First of six LNG shipments delivered at Nikiski

Photo/Rashah McChesney/Peninsula Clarion

The first liquefied natural gas tanker arrived the morning of May 2 at the ConocoPhillips LNG plant at Nikiski, near Kenai, following the company’s reactivation of the plant this spring.

The plant has been in a suspended status since late 2012.

The Excel is owned and operated by the Belgium-based Exmar shipping group. ConocoPhillips spokeswoman Amy Burnett could not say how long it will take to load the vessel or the destination of the cargo, although presumably it is in Asia.

ConocoPhillips plans six LNG shipments this year at approximately one-month intervals, Burnett said. The company has authorization from the U.S. Department of Energy to export 40 billion cubic feet of LNG from the Kenai plant over two years.

The plant was built in 1969 by Phillips Petroleum and Marathon Oil. Phillips later merged with Conoco and subsequently purchased Marathon’s 30 percent share. LNG shipments to Japan were made from 1969 to 2010 under long-term contracts with Tokyo Gas and Tokyo Electric, when the contracts expired. Shipments since then have been on a per-vessel basis.

Plant operations and LNG exports were suspended in late 2012 as natural gas reserves in Cook Inlet were depleted and ConocoPhillips allowed its export license to expire without applying for a renewal.

The measure was taken to reserve gas for regional utilities, which are also supplied by ConocoPhillips. Utilities’ needs are now met through early 2018 thanks to recent new gas discoveries by Hilcorp and other companies, which has allowed for a resumption of exports.

05/08/2014 - 11:28am