The state-owned Alaska Gasline Development Corporation (AGDC) said it took a step forward in the development of its planned $40 billion LNG export project with the completion of the project’s capacity solicitation process.
Alaska LNG project has three major components, a gas treatment plant located at Prudhoe Bay, an 800-mile pipeline to Southcentral Alaska with up to five offtakes for in-state use, and a natural gas liquefaction plant in Nikiski authorized to process 20 million tons of LNG per year.
The capacity solicitation process that ran from June 15 through August 31 enabled AGDC to secure foundation customer status on the transportation and liquefaction system in an open and non-discriminatory process, said AGDC President Keith Meyer.
“In addition to an Alaska producer submitting a conforming intent to subscribe for capacity on the system, each of the three major producers expressed interest in selling gas to AGDC for further sale to the global LNG markets,” he said.
According to Meyer, pending the completion of the deals, AGDC would have gas supply and foundation customer capacity that would allow the company to provide an attractive bundled LNG sale to global customers.
In addition to providing a clear pathway for LNG sales, AGDC will now be able to better determine the potential phased development of the system to meet market demand, the statement reads.
Phasing has the potential to reduce initial capital cost without sacrificing long term capacity.
AGDC added it continues to make progress marketing directly to LNG buyers in the Asia-Pacific region.
“The capacity AGDC reserved during the foundation customer capacity solicitation will accommodate these volumes for customers that prefer to purchase LNG at the jetty rather than become a capacity holder,” the statement said.
AGDC previously partnered with three major North Slope gas owners BP, ConocoPhillips and ExxonMobil on doing preliminary engineering work, however, the companies withdrew from the project two years ago citing poor market conditions.
The Prudhoe Bay and Point Thomson fields anchor the LNG project on the North Slope. These fields will produce, on average, about 3.5 billion cubic feet of gas per day with approximately 75 percent from the Prudhoe Bay field and 25 percent from the Point Thomson field, according to AGDC.
LNG World News Staff