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Begich Efforts Put Nikiski LNG Plant Closer to Being Back in Business


U.S. Senator Mark Begich today hailed the approval of the final export permits required to put ConocoPhillips’ Nikiski-based liquefied natural gas (LNG) plant back in business.

“This is great news for the cradle of Alaska’s oil and gas industry on the Kenai Peninsula,” said Begich. “With plenty of gas available to meet local needs through at least 2018, we’re seeing the kind of job growth responsible oil and gas development can provide.”

The Department of Energy (DOE) approved ConocoPhillips' application to ship to Free Trade Agreement (FTA) countries, such as South Korea, in a February 19 order.  Today’s announcement will allow export of Alaska LNG to non-FTA countries, like Japan, the longstanding traditional customer for the facility.

“I asked Acting Assistant Secretary for Fossil Energy, Chris Smith, to visit the plant last summer, and familiarize himself with our industry, our workforce and the unique situation of our country’s only LNG export plant with a safe track record spanning four decades,” Begich said. “That visit is paying dividends today.”

At Begich’s urging, DOE processed the ConocoPhillips application to ship to non-FTA countries outside the controversial queue DOE has set up for non-FTA LNG export projects. DOE has approved only six applications from Lower 48 projects in that queue since 2012, and at least 24 applications remain in the queue.

ConocoPhillips plans to operate its plant on a seasonal basis, during summer when regional demand is low. The current permit will allow exports up to 40 billion cubic feet over a two-year period.

Phillips Petroleum and Marathon Oil built the Nikiski plant in 1969, and ConocoPhillips eventually bought out Marathon's stake. The plant operated until 2012, when the export license expired and then declining gas production in Cook Inlet limited the gas available.

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