The majority owners and would-be developers of Alaska’s proposed liquefied natural gas pipeline announced Thursday a spate of new agreements they say move the project’s first phase into early development. The news came near the end of a busy week for the company, which got special recognition from Gov. Mike Dunleavy in his final State of the State address.
The Alaska LNG Project promises energy stability for a huge swath of Alaskans. And during his annual address to lawmakers Thursday, Dunleavy teased there may be more at stake: a birthday wish.
“We were joking around earlier,” he said. “My daughter's birthday is tomorrow, and I said, ‘You know what her wish is before she blows out the candle tonight? To have a big gas pipeline in Alaska. Don't let her down.’ Remember that.”
Dunleavy’s been loud about his enthusiasm for the gasline megaproject, which he’s touted as a once-in-a-lifetime opportunity.
“This will be the single most transformative project in Alaska since the Trans-Alaska Pipeline,” he said. “More than anything, Alaska LNG is a dream realized, a hope fulfilled, just like TAPS before it.”
If it’s built, the two-phase Alaska LNG Project would move North Slope gas to Southcentral through a roughly 800-mile steel pipeline. From there, some of the gas would be liquefied in Nikiski and shipped to buyers around the world. Another portion of the gas would be reserved for in-state use.
Dunleavy’s address came hours after Glenfarne Group announced it would move the project’s first phase to “early execution.” The announcement described a smattering of new nonbinding agreements that cover gas supplies from ExxonMobil and Hilcorp, roughly two-thirds of the steel needed for the pipeline and construction services.
Glenfarne also plans to extend its working relationship with the company that recently finished updating the project’s estimated cost. The company reiterated the new price tag will not be made public, even if the state becomes an investor.
“We are a private company, and we don't produce that number,” Glenfarne CEO Brendan Duval during a press conference Thursday. “But what I can tell you is it's come in in a range where it's financeable and it's sufficiently profitable that we can make the financing work.”
It’s been less than a year since Glenfarne assumed majority ownership of the Alaska LNG Project. Since then, the company’s toured the world. Glenfarne’s picked up a handful of nonbinding gas sale agreements and support from the White House and Alaska’s congressional delegation. And project leaders briefed Kenai Peninsula residents on local project implications.
John Sims says those developments are a big reason why his company wants in on the action. Sims is the president of Enstar Natural Gas Company, which announced a tentative 30-year agreement to buy gas from Glenfarne on Thursday.
“There's only one project that's available in the world that can reduce the price of energy for the state of Alaska, and that is the pipeline coming down from the North Slope,” he said.
Sims says Enstar and Glenfarne have been in talks since late 2024. The two companies are collaborating on a natural gas import facility in Nikiski, which Sims says would help address the utility’s immediate energy needs, but won’t be needed if the pipeline is built. If that happens, Sims says Enstar has bigger goals.
“We are looking over the long-term for the project that we're working on with Glenfarne to be the sole provider,” he said. “So that means we would buy all of our gas from them in time.”
Glenfarne still hasn’t actually decided whether it will develop the Alaska LNG Project. Initially, the company planned to decide by the end of 2025. Now, Duval says that decision won’t come until at least February.
Larry Persily remains skeptical about the project’s viability. He’s a former state revenue commissioner and used to coordinate the federal agency tasked with advancing an Alaska gasline project. Until Glenfarne announces binding contracts, he says it’s hard to get excited about the pipeline’s prospects.
“Similar projects take years to put together customers and financing and investors and tax structures and contracts, and we're to believe this one's being put together in a matter of months?” he said. “And that they're close to the finish line? Because there's press releases about conditional, provisional, tentative, possible agreements? No.”
Persily says Glenfarne’s gone where no company has before by identifying which companies would supply steel. But he says identifying a company and signing a contract with a company are two different things. And he says key logistics associated with starting work remain hazy: rail cars to move the steel, work camps, pipe layers.
“You can’t buy those off the shelf on 30 days notice,” he said.
Glenfarne told lawmakers last year it expects to need around 7,000 workers at peak pipeline construction. Legislative support for the gasline is expected to be a top issue this session. Dunleavy has said he will introduce legislation aimed at alleviating the property tax burden on Glenfarne, though that’s met some opposition from local governments, including the Kenai Peninsula Borough.
