Ongoing Optimism: Glenfarne Issues ‘Call to Arms’ for Alaska LNG Pipeline
Photo Credit: Office of the Governor
A final investment decision (FID) still looms for a North Slope natural gas pipeline, yet lead developer Glenfarne Alaska LNG continues to radiate promising signs. In a “fireside chat” with Governor Mike Dunleavy at the Alaska Sustainable Energy Conference in Anchorage on Thursday, the founder and CEO of Texas-based parent company Glenfarne Group, Brendan Duval, expressed confidence in the 2029 target for Phase One—an in-state gasline to Southcentral—becoming operational.
Neither Duval nor Dunleavy had much to say about a special legislative session, which convened simultaneously in Juneau, to consider an alternative volumetric tax on natural gas throughput while limiting municipal taxation on gas pipeline property.
Steppingstones Before Milestones
Dunleavy had no doubt the tax statutes would be rearranged. “It’s just taking a lot longer because this is an enormous project,” he added.
Duval cited the pending legislation as one of the two hurdles remaining before loans are finalized. “That’s a critical condition. The other condition is the RCA [Regulatory Commission of Alaska] approving the ENSTAR agreement,” Duval said.
That agreement refers to formalizing last year’s non-binding letter of intent with ENSTAR Natural Gas Company to supply the utility for thirty years. “We’ve had to come up with an arrangement with ENSTAR that shows you and everyone that we can deliver gas from the North Slope that’s more reliable and more cost-effective than importing LNG,” said Duval. “We’re about to put finishing touches on that agreement so it can go through the RCA, and off the back of that we can go into a financial close. We’re very, very close to finishing that off.”
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Glenfarne also has twenty-year contracts for 16 million tonnes of gas slated for export. Offtake partners have already been signed in Taiwan for 6 million tonnes, Thailand for 2 million tonnes, Japan for 2 million tonnes, South Korea for 1 million tonnes, and another million to French multinational company TotalEnergies. Duval added, “We have another customer we haven’t announced yet, that we’ve negotiated all of the pricing on, that will take a million tonnes. We know where all of our energy is going now, and that’s amazing for a project still a year from taking construction.”
Duval noted that he had a dinner this week with “leading global project finance banks,” and they went away more enthusiastic about the gasline. “I can make a final investment decision here, once we finish up some of these agreements, possibly this tax bill out of Juneau,” he said. “I’ve received enough proposals of private financing on terms and conditions that, once we convert that into long-form documentation, we can build the domestic pipeline.” At that, conference attendees applauded.
The long-form documentation is not a short job. “Every single agreement we have goes from, like, a five-page key terms and conditions, they have to be converted into a couple-hundred-page document. We’re doing all of that with our gas suppliers,” Duval explained.
Those suppliers now include ConocoPhillips Alaska. Earlier this week, the companies signed a thirty-year gas sales precedent agreement. “ConocoPhillips shares Glenfarne’s commitment to developing Alaska’s resources for the long-term benefit of Alaskans,” says ConocoPhillips Alaska President Erec Isaacson. “Our participation in Alaska LNG supports reliable access to responsibly produced North Slope natural gas while complementing our ongoing investment in Alaska.”
The agreement with ConocoPhillips was the final piece of North Slope supply, after earlier agreements with ExxonMobil, Hilcorp Alaska, and Pantheon. “All major North Slope producers have now committed enough natural gas to support a Phase One final investment decision,” notes Adam Prestidge, president of Glenfarne Alaska LNG.
Ready to Go
“This project now has all the diligence, the underpinning to get ready to build it,” Duval told Dunleavy. “We’ve got a few things to do, but we’re ready to go.”
What are those few things? In addition to the legislative and regulatory hurdles, Duval laid out a timeline for the remainder of this summer. “Over the next 90 days—120 days, so long as there’s not too many of the governmental approvals coming up–we’ll be going through 90- to 120-day documentation period with our lenders and investors, and hopefully announce a final investment decision as soon as possible,” he said. “We want to get the construction going and ordering pipe.”
All those factors aside, Duval said, “We can go into documenting those loans and getting all of our construction contractors into mobilization phase. What we’ve asked our contractors to be ready for is having their equipment on the Slope, in the right of way, in Q1 of next year, 2027, to have construction seasons through ’27 and ’28 and have commissioning in ’29, so we can deliver gas here through the pipeline late in 2029.”
From Prospective to Committed
Glenfarne had hoped to reach FID by the end of last year. In January, short of reaching that milestone, Duval said the project was “progressing from planning to building.” That included lining up partners.
This week, Prestige told conference attendees, “Many of those prospective partners have become firm team members with committed roles in the project.”
Glenfarne announced conditional awards for pipeline construction and materials supply for North Slope heavy contractor Cruz Construction, Fairbanks-based regional Alaska Native corporation Doyon, Limited through its Doyon Energy Services subsidiary, and Texas-based Associated Pipe Line.
Other conditional awards go to Wisconsin-based Precision Pipeline, a subsidiary of MasTec, one of the leading pipeline contractors in North America, and to Price Gregory International, a subsidiary of Quanta Services with a long history in Alaska pipeline construction.
ASRC Energy Services subsidiary Houston Contracting Company is conditionally awarded a joint bid with Wisconsin-based Michels Pipeline. Other joint ventures lined up for the job: U.S. Pipeline and Spiecapag, a subsidiary of VINCI Construction, and a team-up of Montana-based Barnard Pipeline and Italian contractor SICIM.
Phase One would consist of a 739-mile, 42-inch pipeline, plus a 63-mile, 32-inch lateral pipeline eastward to Point Thomson. A structure that size will require 700,000 tonnes of API 5L X70 steel pipe. Another 25,000 tonnes would be needed for the Point Thomson Lateral. Glenfarne is sourcing material from Korean steelmaker POSCO International, Greek manufacturer Corinth Pipeworks, and from Europipe GmbH in Germany.
Glenfarne also has a strategic partnership with Baker Hughes to supply the liquefaction refrigerator and power equipment. Worley Limited is completing the final engineering and cost validation for the pipeline, currently the only federally authorized export terminal on the US Pacific Coast.
Although the target for FID has slipped, Duval remains upbeat. He told conference attendees, “Talk to your mayors, your elected officials, your legislators, your community leaders, your union leaders, and get them behind a rally here, to call to arms. Let’s get this thing over the line.”
