The pandemic has delayed when natural gas will be available in the North Pole area.
The Interior Gas Utility has a network of distribution pipe in several neighborhoods in the community, but filling the system awaits completion of two North Pole LNG storage tanks, a project IGU General Manager Dan Britton, told a Fairbanks Economic Development Corporation energy group yesterday, has been slowed by pandemic-related issues.
Primarily materials that are the building, steel, the offload skids, a couple of items like that where items like that were shut down for a period of time.
Britton said the 150-thousand-gallon North Pole LNG storage facility was scheduled to be completed in September, but the date has been pushed out.
“It is looking like it will likely be delayed until December first.”
Meanwhile, Briton says the cost of gas to an IGU customer is the equivalent of 2.75 per gallon heating oil, and with oil currently a lot cheaper than that, conversions to gas may be slower than anticipated, a situation Britton said has delayed planned expansion of an IGU’s Cook Inlet LNG processing plant.
“We decided to pause that final investment decision while we wait and watch how markets react and see the recovery of oil prices. We are moving forward with a smaller bond placement of approximately $10 million so that we can continue to install service lines and meters and bring on new customers.”
Britton said so far this year about 130 new customers have signed up for service, and that even though, the North Pole area won’t have gas until the winter, service connections can be readied now.
“We installed a service line there this summer. The riser will be there at home and once the gas is in the system, we can install a meter any time in the winter.”
Briton also highlighted Fairbanks North Star Borough programs which can help residents cover the cost of converting heating systems to natural gas.