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Fairbanks Natural Gas Invests in LNG Storage

FAIRBANKS, AK, May 31, 2012-- Fairbanks Natural Gas LLC (FNG) today announced that it is moving forward with the development of a Liquefied Natural Gas (LNG) storage expansion in Fairbanks, Alaska to increase availability of clean burning, economic natural gas to FNG customers. Over 1,100 FNG residential and commercial customers now enjoy the benefits of natural gas, including savings of over 20% compared to current fuel oil prices. Additional storage will facilitate the expansion of FNG’s distribution system allowing additional customers to benefit from these savings.

Fairbanks Natural Gas currently owns and operates two LNG storage and regasification facilities in Fairbanks with a total storage capacity of 340,000 gallons. FNG will construct an LNG storage tank with a minimum capacity of 5,000,000 gallons (413 million cubic feet). The tank will be located at FNG’s existing LNG storage facility in the industrial area off Tria Road. This storage capacity is large enough to supply approximately 2,200 homes for an entire year. FNG will fill the LNG storage from its existing liquefaction facility at Pt. Mackenzie while continuing to develop an alternative supply of LNG from a North Slope liquefaction plant.
Construction of the LNG storage facility is expected to commence in the summer of 2013, with initial deliveries beginning in the summer of 2014.

"This substantial investment in storage capacity is a major step in our continuing effort to provide Fairbanks with additional natural gas supplies," said FNG President Daniel W. Britton. "This additional storage will provide the capacity necessary to grow and to meet the needs of new customers as well as our important existing customers, including homes, schools and medical facilities. This storage capacity will play a major role in realizing the potential for a new source of LNG from the North Slope or other points in Alaska. In addition this substantial storage capacity will provide a meaningful redundancy of supply should a pipeline to Fairbanks be built in the future."
FNG is the natural gas utility providing gas service to Fairbanks, Alaska. The company initiated service to its first customer during the spring of 1998. FNG will continue to expand its 70-mile underground distribution system to serve the Fairbanks community with the addition of this storage capacity.

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