State moves to expand lease for Alyeschem's North Slope methanol and diesel plant

The Alaska Division of Oil and Gas moved Friday to give Alyeschem LLC more room for the methanol and diesel plant it is building on the North Slope, issuing a preliminary decision to add 11.7 acres to the company's 30-year state lease.

The new land, east of the company's pad, would hold seasonal construction storage and future supporting infrastructure, according to an August notice. The amendment would also drop 9.22 acres that Harvest Alaska LNG uses for its own liquefied natural gas facility. Harvest said it does not object. The lease would total about 25.5 acres.

Alyeschem's plant would turn 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, which put its cost at $116 million. AIDEA's board approved up to $70 million in loan financing in May 2024.

The plant would take about 4,000 trucks a year off the Dalton Highway, AIDEA has said. The company broke ground May 15, and AIDEA expects the plant online in late 2027, with about 80 construction jobs and 15 operating jobs. Crews had finished installing foundation piles by mid-September, AIDEA said.

The state would have auctioned the extra land if anyone else had wanted it by Sept. 5. No one did, so the division negotiated the lease with Alyeschem.

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