News from the Alaska State Legislature, the Office of Senator Kelly
For Immediate Release: May 12, 2018

Legislature Helps Deliver Natural Gas to Interior

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JUNEAU – The Alaska Legislature today took another step toward clean and affordable natural gas in Fairbanks and North Pole with the passage of legislation extending the bonding authorization for the Interior Energy Project (IEP), a critical financing component of the project.

“This bill got tied up in some weird politics in the House,” said Senate President Pete Kelly (R-Fairbanks). “However, we were able to work with rural House legislators from Northwest and Southeast Alaska to get the Fairbanks project over the finish line.”

The IEP was created in 2013 through the passage of SB 23, and is a joint project between the Alaska Industrial Development and Export Authority (AIDEA) and the Interior Gas Utility (IGU). It includes the liquefaction, transport, storage, regasification, and distribution of natural gas in the Interior. Among its financing package, SB 23 included $150 million in bonding authorization that is set to expire in June of this year. Though none of the bonding authorization has been used, the IEP team plans to deploy it to increase capacity of the LNG facility at Point MacKenzie and expand the gas distribution network to the more outlying areas of the community.

This year, construction began on a 5.2 million-gallon large-scale LNG storage facility in South Fairbanks, which will support future customer growth of the combined utility system. First expanded gas availability is expected in late 2019 with full scale efforts to convert properties with access to the existing distribution system to gas the following year.

“Affordable energy was too big a prize for Fairbanks to let this bill die without a fight,” said Sen. Kelly. “My hat is off to Senator Coghill and Senator Bishop for helping me get the job done.”  

The Senate version of the bill, SB 125, was sponsored by Sen. Kelly. 

HB 119 passed the Senate by a vote of 16 to 3 and the House 37 to 3, for a combined vote of 53 to 6. It now goes to the governor’s desk to be signed into law.

For more information, contact Senate Majority Press Secretary Daniel McDonald at (907) 465-4066.

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