Does TransCanada have a conflict of interest?

 
Through Canada or to Valdez?

When former Governor Sarah Palin took office in 2007, she turned her back upon her campaign’s support of the all-Alaska natural gas pipeline to Valdez, even though she spoke in support of the project and stood with those who supported the project during the campaign. Supporters included former Governor Walter J. Hickel who was an outspoken proponent of the Valdez LNG project and a vocal opponent of Murkowski’s give away to Canada. Undoubtedly, her rising popularity was in no minor part due to her support of the all-Alaska natural gas pipeline to Valdez alternative to then Governor Frank Murkowski’s "contract" with Exxon, Mobil, and BP to build a 4.5bcf/da pipeline through Canada to the Midwest. Palin then beat former Governor Tony Knowles in the General Election in November, becoming the first woman governor of the State of Alaska.

By 2006, it was obvious to most Alaskans that then Gov. Murkowski’s pipeline contract was nothing but a promise by the oil companies to consider building a pipeline after much study and consideration. Exxon spoke of 2025 as the time frame for Alaska North Slope natural gas to move to market. Palin beat Murkowski in the August, 2006 Primary Election. Palin then won the November General election against former Governor Tony Knowles.

The die was cast for the Alaska Gasline Inducement Act.

Upon taking office, Sarah Palin literally reset on her support of the all-Alaska natural gas pipeline. Then Gov. Sarah Palin reappointed Tom Irwin as Dept. of Natural Resources Commissioner. Former Deputy Commissioner Marty Rutherford was also reappointed as Deputy Commissioner DNR. Both had been fired by by Gov. Frank Murkowski for disagreements regarding his actually having a contract with the oil companies to build a pipeline. However, both were firmly convinced that Alaska needed the large diameter 4.5 bcf/day pipeline through Canada to replace oil revenues from the Trans Alaska Pipeline Systems steadily declining volume transported to market. The North Slope oil production was about 700,000 barrels per day (bpd) at that time.

Irwin and Rutherford played a major role with legislative input in drafting AGIA. The project initially mirrored Murkowski’s project with one exception. The project did not rely solely upon the oil companies to build a gas pipeline. AGIA called for a competition with the best project as the winner. TransCanada became the sole competitor and was selected as the sole contractor under AGIA. The Alaska Gas Port Authority, a consortium of the cities of Fairbanks, Big Delta, and Valdez, submitted a proposal that was deemed late, incomplete and, therefore, not considered. By the gubernatorial election of 2010, the route was to the Alberta Hub, and not down through Alberta to the Midwest.

Since, AGPA has touted its route and LNG terminal plan as an alternative to AGIA. AGPA’s arguments have largely fell upon deaf ears in both the Paline/Parnell Administrations and the Legislature. Yet, the LNG market was demonstrating a major growth in Asia.

The contradiction in the volume of the planned pipeline projects, both Palin’s and Murkowski’s, was the Alaska Oil and Gas Conservation Commission limit of allowable production committed for export to market for North Slope Natural Gas. AGOCC set the amount at about 2-3bcf/da. This figure took into consideration the amount of natural gas necessary to keep the North Slope oil fields pressurized for continued production. Where Murkowski or Palin intended to come up with another 1.5 bcf/da between AGOCC’s limit and the 4.5 bcf/da capacity of their pipelines to Canada has to this day never been fully explained. Nor, has Governor Sean Parnell’s administration bothered to explain why his administration has continued to support TransCanada’s planned 4.5 bcf/da pipeline through Canada under AGIA in the face of the AGOCC’s limit on North Slope natural gas available for export.

In 2007, the Palin Administration announced the award of the AGIA contract to the sole applicant: TransCanada. TransCanada plans incorporated much of former Governor Murkowski’s pipeline. The volume was 4.5 bcf/da, the diameter a >=48 inch casing, the route through Canada to Alberta, then down to the Midwest. Later, TransCanada modifed its plan to use the Alberta Gas Hub distribution system to the U.S., thereby using existing pipelines to distribute gas to the U.S. from Canada. However, the price of the project continued to grow. The estimated cost for construction increased from $18B to over $40B by the gubernatorial election of 2010. From 2007 to today, little or no progress was made on the project. No permits for a route were issued in Canada or Alaska. No firm construction date was ever stated by TransCanada.

