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HEA and Furie Sign Gas Sale and Purchase Agreement

KSRM News Desk

Homer Electric Association has signed a Gas Sale and Purchase Agreement with Furie Operating Alaska.

 

HEA’s Joe Gallagher detailed the terms of the agreement.

 

https://radiokenai.net/wp-content/uploads/2015/09/GALLAGHER-ON-TERMS.mp3?_=1

Gallagher: “HEA will receive natural gas to supply fuel to our power plants beginning on April 1, 2016. This is a two-year contract that will terminate in December 2018 but we do have two, one-year options to extend the agreement to December 1, 2020.”

 

The agreement also calls for HEA to purchase between 4 and 6.2 billion cubic feet of natural gas annually.

 

Currently Homer Electric purchases gas from Hilcorp, a contract which ends March 31, 2016.

 

Gallagher says the contract with Furie will lower gas costs for HEA customers.

 

https://radiokenai.net/wp-content/uploads/2015/09/GALLAGHER-ON-TERMS-2.mp3?_=2

Gallagher: “The impact on rates will definitely be positive, we will be paying less for gas beginning in April of 2016 than we currently are. So that will be reflected in our cost of power, we should see a rate decrease that is tied to the cost of natural gas beginning in April 2016.”

 

Furie recently installed an offshore platform 16 miles from Nikiski’s shores in the Kitchen Lights Unit and expects natural gas production online by this November.

 

The Gas Sale and Purchase Agreement does not become effective until approved by the Regulatory  Commission of Alaska (RCA).

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