In response to a September 5th letter from acting Department of Natural Resources Commissioner Joe Balash, asking them to re-open their mothballed LNG plant on the Kenai Peninsula to resume exports, ConocoPhillip has applied for a two-year export permit to do just that.
According to the DNR, re-starting export of LNG will stimulate natural gas production in Cook Inlet and spur more natural gas exploration. The Nikiski export plant was closed down because of shortages of LNG for local consumption in the state and an expiring permit in 2012. Those local needs have now been met through 2018 by Hilcorp, who purchased gas fileds from Marathon and Chevron.
ConocoPhillips says that they applied for the new permit from the U.S. Department of Energy on Wednesday, but would not export any gas this winter because regional utilities will be given priority during the season when gas is in demand. But, the application requests a permit to export 20 billion cubic feet of gas as LNG per year.
The 24-year-old plant was begun in 1969 by Phillips Petroleum and Marathon Oil. Phillips merged with Conoco and then Conoco-Phillips bought out Marathon’s shares to become sole owner.