In 2008, Conoco and BP announced a competing natural gas pipeline project to Canada called Denali. The plan called for a 4.5 bcf/da natural gas pipeline to export North Slope natural gas to Canada. In May, 2011, Conoco and BP announced that the Denali project was no longer viable. About a week before that announcement, the Alaska president of Conoco’s Alaska operations stated that it was never the intention of Conoco or BP to bring Alaska’s North Slope to market, as they had intended to warehouse the natural gas indefinitely through reinjection back into the wells. Conoco and BP’s Denali proposal was intended to influence the course of Alaska’s legislative and gubernatorial policies pertaining to gas production and marketing of North Slope natural gas. The acts on the part of BP and Conoco amounted to fraud upon the State. The silence on the part of the Parnell Administration and the Legislature was deafening. (http://www.facebook.com/notes/alaskans-for-an-all-alaska-gasline/rebuttal-to-representative-les-garas-alaska-dispatch-opinion-piece-by-larry-wood/219621878075614)

On June 11, 2009, Exxon partnered with TransCanada. This partnership raised questions about the viability of just one producer on the North Slope participating in the project, when it was recognized that all three were necessary to any agreement to sell enough gas to move by pipeline. At that time, BP and Conoco were touting their "competing" Denali gasline project.

Since 1978, the completion of the TAPS oil pipeline, no discernible forward progress has been made towards actual construction of a natural gas pipeline in Alaska. Neither Denali’s nor TransCanada’s heavily publicized Open Seasons had produced any customers for their Alaska projects.

The reality of any natural gas pipeline from the North Slope, was that it took production from all three producers, Exxon, Conoco and BP, to provide sufficient natural gas to make a pipeline project viable. Further, the Point Thompson controversy between Exxon and the State also had to be settled.

The all-Alaska natural gas pipeline project first proposed by Yukon Pacific in the early 80s was for a 2.5 bcf/da pipeline from the North Slope to Valdez to be converted to LNG for export to the U.S. That was basically the same pipeline and volume intended in the plan voted on 2002. AGPA’s pipeline plan today is 3.0 bcf/da. Note that these volumes are within the AGOCC’s volume restrictions for North Slope gas export.

In mid-2011, Governor Sean Parnell finally awakened to the reality of the world LNG market. He suddenly decided that the only viable market for Alaska’s North Slope natural gas was as LNG to Asia. Since, he has tried to move AGIA in that direction. Under AGIA, TransCanada has the option to build a pipeline to a LNG terminus at Valdez for LNG export to market.

In October, 2011, Governor Sean Parnell called for a meeting with the North Slope oil producers to discuss a gasline and the LNG option. On January 6, 2012, Gov. Parnell met with Exxon’s CEO Rex Tillerson, BP Alaska’s CEO Bob Dudley, and Conoco’s Alaska operations CEO Jim Mulva in Anchorage. Gov. Parnell announced that he achieved a promise on the part of the producers to consider ways of getting Alaska’s North Slope gas to market. As promised, in a letter dated March 30, 2012, the oil companies outlined their intent to move forward on a gasline under AGIA. They updated their progress in another letter dated October 3, 2012. However, the progress was basically couched in terms declaring that ‘fiscal certainty’ was required for both a natural gas pipeline and any increase in oil production in Alaska. A position that the oil companies have steadfastly promoted for some time.

The first open season by TransCanada and Exxon ran from April 30-July 30, 2010. The second open season was conducted August 31-September 14, 2011. Both were apparently a bust with insufficient commitments to make any announcements regarding pipeline construction. Under AGIA, TransCanada has five years from the first open season before the project can be declared uneconomical and abandonment would be declared by either the State or TransCanada. (http://www.petroleumnews.com/pntruncate/285716809.shtml)

Today, Alaskans are still awaiting news of a natural gas pipeline project that will actually move North Slope natural gas to market.

Does TransCanada have a conflict of interest in its commitment to Kitimat?

Kitimat, British Columbia is the site of a proposed LNG terminal. In 2010, Apache Corp. announced the first agreements regarding LNG commitments with Korea. A 10 year commitment was made by Korea for Canadian LNG exported from Kitimat.

Since, the Kitmat development has expanded to include an additional LNG terminal and oil export capability to be built by a partnership lead by Shell to transport Alberta tar sands oil and LNG to Asia. The oil pipeline will be two parallel pipelines to be built by Enbridge. The pipelines would run 694 miles from Bruderheim, AB to Kitimat, B.C. with an estimated construction cost of $5.5B Canadian. Up to 1,000,000 barrels of crude per day would be transported by the pipelines.

