It has been a significant third quarter for the Alaska Gasline Development Corporation (AGDC). The Alaska LNG project has advanced well over the past three months, through a number of regulatory and commercial accomplishments.
We continue to move forward with the regulatory permitting process for both the Alaska LNG and the Alaska Stand Alone Pipeline (ASAP) projects. With Alaska LNG, our staff has been busy responding to additional data requests from the Federal Energy Regulatory Commission as they review our application to obtain a Natural Gas Act Section 3 permit. With ASAP, we concluded a busy summer of public meetings across Alaska in conjunction with the U.S. Army Corps of Engineers.
Our three primary focus areas continue to be: completing the regulatory process, pursuing binding commercial agreements to underpin the financing of Alaska LNG,
and financial structuring.
In July, senior level representatives from major Chinese companies visited Alaska to meet with AGDC and learn more about Alaska LNG. While we arranged a number of meetings, presentations, and facility tours, the representatives paid all of their own travel and lodging expenses.
The commitment shown by this travel and attention is a testament to their serious consideration of Alaska LNG as a potential source for long-term, reliable, clean energy. We are continuing the conversation with these companies in a series of follow up meetings.
Momentum toward reaching binding commercial agreements continues to grow. To date, AGDC has signed 20 confidentiality agreements and is currently reviewing 13 draft letters of intent involving entities from a number of different countries across the Asia-Pacific region. Additionally, two memorandums of understanding have been fully executed. Though none of these represent binding agreements, they are all critical steps in the commercial process as we work to secure long-term, multi-billion dollar contracts.
In addition to recent advancements on the commercial front, my optimism in Alaska LNG continues to grow as a result of support on the Federal level. We recently received word from the Internal Revenue Service that AGDC qualifies as a political subdivision of the State of Alaska and will not be subject to federal income tax and can issue tax- exempt debt. Furthermore, in August, the Federal Permitting Improvement Steering Council granted “covered project” status to Alaska LNG under Title 41 of the Fixing America’s Surface Transportation Act (FAST-41), which will improve the timeliness, predictably, and transparency of the Federal environmental review and authorization process.
We capped Q3 off with the successful conclusion of the Alaska LNG Foundation Customer Capacity Solicitation, where an Alaskan producer as well as AGDC secured foundation customer status on the transportation and liquefaction system. Additionally, all three of Alaska’s major North Slope producers expressed interest in selling gas to AGDC for further sale to the global LNG markets.
Going into the final few months of 2017, I am optimistic AGDC has what it takes to develop the infrastructure necessary to liberate Alaska’s vast North Slope natural gas resource. I believe today, more than ever, that Alaska LNG is needed, competitive, and achievable – now is the time to take Alaska LNG across the finish line.
Keith Meyer, President