Energy

Two firms now vying for state support in Fairbanks natural gas project

Two companies remain in the running in the state's search for a partner to help lower energy prices in the Interior with deliveries of liquefied natural gas.

The Alaska Industrial Development and Export Authority announced Thursday that Spectrum LNG and Salix Inc. were selected as top-ranked by an evaluation committee from an original list of 13.

A final selection is expected to be made early next year by the AIDEA board, which has received legislative approval to provide a financing package and find a partner in the private sector. Both the finalists would use state funding and their own capital to pay for the project, according to a summary provided by AIDEA.

In the 1990s, Spectrum developed the LNG plant at Point MacKenzie that currently delivers liquefied natural gas to about 1,100 Fairbanks customers. The company, based in Tulsa, Oklahoma, proposes building a North Slope LNG plant.

Liquefied natural gas from the resource-rich North Slope could be trucked to Fairbanks more cheaply than it could from Cook Inlet, the company said in a summary of its proposal, citing competition for limited amounts of gas in Cook Inlet.

Spectrum has also built an LNG plant in Arizona to provide fuel for vehicles in the Western U.S.

Salix, owned by Spokane-based Avista, proposes to start with a 100,000-gallon a day liquefaction plant at Point MacKenzie. Its plans call for trucking gas to Fairbanks initially, with rail delivery possible in the future. Plans call for expansion to 200,000 gallons. To reach that full capacity, the project will cost $115 million, Salix said in a summary of its proposal.

Avista, the owner of Alaska Electric Light and Power Co. in Juneau, is looking to import LNG from Canada to serve Juneau and other Southeast areas.

Alex DeMarban

Alex DeMarban is a longtime Alaska journalist who covers business, the oil and gas industries and general assignments. Reach him at 907-257-4317 or alex@adn.com.

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