Jun. 12--The state of Alaska has awarded a contract for engineering and feasibility studies to Michael Baker Jr. Inc. for a 24-inch, high-pressure bullet line that could bring natural gas from the North Slope to Southcentral Alaska. The work, valued between $5 million and $6 million, is to be done by June 2010.

Separate contracts are soon to be awarded to other firms for work on environmental permits and an assessment of Cook Inlet gas potential, Harry Noah, Gov. Sarah Palin's lead person on in-state gas issues, told state legislators June 5.

As the Legislature adjourned in late April, lawmakers appropriated $7 million to the governor's office for work toward an in-state pipeline. Noah is to give legislators monthly progress reports.

Under its contract, Michael Baker will also do a cost comparison of moving gas through a new pipeline built from the Slope to Southcentral along the trans-Alaska oil pipeline and the Parks Highway, and a spur pipeline built off a large-diameter pipeline at Delta and routed to Southcentral via Glennallen, Noah said.

The engineering company will also do a preliminary assessment of building a smaller pipeline from main pipeline west to the proposed Donlin Creek gold mine on the Kuskokwim River, Noah said.

Energy costs are one of the major obstacles to be overcome in developing the large mine, which would be a major employer in the region if it is built.

"The key questions we have to answer is whether a stand-alone pipeline (a bullet line) from the North Slope is viable," Noah told legislators. "Alternatively, what are the savings if we wait and build a spur line off the large pipeline built to the Lower 48? Or would it make more sense to give additional incentives for Cook Inlet gas development?"

Other groups, both in state government and private, are working to assess Cook Inlet potential, Noah said.

Michael Baker is to do the technical work needed to assess the basic feasibility of a bullet line.

"This is not detailed design, but it will give us enough information," Noah said.

Preliminary engineering, route design and environmental permitting has already being done on the spur line alternative via Glennallen by the Alaska Natural Gas Development Authority, the state gas development corporation.

Noah said ANGDA has been asked to take the lead in securing major permits for the bullet line as well as spur line, and to select the preferred route between the Parks Highway and Glennallen alternatives.