Putting Alaska’s Gas to Work for Alaskans
Governor Parnell is focused on getting Alaska’s gas to Alaskans first, and then to markets beyond.
To harness Alaska’s roughly 200 trillion cubic feet of natural gas reserves, the Parnell Administration made unprecedented progress on an all-Alaska gasline and established the Interior Energy Project to provide energy cost relief for Fairbanks and Interior communities.
Interior Energy Project
In 2013, Governor Parnell introduced and the Legislature passed the Interior Energy Project. The Alaska Industrial Development and Export Authority is now working on a natural gas liquefaction plant on the North Slope and an LNG distribution system within the Fairbanks North Star Borough and into the Interior. Gas will begin to energize the Interior by the end of 2015 via an initial trucking solution, and the distribution system build-out will strongly position Interior residents for a gasline.
In 2012, Governor Parnell outlined a plan to get Alaska's gas to Alaskan with measurable benchmarks for progress. The plan resulted in the resolution of Point Thomson litigation, getting the three oil/gas producers and pipeline company, TC-Alaska, to sign an agreement to align on an Alaska gasline project, and the selection of a project concept and associated work schedule. Virtually all benchmarks Governor Parnell established were met, and milestones continue to be reached, including the selection of Nikiski as the lead site for a terminus of the Alaska LNG (liquefied natural gas) Project.
The Alaska LNG Project
With most of the Governor’s benchmarks met, hundreds of millions of private and public dollars spent, significant fieldwork complete, and more work ahead, the State of Alaska signed a commercial agreement, known as a Heads of Agreement, with a transparent set of terms and road map for Alaskans to consider. For the first time, all the necessary parties have aligned to make an Alaska gasline project go: three producers, a pre-eminent pipeline builder, the Alaska Gasline Development Corporation (AGDC), and the State agencies responsible for the people’s royalties and taxes. Between January and April 2014, the Alaska Legislature is publicly reviewing this Heads of Agreement and other guidance documents for the Alaska LNG Project.
In January, Governor Parnell also introduced Senate Bill 138, enabling legislation for any gas development project. The legislation would establish the framework for Alaska to become an owner in the Alaska LNG Project. With the Heads of Agreement signed, passage of SB 138 will enable the Alaska LNG Project to ramp up to Pre-FEED – the Pre-Front End Engineering and Design phase.
Alaska Stand Alone Pipeline
AGDC continues to be uniquely positioned to get gas to Alaskans with the Alaska Stand Alone Pipeline project (ASAP). Should work falter on the Alaska LNG Project, we will still get gas to Alaskans first with AGDC’s smaller-volume project. With AGDC on track for an open season in early 2015, SB 138 ensures AGDC will continue to aggressively pursue the ASAP project and in-state gas deliveries.
Our way forward will be on Alaska’s terms and in Alaskans’ interests.