Alaska keeps veto power over LNG project despite 25% stake

The Alaska Gasline Development Corporation holds approval rights over key Alaska LNG project decisions despite owning only 25 percent of the joint venture, officials told lawmakers on Wednesday.

AGDC can block contracts that do not align with Alaska priorities, additional capital requests, asset distributions, structural changes to the project company, and affiliate transactions within 8 Star Alaska LLC, the joint venture backed by Glenfarne Group.

"There are certain elements protecting the state primarily where AGDC has clear approval rights," Matt Kissinger, AGDC's commercial director, said. "There are no more capital asks of AGDC into 8 star without AGDC's consent."

8 Star Alaska is governed by a four-member board: two Glenfarne appointees including CEO Brendan Duvall, one AGDC appointee (President Frank Richards), and one independent nonvoting Alaska resident. That independent seat is held by Janet Wiese, former president of BP Alaska. Three of the four quarterly board meetings must be held in person in Alaska to establish a quorum.

The governance structure includes what officials called Alaska Advantage principles, which require the project to maintain a substantial operational presence in Alaska, accept economically viable interconnection requests, and reserve priority rights for the first 500 million cubic feet of gas for Alaska customers.

"The Alaska Advantage principles you see on the screen here are unique," Adam Prestidge, Glenfarne's president, said. "You wouldn't normally find this in a typical private equity type investment."

The principles also mandate a differential rate structure that maximizes gas flow while achieving the lowest possible cost for Alaska utility customers. The structure allows lower rates for industrial users only when doing so brings down costs for residential and utility customers.

AGDC contributed permits, right-of-way agreements, and project information developed between 2013 and 2024 to the joint venture. The state retained its 25 percent stake as a carried interest, meaning Glenfarne will fund AGDC's share of costs through final investment decision.

The Alaska State Legislature created AGDC in 2013 to develop North Slope gas infrastructure and represent the state's interest in the Alaska LNG project. The project includes a gas treatment plant on the North Slope, an 800-mile pipeline to Southcentral Alaska, and a liquefaction plant near Nikiski.

Senator Lyman Hoffman, co-chair of the committee, said members would submit additional written questions to AGDC and Glenfarne. The committee is reviewing Governor Mike Dunleavy's legislation that would replace local property taxes on the Alaska LNG project with a state volumetric tax based on gas throughput.