BP Alaska and Alaska Gasline Development Corporation (AGDC) have agreed to key terms to a gas sales deal which include price and volume, marking a new milestone for the Alaska LNG project.
The parties anticipate finalizing a long-term gas sales agreement in 2018 for AGDC to purchase BP Alaska’s share of 30 trillion cubic feet (tcf) of gas from the Prudhoe Bay and Point Thomson units.
BP operates the Prudhoe Bay field and owns a 26 percent share of Prudhoe Bay as well as a 32 percent share of the nearby Point Thomson field.
“The Alaska LNG project has made significant progress over the past year,” said Janet Weiss, BP Alaska president.
This development comes just six months after the signing in Beijing of the five-party joint development agreement to monetize Alaska’s natural gas.
“This Gas Sales Agreement is a significant factor in progressing the Alaska LNG project,” said AGDC president Keith Meyer.
“We have secured the customers, we have progressed on the pipeline build with regulators and the finance community and now we have a commitment that there will be gas to sell and put through the pipeline,” Meyer said.
Alaska LNG project includes a gas treatment plant located at Prudhoe Bay, an 807-mile pipeline to Southcentral Alaska with offtakes for in-state use and a 20 million ton per annum natural gas liquefaction facility in Nikiski that will produce LNG for export.
Earlier this year, the United States Federal Energy Regulatory Commission said it plans complete its final environmental review statement for the Alaska LNG project on December 9, 2019, bringing the project closer to the final investment decision.