Trump-backed Alaska LNG revival still faces viability questions in Korea

By Lee Min-hyung

• Published Oct 1, 2026 2:37 PM KST
• Updated Oct 1, 2026 4:14 PM KST

With a discrepancy emerging between Korea and the U.S. over a proposed investment of more than $50 billion in the Alaska liquefied natural gas (LNG) project, questions are growing over whether the project can generate sufficient commercial returns for Seoul.

U.S. Secretary of Commerce Howard Lutnick said Wednesday (local time) Korea would invest about $54 billion (73.4 trillion won) in the Alaska LNG project, as part of Seoul's $200 billion investment package to Washington.

The White House presented the project as a committed investment, while Korea has maintained that participation remains subject to further review of its “commercial reasonableness.”

The gap is significant because Alaska LNG has spent more than a decade struggling to demonstrate that it can compete economically with LNG projects closer to major markets.

The project would transport natural gas from Alaska’s North Slope through an approximately 1,300-kilometer pipeline to Nikiski, where it would be liquefied and exported primarily to Asian markets.

Glenfarne Group owns 75 percent of the project alongside the state-owned Alaska Gasline Development Corp. (AGDC). The project targets annual LNG production of up to 20 million tons, with first exports targeted for 2031.

Glenfarne has secured preliminary agreements covering about 13 million tons of annual LNG sales, but the commitments are largely nonbinding. The developer has said it needs another 3 million tons and binding purchase agreements covering at least 16 million tons to secure financing for the project.

That shortfall is particularly important for Korea because the latest U.S. announcement does not itself resolve whether the project can generate sufficient returns to justify the scale of investment being discussed.

The commercial concerns are not new.

ExxonMobil, BP and ConocoPhillips were among the major energy companies involved in developing the project in the mid-2010s. But in 2016, the three companies decided not to proceed with the next phase of development, citing changes in the economic environment.

The companies’ withdrawal eventually left AGDC in control of the project. In 2017, Alaska state officials said the three producers had withdrawn because the project was too expensive to compete in an oversupplied global LNG market, with weak LNG prices further undermining its economics.

More than a decade later, the fundamental questions remain. The project requires an enormous upfront investment, including a pipeline stretching more than 1,300 kilometers through one of the world’s harshest construction environments.

Korea’s Industry Minister Kim Jung-kwan told reporters after the announcement that the two sides had discussed figures as high as $67 billion before the U.S. government unilaterally announced an investment of around $50 billion.

“I think the fact that the figure changed so significantly shows that the U.S. side itself does not yet have a firmly established project,” Kim said. “This is not a small amount — the difference is more than $10 billion — yet the size of the project changed within just a few days. I think that shows the project has not been thoroughly reviewed.”

Kim added that both sides had negotiated with an understanding that it was a “notorious project,” citing permitting and labor shortages caused by harsh weather as major challenges. He added that improvements in those areas could enhance the project’s commercial viability.

Alaska officials, meanwhile, have portrayed the project as a long-awaited economic and energy security opportunity.

At the White House event, Alaska Gov. Mike Dunleavy credited Trump with reviving the project, saying it “wouldn’t have been done without the president of the United States, Donald Trump. There’s no doubt about it.”

Glenfarne CEO Brendan Duval also said the company could begin construction as soon as financing is secured.

“Glenfarne has spent the past 18 months building the commercial, engineering, workforce and construction foundation for this project,” Duval said in a press release. “This investment gives us the scale of capital needed, and we will keep working to make sure Alaska captures the jobs, economic opportunity and long-term value this project can create.”

Glenfarne has continued to build commercial ties in Asia. POSCO International signed a framework agreement with the developer and AGDC last year to purchase 1 million tons of LNG annually for 20 years, while POSCO agreed to supply steel for the pipeline.

For the Korean government, however, the key issue now is whether the political momentum behind Alaska LNG can be translated into a commercially viable project.

The U.S. announcement may give the project a new financing pathway, but it does not by itself eliminate the risks that caused major energy companies to step away a decade ago.

Korea is concerned about whether it can secure sufficient safeguards on costs, LNG pricing, offtake commitments and project returns, as the scale of the proposed investment could leave Korean investors exposed if the project fails to meet its commercial assumptions.

The government said it was “only reviewing” the Alaska LNG project.

"Neither the decision on whether to invest nor the size of the potential investment has been determined," an official from Korea's Ministry of Trade, Industry and Resources said.