At a conference on LNG, Kenai Peninsula Borough Mayor Mike Navarre’s special assistant on oil and gas Larry Persily said there were many concerns over the current global flood of LNG into the markets.
Persily: “In the last couple years China’s slowed down, Japan is starting to restart nuclear, that demand is weakening just as new supply is starting to come online in Australia, in the United States, a new project went online in Papua New Guinea. So right now you’ve got an oversupplied market and in the world of commodities when you have too much of something, prices drop and they have.”
That does not mean that the Alaska LNG Project is a bad idea for the state though…
Persily: “The expectation in the industry is that as energy is lower cost, you’ll have economies in India and Pakistan and elsewhere become significant LNG customers so over the next several years, the world will buy, or hopefully buy, more LNG and there will be needs for more LNG supply in the 2020s.”
The Alaska LNG facility in Nikiski would be completed around 2023.
Persily says unless the global economy goes into a recession, the LNG markets are forecast to expand, making a niche for Alaska’s gas worldwide.
That global conference was held in London, England, but Persily says no borough funds were spent, the conference covered his travel costs.