TransCanada’s involvement and conflict of interest lies in its commitment to Shell to build a $4B (Canadian) 434 mile long natural gas pipeline from the B.C. shale gas fields to Kitimat. Kitmat’s LNG terminal will export approximately 1.2 bcf/da of LNG for Asian markets. Shell expects to export up to $10B in Canadian LNG to Asia through TransCanada’s pipeline. Shell is estimating a demand that will see up to 200 LNG tankers a year taking on LNG from Kitimat. The estimated completion date, given the environmental and indigenous lands rights of way issues, is expected by the end of the decade. The pipeline to be built by TransCanada is expected to measure over a meter (>39 inches) in diameter with an initial capacity of 1.7 bcf/da.

(http://www.theglobeandmail.com/report-on-business/industry-news/energy-and-resources/transcanada-wins-4-billion-pipeline-contract/article4231488/ ; http://www.transcanada.com/6054.html; http://www.coastalgaslink.com/ ; http://nwcoastenergynews.com/2012/06/05/2778/transcanada-build-shell-natural-gas-pipeline-kitimat/ )

Shell and its partners, Korean Gas, Mitsubishi, and PetroChina, are planning to build a separate LNG terminal from that planned by Apache Corp. back in 2010.

However, there may be a new wrench in the monkey works of the plans for any west coast LNG terminal, including Valdez.

TransCanada has an exclusive under AGIA. An exclusive normally implies a higher standard of commitment to the grantor than would an ordinary contract without an exclusive.

Given TransCanada’s commitment to Kitimat, should the State of Alaska move to declare breach to end AGIA?

Is there any basis in fact or common sense that would require the State to continue what is clearly a contract that is compromised by a conflict of interest by the grantee of the exclusive under that contract?

The latest cost estimate to construct a 3.0 bcf/da natural gas pipeline from the North Slope to Valdez is now estimated by TransCanada and Exxon to be $65B, including the LNG train at Valdez. The last estimate of the cost of construction for the AGIA Alberta Hub pipeline was approximately $40B. Compare the $65B cost of the AGIA LNG option to that the cost of the Kitimat 1.7 bcf/da >39 inch natural gas pipeline to be built by TransCanada under its agreement with Shell Oil. The cost of the Kitimat natural gas pipeline is just $4B Canadian.

(http://www.bloomberg.com/news/2012-10-04/exxon-bp-estimate-alaska-lng-export-project-at-65-billion.html)

Is the $65B price tag of the Alaska natural gas pipeline and LNG train under AGIA just hype to dissuade any protest at further delays?

The Chinese art of war . . . and it is war.

India's recent power outage in July of this year of almost 50% of the country's generation capacity was a shocker to most in the West.  Over 640 million people in 19 states in India lost power.  The alleged cause of the power grid failure was the higher demand from the use of water pumps by rural farmers due to drought, causing the need to pump water from distant sources.  However, One India News reported that there may have been another contributing factor, aside from demand.  (http://news.oneindia.in/2012/08/22/china-s-hand-in-india-s-power-blackout-1057676.html)

The blame surrounding the failure of India's northern power grid has been attributed to corruption, graft, greed and, most recently as related in the Washington Times citing One India News, by a purposeful strategy by the People's Republic of China (PRC) to undermine India's power grid.  Whether or not this was a demonstration by the PRC's military of their ability to disable a potential adversary's power grid through a concerted cyber attack as was alleged by India, or a red herring by India's power companies to assuage blame has yet to be determined.  (http://www.washingtontimes.com/news/2012/aug/29/inside-china-missile-defense-conspiracy/#ixzz25S8WR6fB)

What is known is that over the last few years, PRC companies undertook the modernization of the northern India power grid with successful bids worth several hundreds of millions of dollars.  These contracts were to install new control infrastructure, new transmission facilities and equipment, including switching centers to transfer loads from one area to another, and key components to modernize and to upgrade the power grid as part of a master plan to modernize India's power grid.

The PRC companies are alleged to have installed "back doors" into the computerized control systems for the power grid.   These "back doors" are alleged to be for the benefit of the Chinese military to exploit. The PRC companies are also alleged to have installed faulty components that broke down under load.  It has been alleged that the PRC's military undertook a concerted cyber attack against the control facilities using the alleged "back doors".

Where have we heard those allegations before?  From our very own Department of Defense. 

SecDef Leon Panetta has complained and warned of electronics parts and machined parts supplied to western defense contractors used in NATO and U.S. equipment as being defective and failure prone.  Panetta has also stated that the PRC suppliers have provided a "back door" to much of the communications and computerized systems purchased from PRC suppliers. 

It was recently disclosed that a major new weapons system, the Boeing P8 Poseidon, a replacement for the Navy's land based P3 Orion anti-submarine aircraft was compromised by defective electronic components and components having a "back door" accessible to the PRC military.  The P8 is a modified Boeing 737-800 aircraft modified for the military sub hunting mission. 

