AGDC board moves review of Pt Thomson to Fairbanks gas line

Kristen Nelson

Petroleum News

The Alaska Gasline Development Corp. board approved a resolution at its Feb. 4 meeting recognizing that a strategic party had been identified that was “fit, willing, and able to initiate and lead Phase 1 of Alaska LNG, inclusive of natural gas pipeline development, ownership and operation from Pt. Thomson to Prudhoe Bay to Fairbanks, Alaska.”

The name of the strategic party has not been made public.

A phased approach to the Alaska LNG Project surfaced when Gov. Mike Dunleavy mentioned a pipeline to the state’s road system in his state-of-the-state address Jan. 28. He elaborated later in an opinion piece, pegging the cost of a Point Thomson to Fairbanks line at $5.9 billion and saying that in addition to private funding “there is a strong possibility of federal funding.” (See story in Feb. 7 issue of Petroleum News.)

The phasing of the project was discussed at the board’s Feb. 4 meeting, with benefits listed as jobs for Alaskans, unlocking stranded gas for upstream investors and providing natural gas to the state’s Interior.

AGDC President Frank Richards, responding to a question about the use of Point Thomson gas, said it was different than Prudhoe gas, which for the large project would require conditioning to remove CO2. Unlike Prudhoe Gas, he said, Point Thomson is likely pipeline quality.

Asked whether Point Thomson gas wasn’t needed for reinjection, Richards said AGDC’s understanding from communication with Point Thomson is that the volume needed for Fairbanks is so small it wouldn’t impact their operations.

Potential lead for all phases

The AGDC board is to initiate working groups of the board to meet through February to review and update the strategic plan approved in April 2020, including “re-considering the Strategic Plan’s baseline assumptions, updating the strategic roadmap through June 30, 2021, and potentially updating strategic objectives” - work which would result in further board review and approval and be presented at the board’s March 5 meeting.

With the identification of a strategic sector party for Phase 1, “an open solicitation is not warranted at this time,” the resolution says.

If AGDC had been unable to identify a strategic party the first option would have been to solicit interest - and if there was none, to put the projects assets up for sale.

In other news from the Feb. 4 meeting, Joe Dubler has joined the board. Dubler retired as interim president early last year, a position he was named to in January 2019.

- KRISTEN NELSON