Robert Seitz: A response to commenters and some guidance for legislators

By ROBERT SEITZ

June 3, 2026 – It will not take any Hail Mary’s or acts of contrition. However, I recommend prayers for people to make right decisions.

If we look at the Alaska LNG project we will see that during the construction phase, Alaska will be busy and money will be pouring into communities all over the state. Trucks will be hauling, restaurants will be feeding, building material stores will be selling materials to build camps, vehicle sales will increase, hotels will fill up, and ports of entry will be receiving materials and equipment.

So for those who are concerned with the requested 10-year delay before the property tax would kick in can look back at years of increased financial activity in the state which would have a great economic impact on many communities in the state.

So there should be some room for empathy of an organization which has committed itself to a large project and committed is resources to that project.  Once the project is completed there will be no cash flow with which to pay back loans and investments.  There is no cash flow until product flows to market.

The Alpine Project was a project for which design began in about 1996 and construction was completed in 2000. It was a $750 million project, but as construction was being completed the price for oil was $9/barrel. People were nervous and some small parts of the facility were removed from construction before those parts got started, just to cut the out flow of cash. Around start up, the price of oil was up to $26/barrel and the initial flow was about 86,000 barrels/day. Cash flow was about to begin because it takes a little time to get to a refinery.

All Glenfarne and the State of Alaska wants is a project climate that will attract good investors quickly. Delay of property tax will help with that. To help with the concern over the cost of the project, the Iran War needs to be settled well enough to get the price of crude oil back down to reasonable level so that the shipping and work is not done with very high fuel prices. Hopefully Glenfarne has some equipment prices secure in contracts so that once fuel prices drop equipment prices and delivery times will work together to provide a constructed cost close to what we have been given.

To answer one question about the price of gas in Southcentral from my commenters:

“The price of gas in South Central will not be lower once the pipeline is built.”

You have Cook Inlet gas which will be your least expensive natural gas supply for some time. Hilcorp and Hex will be drilling gas wells every year to keep the available amount of gas up where no one has to panic.  Keep encouraging these companies to keep drilling and expanding the amount of natural gas that is available.  Fairbanks and the North Star Borough will greatly benefit once gas is available there.  It will be the least costly fuel as soon as it hit town.  If they could start generating electricity with that fuel customers of Golden Valley Electric Associate will benefit.

The AK LNG project will not have sufficient cash flow in with gas distributed in state. It will not be until The LNG is finally shipped to our overseas customers that sufficient cash flow will begin that the investment can begin to be repaid. As for investors, maybe there could be a Pick, Click and Give account with the Permanent Fund Dividend, through which we can contribute, be a way for Alaskan to invest in the natural gas project. We could all be venture capitalists.

Lack and delay of action to pass positive legislation to show Alaska is behind this project can only discourage potential investors.  Show your confidence. We’ve done big projects before. We still have some very skilled and knowledgeable engineers, smart managers and skilled laborers who can get it done.

Once the project begins, there will be cash flow in this state. Let your legislator and everybody else you know that this pipeline will work and provide benefits to Alaskan and add revenue to the State Treasury. Doing nothing will have no positive results.

Robert Seitz is a professional electrical engineer and lifelong Alaskan.

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