By: Margie Brown, CIRI president and CEO
I am very excited about CIRI’s underground coal gasification project because it promises great benefits for our company and for the entire Cook Inlet region.
World, national and local energy needs are undeniably creating some of the most promising investment opportunities available today. World energy consumption is projected to increase 44 percent in the next quarter century. Closer to home, Alaska leads the nation in per capita energy consumption (1062 million BTU annually, ahead of second-ranked Wyoming at 948.6 million BTU). And CIRI’s home region is on the verge of an energy shortage that could lead to energy price spikes and supply problems that already plague the rest of Alaska.
Consequently, CIRI is working to expand and diversify its energy portfolio to benefit from these market trends and our core corporate strengths. The company is maintaining its traditional Alaska oil and gas energy businesses. CIRI has earned royalties from Cook Inlet basin leases since the 1970s and continues to pursue new oil and gas development on its lands, with two exploration wells scheduled for drilling this winter.
However, I believe that other business opportunities are being created by rapidly changing local, national and world energy market trends. Energy consumers worldwide are demanding and using more and more energy; at the same time, we all need increased energy price stability and fewer environmental costs. CIRI is responding to these demands by investing in a variety of local energy projects that will provide Alaskans with more affordable, reliable, clean, sustainable energy alternatives. The company is also investing to improve its own energy efficiency and to develop and commercialize emerging energy technologies.
*You can read in this newsletter about CIRI’s underground coal gasification (UCG) project that will enable the company to responsibly develop its vast coal resources on the west side of Cook Inlet. The Clean Air Task Force issued a coal energy report in September that calls UCG a “next generation” energy technology that “holds the promise of transforming the use of coal as an energy resource, with positive consequences for the natural environment and energy costs.” CIRI’s UCG project will initially fuel a new 100-megawatt combined-cycle power plant and provide timely relief to Southcentral Alaska’s energy crisis. CIRI is committed to using carbon capture and sequestration at this project, possibly by way of enhanced oil recovery that could increase Cook Inlet oil production. Later phases of CIRI’s UCG project are expected to include additional power generation for the region as well as production of synthetic natural gas or clean liquid fuels that could be used throughout Alaska and exported into national and world energy markets.
*CIRI is developing a 36-turbine, 54-megawatt wind farm on its land on Fire Island, just three miles offshore from Anchorage. CIRI’s wind team is still working out the final details of this project, but crews started clearing land for the project this fall and we anticipate that it could be online and offsetting Railbelt natural gas burn by late 2011.
*CIRI is exploring other energy resource development opportunities in the region, including additional wind projects, geothermal and other renewable resources.
*CIRI is exploring other infrastructure investments to support Alaska power generation, distribution and/or efficiency.
*CIRI is investing in ventures outside of Alaska that are developing new energy technologies that range from batteries to bio fuels.
*Finally, CIRI is working to become a more efficient energy consumer that uses less energy and leaves a smaller carbon footprint. It is, for example, planning a headquarters building renovation to decrease heating and power costs. It recently replaced two mono-hulled tour boats in its Kenai Fjords Tours fleet with fuel-efficient catamarans. And it is working to develop LEED-certified, energy-efficient office buildings at CIRI projects in Anchorage.
I believe these energy projects and others will boost CIRI’s long term growth and profitability. They will also become a CIRI legacy that benefits current and future generations of shareholders and Alaskans by supplying near- and long-term energy needs in our region, our state and our nation.