Conoco pauses Nikiski LNG exports

ConocoPhillips did not export any liquefied natural gas cargoes from its Nikiski LNG facility on Alaska’s Cook Inlet during the first quarter of 2016, according to a report that the company has filed with the Federal Energy Regulatory Commission. In February the company secured an extension to its Nikiski LNG export license from the Department of Energy but so far has not made use of its license extension. Global LNG prices have been depressed recently due to a combination of the low oil price and the softening of demand relative to supply.

“Due to market conditions, we do not currently have plans for an LNG export program from the Kenai plant in 2016,” ConocoPhillips spokeswoman Natalie Lowman told Petroleum News in an Aug. 10 email. “It will remain operational and ready to resume exports. We will continue to evaluate opportunities for future LNG exports.”

Lowman said that gas being produced from ConocoPhillips’ North Cook Inlet gas field is currently under contract and being sold in the local market.

According to the FERC report neither did the Nikiski plant deliver any LNG to Fairbanks Natural Gas in the first half of 2016 - the Nikiski plant sometimes supplies LNG to the gas utility to bolster gas supplies for the city of Fairbanks.

After mothballing the plant in early 2013, ConocoPhillips restarted the facility in 2014, shipping out five cargoes between May and September of that year. The company followed up with the shipping of six cargoes between May and mid-October 2015. Cargo sizes have ranged from 588,764 barrels to 855,100 barrels.

- ALAN BAILEY