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Governor considers state ownership of LNG plant

Posted: November 28, 2012 - 1:04am

FAIRBANKS — Gov. Sean Parnell is considering state ownership of a gas liquefaction plant on the North Slope, a state official told a group of Interior citizens.

Gene Therriault, deputy director of the Alaska Energy Authority, told the Lowell Group on Monday that it makes sense for Alaska because a wide array of customers could potentially use the natural gas and propane from the plant, the Fairbanks Daily News-Miner reported.

Fairbanks area leaders consider natural gas a priority for the Interior because it could offset high heating and electricity costs in the Interior generated by high oil prices.

“I think the governor believes Fairbanks and the demand in Fairbanks is the initial demand that gets the project rolling. But he views this as an asset, especially if the state is going to participate, that would serve a much larger geographic area than Fairbanks,” Therriault said.

A state-owned plant could process natural gas from multiple oil companies and sell it to a wide group of buyers, Therriault said. It would be inappropriate for the state to finance a plant owned solely by a private company such as Fairbanks Natural Gas or the local electric cooperative, Golden Valley Electric Association, he said.

The governor is in the process of preparing his annual budget due for release Dec. 15. Several local governments and organizations are requesting a state subsidy on the liquefaction plant to accelerate the project. Several members of the Interior’s legislative delegation also attended Monday’s meeting.

A liquefaction plant is the first and most expensive piece of infrastructure needed to truck North Slope natural gas to Fairbanks.

Lowell Group is an organization of Interior residents that meets every week to discuss community issues in the basement conference room of Fairbanks Neighborhood Housing.

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