Homer Alaska - News

Story last updated at 7:51 PM on Wednesday, April 6, 2011

North Fork gas flowing north

By McKibben Jackinsky
Staff writer

It's been a long time coming, but natural gas production has begun on North Fork Road.

"Gas is flowing," John Sims, Enstar Natural Gas Company's manager of corporate communications and customer service, told the Homer News Monday.

Enstar's contract is with Anchor Point Energy LLC and Denver-based Armstrong Cook Inlet LLC is the main operator of the gas field located approximately eight miles east of Anchor Point. The natural gas flows to a pressure reduction facility at the corner of North Fork Road and Bailey Drive. A pipeline is in place to deliver natural gas as far south as Chapman School beginning next fall. To the north, the gas flows to Ninilchik, then into KKPL, the Kenai Kachemak Pipeline, continues to Soldotna to an Enstar pipeline where it continues to Anchorage.

Production is good news for some Anchor Point business and homeowners interested in forming a Kenai Peninsula Borough utility special assessment district, or USAD, as a way to get a natural gas pipeline to their property. A USAD is an avenue for financing the lines of service of those public utilities regulated by the Regulatory Commission of Alaska or of city-owned utilities to areas outside city boundaries.

With a minimum 70 percent of those in the designated area needing to approve formation of the USAD, letters have been sent to approximately 250 addresses to assess interest prior to petitioning for the USAD.

"We're looking at the developed areas of core Anchor Point," said Emmitt Trimble, who is helping with the process and recalls natural gas for the area being discussed as far back as the 1970s. "We're trying to get the highway corridor for commercial use and then over to the inlet bluff and river bluff."

A special assessment coordinator in the borough assessor's office has the responsibility for approving the USAD boundary and ensuring all appropriate parcels are included. It is estimated property taxes will increase between $2,600-$3,000 per lot, which will be amortized over 10 years, according to Trimble.

"So you might pay an extra $260-$300 per year," he said. "For those people who are interested in hooking up to natural gas, it's a huge savings, particularly if they're using propane now or even oil. It may cut fuel bills in half."

If approved, property owners in the USAD also will pay to connect their business or house directly to gas line extension, as well as purchase appliances designed for natural gas.

"I think it's a win-win for everybody. People that can hook up can get cheaper gas ... and it will easily increase the value of a lot by about $5,000," said Kathy Kacher, whose residence is within the proposed USAD. With a laugh, she added, "My goal is to get (natural gas) before Homer does."

Getting the gas moving had a bit of a bumpy start over the weekend when a pig, a device inserted and designed to travel through a pipeline, was used to remove debris and water that had accumulated in the new line.

The activity drew complaints of noise, vibration, odors and bright lights from residents near the pressure reduction unit. In response, Steve Russell, environmental program specialist with the Alaska Department of Environmental Conservation in Anchorage, drove to the site Monday to assess the situation.

"They were using natural gas to push the pig through, which is a fairly common practice, and venting it into a large portable tank. That's what the neighbors were smelling," said Russell.

Although he found nothing that concerned him about the operation, Russell said he encouraged Armstrong to maintain communication with its neighbors.

Nate Lowe, spokesperson for Armstrong, described the unexpected activities over the weekend as a "temporary nuisance."

"(That) was associated with venting that occurred this weekend at the custody transfer station where gas from the North Fork Unit (is) delivered to Enstar," Lowe said in an e-mail to the Homer News. "We at Armstrong/Anchor Point Energy take being a good neighbor to the local community seriously. Unfortunately, the operations conducted over the last few days were not foreseeable."

With regard to communicating with area residents, Lowe said, "In instances where we are able to forecast operations, we've sent out letters, e-mails and field representatives to those that have provided contact information to us in the past. Unfortunately, this recent operation was required, but not planned. The permanent operation of the pipeline should be almost entirely silent and void of vibration, odor and bright lights."

Another concern of residents regarded benzene at the pressure reduction facility, however, Russell said a site plan indicating a benzene reduction unit did not pertain to the Bailey Drive site.

Lowe said Armstrong has never introduced benzene into any of its operations, "therefore there is no reason for a benzene reduction unit."

"I would encourage anyone desiring to be added to future distributions or anyone that has any questions to please correspond with Amber Babcock," said Lowe. "(Babcock) has helped facilitate concerns and questions associated with our operations in the past.

Babcock can be reached at amber.babcock@solstenxp.com. Babcock is located in Anchorage and is with SolstenXP, a project management and contracting service company for the petroleum and natural resource industries in Alaska and elsewhere.

Lowe also encouraged concerned individuals to contact agencies overseeing Armstrong's operations including the Alaska Oil and Gas Conservation Commission, the Alaska Department of Environmental Conservation and the Alaska Department of Natural Resources.

Now that natural gas is flowing, Sims said Enstar is waiting to see what kind of activity will be generated.

"One of our hopes is the 20-mile extension of the transmission line would provide access to a market where there was no access before," said Sims of the Anchor Point-Ninilchik line.

"We're hoping some other players come to market with some additional finds."

McKibben Jackinsky can be reached at mckibben.jackinsky@homernews.com.