Comments on DOE Extending LNG Gas Export License

WASHINGTON, D.C. -- Alaska Sen. Lisa Murkowski today urged Cook Inlet natural gas producers to now redouble their efforts to find more natural gas in Alaska and to reach agreements at reasonable contract prices for sales of new natural gas supplies to Southcentral utilities, now that the U.S. Department of Energy has granted their request for a two-year extension of their natural gas export permit needed to keep the Kenai LNG gas export facility in operation.

Murkowski said she understands that it is important for the Kenai LNG facility to remain operational since it provides a strong incentive for producers to spend money on new exploration and gas production wells in Cook Inlet, and because the plant serves as a form of gas storage facility to help meet Southcentral gas needs during period of peak wintertime demand.

“Clearly the producers should gain a fair rate of return for any new gas that they discover. But for the past 50 years the producers have depended on Southcentral’s utilities as a dependable market for their otherwise stranded natural gas. Southcentral’s local economy is built around it and utilities under the contracts have actually been barred from seeking other types of fuel for power generation. It is only fair that utilities in the region have time to find new fuel supplies before the full impact of higher gas rates apply to gas already discovered and under production,” said Senator Murkowski.

“We clearly need for the producers to be reasonable in their talks on new gas contracts with Chugach Electric and in implementing their contracts with ENSTAR. Now that this lengthy permit review process has been settled and a new export license issued, it is important for both the gas producers and the utilities that they come together and provide price stability for Southcentral utility rate payers at this time of record energy costs,” said Sen. Murkowski.    ###