under the more northerly part of the inlet. And a third was a request for approval for Cook Inlet Pipeline Co.’s plan to extend and modify the existing pipeline system, to accommodate the new oil and gas transportation arrangements.

The idea is that oil will be shipped west to east through the CIGGS line, while an existing gas line from the Kenai Peninsula to the offshore Tyonek gas platform will connect to a new Tyonek subsea gas line to the west side of the inlet. The capacity of the new gas line will replace the CIGGS gas carrying capacity lost when one of the CIGGS lines converts to the carriage of oil.

Hilcorp has planned the business and regulatory arrangements for the modified pipeline system, so that the cost of the pipeline project can be recovered through oil transportation rates, without impacting the rates for the carriage of gas across the inlet.

- ALAN BAILEY