Alyeschem's vision for methanol, ULS diesel production take shape BY TIM BRADNER AN ALASKA-BASED COMPANY WILL BUILD A $140 MILLION PETROCHEMICAL PLANT AT PRUDHOE BAY ON THE NORTH SLOPE TO MANUFACTURE METHANOL AND AID IN THE PRODUCTION OF ULTRA-LOW SULFUR (ULS) DIESEL. Anchorage-based Alyeschem LLC plans to have the facility under construction next year and to be producing methanol and ULS diesel in 2027, according to JR Wilcox, the company’s CEO. Private equity investors will fund half of the capital cost with the remainder financed by the Alaska Industrial Development and Export Authority (AIDEA), the state’s development finance corporation, Wilcox said. Methanol is used by producing companies for freeze protection of producing wells and other purposes. It is now trucked to the North Slope from Southcentral Alaska along with the ULS diesel. When in operation, the plant will have the capacity to produce 32,500 gallons of methanol per day, enough to supply all current needs by producers, as well as 1,500 barrels per day of ULS diesel, which will supply part of the need for the fuel in trucks, Wilcox said. This will reduce truck traffic on the Dalton Highway, a state road linking the North Slope with Interior Alaska highways. The highway is heavily used to support new fields being developed on the Slope, and maintenance has been a challenge in recent years, so any reduction in traffic is being welcomed by state transportation officials. Wilcox said the plant will not totally produce the ULS diesel, but that by using hydrogen available from the methanol process, it will upgrade high-sulfur diesel now produced in small topping plants on the Slope to remove sulfur and meet the U.S. Environmental Protection Agency’s standard of 15 ppm sulfur standard for ULS diesel. Once the plant is in operation, Alyeschem will explore other products that can be marketed to producers such as dimethyl ether (DEM) for Enhanced Oil Recovery in large viscous and heavy oil deposits in the North Slope field areas, Wilcox said. Companies have worked for years exploring ways of using large stranded natural gas deposits on the North Slope to make liquid products that can be used in the region or exported off the Slope. A lot of work has been done including by ExxonMobil on a plant using the Fischer– Tropsch process, but the scale of the plant and complexity of the process have made it uneconomic. A Fischer–Tropsch plant could make gasoline, diesel and other products. ExxonMobil’s studies focused on a large plant on the Slope that would transport products through the Trans-Alaska Pipeline System, which now moves crude oil but has ample available capacity. Wilcox pursued an alternative plan of demonstrating that liquids manufacture from gas on the North Slope, a high-cost region, can be done by initially targeting a niche product like methanol and then expanding the plant as other products are developed. In a related development, a new plant to produce liquefied natural gas, or LNG, is nearing completion on the North Slope and is being built on the same 15-acre pad with the Alyeschem plant. The LNG plant is being built by Harvest Alaska, an affiliate of Hilcorp Energy, a North Slope producer. The Harvest and Alyeschem plants will share certain facilities, such as a 1,000-foot 8-inch pipeline bringing natural gas from a nearby oil processing plant along with certain utilities. Harvest will supply LNG to a gas utility in Fairbanks, in Interior Alaska, the Interior Gas Utility (IGU). LNG will be trucked from the North Slope to IGU in Fairbanks for storage and for local gas distribution. ALASKA RESOURCE REVIEW SPRING 2025 34 VOLUME 2 | ISSUE 2 | SPRING 2025 SLOPE PETROCHEMICAL FACILITY MOVES AHEAD Photo Courtesy Alyeschem LLC
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