A recent article in the Financial Times of London where Conoco's (NYSE:COP)chief executive officer Jim Mulva said the company may have to "reaccess" the Denali pipeline it is proposing to develop with partner BP (NYSE:BP).
The comment was based upon the enormous amount of natural gas reserves in the lower 48 states, which Conoco spokesman John McLemore commented on saying: "Clearly, shale gas (in the Lower 48) has changed the dynamics of natural gas in North America."
He added that there hasn't been a new review of the project launched.
This gave the idea to some that maybe the pipeline deal will be put on hold or abandoned, but McLemore said the company is continuing on with the work on the project.
Mulva did say after his comments to FT that natural gas still remains an "attractive" investment for the company, although it seems he's starting to think longer term than he was in the past.
This coming Monday McLemore said Conoco will look closely at natural gas prices over the long term, supply projections, response of the market and tax issues.
It sounds like in the shorter term things aren't looking nearly as good because of the huge supply for the pipeline, and it'll be interesting to see if that affects the timing of starting the pipeline, if it gets built at all by Conoco and BP.
Another factor is a competing proposal from Exxon Mobil (NYSE:XOM) and TransCanada to built a pipeline serving the same region.
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