Alaska reacts to ConocoPhillips' gas pipeline statements

ANCHORAGE, Alaska — A story in the London Financial Times sent a jolt of fear to those pushing for an Alaska natural gas pipeline.  

The Times quoted Jim Mulva, the head of ConocoPhillips, as saying the company is re-assessing the economics of the project.

The timing is what really got people's attention.

ConocoPhillips, along with BP are partners in the Denali Pipeline Project, which is about to wrap up its “open season” on Monday.

“Open season” is a time when producers commit their gas for shipment in the pipeline. A key step in getting the project financed.

In the article, Mulva was quoted as saying the glut of cheap shale gas in the lower-48 "creates more competitive concerns for Alaskan natural gas.”

Managers of the Denali Pipeline Project had no comment on Mulva's remarks, except to say that once the “open season” concludes, Denali will continue to negotiate with producers.  

A company spokesman said, nothing has changed and they’re continuing to march forward.

Despite the reassurances, those attending the Alaska Oil and Gas Congress in Anchorage Tuesday took note and say they're hoping for more clarification from ConocoPhillips.

"I think everybody in Alaska would like to understand what Mr. Mulva meant when he called into question the viability of the project,” said Kurt Gibson,  deputy director of the Division of Oil and Gas.

"The fact that he highlighted the Alaska project in the context of natural gas, I think has sent shock waves through the community. One of the things that gives me comfort is that you haven't seen statements like that from BP,” said Sen. Lesil McGuire, chair of the Alaska Senate Energy Committee.

Steve Rinehart, a spokesman for BP, also declined comment on Mulva's remarks, but did say BP remains focused on finding ways to commercialize North Slope gas.

ConocoPhillips did issue a statement Tuesday saying the company isn't wavering in its support of Alaska's gas line.   

At Tuesday's Oil and Gas Congress, there was news about one champion for Alaskan natural gas. The pipeline's federal coordinator, Larry Persily, read a letter from President Obama in support of the project.   

Obama says the pipeline is important to the nation, because it will provide both energy security and jobs.