LNG

The US Federal Energy Regulatory Commission has issued the draft environmental impact statement on the Alaska LNG project proposed by the Alaska Gasline Development Corp. and concluded that it would have significant impacts on the state offset by many economic benefits.

The project was launched nine years ago and LNG would be produced and exported by 2025 after engineering, construction and production costs estimated at around $43 billion.

The FERC conclusions were that the venture's significant environmental impacts would also bring an economic boost from export revenues in commercializing the natural gas resources of Alaska’s North Slope.

Alaska’s project would comprise several pipelines, including a 807-mile main line of 42-inches in diameter and with associated above-ground facilities.

These include eight compressor stations and a liquefaction facility with output of 20 million tonnes per annum at Nikiski on the eastern shore of Cook Inlet on the Kenai Peninsula.

The main pipeline would deliver peak capacity of 3.9 billion standard cubic feet per day of natural gas from companies such as US major ExxonMobil and BP of the UK.

The publication of the three-volume FERC report marks a key step in the state’s efforts to secure a permit leading to construction.

A public comment period has now started as part of the permit process and would last until October 3.

The FERC draft report said that the project would have significant environmental impacts if it goes ahead, though most impacts could be minimized with mitigation measures.

“However, some of the adverse impacts would be significant even after the implementation of mitigation measures,” stated the regulator.

The President of the state-owned AGDC, Joe Dubler, said the FERC report represented substantial progress for the Alaska LNG project.

“Alaska LNG holds the potential for significant energy, economic and employment benefits for Alaskans,” said Dubler.

“We will now begin to thoroughly examine this comprehensive document to understand the Commission’s recommendations,” he added.

“The ongoing permitting process incorporates 150,000 pages of data and should give Alaskans confidence that the project’s merits and impacts are being rigorously scrutinized,” he explained.

The gas treatment facilities comprising a main plant at Prudhoe Bay and the Point Thomson gas transmission line would be on state land designated for oil and natural gas development within the North Slope Borough.

“We conclude that project construction and operation would result in temporary, long-term, and permanent impacts on the environment,” said the FERC report.

“Most impacts would not be significant or would be reduced to less than significant levels with the implementation of proposed or recommended avoidance, minimization and mitigation measures, but some impacts would be adverse and significant,” explained the regulator.

“We conclude that constructing the project would have significant impacts on permafrost due to granular fill placement, particularly for the Mainline Pipeline facilities,” it said.

“The project would have significant adverse impacts on wetlands from granular fill placement resulting in substantial conversions of wetlands to uplands,” added the report.

“Significant adverse impacts on forest would result from permanent losses or conversions from installation of above-ground facilities, granular fill placement and vegetation maintenance in the Mainline Pipeline right-of-way,” it stated.

The FERC also gave details of impacts on wildlife in the state.

“For caribou, the impacts on the Central Arctic Herds would likely be significant due to the timing of impacts during sensitive periods, permanent impacts on sensitive habitats, and the project location at the center of the herds’ range,” said the FERC.

“During the years of simultaneous construction, start-up, and operational activities at the liquefaction facilities, as well as during flaring events, impacts on air quality could be significant,” said the FERC.

“Operational noise associated with the liquefaction facilities at the two nearest noise sensitive areas would likely double due to facility operation, which would be considered a significant increase,” the report added.

However, it also stated that the project would result in positive impacts on the state and local economies, though adverse impacts on housing, population, and public services could occur in some areas.

US engineering company Black and Veatch has received notice to proceed with providing the topsides for its third floating LNG production venture, the conversion in Singapore of a conventional LNG carrier for BP of the UK.

US energy engineering company KBR was awarded the preliminary front-end engineering contract by BP of the UK for the second and third phases of the Tortue natural gas project being pursued with Kosmos Energy of the US that will underpin floating LNG production on the maritime border between the West African nations of Senegal and Mauritania.

Alaska Gasline Development Corp., the state agency overseeing the Alaska LNG project, said it signed an agreement with ExxonMobil Corp. and BP to cooperate on ways to advance the venture by working together to improve the project’s competitiveness and its progress to gain regulatory permits.

Clean Energy Fuels Corp., the supplier of liquefied natural gas and compressed natural gas fuels has decided to make its Redeem renewable natural gas (RNG) made from waste available at all of its fueling stations by 2025.

Kosmos Energy, a main partner in the BP-led floating liquefied natural gas projects offshore Senegal and Mauritania in West Africa, has announced key management changes as its FLNG proposals move forward.

UK major BP said it produced its first natural gas from the second stage of its West Nile Delta development offshore Egypt, helping to give the Arab nation additional resources as it once again builds up its LNG export volumes.

BP of the UK and Kosmos Energy of the US have decided to go ahead with their multi-billion dollars of investments in developing floating liquefied natural gas projects offshore West Africa with their state partners Mauritania and Senegal.

BHP Billiton, the Australian commodities and energy company with a long-standing stake in the North West Shelf LNG plant, has agreed a US10.8 billion cash sale, mostly to BP of the UK, of its entire interests in the Eagle Ford, Haynesville, Permian and Fayetteville shale plays in the US Gulf Coast states.

Pertamina, the Indonesia state energy company, said it would not be going ahead with on onshore LNG regasification terminal project backed by Japan and planned for Bojonegara in Western Java.