ConocoPhillips Nikiski plant ships LNG

Although much attention of late has focused on a potential major liquefied natural gas plant for exporting North Slope gas via Alaska’s Cook Inlet, ConocoPhillips’ venerable LNG plant at Nikiski, on the west side of the Kenai Peninsula, continues to export Cook-Inlet-sourced LNG.

According to a report filed by ConocoPhillips with the Federal Energy Regulatory Commission on Aug. 10, the company expects to ship up to six LNG cargoes from the Nikiski plant to Pacific Rim customers this year. Shipments began on May 10 with an 857,484-barrel cargo, carried out of Cook Inlet on the LNG carrier LNG Excel, with the same vessel picking up an 826,317-barrel cargo on June 11, the report says. Operations will be relatively continuous before ending in October for the winter, the report says. In April 2014 the U.S. Department of Energy issued a new export license for the facility, allowing up to 20 billion cubic feet per year of gas to be exported as LNG over a two-year period.

The report to FERC also says that during the first six months of this year the LNG facility delivered two tank truck loads of LNG to gas utility Fairbanks Natural Gas, presumably for transportation by road to Fairbanks.

The LNG plant first went into operation in 1969, exporting LNG to Japan as a market outlet for gas from the North Cook Inlet gas field that is now owned and operated by ConocoPhillips. However, although the North Cook Inlet field continues to supply gas to the Nikiski facility, the facility does now accept gas from other sources.

The report to FERC indicates no significant operational problems at the Nikiski plant. However, this year ConocoPhillips is cleaning, re-coating and re-sealing the entire perimeters of the three LNG storage tanks at the facility, the FERC report says.

At the end of July ConocoPhillips announced that was putting up for sale its interests in Cook Inlet gas fields, including the North Cook Inlet field. However, the company plans to retain ownership of the Nikiski LNG facility.

- ALAN BAILEY