The state corporation behind the over-$40 billion Alaska LNG project could be ready to sell off project assets if it does not find a party to take over development of the massive natural gas transportation and export proposal.
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Larry Persily, a former deputy commissioner at the Alaska Department of Revenue and a veteran journalist, said the board of directors for the state entity Alaska Gasline Development Corp., or AGDC, "appears ready to sell off the project's assets" in a formal bidding procedure. The assets for sale could include permits, studies and engineering work.
Persily made the observation in an article he wrote for Alaska Business magazine. He said the AGDC board adopted a strategic plan on the project on April 9. Persily said the document was confidential but the board publicly reviewed assumptions in the plan, which include reduced construction costs, a viable Asian market for Alaska gas and a new lead sponsor. The corporation is updating a three-year-old, $43 billion cost estimate for the project.
AGDC was not immediately available to confirm the potential asset sale.
The state corporation has had the lead role on the gas export project since late 2016. It has advanced the project through permitting, and it has planned to turn it over to private interests when markets turn around. However, AGDC has had some trouble attracting a sponsor even before the COVID-19 crisis in the global economy and energy markets, and now many developers of new LNG projects and even existing LNG operators are facing difficulty.
The Alaska LNG project would move natural gas produced on Alaska's North Slope through more than 800 miles of pipeline to a gas liquefaction and export terminal in southern Alaska. It would be capable of exporting 20 million metric tons per year of LNG.
The Federal Energy Regulatory Commission plans to vote on a Natural Gas Act certificate authorization for the project at its monthly meeting on May 21. FERC released a final environmental impact statement in March.