Korea reaffirms Alaska LNG investment hinges on commercial viability

Industry Minister Kim Jung-kwan reaffirmed Tuesday that Korea would participate in the Alaska liquefied natural gas (LNG) project only if it proves to be commercially viable, saying the government has just begun reviewing the proposal.

He added, however, that while poor economics had long held the project back, the Middle East war had strengthened its strategic importance.

“There is no question that weak commercial reasonableness kept the project from moving forward. But the Middle East war has created new strategic value,” Kim told lawmakers during a parliamentary audit. “If the project succeeds and Korea can secure LNG from Alaska, there would clearly be strategic benefits.”

He made the comments in response to a question from Rep. Choi Soo-jin of the main opposition People Power Party.

Choi accused Washington of presenting a large Korean investment as a foregone conclusion despite the project having stalled for four decades because of poor economic viability. She pointed to language in a joint fact sheet stating that work would begin on the project.

“With economic viability and feasibility still unverified, the two countries’ differing accounts have damaged diplomatic credibility and opened the door to retaliatory tariffs,” Choi said.

Kim disputed that interpretation, explaining that the agreement covered the start of a review and that commercial viability would remain a condition for participation.

“As we have explained repeatedly, agreeing to begin a review is premised on commercial reasonableness,” Kim said.

Finance Minister Lee Hyoung-il also told lawmakers during a parliamentary audit that Korea had yet to decide whether to invest or how much to commit.

Lee said the decision would depend on the project’s commercial merits and the likelihood of recovering the investment.

“The project is at the initial review stage, and we still need to assess its commercial reasonableness,” Lee said.

The venture, which Seoul and Washington have named “Project North,” involves carrying natural gas from Alaska’s North Slope to Nikiski on the southern coast through a pipeline stretching about 1,300 kilometers. After liquefaction, the gas would be shipped to Korea, Japan and other Asian markets.

Announcing the plans on Sept. 30, U.S. President Donald Trump said Korea had committed to investing in the Alaska LNG development. Commerce Secretary Howard Lutnick put the prospective investment at more than $50 billion.

Yet Seoul maintains that no commitment has been made and no investment amount has been agreed upon, describing the process as an initial assessment of the project.

U.S. Vice President JD Vance acknowledged Monday (local time) that some details still needed to be worked out with Korea.

“The pipeline is something that we really want to see happen and a lot of our Asian friends want to happen as well,” Vance said, according to a White House pool report. “It’s not just the South Koreans. The Japanese would love to see this pipeline. So I think it's something that's going to happen.”

He added, “Obviously, you still got to work out some of the details and the South Koreans, you know, have spoken to that.”

Meanwhile, regarding “Project Power,” a joint Korea-U.S. nuclear power initiative, Lee said an advance payment would require the completion of domestic legal procedures.

Asked about the U.S. request for $10 billion by year-end, he said Korea could transfer the funds after fulfilling all requirements under domestic law, including parliamentary procedures.

The nuclear initiative is being discussed at a total project cost of $120 billion. Key investment terms, including the timing and amount of investment recovery, remain under negotiation.