Korea protests US' unilateral announcement on Alaska LNG project

By Lee Gyu-lee

• Published Oct 1, 2026 4:01 PM KST

Seoul reaffirms LNG, nuclear projects still under review

Korea on Thursday stressed that it retains discretion in deciding whether to invest in the Alaska liquefied natural gas (LNG) and nuclear reactor projects in the U.S., refuting the U.S. side's announcement that implied the two countries confirmed proceeding with the projects.

Industry Minister Kim Jung-kwan said he lodged a protest with U.S. Secretary of Commerce Howard Lutnick over "the announcement that went far beyond what was agreed."

This came after U.S. President Donald Trump presented the Alaska LNG project and plans for eight nuclear reactors alongside a $22.3 billion Texas combined-cycle gas power plant as part of Korea's $200 billion strategic investment package during an announcement at the White House in Washington on Wednesday (local time).

“Thanks to the agreements my administration has secured with the Republic of Korea, they will invest up to $200 billion. That's the Korean government, $200 billion to build a six-gigawatt power generation facility in Texas … Eight new large-scale nuclear power plants, and at long last, the Alaska liquefied natural gas pipeline,” Trump said. Lutnick also said, “... just over $50 billion invested in Alaska for the Alaska LNG project.”

The discrepancy is significant as Seoul had been classifying the Texas power plant as the only project formally selected under the strategic investment framework, while treating the nuclear and Alaska projects as matters requiring further negotiations and review.

The Korean government made it clear that any commitments will be subject to “commercial reasonableness” standards and required domestic procedures, signaling that Seoul does not regard the projects, especially the LNG one, as a finalized investment commitment.

"We agreed to begin working on the Alaska LNG project on the conditions that, first, its commercial viability is confirmed and, second, it complies with Korea’s legal procedures ... For nuclear power plants as well, commercial viability must be guaranteed on a plant-by-plant basis," President Lee Jae Myung wrote on X (formerly Twitter) on Thursday.

The Ministry of Trade, Industry and Resources also said that the Alaska LNG project will undergo a review process under the two countries’ memorandum of understanding (MOU), adding that “nothing has been decided regarding whether to invest or the size of any investment.”

"This morning (after the announcement), I lodged a strong protest with Lutnick as the announcement went far beyond what was agreed, as the countries agreed to proceed with the Alaska project only on the premise that commercial reasonableness is guaranteed," Kim told reporters.

"He said he understands Korea's concerns and suggested the two countries make efforts to make the project successful."

The joint U.S.-Korea factsheet released with Trump’s announcement also states the two countries have agreed to "commence working on" the Alaska LNG project when it meets the commercial reasonableness standard under the investment MOU and all applicable domestic legal requirements.

The document says the U.S. will seek to facilitate Korean suppliers' participation and ensure offtake agreements for the project “at economically viable prices,” as well as Korea’s priority access to LNG produced by the project.

Kim has repeatedly acknowledged that the Alaska project faces commercial challenges, saying the project's commercial reasonableness is low and Seoul would not proceed if the project fails to meet the condition, even if it offered strategic benefits.

The government plans to examine factors including permitting delays, labor shortages, weather conditions and technical issues. It is also seeking measures from Washington that could improve the project's economics, including relief on tariffs for steel and other equipment, adjustments on taxes and long-term LNG offtake arrangements.

"The U.S. told us it plans to transfer the business license of the project from private companies to the federal government," Kim said. "In such case, permission and labor shortage challenges may improve."

A similar discrepancy can be seen in the nuclear reactor project. The two countries agreed on a broad framework for eight reactors — two APR1400s and six AP1000s — but have yet to finalize individual projects.

Lutnick also named Ohio, Tennessee, South Carolina and Kentucky as states where the nuclear reactors will be built. But Kim said, "Those are states that want to build nuclear power plants. When the project develops, we expect the U.S. to provide us with the candidate regions."

He said building nuclear reactors require many conditions, such as water supply and hard bedrock, adding the government will look into whether the candidate sites are the best options for commercial viability.

The Korean government has also secured an annual investment ceiling of $20 billion and an overall cap of $200 billion, with funds to be deployed in stages according to project milestones rather than transferred upfront.

Lee also stressed an arrangement under which profits will be split equally between Korea and the U.S. until the principal and interest of "all projects are repaid."

A trade expert said Trump's announcement could be viewed as a political move intended to put symbolic pressure on Korea ahead of the U.S. midterm elections, particularly given the political significance of the Alaska project.

“Alaska's Senate seat is currently held by a Republican, but a Democratic candidate is closing in, so this is a symbolic push to help politically,” the expert said.

He added that the investment would also face practical constraints.

“We have a $20 billion annual cap, but the Texas project alone is already worth more than $22 billion. Even if we want to do the Alaska project this year, we can't,” he said. “Japan is mixing in things like loans, but we have to take cash, so it cannot happen unless commercial reasonableness is guaranteed.”