US approves $ 43 billion LNG project in Alaska that is still looking for investors

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The U.S. Federal Energy Regulatory Commission (FERC) this week approved construction and operation of the LNG project in Alaska, estimated at US $ 43 billion, which is years in planning, but still missing to investors the commitments for its completion.

The FERC authorized the Alaska Gasline Development Corporation (AGDC) – a public company independent of the State of Alaska – to liquefy and export liquefied natural gas (LNG) from the north slope to an export facility on Thursday. Nikiski, Alaska.

The LNG project in Alaska includes a gas processing plant on the North Slope of Alaska, an 800-mile pipeline and an LNG facility in Nikiski, Alaska, and is expected to cost US $ 43.4 billion.

Commenting on the FERC project authorization, Alaska Governor Mike Dunleavy said:

“The federal authorization granted today is a key step in determining whether Alaska’s LNG is competitive and economically beneficial to Alaska. I congratulate the AGDC team for their diligence. The economic review of the project and discussions with potential partners will determine the next steps for this project. “

“Our momentum continues as we complete our assessment of the project’s economy and competitiveness, and we are engaging with potential project partners to determine the best path for the LNG project in Alaska,” said the President of AGDC, Frank Richards.

The project was first proposed in 2014, but in 2016 the project partners, ExxonMobil, BP, ConocoPhillips and TransCanada, withdrew as potential investors and the State of Alaska took over the project .

According to Alex DeMarban of Anchorage Daily News, FERC approval of the project could be a key step for a potential sale of the project to investors or buyers.

However, given the current state of the global LNG market with record high prices and sluggish demand in the COVID-19 pandemic, investors may not be rushing to pay billions of US dollars for complete the project, especially since the oil and gas supermajors are tightening their belts after the drop in oil prices in March.

By Tsvetana Paraskova for Oilprice.com

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