A federal agency on Thursday certified the Alaska LNG project for construction and operation, a vital achievement for an uncertain effort that has been in the works for years.
Other state and federal permits would be needed before construction could begin, and the state would need to find new investors or buyers for a project estimated at $43 billion.
“Today’s federal authorization is a key step in determining if Alaska LNG is competitive and economically beneficial for Alaska," Gov. Mike Dunleavy said in a prepared statement from the Alaska Gasline Development Corp.
“The ongoing project economic review and discussions with potential partners will determine the next steps for this project,” Dunleavy said.
The Federal Energy Regulatory Commission issued the approval on Thursday after six years of public input, studies and fieldwork, AGDC said. The state submitted more than 150,000 pages of environmental, engineering and cultural data to the federal agency.
The project calls for construction of an 800-mile pipeline to deliver natural gas from the North Slope to Nikiski in Southcentral Alaska, where the fuel would be superchilled into a liquid for overseas shipment in tankers.
The project dates back to 2014 under Gov. Sean Parnell, in a partnership involving the state, Exxon Mobil, ConocoPhillips, BP and pipeline owner TransCanada.
The state in 2016 took over the project, under Gov. Bill Walker, after the companies backed away as investors. The state gas line corporation last year reported cumulative project expenses of $548 million.
Achieving federal approval is considered a key step for a possible sale of the project, in hopes that a buyer or investors will help complete the project to tap Alaska’s gas-rich fields.
Alaska’s congressional delegation commended the FERC approval in a prepared statement.
“This is a capstone moment for Alaska LNG at the federal level, and it is the result of a robust and comprehensive review process,” said Sen. Lisa Murkowski.
Frank Richards, president of the state gas line agency, said the project is important to the state.
“The Alaska LNG project presents an opportunity to unlock significant benefits from Alaska’s stranded North Slope natural gas, including a new reliable and affordable clean energy source, the creation of a substantial number of high-paying construction and operations jobs for Alaskans, and long-term U.S. energy security," Richards said.
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