ConocoPhillips says it will mothball its Nikiski liquefied natural gas plant as soon as April, laying off about 60 company employees and contract workers.
The company told employees of its decision Wednesday rather than making a formal announcement, according to ConocoPhillips spokeswoman Natalie Lowman.
But word spread quickly through the community which has suffered other economic downturns in recent years, reaching lawmakers in session in Juneau.
The closing of the plant didn't go over well at the state Capitol, where lawmakers learned of it late Wednesday afternoon through friends, staff and constituents.
"It's a sad day when we shut down an export facility knowing that we have 35 known (trillion cubic feet) of gas on the North Slope that's just 800 miles away and one of the things we're looking at is importing LNG from some foreign country," said House Speaker Mike Chenault.
The ConocoPhillips plant is "right down the street" from the Nikiski Republican's house and he grew up with many of the workers who will lose their jobs, he said.
"I can only imagine what their families are going through," Chenault said from his Juneau office Wednesday evening.
The plant has been a mainstay of the Kenai Peninsula community for more than 40 years. Lowman said at its peak it shipped 64 billion cubic feet of gas a year to Asian markets, primarily Japan. But in recent years shipments have dwindled as other supplies of LNG have flooded the Pacific Rim and the company has only been sending out a single ship.
The Nikiski plant recently received an extension from the federal government for its export license allowing shipments through 2013. But Lowman said the license was contingent on getting contracts and the contracts just weren't there.