Alaskan Governor Proposes USD 355 Million LNG Investment

In a move to make Alaska’s gas available to Alaskans, Governor Sean Parnell proposed a $355 million financial package to jump-start construction of a natural gas liquefaction plant on Alaska’s North Slope and a Fairbanks-area natural gas distribution system through the private sector, and an area-wide utility.

A North Slope LNG plant has the potential to deliver gas via truck to Fairbanks and to provide access to gas for road and river communities, as well as Southcentral Alaska. The target for first delivery is the latter part of 2015.

Governor Parnell’s $355 million financial package includes $30 million in existing gas storage tax credits. The governor will also introduce legislation to provide financial support for the infrastructure, up to $275 million, through Alaska Industrial Development and Export Authority (AIDEA) loans and bonding authorization, and $50 million in general fund dollars.

“The state has stepped up with a financial package that will lead to lower heating and electric costs,” Governor Parnell said. “And, it can be a springboard for cheaper energy for Alaskans in other communities.

“While we continue to aggressively pursue a gas pipeline to get Alaska’s gas to Alaskans, that project is, at minimum, some years away. In the meantime, trucking gas from the North Slope is the best alternative – with the added benefit of preparing communities for an eventual connection to a pipeline.”

AIDEA, in collaboration with the Alaska Energy Authority (AEA), is seeking interested parties to participate in the financing, development and operation of a liquefied natural gas production facility.

An added benefit of the LNG plant is the potential for propane and gas to be distributed to Interior and river system communities, as well as for transport to Southcentral Alaska to supplement gas from Cook Inlet.

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LNG World News Staff, December 10, 2012; Image: gov.alaska.gov