Alaska LNG nears Enstar supply deal as Cook Inlet gas declines

The Alaska LNG project is close to a gas supply agreement with Enstar Natural Gas that would deliver North Slope gas to Southcentral Alaska homes and businesses at prices below imported LNG, developer Brendan Duval said Thursday.

The deal awaits final details and approval from the Regulatory Commission of Alaska before the pipeline can move to financial close. Duval, CEO of developer Glenfarne Group, said the agreement would guarantee long-term supply from the North Slope at costs more favorable than importing LNG. Enstar serves customers from Houston to Homer in Southcentral Alaska.

"We're putting the finishing touches on an ability to offer you all here in your homes gas that we can have locked in coming from the North Slope that is better financially and from a sustainable supply standpoint than importing LNG," Duval said.

The agreement is part of Phase 1 of the Alaska LNG project, the 807-mile in-state pipeline from Prudhoe Bay to Nikiski. Glenfarne became majority owner of the project in March 2025 after executing a purchase agreement to buy 75% of the company from the state-led Alaska Gasline Development Corporation. The company announced in January that Phase 1 had moved from development into early execution. Phase 2, which would add a liquefaction facility in Nikiski for LNG exports, is being advanced as a financially independent stage.

Cook Inlet gas production has been declining for years. Governor Mike Dunleavy said a cold winter in Fairbanks and cold spring in Southcentral Alaska increased drawdown of remaining Cook Inlet gas supplies. A fertilizer plant at Nikiski closed after Cook Inlet gas supplies dwindled. Enstar's current contracts run through 2033, but the utility has warned that local production cannot meet long-term demand.

Duval said construction contracts are signed and the 807-mile pipeline from Prudhoe Bay to Nikiski is on track to start in the first quarter of 2027, with gas delivery by late 2029. Private banks have submitted financing proposals for the domestic pipeline, he said, contingent on the Enstar agreement clearing the Regulatory Commission of Alaska and the legislature passing tax stabilization.

Duval said Glenfarne has enough North Slope gas supply agreements to make a final investment decision and is converting those agreements into long-form contracts. The company has signed gas supply agreements with ConocoPhillips, ExxonMobil, Hilcorp, and Pantheon.

The Regulatory Commission of Alaska will review the Enstar agreement to ensure that contract rates and terms are just and reasonable for consumers before it can proceed to financing closure. The legislature has not yet passed tax stabilization for the project.