The developer of the Alaska Liquified Natural Gas (AK LNG) pipeline project recently announced major agreements that will move the project “from development into early execution.” Not only will the AK LNG pipeline unlock gas for international markets, but Alaskans will gain a long-term and affordable source of natural gas.
The AK LNG pipeline will carry natural gas from Alaska’s North Slope about 800 miles south to the Kenai Peninsula. Glenfarne, the majority owner and developer of the project, is prioritizing in-state customers in Phase One, which will entail a 739-mile, 42-inch pipeline with interconnections to serve Alaska’s Interior, south-central region, and its largest city, Anchorage. Phase Two will build the LNG liquefaction terminal and infrastructure to export LNG overseas.
If the project stays on track, the pipeline will be constructed in 2028 and deliver its first gas in 2029. Alaskans desperately need to secure new natural gas supplies, as shortfalls in Cook Inlet could begin to hit consumers as early as 2027.
Alaska generates 55.7% of its electric power consumption from natural gas, with nearly half of Alaskan households using natural gas for home heating. As part of Glenfarne’s announcement, it made a gas sale agreement with ENSTAR Natural Gas Company, which is the largest utility in Southcentral Alaska. AK LNG offers a long-term solution, and at a lower cost than importing natural gas from other countries. But it may not arrive in time to fully avert the shortfalls.
The Alaska Gasline Development Corporation estimates that AK LNG will create up to 12,000 jobs during construction and another 1,000 full-time jobs during operation. The AK LING pipeline could provide up to 20% of Alaska’s GDP and will contribute a substantial tax base to the state, although details will be hammered out in Alaska’s legislative session.
There is still uncertainty about the project costs. An updated estimate in 2020 put the costs at $38.7 billion, down from the $44 billion estimate compiled in 2015. However, AK LNG is a top priority of President Trump, who has touted the project to Japanese officials. Glenfarne has made major agreements with leading LNG buyers in Japan, Korea, Taiwan, and Thailand.
Helping Alaska to develop its natural resources responsibly has been a priority of the state’s two senators, as well as lone Representative Nick Begich III. Begich will be the executive vice chair of the Western Caucus, the second-highest position, after Rep. Celeste Maloy of Utah steps up to lead the caucus.
The AK LNG pipeline will expand the U.S.’ energy dominance and help it deliver affordable natural gas to friendly and allied nations around the world. Perhaps more importantly, to Alaskans, it offers an affordable energy future for residents and a pathway for economic growth, held to Alaska’s high environmental standards for development.