Dunleavy put gasline project cost at $65 billion to $70 billion
Perhaps auditioning for his next role at a Council on Foreign Relations event June 12, Gov. Mike Dunleavy meandered across a range of international topics with vague and superficial comments that Donald Trump would approve on Greenland, the war in Iran, relations with Canada and more.
The numbers he gave about the cost of the gasline do not bode well for the project.
Asked about the fall elections and the U.S. Senate race in Alaska, Dunleavy said he wasn’t sure what would happen, but claimed that the gasline would be a big issue.
“For Alaska a lot of that will be dictated by the success and the movement of our gasline project, which right now is still moving forward. That would be the largest non-recourse investment in the world, the history of the world, upwards of $65, $70 billion for that project,” Dunleavy said.
Glenfarne and the Alaska Gasline Development Corp. have lately been claiming it was a $55 billion project, after more than a year of sticking with the old $44 billion estimate and then a state estimate of $46.2 billion.
After a lot of pushback from legislators—Sen. Bert Stedman said the number was “complete garbage”—Glenfarne said the cost would be between $44.5 billion and $54.5 billion.
The estimates for the LNG plant and the gas treatment plant in so-called Phase 2 are not based on the detailed level of analysis necessary to get the real costs pinned down.
The higher number Dunleavy quoted in his Washington, D.C. presentation is probably closer to reality, though I would not be surprised if his office claims he gave the wrong numbers.
The higher the number, the greater the risk and the more difficult it will be to ever get it built.
A year ago, the consulting company Rapidan estimated that Phase 2 alone could cost up to $60 billion based on the numbers from large-scale export projects underway along the Gulf Coast.
Add in the cost of the so-called first phase—building a pipeline from the North Slope to Anchorage without compression and export facilities—and the total project cost would exceed $70 billion. It said the project was not economic.
Dunleavy said he expected a final investment decision by Glenfarne in early fall on just building the pipe portion of the project.
“I believe that if everything goes well you’ll get an FID (final investment decision) on the pipe, phase 1, early fall,” he said.
“Here in I believe in another month or two you’re going to see some big names internationally involved in this project,” he said. “The federal government, President Trump this is probably his biggest infrastructure project, if not, it’s in the top two.”
“The administration wants gas flowing before the president’s out of office. And so I think we’re going to get to that point,” he said.
In spring 2025 Dunleavy said a final investment decision would be made by late summer of 2025. Then he predicted it would happen by the end of 2025. Then he predicted it would happen by the end of January or February.
Dunleavy also said he still thinks it was a strategic master stroke for Trump to go to war with Iran and that the U.S. “is not losing control over the outcome.”
“I would still say the U.S. is in control. It depends on what levers we want to use to get the outcome that we want as that outcome evolved over time.”
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