By Dan Bross, KUAC – Fairbanks | September 16, 2015

The Alaska Industrial Development and Export Authority will select a partner for the Interior Energy Project by the end of the year. AIDEA chose finalists earlier this month following a request for proposed plans to supply Fairbanks with natural gas this summer.  An earlier public-private partnership yielded a North Slope gas plan that proved to be too expensive. A review committee will consider the latest proposals and how state financing can be used to leverage a project.

Two of the five finalist companies, Harvest Alaska and Salix, have offered Cook Inlet gas supplies, while Wespac Midstream proposes tapping either Cook Inlet or imported Canadian gas.

Two others: Phoenix Clean Fuels and Spectrum LNG are offering North Slope gas supplies. AIDEA Energy Infrastructure development officer Nick Szymoniak  says all five companies can technically get the job done, and the issue is finances.

Natural gas has long been sought by Interior residents as a lower cost cleaner burning alternative to oil, coal and wood, but gas requires distribution lines and conversion of heating and power generation systems, elements that undermine potential demand and have inhibited private sector interest in the project.

The state legislature allocated over $330 million in financing aimed at lessening the risk of investing in a gas processing plant and other infrastructure.

AIDEA’s Syzmoniak says the challenge is using the financing to enable a gas supply that works for private industry, local utilities and consumers.

The five finalist companies being considered as partners for the Interiors Energy Project have been charged with fine tuning their proposals by October 16th. A committee, which includes representatives of local energy utilities, will then analyze the proposals and select a partner by December 17. Szymoniak says its possible AIDEA could partner with more than one company.