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Alaska Gasline's natgas pipeline gains key federal approval

by Kirk Beyers (2020-11-24)


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March 6 (Reuters) - Alaska Gasline Development Corp (AGDC) said on Wednesday it received the last major federal permit needed before it can decide on its proposed $10 billion Alaska Stand Alone Pipeline (ASAP) to supply natural gas to in-state consumers.

That permit came from the U.S.

Army Corps of Engineers and the Bureau of Land Management (BLM) in a joint record of decision for the ASAP project on March 4.

ASAP is a 733-mile (1,180-kilometer) project designed to deliver gas from Alaska's North Slope to customers in Fairbanks, Anchorage and other parts of the state.

It is also part of state-owned AGDC's proposed $43.4 billion Alaska liquefied natural gas (LNG) project.

"We see Alaska Stand Alone as a backup plan. We are mostly focused on Alaska LNG," AGDC spokesman Tim Fitzpatrick said, noting the two projects share a common path for 80 percent of their pipeline routes.

The proposed $43.4 billion Alaska LNG is designed to liquefy 3.5 billion cubic feet per day of gas for sale to customers in the Asia-Pacific region from a facility to be built in Nikiski on the Kenai Peninsula south of Anchorage.

It includes an 807-mile pipeline.

"We are moving forward on Alaska LNG, focusing on permitting and commercial progress ... while we conduct a review of the project to assess its economic potential," Fitzpatrick said.

Last week, U.S. energy regulators delayed the date they expect to decide on the LNG project to June 2020 from February 2020.

Under its revised schedule, the U.S.

Federal Energy Regulatory Commission (FERC) said it now plans to issue a draft environmental impact statement (EIS) in June 2019 and a final EIS in March 2020.

"We believe the (FERC scheduling) revision does not affect the prospects for Alaska LNG," Fitzpatrick said.

In the past, AGDC said it planned to make a final investment decision to build the LNG project in early 2020 that would enable it to enter service in 2025.

AGDC Interim President Joe Dubler said in a report to be presented to the company's board on Wednesday that the LNG project schedule is under review.

The report says "AGDC will only pursue Alaska LNG if project viability is assured."

AGDC, meanwhile, is continuing negotiations with several parties interested in the project, including a joint development agreement with Chinese oil and gas company Sinopec, China's sovereign wealth fund China Investment Corp's CIC Capital Corp and the state-owned Bank of China.

(Reporting by Scott DiSavino in New York Editing by James Dalgleish)