ExxonMobil in Alaska LNG deal

US energy giant ExxonMobil has signed a preliminary deal with the developers of the proposed Alaska liquefied natural gas (LNG) export project to supply feed gas for the liquefaction facility.

ExxonMobil Alaska Production and Alaska Gasline Development Corporation (AGDC) have agreed to certain key terms including price and a volume basis for the gas sales deal.

State-owned AGDC said in a statement on Monday that the parties anticipate finalizing long-term gas sales agreements to purchase ExxonMobil’s share of 30 trillion cubic feet (TCF) of gas from the Prudhoe Bay and Point Thomson units.

ExxonMobil operates the Point Thomson field where the company has a 62.75 percent share. ExxonMobil also has a 36.4 percent share of the nearby Prudhoe Bay field – the largest oil and gas field in North America.

“This precedent agreement is good for Alaska and ExxonMobil and represents a significant milestone to help advance the state-led gasline project,” said ExxonMobil Alaska President Darlene Gates. “

This development comes less than a year after President Donald Trump and President Xi Jinping witnessed the signing in Beijing of the five-party joint development agreement to monetize Alaska’s natural gas, the statement notes.

“The Alaska LNG project has made meaningful progress over the past year,” said AGDC President Keith Meyer. “We have secured the customers, we have advanced the project with regulators, and now we have ExxonMobil’s Gas Sales Precedent Agreement executed.”

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.