New analysis of emissions gives Alaska new sales tool for big Alaska LNG Project

Alaska has a new sales tool to pitch customers for the proposed $40 billion-plus Alaska LNG Project.

A report released last Thursday by the state-owned Alaska Gas Development Corp. shows greenhouse gas, or GHG, life-cycle emissions significantly lower for its Alaska liquefied gas project compared to coal-fired power generated in China or competing LNG projects on the U.S gulf coast.

This will be important for customers interested in purchasing energy from sources with lower emissions.

“The world is increasingly focused on the climate impact of new high-volume energy projects, said Frank Richards, AGDC’s CEO. “This assessment uses respected and transparent methodologies to quantify the value of replacing high-emissions energy sources in foreign markets with low-emissions Alaska LNG. The justification for Alaska LNG is compelling,” Richards said.

According to the analysis, LNG from Alaska would result in release of about half the planet-warming GHGs compared with generating the same power in China with coal, or 541 kilograms of carbon dioxide equivalent per megawatt hour of power produced compared with 1,085 kilograms of CO2 per megawatt hour of power with Chinese coal. The figure for China comes from a 2019 study by the U.S. Department of Energy National Energy Technology Laboratory, according to the report.

AGDC’s report also compared Alaska LNG emissions to equivalent LNG projects in Louisiana and Australia that have undergone similar lifecycle analyses. It shows that the production and delivery of Alaska LNG also provides 50 percent lower greenhouse gas intensity compared to those projects.

One advantage for Alaska in the gulf coast and Australia comparisons is the shorter shipping distance to Asia, which lowers emissions. Also, the gas in Alaska would be produced in the Prudhoe Bay and Point Thomson fields with integrated infrastructure compared with Lower 48 LNG made from has produces in many areas and requiring a broad network of pipelines and producing facilities/

“This assessment uses transparent methodologies to quantify the value of replacing high-emissions energy sources in foreign markets with low-emissions Alaska LNG,” Richards said.

In June the DOE ordered a new GHG analysis of the big Alaska project to include downstream uses of the LNG in export markets.

A GHG analysis in a Final Environmental Impact Statement for Alaska LNG Project prepared by the Federal Energy Regulatory Commission considered only GHG emissions from the project itself, such as in gas production on the North Slope; pipeline transportation to a south Alaska port and operation of a large LNG plant at the port.

A new Supplemental Environmental Impact Statement being prepared for DOE by NETL will include downstream uses of the LNG such as in power generation. NETL is expected to publish its report in mid-2022.

Richards said AGDC hired consultants for its report who have worked with NETL on similar GHG lifecycle studies and relied on the model the lab will use in its report.

AGDC did the report to get its own assessment of the GHG downstream impact several months ahead of the NETL report, which is expected to show similar results because the same assumptions and procedures were used, Richards said.

Other U.S. LNG developers like Cheniere Energy have commissioned lifecycle GHG studies, in Cheniere’s case for its Sabine Pass LNG project.

The Alaska LNG Project would involve an 800-mile, 42-inch pipeline from the North Slope to a large gas liquefaction plain at Nikiski, on the Kenai Peninsula. The pipeline would pass through the Matanuska-Susitna Borough and would make gas available at economical costs for residential and commercial space heating as well as industrial uses.

It would also create a large industrial property tax base for the Mat-Su Borough, lowering reliance on residential property taxes.