The U.S. Department of Energy will conduct a supplemental environmental review of the $38 billion Alaska LNG project, analyzing the project’s greenhouse gas emissions as the Biden administration prioritizes concerns about climate change.
The Trump administration approved the project last year for construction, operation, and to export the liquefied natural gas from Alaska to other countries, following a three-year environmental review of the project.
It’s uncertain how the supplemental review will affect the project. The Department of Energy in April said it retains the authority to “modify or set aside” its 2020 decision to authorize Alaska LNG exports.
The state agency that owns the project, the Alaska Gasline Development Corp., said in a statement that approval for the project remains “in full effect” during the supplemental review.
The Department of Energy’s “decision to conduct additional analyses doesn’t directly affect the Alaska LNG project,” the state agency said in a prepared statement sent by its spokesman, Tim Fitzpatrick.
The project would ship gas from the North Slope to the Kenai Peninsula in an 800-mile pipeline. In Nikiski, the gas would be super-chilled into a liquid. It would be loaded onto tankers for oversea delivery to customers in Asia.
Alaska leaders consider the project important for the state’s economic future.
The Sierra Club and other groups have sued to stop the project, saying the Trump administration did not properly analyze the project’s impacts on Alaska lands and waters, climate change and endangered species such as polar bears.
The Department of Energy in August authorized the project to export 2.5 billion cubic feet of gas daily for 30 years.
After a challenge by the Sierra Club, the Energy Department last week said it would review the environmental impacts of natural gas production on the North Slope and conduct a “cradle-to-grave” study of greenhouse gas emissions, from the production of the natural gas to its use by electricity consumers.
The agency’s notice said two executive orders designed to combat climate change, issued by President Joe Biden in the first days of his administration, were relevant to its decision to conduct the supplemental review.
Larry Persily, former federal coordinator for Alaska gas line projects under then-President Barack Obama, said Thursday that the project’s emissions were previously studied.
But this new analysis would be broader, he said. For example, emissions related to the consumption of the gas were not previously reviewed, he said.
The project’s greenhouse gas emissions will be substantial, he said. A decision by the Department of Energy to set aside its order would spell the end of the project, he said.
“It’s conceivable they could do that, though that would surprise me,” he said.
The review could take several months, he said.
The project has struggled to find investors and customers to buy the gas, he said.
Even a plan for a first-phase line delivering the gas to Fairbanks for use in the Interior, touted by Gov. Mike Dunleavy, would cost $6 billion. The state agency has proposed that more than $4 billion of that would come from federal infrastructure funds.
The state gas line agency said it continues to look for investors for the project.
The agency “can begin construction as soon as funding has been secured, and will continue to respond to future (Department of Energy) inquiries,” its statement said.