Dec. 14--Southcentral Alaska's natural gas situation is getting grim. The large producing fields in the region are being depleted faster than expected.

While there is still plenty of gas left in producing gas fields, producing companies and utilities are concerned about the "deliverability" of the fields, or the capability of the aging wells to produce enough on cold winter days to meet peak demands.

"Gas deliverability from the four largest fields in the Cook Inlet Basin has declined significantly in the last three years," Steve Wright, Chevron Corp.'s Alaska asset manager, told the Resource Development Council Nov. 19. "These four fields -- Beluga River, North Cook Inlet, McArthur River field and Kenai field -- were capable of delivering up to 14 billion cubic feet per month in January 2004. At present, they are capable of producing only 9 billion cubic feet per month."

The four fields produce about 65 percent of the natural gas production in Southcentral Alaska. The concern over deliverability was a major factor in Chevron's decision to reduce the amount of gas it will supply in its contracts with Enstar Natural Gas Co. from 2012 to 2016.

"We could not document that we would have adequate deliverability to have met this commitment," Wright said.

The heat and power in Southcentral Alaska communities won't get turned off, however. ConocoPhillips and Marathon Oil, the owners of the liquefied natural gas plant near Kenai, have pledged to backstop utilities if gas deliverability is insufficient on cold days.

Still, the underlying problem of declining reserves is getting worse, and exploration results in recent years have been modest.

"Gas exploration has not been successful. Chevron has operated six exploration wells in recent years and have had only modest success," Wright told the RDC council.

There is good potential in the region, but the problem is that many areas with prospective geology have substantial surface occupancy issues, he said, which limits explorers' access.

Production has actually dipped below what the state Department of Natural Resources has estimated would be possible from remaining proved gas reserves in the Cook Inlet Basin, he said.

The industry isn't sitting on its hands, however. Chevron and other Cook Inlet operators are making substantial investments. Two years ago Chevron announced a $400 million program to refurbish aging oil production platforms in Cook Inlet and to stimulate new gas production. The company is carrying out that program, Wright said.