Pursuant to Alaska Gasline Port Authority (Port Authority) Bylaws, Article 5 (V) and AS 29.35.700, the Port Authority Board of Directors hereby submits this annual report to the Mayor and Assembly / City Council of each participating municipality in the Port Authority (Fairbanks North Star Borough and the City of Valdez). This annual report covers the period dating January 1, 2012, through December 31, 2012. This past year has been a very busy year consisting largely of the Port Authority interacting with the LNG Asian market participants. Additionally, this year AGPA has engaged the services of several companies to perform various studies regarding the AGPA proposed large volume gasline to Valdez. Those studies included: Continue reading
In the last edition of the LNG news, I reported that on September 14, 2012, the Alaska Gasline Port Authority submitted a nomination of gas into ExxonMobil/TransCanada’s Solicitation of Interest open season that was required under AGIA. The AGPA nomination on behalf of specific Asian buyers plus the estimated instate demand was for over 3 billion cubic feet per day (bcf/d). Shortly after that LNG News was published, we learned from an Anchorage Daily News report that there was another nomination in that same AGIA open season from a consortium of Japanese buyers. Their nomination was for 2.7 bcf/d. The combined total of the two nominations was over 5.75 bcf/d. This is over 200% of the volume needed for a large line to tidewater for export to Asian markets to be economically viable. However, there has been no response to the gas nominations which were submitted last fall. What exactly is Alaska getting from the $500 million AGIA licensee that fails to acknowledge the abundant market demand and ignores the letters of interest of would be buyers? Continue reading
Having completed critical feasibility and benefit studies and engaging with multiple companies and utilities in various parts of Asia over the past two years, the Alaska Gasline Port Authority (AGPA) has reached an exciting milestone toward securing buyers for Alaska LNG.
ExxonMobil/TransCanada recently contacted AGPA seeking a non-binding Solicitation of Interest (SOI) for New Natural Gas Pipeline Capacity as required under AGIA. ExxonMobil’s SOI closed on Friday, September 14th. In response, AGPA aggregated the interest for LNG export from Valdez it had received over the past year from major Asian buyers. The volume of gas nominated by these Asian companies plus projected instate volume exceeds the volume targeted by the AGPA for the proposed gas line to Valdez. Continue reading
Captain Jeff Pierce, President of Safeguard Marine, LLC released a study at the Alaska LNG Summit held earlier this month which concluded that Prince William Sound (Port Valdez) is far safer than Cook Inlet for transporting Liquefied Natural Gas (LNG) on Large LNG (LLNG) vessels to market. Captain Pierce has been a state licensed ship pilot with Southwest Alaska Pilots Association (SWAPA) for 27 years and has performed over 5,000 ship movements. SWAPA provides pilotage services for South Central Alaska which is a large area encompassing PWS, Cook Inlet, Kodiak Island, and Seward.
Pierce’s conclusions were based on interviews conducted with nineteen other marine pilots with a combined 442 years of experience in maritime navigation in both Prince William Sound as well as Cook Inlet. The findings concluded that Cook Inlet poses a greater shipping risk due to the presence of significant ice during the winter. Although Captain Pierce noted that LNG tankers have called on Cook Inlet for 40 years, the ships used there were specifically designed for that port and carry much smaller volumes of LNG. Large LNG ships are three times the size of old LNG ships that have been calling at Cook Inlet/Nikiski. “Shipping large volumes requires large ships for scale of economics,” stated Pierce.
When the pilots interviewed were asked about various locations for a large LNG terminal, more than 80% stated that a large LNG terminal out of Cook Inlet would pose a risk, whereas only 10% believed that a Prince William Sound /(Port Valdez) would pose any risk. One hundred per cent of the pilots interviewed agreed that ice conditions in Cook Inlet can prevent tug assist when needed whereas 100% of the pilots stated that the existing Ship Escort Response Vessels System (SERVS) and the Coast Guard provide adequate risk mitigation in Port Valdez. Coast Guard operations in the Port of Valdez have been uniquely designed and equipped and the personnel trained to ensure the safe navigation of large oil tankers through its waters. Similarly sized vessels would be required for the export of natural gas to the Asian Pacific Rim. Continue reading
The Alaska Gasline Port Authority (AGPA) is pleased to release the results of its efforts over the past several years to attract the Asian market as interested buyers of a large volume of North Slope gas.
ExxonMobil/TransCanada recently contacted AGPA seeking a non-binding Solicitation of Interest (SOI) for New Natural Gas Pipeline Capacity as required under AGIA. ExxonMobil’s SOI closed last Friday, September 14th. In response, AGPA aggregated the Asian interest for LNG export from Valdez. The volume of gas nominated by these Asian companies plus projected instate volume exceeds the volume targeted by the AGPA for the proposed gas line to Valdez.
The target volume of gas for the gasline from Prudhoe Bay to Valdez is 2.7 billion cubic feet per day (bcfd). The non-binding nominations AGPA received from the Asian market for LNG off-take amounted to 2.8 bcf per day. When combined with projected instate gas market (.25bcfd -.50 bcfd), the total volume nominated for the large diameter gasline is 3.3 bcf per day.
Bill Walker, general counsel for APGA noted that “although the nominations are non-binding, such letters of interest are industry standard in engaging the market and match ExxonMobil’s nonbinding Solicitation of Interest.” Walker added, “This is an exciting milestone toward securing buyers for Alaska LNG.”
Several of the companies nominating volumes included major buyers from Asia who would qualify as Free Trade Agreement countries, for export under the pending export license AGPA recently filed with the U S Department of Energy. The companies include POSCO (Korea), Korea East West Power, KOGAS (Korea), GS Energy (Korea), PTT International Co. Ltd. (Thailand) and PT PGN LNG Indonesia. Not all companies designated a specific volume of LNG off-take.
The overwhelming interest expressed in the letters of interest confirms the Asian market is eager for an opportunity to buy Alaska’s LNG in large quantities.
This announcement comes on the heels of the Alaska LNG Summit held in Valdez this past week. Interested buyers and industry leaders traveled from Indonesia, Japan, Hawaii, and throughout the Lower 48 to attend the summit.
During the Summit, LNG experts in financing, marketing, shipping, and purchasing LNG detailed the urgency and viability of a gasline from Prudhoe to Valdez for LNG export.