Trump’s Alaska gas ambition: US pressures Japan, South Korea for LNG investment

According to a latest article, The New York Times features that as President Donald Trump pushes forward with his ambitious $44 billion liquefied natural gas project in Alaska, US officials are urging Japan and South Korea to commit to the initiative by early June. 

The success of the Alaska L.N.G. project hinges on securing major investments from these energy-hungry nations, promising a fast, cost-effective alternative to traditional gas suppliers in the region. 

According to sources familiar with the matter, US officials are working to arrange meetings with the trade ministries of both Japan and South Korea in early June, with the goal of announcing significant progress. The summit is tentatively set for June 2 in Alaska, where officials hope to secure signed letters of intent from Japan and South Korea to invest in the project or purchase its gas. Taiwan has already agreed to buy six million metric tons of gas from Alaska L.N.G. through a similar arrangement.

The Alaska L.N.G. project has been under development for over a decade but has gained renewed attention under the Trump administration. It involves constructing an 800-mile pipeline from the Arctic Circle to southern Alaska, where the gas will be liquefied and transported to Asia via tankers. For Asian countries, the Alaska L.N.G. route would be faster and cheaper than sourcing gas from traditional suppliers such as Australia and the Middle East.

However, some major buyers in Asia, particularly Japan, have expressed reservations due to the high costs and uncertainty surrounding the project's feasibility. Despite this, President Trump remains optimistic, citing the potential for significant foreign investment. In a speech to Congress earlier this year, Trump suggested that Japan and South Korea were interested in investing "trillions of dollars" in the project, though this claim surprised officials in both countries and lacked further clarification on how such an investment would materialise.

Japan, South Korea, and Taiwan are also dealing with the threat of additional tariffs imposed by the US on foreign trade. Economists have warned that if these tariffs—currently paused until July—are implemented, they could severely hinder economic growth. In response to tariff discussions with the US, Japan has suggested that increased purchases of American liquefied natural gas could be a key component of its offer to ease trade tensions.

The Trump administration's push for international support comes as the US seeks to reshape its energy sector. On his first day in office, President Trump signed an executive order aimed at unleashing Alaska’s energy potential, which included support for the Alaska L.N.G. pipeline.

Despite the optimism surrounding the project, securing long-term commitments from private-sector buyers remains a key challenge. In Japan, US officials are hopeful that energy companies like Jera, Tokyo Gas, and Inpex will agree to purchase gas from Alaska L.N.G., but there are concerns about the financial viability of the deal. Many of the letters of intent being signed allow for the possibility of backing out, and the project's backers argue that the price of the gas will be competitive once operations begin in the early 2030s.

With global competition for natural gas supplies intensifying, the success of Alaska L.N.G. could play a pivotal role in the US energy landscape. However, the project’s future still hinges on gaining support from Asia's major economies.

By Naila Huseynova