JUNEAU, Alaska (AP) — Alaska's contribution toward building a liquefied natural gas project could range from $4.6 billion to $11.4 billion, depending on the state's equity stake and whether it has a partner.
An agreement to advance the project, contingent upon legislation authorizing it, anticipates a state stake of about 20 to 25 percent. Alaska's participation rate would be established through taxes and royalties, and the state would be responsible for a commensurate level of construction costs. So if the state has a 25 percent stake, it would be responsible for 25 percent of costs.
That agreement includes the state, TransCanada Corp., the Alaska Gasline Development Corp., or AGDC, and the North Slope's three major players: BP, ConocoPhillips and ExxonMobil Corp. Current cost estimates, expected to be refined as the project advances, are from $45 billion to more than $65 billion.
On Wednesday, administration officials gave the House and Senate Resources committees overviews of a memorandum of understanding between the state and TransCanada detailing the terms of service for transporting Alaska's gas through a gas-treatment plant and pipeline. The agreement also represents a move away from the terms of the Alaska Gasline Inducement Act (AGIA), which Gov. Sean Parnell has said do not fit well with the current project.
TransCanada had won an exclusive license to pursue a major gas line under AGIA. But the project has shifted from a pipeline that would run from the North Slope into Canada and serve North American markets to a liquefied natural gas project capable of overseas exports. Moreover, more companies are involved in the project.
Natural Resources Commissioner Joe Balash told lawmakers that the state's total capital investment without a partner for the gas-treatment plant, liquefaction facility and pipeline could be $9.1 billion with a 20 percent stake and $11.4 billion at 25 percent. Those figures are in 2013 dollars and considered estimates.
But Balash noted there are going to be competing needs and draws on the state's cash reserves in the coming years.
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