Providing coverage of Alaska and northern Canada's oil and gas industry
September 2023

Vol. 28, No.39 Week of September 24, 2023

Harvest has started construction of North Slope LNG plant for IGU

Alan Bailey

for Petroleum News

The construction of a liquefied natural gas plant on the North Slope is progressing to schedule, executives from Harvest Midstream told the board of the Interior Gas Utility on Sept. 12. The plant is expected to be operational by the end of 2024.

In January of this year IGU, the gas utility for the Fairbanks region, signed contracts with Hilcorp Alaska and Harvest for the supply of North Slope gas in the form of LNG to Fairbanks and North Pole. Harvest, Hilcorp's midstream affiliate, is building the LNG plant on a pad adjacent to the Spine Road on the North Slope. Harvest will operate the plant using North Slope gas that IGU is purchasing from Hilcorp.

IGU is establishing trucking arrangements for transporting LNG from the North Slope to Fairbanks.

Replaces Cook Inlet gas supplies

The North Slope LNG supply will completely replace IGU's LNG supplies from the Cook Inlet. Currently IGU purchases Cook Inlet gas from Hilcorp and manufactures LNG from the gas using the utility's LNG production facility near Point Mackenzie. The LNG is trucked to LNG storage facilities in central Fairbanks and North Pole, to enable gas supplies for customers in the region.

The move to the use of North Slope gas comes in response to growing concerns about the future capacity of Cook Inlet gas supplies.

The Harvest executives told the IGU board that, following the signing of the new LNG supply agreements with IGU, Harvest was rapidly able to negotiate arrangements for the use of the North Slope pad and obtain an easement for pad use. Harvest is sharing the use of the pad with Alyeschem LLC. Alyeschem plans to construct a petrochemical plant on the gravel pad to produce methanol.

Air permit was critical

Obtaining an air permit from the Alaska Department of Environmental Conservation was a critical step in the process for building the LNG plant -- Harvest could not begin any on-site construction work until it obtained that permit. ADEC issued the permit in July, and Harvest began its on-site work immediately afterwards. Harvest had already begun engineering and design work for the project during the second half of 2022. Following the signing of the agreements with IGU the company proceeded with the procurement of the components of the LNG plant.

Four main structures

The plant will consist of four major structures: a gas treatment building; a liquefaction building; LNG storage and truck loading facilities; and an office and power generation building. The plant will connect to the main Prudhoe Bay field fuel gas pipeline via two above ground, 1,300-foot pipelines. One of the pipelines will deliver gas to the facility while the other pipeline will return carbon dioxide to the fuel line. The carbon dioxide will be extracted from the gas in the gas treatment building -- Prudhoe Bay gas contains some carbon dioxide which must be removed before LNG can be manufactured.

The liquefaction process will use nitrogen loop cooling technology.

Microturbine power generation in the office and power building will enable the LNG plant to operate independently from the Prudhoe Bay power supplies.

On-site work

The on-site work conducted this year involves constructing the building foundations and starting the installation of the buildings. The preparation work has involved excavating the foundations, installing piles for supporting the buildings, and installing the thermosyphon equipment and insulation needed to protect the permafrost. A liner and grading material were placed above the insulation. Work laying the concrete bases for the buildings is in progress. Harvest anticipates the building modules to start arriving by truck on the North Slope during October and hopes to erect at least one building before the end of the construction season in mid-October.

During the tundra travel season in the coming winter Harvest anticipates using an ice road to drive in the piles for the pipelines connecting to the Prudhoe Bay fuel pipeline and install the pipelines -- the company already has the necessary piping staged on the pad.

Trucking of the modules for the facility should begin in the spring, with the various components of the plant being assembled during the 2024 North Slope construction season. That would lead to commissioning of the plant starting at the beginning of October, with plant startup anticipated by the end of the year.


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