Houston-based ConocoPhillips is in the “initial stages” of putting up its Kenai LNG plant for sale, the company recently announced. For nearly 50 years, the plant was the only LNG export facility in North America.

In an emailed statement to DownstreamBusiness.com (DSB), ConocoPhillips spokeswoman Christina Kuhl said the company wants to focus on its North Slope operations.

“Our efforts to market the plant are consistent with our company’s efforts to regularly review our assets to ensure we are optimizing our portfolio. Our current focus is on our North Slope operations. We believe the plant is a strategic asset that offers good opportunities for the right buyer,” Kuhl said.

The Kenai LNG plant, located in Nikiski on the Kenai Peninsula, was the world’s largest plant when built, and the first to serve the Asia-Pacific market. Nearly all LNG produced at the plant has been sold via contracts with two Japanese utilities.

The development of the LNG technology coincided with the growth of the oil and gas industry in Alaska. Until the 1950s, oil companies hesitated to explore in Alaska because of the territory’s distance from major markets. Major gas discoveries in the late 1950s and early 1960s in the Cook Inlet Area of Alaska, coupled with a lack of local demand for the product, led Phillips Petroleum (ConocoPhillips’ predecessor) and partner companies to consider international LNG projects.

The Kenai LNG plant complex includes docking and loading facilities to transport LNG, which is carried to customers by tanker.

In March 2013, the Kenai LNG plant export license expired. Due to a change in market conditions, including additional gas supplies in the Basin, and with the encouragement of various stakeholders, ConocoPhillips Alaska pursued a new license, which was granted on April 14, 2014. The authorization from the U.S. Department of Energy allowed the export of the equivalent of 40 billion cubic feet (Bcf) of LNG over a two-year period.

In 2015, the plant operated for six months, liquefying 20 Bcf of gas delivering six cargoes. Due to market conditions, ConocoPhillips did not conduct an export program in 2016, according to Kuhl.

“The Kenai LNG plant remains operational and ready to resume exports,” she told DSB.

Kuhl noted that ConocoPhillips has been operating in Alaska for nearly 50 years. In 2016, ConocoPhillips Alaska had a capital budget of nearly $1 billion.

“We’ve accepted delivery of two new drilling rigs this year, and are continuing to progress GMT1, GMT2 and 1H NEWS,” Kuhl said in the statement.

It’s the second year ConocoPhillips has sought to drop Cook Inlet assets. In 2015, it put its natural gas production assets up for sale. It sold its North Cook Inlet field to Hilcorp in late October.

ConocoPhillips also sold its stake in the Beluga gas field to the city of Anchorage earlier this year.

Bryan Sims can be reached at bsims@hartenergy.com and @bsimshart.

Comments