FAIRBANKS -- Golden Valley Electric Association has agreed on a contract with BP to purchase North Slope natural gas.
The power cooperative serving rural Fairbanks customers will now decide whether it's financially viable to truck liquefied gas south for power generation and distribution to homes.
The contract would provide enough gas meet Golden Valley's needs for electrical generation and the space heating needs of nearly 100,000 interior Alaska residents, association CEO Cory Borgeson told the Fairbanks Daily News-Miner.
"We're pretty darn excited about this," Borgeson said.
The gas is part of a plan between the utility and the owner of the North Pole refinery, Flint Hills Resources, to truck liquefied natural gas from the North Slope to Fairbanks.
Both sides must agree on how the gas from the North Slope will be shared.
Borgeson said the BP contract is an integral part of the trucking plan first announced this summer, but it doesn't ensure it.
Work will start on engineering plans for infrastructure, including a North Slope plant to liquefy the gas and a facility to turn it back to gas in North Pole.
They would also need a fleet of trucks to transport the gas.
The utility will go forward with the project only if those costs make it worthwhile, he said.
Gas deliveries to the Interior could start by 2015 if everything works out, he said.