At a meeting in Nikiski Thursday night, over 50 attendees were told draft resource reports for the Alaska LNG project were originally scheduled to be submitted this spring, but now that schedule is slipping.
Oil and Gas Specialist Larry Persily with the Kenai Peninsula Borough also talked with local residents about the bleak global LNG markets that could potentially delay the investment decision slated to be made in 2019.
Persily: “One of the big gas utilities in Japan has said, hey for the next five years our demand is [projected to be] flat.”
He says if that happens, it doesn’t necessarily mean it’s the end of the project or a significant change from what’s seen north of Kenai now.
Persily: “I’m one of those who believes it will be built, the question is when. So it’s not like everything goes away, Alaska LNG would own the land that they’ve purchased, they would pay property taxes on it they’d be responsible for that property, I’m sure there’s work that they’d continue doing. You wouldn’t see construction modules move across the dock in 2019 if it gets delayed a year. It’s not like someone’s building a warehouse and ran out of money halfway through it and you see this empty structure that weeds start growing in.”
Much of the audience’s questions revolved around rising prices of assessed values of their homes this year, which Persily reiterated that that is not his department.
Nikiski resident Heidi Hatch lived through the 80’s drop in oil prices and has worked in real estate.
Hatch: “I know that a lot of people don’t understand, they think the LNG for the assessment is going up but the reality is we’ve had a really good economy for the last few years so property values are going up. Housing isn’t as available because people are moving into the area. Once the economy starts to decline a little bit with not as much work, not as much drilling with the inlet and stuff, then our properties’ value will go down again.”
She added another interesting impact of low oil prices is that she’s seeing more Alaskans moving out of the oil and gas industries to become entrepreneurs.
Kenai Peninsula Borough Assembly Member Wayne Ogle also attended the meeting Thursday, saying although not much new information was given, he appreciates, and believes his constituents appreciate, the continued updates from the Borough.