Port vs. Point

The Mat-Su Borough is calling foul over what could be an embarrassing foul-up in the analysis of port sites for the large natural gas liquefaction plant built for the Alaska LNG Project, which is now being led by the state of Alaska.

Essentially, the Alaska LNG team did its analysis of a Mat-Su site for the LNG plant using the wrong location for a port, borough manager John Moosey says.

“We feel the errors are both significant and material and could affect the outcome,” of Alaska LNG alternatives analysis,” Moosey said in a Dec. 29 letter to the Federal Energy Regulatory Commission.

How this happened is a little mystifying.

“The Alaska LNG team was standing on the deep-draft dock at Port MacKenzie during route studies, yet a little-known mudflat, Point MacKenzie, wound being ‘considered’ (by mistake) but deleted as an alternative,” borough spokeswoman Patty Sullivan said.

That led to Mat-Su being disqualified in favor of Nikiski, on the Kenai Peninsula, for the LNG plant and terminus of an 800-mile, 42-inch gas pipeline built from the North Slope.

The borough filed a brief Dec. 29 with the Federal Energy Regulatory Commission to become an intervenor in FERC’s consideration of a license for the $43 billion gas project.

The state’s Alaska Gasline Development Corp., which is now leading Alaska LNG and handling regulatory matters with FERC, submitted the erroneous alternative site analysis in one of the reports required with the FERC license application, but it isn’t clear whether AGDC made the mistake or whether it was the ExxonMobil-led industry team that researched alternatives before the project was handed over to the state, which was a partner in the earlier industry-led consortium.

In any event, the borough asked AGDC to correct its report so FERC would have correct information when it begins an Environmental Impact Statement. So far the report has not been corrected, according to the borough’s filing.

Based on that, Mat-Su decided to request to intervene which, if granted by the federal commission, will allow the borough to participate more directly in FERC’s proceedings.

“The borough’s position is that the alternatives analysis employed by AGDC in its Resource Report No. 10 is erroneous and must be corrected so the (FERC) Commission can issue a draft environmental impact statement based on correct facts. The borough’s position is that a proper alternatives analysis must fairly include Port MacKenzie as an alternative for the Project’s liquefaction facility,” Moosey said in a letter to FERC accompanying the invention request.

The borough discovered the mistake in a review of Resource Report No. 10 and brought it to the attention of AGDC.

“The borough discovered that AGDC did not actually consider Port MacKenzie at all in its alternatives analysis. Instead, as shown in an aerial map included in Resource Report No. 10, AGDC considered Point MacKenzie, a completely separate location with different attributes than Port MacKenzie. This is in spite of the fact that AGDC, on numerous occasions over several years and multiple site visits, insisted that Port MacKenzie would be studied as an alternative for the liquefaction facility,” Moosey said in the letter.

Exhibit 3 filed with the resource report shows an area due north (of the port site) along Mule Creek, which the applicant, AGDC, referred to as “Point MacKenzie” in its application. The attributes of the site are much difference than the actual port site, the borough said in its application for intervention.

The borough hired Millcreek Engineering of Salt Lake City to compare the what was said in the resource report, using the wrong location, with actual conditions at the borough’s Port MacKenzie.

Millcreek Engineering made these points:

•“The evaluation criteria determinations that were used to rule out Point Mackenzie from further analysis in Resource Report No. 10 do not apply to Port Mackenzie as follows:

•The Point Mackenzie Site had incompatible land use due to Native Village (Knik) Lands.

•• The Port Mackenzie Site is located on Port Industrial Development Area land ideally suited for a large-scale LNG Facility without land ownership issues.

•Point Mackenzie ship traffic would conflict with other ship traffic. Point Mackenzie’s location at the tip of the inlet to the Knik Arm and the long distance from the shore to the ship placed the berth near the shipping channel for the upper Cook Inlet.

•Port Mackenzie is located within the Knik Arm and away from other shipping traffic at the deep draft dock. LNG ship staging can be accomplished in Cook Inlet locations similar to Nikiski. Further investigation into ship staging and cuing is warranted.

•Point Mackenzie is located on a high bluff and would require extensive grading. The Point Mackenzie shoreline has high erosion rates.

•The Port Mackenzie site is located at tidewater with land available for development on a flat bluff that requires minimal site grading and has an industrial, paved road connecting the two areas. Port Mackenzie port development mitigates the need to conduct extensive site grading from the plant site to the dock. Port Mackenzie does not experience shore erosion issues.

•Point Mackenzie shoreline has extensive shallows requiring approximately 1.6 miles of trestle and/or extensive dredging to reach -60 feet of water depth).

•The Port Mackenzie shore line to 60’ depth is very close and does not require dredging. Current distance from shore to end of trestle at Port Mackenzie is 500 feet.

•Point Mackenzie dock facilities would be located within a Beluga Whale ESA.

•Port Mackenzie has an existing deep water dock that was constructed and is operating within the Beluga ESA without issue. A 3-acre expansion of the barge dock facility was completed recently also without issue.

•Point Mackenzie has ice concentrations, strong currents and rock outcroppings that could pose marine vessel risks.

•Port Mackenzie along with the Nikiski site will experience Cook Inlet tide currents. Port Mackenzie tends to experience less ice than Nikiski and the shallow Point Makenzie site. Port Mackenzie does not have rock outcrops in the vicinity of the dock.

•All ship operations in the Cook Inlet require prudent maneuvering during the high currents associated with the large tidal changes, Millrock said in its report.

•“The associated risks should be thoroughly reviewed for any Cook Inlet LNG port. Past and current ship maneuvering at Port Mackenzie and the port of Anchorage have been safely conducted with proper knowledge of the tides and ship location,” Millrock said.

If the evaluation is corrected, the Port MacKenzie plant location would be equal to Nikiski in an environmental analysis and other advantages, such as a partly-completed 32-mile rail link from the Alaska Railroad to the port would create important advantages for access to the site, the borough said in its letter.

Since 2009 the state invested $184 million in the rail extension.

Source: Frontiersman