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FERC accepts Nikiski LNG timing
Harvest has until mid-Dec. '28 to convert LNG export terminal for LNG importing
Alan Bailey for Petroleum News
Federal Energy Regulatory Commission has approved a request from Trans-Foreland Pipeline Company to delay the required completion date for the conversion of the liquefied natural gas export facility at Nikiski on the Kenai Peninsula to an LNG import facility.
The required completion date for the terminal conversion has been deferred from Dec. 17, 2025 to Dec. 17, 2028. As previously reported by Petroleum News, Hilcorp pipeline affiliate Harvest Alaska LLC has purchased Trans-Foreland from Marathon Petroleum Corp. for the establishment of a terminal for the importing of LNG, to bolster gas supplies in Southcentral Alaska.
Earlier LNG import plan In 2020 FERC had authorized Trans-Foreland to convert the facility into an LNG import facility, with an anticipated startup date by Dec. 17, 2022. And in 2022 FERC granted an extension of the timeframe to Dec. 17, 2025. The purpose of the conversion would have been to bolster natural gas supplies for fueling Marathon's oil refinery at Nikiski. However, the proposed conversion was never carried out. Hence the need to change the required completion date.
On Dec. 5 Trans-Foreland also requested FERC approval for an extension of the time required to put into operation new seismic instrumentation that the company has installed in the facility. The company says that a transition to Harvest's computer and communications systems is delaying putting the new instrumentation into operation, potentially until the fourth quarter of 2026.
The LNG terminal first went into operation in 1969 as a means of exporting natural gas to Japan during the heyday of Cook Inlet gas production. But with the later decline in production, the terminal stopped operating in 2016 and since then it has remained in long-term warm shutdown mode.
Chugach Electric needs firm gas In February Harvest and Anchorage-based Chugach Electric Association announced an agreement with Marathon for Harvest to acquire the facility for the importing of LNG. Chugach Electric urgently requires a means of ensuring that it can continue to obtain firm gas supplies for power generation after the utility's firm supply contract with Hilcorp expires on March 31, 2028.
Anchorage based Enstar Natural Gas Co. also anticipates needing imported LNG at some time in the future to ensure firm gas supplies. Enstar is working with Glenfarne Energy Transition on the development of a new LNG import facility at Nikiski. Enstar has indicated that it would likely need to be importing gas into storage by around 2032 or 2033, a few years later than Chugach Electric, and that the existing Nikiski LNG facility would not have sufficient capacity to support both utilities.
Glenfarne, in conjunction with Alaska Gasline Development Corp., is planning the construction of a gas pipeline from the North Slope to the Cook Inlet. If that project moves ahead successfully, the new LNG import facility would be enlarged into an LNG export facility. Gas for use in Southcentral would be obtained through the pipeline.
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