Friday, October 11, 2013

Preferred Site Chosen for Alaska LNG Project

 The Kenai Peninsula town of Nikiski, the largest cape on the southern coast of Alaska, has been selected by Exxon Mobil, BP, ConocoPhillips and TransCanada Corp. as the leading contender for the terminal site where gas would be liquefied and shipped to Asia, the companies announced Oct. 7.

The site was chosen after 20 locations were analyzed regarding the environmental and socio-economic impact of the project, as well as cost and related technical issues.

The pipeline, which could cost $45 billion to more than $65 billion to build, would span 800 miles from the North Slope to south-central Alaska. The companies haven’t yet committed to build, however, and have been seeking favorable terms on oil and gas taxes and royalties.

“The work that we have put into the site selection process gives us confidence that the Nikiski site is the lead location for the LNG plant and terminal,” senior project manager Steve Butt said. “The Nikiski site also results in a pipeline route that provides an access opportunity to North Slope natural gas by the major population centers in Fairbanks, Mat-Su Valley, Anchorage and the Kenai Peninsula.”

Nikiski, a town of about 4,600 people, is located 10 miles north of the city of Kenai. A liquefied natural gas plant operated in Nikiski for decades and provided exports to Japan. But ConocoPhillips and its then-partner, Marathon Oil Corp., announced in 2011 that the plant would be closed, citing market changes.