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gas resources. WesPac also hopes to buy Cook Inlet gas for its facility and has signed a preliminary agreement with BlueCrest Energy, a Texas-based independent with plans to develop an offshore Cook Inlet gas discovery at Cosmopolitan, near Anchor Point. WesPac is a company with experience in development and operation of regional fuel terminals, and the company has moved more recently into projects to supply LNG as a transportation fuel. The company has signed a contract, for example, with Totem Ocean Trailer Express, or TOTE, to supply LNG in Florida to two TOTE ships operating in the Caribbean. TOTE’s vessels would be the first large US ships to convert to LNG, and the company also plans to convert its two vessels that serve Alaska from the Port of Tacoma. Meanwhile, for REI, does having two LNG plants of about the same size on Cook Inlet, REI’s and ConocoPhillips’, make sense? Does it also make sense with the looming possibility of a very large LNG plant, many times the REI size, also planned for Nikiski, although the timing for it is a decade away? REI, a venture of several Japanese technology companies and regional municipal governments, believes it does make sense.
Own and Control What is most important is that the Japanese entities involved in REI want to have their own source of imported LNG and want to not have to depend on the big Japanese trading companies. They also want to own and control the source of the LNG, which means owning the plant and owning part or all of the natural gas that would flow to the plant for the manufacture of LNG. Through owning and controlling the supply source, Japanese companies hope to secure the lowest possible prices for their LNG. They also do not want to be beholden to larger US companies who own Alaska gas and have a goal to extract the highest prices. Although REI is not in competition with the large Alaska LNG Project, the Japanese company sees advantages in its “start small” strategy compared with the large project. The Japanese company believes that being first into the market, at least with a new Alaska
Alaska Business Monthly | May 2015 www.akbizmag.com