OPINION: Advancing Alaska’s natural gas line

Frank Richards gas line

In listening to the Alaska Gasline Development Corporation board meeting June 16, I was pleased to hear Gov. Mike Dunleavy speak about the importance of the project and the strong international interest in the project he witnessed firsthand. That was certainly a welcome change from 2018.

AGDC is correct in stating all the benefits of the project that continue to be present. However, I object to their mischaracterization of the commercial agreements that were signed before the 2018 shutdown. When President Frank Richards was asked by Board Chair Coffey, “What happened to all the MOU’s we had previously signed,” President Richards responded that “They were with a bunch of Chinese companies and a small Vietnamese company … and have all lapsed.”

The truth is, AGDC had signed and announced 15 deals, including the leaders in the Pacific LNG trade: Tokyo Gas, Korea’s state-owned Kogas — the largest single LNG buyer in the world, Sinopec — a company with a market value 50% larger than Exxon, and the “small Vietnamese company” was PVGas — Vietnam’s state-owned gas company, with a deal signed in front of President Donald Trump and the president of Vietnam. To mischaracterize the progress made as insignificant does a great disservice to all the men and women of AGDC and Alaska who helped push the project to a point it actually had never been before nor since.

Politics — especially during an election year — can make rational people do irrational things. AGDC is currently under enormous pressure to have a headline before the primaries. That pressure can lead to bad decisions and bad deals that will have to be unwound to move the project to completion.

The current structure that AGDC is promoting may lead to headlines, but not a successful project. I understand the pressure, but would strongly urge the rational leaders in Alaska to ensure the deals signed to get the headline do not lock in an unworkable structure. At a minimum, insert a clause in each of these “segment leader” agreements, that AGDC has the right to terminate if, in AGDC’s sole opinion, the agreement, party, or structure will not allow the project to advance on a timeline established by AGDC.”

Keith Meyer is a former president of Alaska Gasline Development Corp.

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