Defective and counterfit integrated circuits supplied by PRC companies have also been found in Thales military communications gear used by NATO and U.S. forces world-wide.

It is simply incredible to think that the United States is buying critical military components from a country that has a nuclear first strike policy against the United States!  Further, the United States Navy has sacked at least one Pacific Fleet Carrier battle group commander for the failure to detect a PRC Navy submarine that actually surfaced to disclose its presence to the American Navy earlier this year.  A submarine the P8 is designed to detect . . ..

PRC telecommunications companies have publically disclosed that they have hacked much of the U.S. telecom infrastructure using PRC supplied equipment installed in the U.S. as a starting point for the hacks.  The assault by the PRC on U.S. companies' mainframes and other computer infrastructure, including power grid and water system control systems has been admitted by U.S. officials.  The loss of data to the PRC is unknown.

The Pentagon has recognized the threat with the creation of the new Cyber Command.  Yet, the PRC military has ignored the assertions by our SecDef that an attack on U.S. power grid or other common control infrastructure that would have national impact would be construed as an act of war.  The cyber attacks against our military computing infrastructure is a daily occurrence.  Same for the attacks attributed to the PRC military against our commercial data infrastructure, and command and control systems for our power grids and water supplies.  Our telecommunications systems are already compromised.

Sun Tzu:  The Art of War

III.  Attack by Stratagem

"1. . . . In the practical art of war, the best thing of all is to take the enemy’s country whole

and intact;

2.  Hence to fight and conquer in all your battles is not supreme excellence; supreme excellence consists in breaking the enemy’s resistance without fighting.

. . . 6.  Therefore the skillful leader subdues the enemy’s troops without any fighting; he captures their cities without laying siege to them; he overthrows their kingdom without lengthy operations in the field.

  7.  With his forces intact he will dispute the mastery of the Empire, and thus, without losing a man, his triumph will be complete. This is the method of attacking by stratagem.

 . . . 17. Thus we may know that there are five essentials for victory:

(1) He will win who knows when to fight and when not to fight.

(2) He will win who knows how to handle both superior and inferior forces.

(3) He will win whose army is animated by the same spirit throughout all its ranks.

(4) He will win who, prepared himself, waits to take the enemy unprepared.

(5) He will win who has military capacity and is not interfered with by the sovereign."

If what was conveyed by the Washington Times is true, we have had a precursor of the strategy of the PRC's military in using commercial and military cyber resources to attack the infrastructure of a target state.  Our State Department and our President need to let the SecDef and the U.S. military do their jobs of protecting U.S. infrastructure unfettered by illusions of "good will" on the part of the Red Chinese where there are none on the part of the Red Chinese.

Whether we like to admit or not, another layer of strategy of the PRC in its undeclared conflict with the United States may have been revealed by the alleged cyber attacks against India's power grid in July of this year.  We can either pay attention and focus on eliminating our weaknesses in our cyber control systems, or, we can pay the price:  ". . . He will win who . .  .waits to take the enemy unprepared." 

The PRC is not playing games.

