ExxonMobil Corp.’s plan to engineer an expansion of the Point Thomson natural gas project on the North Slope has been approved by Alaska, considered a key step as a long-awaited gas export project takes shape.

Point Thomson is on state acreage along the Beaufort Sea, 60 miles east of Prudhoe Bay. It includes 28 state leases on 93,000 acres. Gaining approval to expand gas output is considered key in helping to firm up the planned liquefied natural gas (LNG) export project underway by the state-run Alaska Gasline Development Corp. (AGDC), which took over the project last year from ExxonMobil, BP plc and ConocoPhillips.

In the past few weeks, the LNG export project has gained traction as several big Asian operators provided conditional support. AGDC last month asked the Federal Energy Regulatory Commission to advance a review of the project.

Gov. Bill Walker, in announcing the Point Thomson expansion approval, also keyed it to the export project

“The Alaska LNG Project has been endorsed by the Trump administration and the Chinese government,” Walker said. “Interest in this project has grown immensely in the last 45 days due to the historic joint development agreement between state officials, Sinopec, the Bank of China and the Chinese Investment Corp.

“Our approval of the Point Thomson to Prudhoe Bay pipeline plan adds to the momentum of the Alaska LNG project and demonstrates the commitment of the Point Thomson working interest owners to move gas from Point Thomson into AGDC’s 800-mile pipeline,” he said.

The expansion project also would increase oil production from Point Thomson by 50,000 b/d, he noted.

The Alaska Division of Oil and Gas had approved ExxonMobil’s plan to continue liquid condensate production from Point Thomson, but earlier this year officials rejected the expansion of the field, calling it "vague" and noncommittal. However, ExxonMobil in October provided a response addressing the state's concerns.

“It’s clear that ExxonMobil is committed to commercializing North Slope gas, particularly from Point Thomson,” said Alaska Natural Resources Commissioner Andy Mack. “This helps align the company’s work in Alaska with the State of Alaska and AGDC.”

ExxonMobil in early 2016 had ramped up production at Point Thomson, its first operated project on the North Slope, where initial output was expected to be 5,000 b/d of condensate and 100 MMcf/d of natural gas.

The Point Thomson reservoir holds an estimated 8 Tcf of gas and associated condensate, a resource that represents about one-quarter of the known gas on the North Slope. Through 2015 ExxonMobil and its Point Thomson partners had invested close to $4 billion to develop the production facilities.