DOE Dismisses AGPA Application, Provides Roadmap to Acquire Export License

On March 7, the Department of Energy (DOE) dismissed the Alaska Gasline Port Authority’s (Port Authority) application for an export license with an invitation to re-file at a later date. DOE explained that a “source and security of natural gas supply to be imported or exported” must be demonstrated. In dismissing the Port Authority’s application, DOE also pointed to the lack of “availability” of a pipeline from the North Slope to Valdez and identification of a location for the LNG liquefaction facility.

The Port Authority, on behalf of five Asian companies, participated in the Solicitation of Interest held under AGIA in September 2012. According to Port Authority Chairman Dave Cobb, “The Port Authority was pleased to have responded to the AGIA open season with sufficient volume for a full LNG export project on behalf of specific Asian buyers. Unfortunately, we have yet to receive a response from the AGIA license holder TransCanada or their partner in AGIA, ExxonMobil. We will continue to work with the Department of Energy on our export license application to satisfy the issues raised in its letter.” said Chairman Cobb.

ExxonMobil recently applied for and received its own export license for its LNG export project from Golden Pass in Texas, bound for the lucrative Asian markets. “We are disappointed that export of Alaska’s gas continues to be held off the market by the North Slope producers’ demands for oil tax concessions. This nearly twenty-year stand-off persists while the producers pursue competing LNG projects targeting the Asian Market. Alaska natural gas goes from a bargaining chip to a contracted project when the State takes control of its asset. ” said Port Authority general counsel Bill Walker.

The Port Authority consists of the Fairbanks North Star Borough and the City of Valdez. It was formed by a vote in 1999 for the purpose of “building or cause to be built” a large volume gasline from the North Slope south to Port Valdez, following Alaska’s energy corridor alongside the Trans-Alaska Pipeline System.

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