Racism, just another tool of the new order

What is racism?
In fact, how can there be racism?
Racism implies that there are more than one race of homosapiens sapiens.
Were there separate races, we would not belong to the same genus, meaning that interbreeding would be impossible. Can horses bread with frogs?
Therefore, "racism" should be more properly termed "color" phobia or "color" based prejudice.
This prejudice has been around since time immemorial.
Christ died to end it.
Martin Luther King died to end it.
Yet even today, some black Americans hate white Americans and vice versa.
Same for Asians, same for Hispanics.
Some just hate.
Yet, there are those who foster the lie that only white Americans are capable of prejudice.
Male bovine offal.
The rantings of the head of the New Black Panther Party put that liberal lie to rest.
What is ignored is the fact that we all share the same physiology, the same emotions, the same tendency towards prejudice of one sort or another, and all feel pain.
Whether or not we admit it, we all know what is right and wrong when we denigrate another for whatever reason. We know that we are cowards when we bully the weak, but we excuse our conduct because the object of our prejudice is obviously a lesser being, weak, or limited in some manner or another.
There is an industry built around perpetuating this color intolerance.
The race baiters like Jessee Jackson and Al Sharpton have made a lot of money extorting claims of prejudice where, in all likelihood, none existed.
Much that is called racism is couched in subjective emotionalism on the part of the individual experiencing the conduct. I state this, because there are no more lynchings, armed incursions into homes, public beatings--although black on white crime and violence is ignored by the liberal media--simply because of the dislike of one color by people of another in this country.
How much longer that state will exist depends upon how far the socialist agenda of the Obama administration manages to make inroads into compromising and reducing the Constitution to just history without meaning.
Once our rights become the whim of man rather than inalienable as granted by a creator, our rights are no longer sacrosanct. Our rights are reduced to edict.
The liberal agenda is to denigrate, reduce and remake our Constitution into their vision of social utopia. A false utopia where judges eclipse legislators and regulators make the law according to political whim.
Prejudice is something that plays into this. The alleged need to remake society in the 1960s with the Great Society was an attempt to atone for evils that should never existed. Yes, there was prejudice in the United States that has existed since before the Great Revolution. In that regard, the U.S. was not unique. Nor, is it the fault of the Northern European. Slavery has existed since one man bested another and one tribe bested another, and one city state bested another, and one nation bested another, and one empire bested another and took the losers into bondage.
How did slaves come to the U.S.? Slavery came before there was a U.S. The vanquished of whatever conflict became the fodder for the slave market. The military stronger power making a profit over the vanquished.
Prejudice came as the lie that allowed one man to "own" another. It has existed throughout history.
The same lie permeates the liberal Congress and the Marxist President to give them impetus to destroy our rights in the name of making us all the "same". In that regard, they use prejudice as a tool to create conflict and to divide.
Emotionalism is the imperative that drives.
"Feel good" is the Valium of the masses. Why if we all are the same, then we will all be happy.
Note how riots are now ignored by authorities. The rioters, usually black, are excused for their irresponsible and outrageous lawlessness on the basis of "well, they deserve to steal that TV".
No. They deserve to be shot in order to restore order.
We are a nation of law, not disorder, not color, not the whim of the despot or a Congress and President that pursue the destruction of all that made this nation great.
Prejudice will always exist as long as there is envy of another for whatever reason. There will be prejudice in the minds of those small enough to believe that one "man" is superior to another.
In the mean time, we must deal with the cancer eating at the fabric of this nation called diversity. Diversity is the attempt by the liberals and Marxists to compromise the unity that made this national great.
In order for the destruction of the United States to be accomplished, the social fabric must be destroyed. The conventions of marriage, family, culture, language, borders, and history must be destroyed or suborned in order to reach the end goal of a socialist/Marxist utopia where the dictatorship of the proletariat is the outcome.
In many regards, this has already happened.
The movements to give women equal rights has been perverted into something that now encompasses the elimination of the father figure in raising progeny, the needless, irresponsible killing of the unborn in the name of a woman controlling her own destiny and body in order to achieve the end game of accomplishing the end of the American family as we know it. The further perversion of the family by giving homosexuals parental rights and the ability to adopt have further diminished the role of the heterosexual family in our society.
Our borders and culture have been relegated to the trash heap of history. Why, the U.S. should not have borders! And, the national security and national identity issues are irrelevant. No nation in history has survived the loss of national integrity by failing to secure national boundaries.
Culture has been replaced by diversity. Why, every culture on the Earth is superior to ours.
That's why we are still a super power and the rest are third world offal holes. However, that leadership diminishes daily as our technological base is eroded by an education system that teaches diversity, the normalcy of the abnormal and deviant and "feel good" rather than hard nosed COMPETITION and how to read and write. The theft of our technology and our trade secrets, not to mention military technology and national secrets are openly sold as if they are meaningless.
How many nations have survived when the enemies of the nation have had the gates opened to them and the knowledge of their military and tactics compromised?
We have sold our national soul to the slave labor of communist China and other third world offal holes.
Our manufacturing and technology base, the envy of the world is now in the hands of the great copiers of Asia. Countries incapable of creating their own counter to our success. Done to level the playing field, to make us less threatening to the rest of the world. Our pols have sold our future down the river.
What happened to Rome, when Rome became "less threatening"?
Between the new religion of the left and the religion of climate change, the survival of western culture, much less that of the U.S. is in serious doubt. It was the liberal idiots that let the rabble from Islamic nations into western Europe . . . and the U.S. And, what have they contributed? The very real threat of revolution from and subordination to a 7th century theocracy. Yeah, Islam is sooooo tolerant and forgiving it calls for conversion . . . or death. Heck of a choice, eh?
As Dr. Michael Savage states: "Everything that is wrong is now right."
Every perversion is now to be accepted under the new order. Using children as sex toys is just another step towards social utopia.
Who determines what is right and wrong?
We do.
This election and the 2012 election will determine the fate of this nation.
In the mean time, shoot the looters in Oakland and restore order.