HAWAI'IGAS Pursues Natural Gas Strategy For Hawai'i

O'AHU, Hawaii, Aug. 10, 2012

Under the terms of the Natural Gas Act, HAWAI'IGAS seeks to initiate the first of three phases of a program for the use of this clean, cost effective fuel for customers. The gas is being shipped from the Continental United States in conventional insulated intermodal containers and will be used for emergency backup purposes to supplement feedstock supply in the event of damage or disruption in supply from existing sources.

HAWAI'IGAS is pursuing the use of natural gas to diversify its fuel supply and improve energy security. The company manufactures most of Honolulu's gas from naphtha feedstock supplied by the Tesoro Kapolei Refinery adjacent to its Synthetic Natural Gas (SNG) Plant on the island of O'ahu. Performance issues with the Hawai'i-based refineries and announced intention to sell the Tesoro Kapolei Refinery, along with Tesoro's other Hawai'i assets, emphasizes the importance of fuel supply diversification.

Hawai'i does not have any naturally occurring fossil fuel resources and relies on imported petroleum to meet its energy needs. In 2011, the state imported 42 million barrels crude oil and another four million barrels of finished petroleum products, 95 percent of which were from countries other than the United States.

Natural gas is an alternative fuel available today that can be used to diversify Hawai'i's fuel supply and lower the cost of energy. It also supports the state's clean energy goals, which seek to achieve 70 percent clean energy by 2030; 40 percent from locally generated renewable energy and 30 percent from efficiency measures.

"Subject to obtaining approval from the Federal Energy Regulatory Commission, the Hawai'i Public Utilities Commission and other regulatory agencies, The Gas Company intends to start importing LNG later this year," according to Jeff Kissel, Gas Company president and CEO.

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