Shut-in Cook Inlet gas wells could impact Southcentral’s supply 

By Patti Epler in Alaska Dispatch: ConocoPhillips will likely have to shut in gas wells in its Beluga and and North Cook Inlet fields this summer since it won’t need the gas for export to Japan, a company official told a legislative committee on Tuesday.

Dan Clark, manager of Cook Inlet assets for ConocoPhillips, appeared at the request of the House Economic Development Committee, which wanted to talk about the company’s announcement last week that it would close its Nikiski liquefied natural gas plant as soon as April.

The plant has been operating for 40 years, exporting LNG to Tokyo Electric and Tokyo Gas in Japan.

ConocoPhillips, which owns the facility with Marathon Oil, had recently received a new export license from the federal government to continue shipments through 2013. But company officials said a glut of LNG on the Asian market had made continued shipments economically unviable. They decided to mothball the plant, but, as Clark said Tuesday, keep it in good shape so it can be reopened either for exports again or perhaps retrofitted as a facility that could import LNG.

Shutting in wells at the two fields will be necessary because the gas isn’t needed in the summer, Clark said. But next winter, when Southcentral Alaska generally uses all the gas it can get to keep homes heated and lights on, it may not be easy or even possible to restart the wells because of their age and other condition, he said.

The fields have been in production for more than 40 years and the company will make every effort to shut down the wells in a way that will be the least damaging. Read more

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