Gov. Bill Walker’s administration is considering major changes to the Alaska LNG project, the effort to build a massive natural gas pipeline from the North Slope.
State officials said Tuesday the administration is considering increasing Alaska’s stake in the project — or even taking over ownership completely.
That would be a radical shift from the structure as it’s currently envisioned — and blessed by the legislature. Right now, Alaska holds a 25 percent stake, sharing ownership with the big three North Slope producers: ExxonMobil, BP and ConocoPhillips.
Keith Meyer started work as president of the state-owned Alaska Gasline Development Corp. last week. In an interview Tuesday, he said if the state increases its ownership, it would look for outside investors to fund the project.
“So this is significantly different from the way it was done (to date),” Meyer said. “However, it’s very similar to the way that most of the pipelines in the U.S. have been built, and also the way most of the LNG facilities now have been built.”
Both Meyer and Marty Rutherford, the acting commissioner of the Department of Natural Resources, said Tuesday that the state is discussing the change because the three oil companies have indicated they may not be ready to move the project forward next year as planned, as low oil prices have cut into their bottom lines. The final project is expected to cost $45 to $65 billion.
But both stressed that nothing has been decided, and the state is still in discussions with its three partners.
The administration is set to deliver its quarterly update on the project to the legislature on June 29.