Flint Hills Resource Alaska ended discussions with Golden Valley Electric Association on Monday, according to the Fairbanks Daily News-Miner, ending immediate plans to truck natural gas from the North Slope to the state's Interior as early as 2014.
Flint Hills has finished the project's engineering phase and has announced that the next step will be to determine whether there's enough demand for a gas-processing plant beyond the company's North Pole refinery.
Flint Hills said in a news release that it would like to hear more from two state agencies, the Alaska Industrial Development and Export Authority (AIDEA) and the Alaska Energy Authority (AEA), about marketing demands for a natural gas processing facility.
In the release, Mike Brose, vice president of Flint Hills Alaska, said, “We don’t think that we would build the plant for our needs and the needs of other industrial users alone, so we will wait for AIDEA or AEA to do further investigation and present a proposal if they think that is appropriate." Brose added, "In the 15 months since the project was announced, we have made significant progress. Flint Hills still believes LNG trucking is a valuable project for Fairbanks and Interior Alaska. However, there are a number of other entities that have expressed interest in this project, and we think the time is right for a third party to determine if there is sufficient support for the project outside of the industrial demand that Flint Hills has been targeting."
Golden Valley and Flint Hills formed a partnership in August 2011, with the goal of trucking natural gas by 2014. Since then, the comapnies have drifted apart. Golden Valley Interim President Cory Borgeson told the News-Miner that Flint Hills' decision wasn't a surprise and that the companies had different views on how construction of the processing plant would proceed. Borgeson added that Golden Valley will continue its plan to use natural gas.
While Flint Hills and Golden Valley are ending the gas trucking venture, Golden Valley has received good news about the proposed restart of the idle Healy Clean Coal Plant. According to the News-Miner, U.S. District Court Judge Ralph Beistline approved a consent decree between GVEA and state and federal regulators on Monday.
“This is a significant milestone in restarting (the Healy Clean Coal Plant),” Borgeson said in a news release. “We are excited to be finally moving forward in getting the Healy Clean Coal Plant online to be able to provide Interior Alaskans with a reliable long-term lower-cost power supply.”