CSHR 17(RLS) am: Urging the United States Department of Energy to expeditiously approve a two-year extension of the export license for the Kenai liquefied natural gas plant.
00 CS FOR HOUSE RESOLUTION NO. 17(RLS) am 01 Urging the United States Department of Energy to expeditiously approve a two-year 02 extension of the export license for the Kenai liquefied natural gas plant. 03 BE IT RESOLVED BY THE HOUSE OF REPRESENTATIVES: 04 WHEREAS the Kenai liquefied natural gas plant has been operating safely and 05 efficiently for more than 40 years and is currently the only significant industrial user of 06 natural gas in Southcentral Alaska; and 07 WHEREAS the Kenai liquefied natural gas plant received a two-year extension of its 08 export license in March 2009, and the license will expire in March 2011; and 09 WHEREAS the Kenai liquefied natural gas plant is a significant economic engine for 10 the Kenai Peninsula Borough and the City of Kenai, generating approximately $130,000,000 11 in economic benefits to the combined state and local economy each year; and 12 WHEREAS the approximately 60 jobs that the Kenai liquefied natural gas facility 13 supports directly and the approximately 50 jobs it supports indirectly generate approximately 14 $17,000,000 annually in personal income; and 15 WHEREAS the production of gas for transportation to the Kenai liquefied natural gas 16 facility or for feedstock and the sale of Kenai liquefied natural gas together generate
01 approximately $60,000,000 in royalties and taxes for the state and the Kenai Peninsula 02 Borough; and 03 WHEREAS, by serving as a virtual storage facility, the Kenai liquefied natural gas 04 plant ensures a stable supply of gas for Southcentral Alaska by backing up gas supplies for 05 local utilities during periods of peak demand on cold days or when disruptions occur in the 06 gas supply system; and 07 WHEREAS, while additional storage options are being investigated, encouraged, and 08 pursued, to date, no practical source of backup gas other than the Kenai liquefied natural gas 09 plant exists; and 10 WHEREAS the Kenai liquefied natural gas plant helps drive investment in 11 development of natural resources in the state; and 12 WHEREAS resources developed for the Kenai liquefied natural gas plant can and 13 will be used during the life of the Kenai liquefied natural gas plant and may continue to be 14 used to meet local demand, even if exports are discontinued in the future; and 15 WHEREAS maintaining natural gas demand is vital to the economics of gas 16 exploration and development in the state; and 17 WHEREAS the availability of liquefied natural gas at a local gas plant for distribution 18 by truck would alleviate the high price of liquefied petroleum energy for many cities and 19 villages on the Kenai Peninsula; and 20 WHEREAS maintaining the infrastructure of the Kenai liquefied natural gas plant 21 will preserve the option to use the plant in the future to help meet the natural gas demands of 22 Southcentral Alaska; and 23 WHEREAS the supply of deliverable gas exceeds local market demand, and, if this 24 excess gas is not exported, it may become shut-in, causing reserves to diminish and further 25 jeopardizing the ability of liquefied natural gas producers to meet peak winter demands; and 26 WHEREAS the owners of the Kenai liquefied natural gas plant have demonstrated 27 their commitment to meeting local needs by voluntarily diverting gas from contractual export 28 obligation when necessary to meet peak consumer demands in Southcentral Alaska; and 29 WHEREAS the Department of Natural Resources, on March 15, 2010, declared its 30 commitment, under the terms of a 2005 settlement agreement, accepted by the Regulatory 31 Commission of Alaska in order P-04-20(16)/U-05-20(13), on January 26, 2007, to work with
01 the Kenai liquefied natural gas plant owners, stating that the department recognizes the 02 importance of the Kenai liquefied natural gas export facility to the market and economy of the 03 Cook Inlet region and expressing the department's desire that the facility stay in operation; 04 BE IT RESOLVED that the House of Representatives supports a two-year extension 05 of the Kenai liquefied natural gas export license; and be it 06 FURTHER RESOLVED that the House of Representatives urges the United States 07 Department of Energy to expeditiously approve a two-year extension of the Kenai liquefied 08 natural gas export license. 09 COPIES of this resolution shall be sent to the Honorable Steven Chu, United States 10 Secretary of Energy; and the Honorable Lisa Murkowski and the Honorable Mark Begich, 11 U.S. Senators, and the Honorable Don Young, U.S. Representative, members of the Alaska 12 delegation in Congress.