Gas project partners OK work plan, budget

JUNEAU — The partners in a major liquefied natural gas project that the state of Alaska is pursuing voted Thursday to approve a work program and budget for the coming year.

The state is pursuing the project with the North Slope’s major producers: BP, ConocoPhillips and Exxon Mobil Corp. Miles Baker, a spokesman for the state-sanctioned Alaska Gasline Development Corp., said by email that the vote was unanimous and occurred Thursday evening.

Earlier in the day, the board of the corporation, known as AGDC, authorized staff to vote to approve the 2016 work program and to put up money appropriated by the state for the corporation’s share of the costs, roughly $60 million. AGDC holds Alaska’s interest in the pipeline, gas treatment plant and liquefaction facilities.

The project partners all had to be willing to put up their share of the money to move forward.

The project remains in a preliminary stage. There’s no guarantee it will be built but it is seen by many as key to Alaska’s financial future; Gov. Bill Walker called it a “must-have project.”

According to a release from the project, elements of the 2016 work plan include filing draft resource reports with federal regulators and completing an evaluation of a larger-diameter pipeline option.

AGDC’s board met briefly Thursday morning before taking an hours-long recess. Baker said Walker’s administration was working on agreements with the other project partners and wanted time to continue that effort. The board voted when the teleconferenced meeting resumed in Anchorage early Thursday afternoon.

Walker has sought assurances from the producer partners that they could not withhold their gas from a project if they no longer are involved.

In a news release Thursday, Walker thanked BP and ConocoPhillips for agreeing to continue to negotiate terms under which their gas would be made available if either company doesn’t continue in the project past the current stage.

“BP and ConocoPhillips have given us the assurances we need to move forward,” he said. The release does not reference Exxon with regard to any such agreement.

Walker was traveling and plans to hold a news conference today, Walker spokeswoman Katie Marquette said. “The agreements will be made public once they are fully executed, which will be as soon as possible,” Marquette wrote in an email.

An Exxon spokeswoman, Kim Jordan, said by email that the company has been working diligently to find mutually acceptable terms to move the project ahead and remains committed to doing so. The company has been negotiating with the state and has a confidentiality agreement in place to discuss other commercial agreements that would advance the project, she wrote.

“We, and many others, have communicated to the state, these agreements take time to negotiate and complete,” Jordan wrote.

In releases, state Senate President Kevin Meyer, R-Anchorage, said the board’s vote was critical to advancing the project, while House Speaker Mike Chenault, R-Nikiski, called the vote welcome news and a good first step for the new board.

Walker has shaken up the board’s membership over the past year.

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