Alaska’s planned natural gas export project got another boost this week after Tokyo Gas Co. Ltd. executed a letter of intent with Alaska Gasline Development Corp. (AGDC) to secure future supply.
The tentative agreement to send liquefied natural gas (LNG) from the proposed Nikiski LNG terminal was signed Monday by Tokyo Gas President Michiaki Hirose and Alaska Gasline President Keith Meyer.
As designed, Nikiski would have liquefaction capacity of around 20 million metric tons/year. If all goes as planned, startup for commercial production would begin in the mid-2020s. AGDC last month asked the Federal Energy Regulatory Commission to advance a review of the project.
Going forward, Tokyo Gas and ADGC plan to begin a dialogue regarding “the purchase of the LNG from the project and other businesses,” Tokyo Gas management said.
Tokyo Gas noted it has had a “good relationship” with Alaska since 1969, when it became the first Japanese buyer of LNG in Alaska’s history.
“We recognize that...2019 is the 50th anniversary of the history of relationship between the State of Alaska and Tokyo Gas,” management said. “Tokyo Gas will continue to work aggressively to realize further diversification and expansion of resources, suppliers and overseas business domains” to balance supply conditions, stable supply, affordable price and flexibility.
AGDC, owned by the state, last summer secured a memorandum of understanding to supply LNG to one of the world’s biggest LNG buyers, Korea Gas Corp. No formal agreement has been reached.
During President Trump's Asia-Pacific trade mission to China in November, state-owned Sinopec Group, the Bank of China and China Investment Corp. signed a joint development agreement to help Alaska develop the LNG export project. AGDC also recently picked up more potential backing for the LNG export project when PetroVietnam Gas signaled its support.
Late last year AGDC took over control of the project from major producers ExxonMobil Corp., BP plc and ConocoPhillips, which said the project had become uneconomic.