AIDEA approves key steps for new project putting North Slope natural gas to work

The Alaska Industrial Development and Export Authority (AIDEA) has approved a cost reimbursement agreement to undertake feasibility activities of Alyeschem, LLC (Alyeschem), the first petrochemical facility in the U.S. Arctic.

Alyeschem is developing a small chemical plant in Prudhoe Bay to make methanol and hydrogen from natural gas, carbon dioxide (CO2), and water. The hydrogen will be used to remove sulfur from diesel produced on the North Slope so that it can be used in engines. This will eliminate the cost, risk, and emissions from transporting the two highest- volume imports to the North Slope. Methanol is simple chemical made from natural gas, yet it has been imported to the North Slope thousands of miles, daily, for over 40 years. Methanol is used to provide freeze-protection on North Slope wells and other equipment.

Alyeschem’s project will reduce CO2 emissions by 93%, or 45,000 tons per year. It will significantly reduce transportation pollution and enable cleaner and cheaper fuel. By eliminating the long supply chain of importing methanol, the project will also reduce wear and congestion on the Dalton Highway along with environmental impacts.

AIDEA is excited to begin the process for potential investment in Alyeschem as the project could lead to 150 jobs and be a catalyst for economic growth in the region along with the environmental benefits.

"I am pleased to support AIDEA’s involvement in Alyeschem, an exciting new project addressing a longstanding need in our state for supplying critical chemicals like methanol and utilizing stranded North Slope natural gas. Alyeschem's strategic location on the North Slope creates a unique opportunity to meet the current demand and contribute to Alaska's economic growth and create jobs. This project allows us to keep more of the value from our raw materials within the state and aligns with our goal of maximizing the benefits of our resources. Together, we're harnessing the power of North Slope natural gas to drive prosperity, innovation, and a cleaner, more resilient future for Alaska," Governor Mike Dunleavy.