The pipeline as envisioned would rival the famed trans-Alaska oil pipeline, a major project of a generation ago. This pipeline has been a dream for Alaskans for years, seen as a way to provide economic certainty as oil production from the North Slope declines.
ANCHORAGE — Alaska took a major step toward realizing a long-sought pipeline to move natural gas from the North Slope to Asia, siding with interests from China after major oil companies stepped back from the project.
The agreement Gov. Bill Walker signed Thursday in Beijing with Sinopec, China Investment Corp. and the Bank of China does not guarantee a pipeline will be built, but it gives the liquefied-natural-gas project a jolt of life.
“This is the market responding, and we’re very, very pleased with that,” Walker told reporters in a teleconference from Beijing.
The pipeline as envisioned would rival the famed trans-Alaska oil pipeline, a major project of a generation ago.
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The natural-gas pipeline is intended to tap into the rich natural-gas reserves on the North Slope. Similar in length to the oil pipeline, it would transport the gas 800 miles to the coast on the Kenai Peninsula, where it would be liquefied and shipped to Asia.
Such a pipeline has been a dream for Alaskans for years, seen as a way to provide economic certainty as oil production from the North Slope declines.
No financial terms were released, but it’s been estimated that the project could cost $43 billion.
The agreement means all parties will work on various aspects of the project, including marketing and financing with a status check in 2018. The goal, Walker said, is to have definitive contracts signed by the end of 2018.
Construction would start the following year, with the aim of having the pipeline operational by 2024 or 2025.
Representatives of Sinopec and the Bank of China toured operations on the North Slope and visited facilities in Anchorage before making their decision, which had to be approved by the Chinese government.
“This has been a long courtship with these folks,” said Keith Meyer, the president of the Alaska Gasline Development Corp., the state-sponsored entity advancing the project.
The Alaska corporation would retain majority ownership, Meyer said.
About 75 percent of the LNG would go to China, with Alaska retaining 25 percent for other regional markets in Asia, including Japan, South Korea and Vietnam.
Said Alaska’s Democratic House Speaker Bryce Edgmon, in a statement, “A pipeline project will bring jobs, investment, and, perhaps most importantly, a renewed sense of hope that Alaska’s best days are ahead of us, not behind.”
Estimates have put proven gas reserves on the North Slope overall at 35 trillion cubic feet.
Alaska could provide a generation’s worth of liquefied natural gas to China, Walker told Chinese President Xi Jinping when Xi stopped in Anchorage on a layover in April.