From the Frontiersman
POINT MACKENZIE — This region of vast birch and cottonwood forest is at the center of supplying two very different markets with an alternative energy source in the coming decades.
And while the details of both projects — and whether they will even pencil out — remain to be decided, Mat-Su Borough officials are hopeful one or both will be a boost to the region’s industrial infrastructure.
Both projects deal in liquefied natural gas from Cook Inlet. The largest, from Japanese company Resources Energy Inc., is a proposed small-scale liquefaction facility that would ship LNG to Japanese markets.
The second, smaller proposed project is being spearheaded by the Alaska Development and Export Authority’s Interior Energy Project, and is focused on supplying Fairbanks with an increased volume of natural gas as a way to lower that region’s high cost of energy and move the Interior city away from burning wood.
The proposed REI facility was the focus of a May 29 visit to Port MacKenzie by a Japanese delegation that included the mayor of Maizuru City and members of the Kyoto Prefecture.
While far from a done deal, the project could lift the deep-water port from its financial struggles and boost ship traffic.
However, the port still needs some work. After some $2 million in repairs this year, port director Marc Van Dongen said Friday that five of the eight underwater anode sleds used to control saltwater corrosion at the facility aren’t working. The sleds were installed last year.
Van Dongen said the next course of action will be to raise the five sleds and associated cables to inspect them on the dock.
“Once the cause of the problems are discovered, we will determine who is responsible to pay for the repairs or replacements,” he wrote in an email. “We have a one year warranty on both the parts and installation. Because the system worked fine for about five months, it is likely a problem with the sleds or cables rather than with the installation.”
REI is proposing to build a plant that would produce 160 million cubic feet of natural gas per day, or 1 million tons a year, for shipment by LNG tanker. The project calls for building storage tanks, a 15-mile pipeline to connect with the Enstar gas line to the north and a marine loading terminal, said Brian Murkowski, REI’s vice president of government and regulatory affairs. Murkowski is the brother of U.S. Sen. Lisa Murkowski and son of former Alaska Gov. Frank Murkowski. The company also is looking at two receiving terminal sites in Japan, one in Hyogo Prefecture and one in Maizuru, he said Friday.
All told, the price tag will approach $1 billion, according to Murkowski, who added the project would generate between 200-300 construction jobs initially and 20 permanent positions associated with running the plant.
REI was formed in 2012 after the 2011 earthquake and tsunami in Japan caused the nation’s nuclear power plants to close, which caused LNG imports to increase and prices to rise. It has offices in Anchorage, Honolulu and Toyko.
Along with the move away from nuclear power after the Fukushima plant disaster, Japan is in the process of deregulating its gas and electric power utilities. REI is trying to position itself to fill certain niche markets in ongoing negotiations with municipalities in Japan. Murkowski said the company also was working with Cook Inlet producers on potential gas contracts.
“In April 2016 Japan began deregulating the electricity markets and next year they will begin deregulation the power markets,” Murkowski said. “This does allow for companies with large power demands to negotiate their own LNG contracts, which does open up new possibilities. As we are a proposing a smaller, niche project we only need a few customers to make it a reality, and we are currently negotiating with a number of them.”
He said first gas from the facility could come by 2020.
