Alaska LNG Project Shifts Focus to In-State Gas, Delays Export Phase

The Alaska LNG project will focus on in-state gas needs before pursuing international exports, Glenfarne Group CEO Brendan Duval said May 21 at the Alaska Sustainable Energy Conference in Anchorage.

Duval told Governor Mike Dunleavy the company is building an Alaska solution first. International exports will come in a second phase. He did not say when that phase might begin or how the narrowed scope affects financing.

"Right now my job is to get you guys gas so that when Cook Inlet is not producing enough for the winter here, you can pull it off the pipeline with absolute abundance, and it is guaranteed to be delivered for 30 to 40 years," Duval said.

State lawmakers are debating whether project tax benefits should require broader in-state access. A committee substitute to the governor's bill would require a gas line or spur to the Fairbanks North Star Borough as a condition for tax exemptions.

Fairbanks North Star Borough Mayor Grier Hopkins said the original bill gave the project financial infrastructure but did not give interior residents access to gas. The substitute ties tax benefits to Fairbanks access without requiring Glenfarne to build the spur or change federal permitting.

Glenfarne executive Adam Prestidge told legislators the company faces a narrow window of financial feasibility for phase one. He acknowledged the challenge of limited capacity on a large pipeline.

Governor Dunleavy argued the payment-in-lieu-of-taxes structure would reduce financing costs and make Alaska competitive. He said Alaska cannot pretend it has the same cost structure as Texas.

"If we keep fooling ourselves into believing that, we may not get this pipeline done," Dunleavy said.

Cook Inlet gas production has declined in recent years. The Alaska LNG pipeline would connect North Slope gas fields to Southcentral markets. Dunleavy has warned that without the project, Alaska will import gas on a large scale.

The conference drew government and industry officials for three days. Dunleavy said the event, now in its fifth year, puts Alaska on the map for investors.

Interior Secretary Doug Burgum returned to the conference and cast Alaska as central to American energy dominance. He urged Alaskans to leverage their resources and strategic location to power allies and shift geopolitical influence toward the Western Hemisphere. The conversation between Burgum and Dunleavy was recorded as an episode of the podcast C.O.B Tuesday.

Entrepreneur Magatte Wade closed the conference with a keynote on energy and economic freedom. Wade said human flourishing requires affordable, reliable, abundant energy combined with economic freedom.