AK LNG

The Alaska LNG Project has been stalled for years, but the Alaska Gasline Development Corporation is hoping a new, lower cost estimate will make it more competitive.

The corporation released the revised cost estimate during a board meeting on Thursday. The new estimate sits at $38.7 billion, about $5.5 billion less than the previous estimate, which was done in 2015. The new estimate was put together by AGDC with BP, ExxonMobil, and Fluor Corporation, a consulting company with experience in LNG.

Since the state announced Nikiski as the chosen site for its liquefied natural gas plant project about six years ago, Kenai Peninsula residents have had an ear to the ground for developments. The project would use an 807-mile pipeline from the North Slope to deliver natural gas to a plant in Nikiski, where it would be liquefied and shipped out to international markets, all for a price tag of about $45 billion.

Since 2017, the state has been heading up the project alone through the Alaska Gasline Development Corporation. The project partners, including ConocoPhillips, BP and ExxonMobil, shied away from it after a number of international LNG plants came online, pushing down prices and making Alaska’s project too expensive to be competitive. But the state has pressed on, gathering permits and information. On Thursday, the Federal Energy Regulatory Commission gave the state the green light to build and operate the project.

Now it’s just a matter of how to pay for it. This is the last year the state is going to go it alone —it’s either find other sponsors or sponsors or sell the assets.