DNR preliminarily decides to add 11.7 acres, drop 9.22 from Alyeschem's North Slope lease

The Alaska Department of Natural Resources' Division of Oil and Gas made a preliminary decision Friday to amend Alyeschem LLC's 30-year North Slope state lease, adding 11.7 acres and removing 9.22 acres. The lease would total about 25.48 acres.

The added land, east of the company's pad, would hold seasonal construction storage and future supporting infrastructure, according to an August solicitation notice. The removed acreage is used by Harvest Alaska LNG for a liquefied natural gas facility under its own easement. Harvest filed a letter of non-objection to the change.

The lease holds a 5-acre gravel site for Alyeschem's planned plant, which would convert North Slope natural gas into methanol and refine high-sulfur diesel into ultra-low sulfur diesel, according to a December 2023 resolution of the Alaska Industrial Development and Export Authority. That resolution estimated the plant at $116 million. AIDEA's board approved up to $70 million in loan financing in May 2024.

Alyeschem broke ground May 15, and AIDEA has said the facility should be online in late 2027, supporting about 80 construction jobs and 15 operations jobs and removing 4,000 trucks annually from the Dalton Highway. AIDEA reported Sept. 15 that the company had finished installing foundation piles.

The August notice said the division would hold a competitive auction if another party expressed interest in the expansion land by Sept. 5. No one did, so the division moved ahead with a negotiated lease.

Written comments on the preliminary decision are due by 4:30 pm Nov. 23. Only those who comment can appeal the final decision.