By Tim Kelly and Katya Golubkova
TOKYO (Reuters) – Alaska’s governor said he will brief U.S. President Donald Trump’s administration after returning from Japan next week on progress securing Asian backing for a natural gas project that has become part of a broader discussion on trade and tariffs.
Governor Mike Dunleavy, along with the heads of the state-run Alaska Gasline Development Corporation (AGDC) and development partner Glenfarne Group, visited Taiwan, Thailand, South Korea, and Japan seeking investors and long-term buyers for a project that Trump wants Japan, South Korea, and Taiwan to join.
“Buying gas and then investing in America helps with the discussions that are happening at the federal level and at the national level,” Dunleavy told Reuters in an interview in Tokyo.
The timing of the Alaska delegation’s visit coincided with renewed trade pressure from Washington. On Wednesday, Trump announced a 25% tariff on imported cars and light trucks starting April 3 — a direct threat to the key auto sectors of both Japan and South Korea.
While no preliminary investment or purchase commitments have yet been secured from Japan or South Korea, Dunleavy said he would return home with a letter of intent from Taiwan to buy 6 million metric tons of liquefied natural gas (LNG) annually, following two meetings with President Lai Ching-te.
“The desire to be linked to the United States for geopolitical purposes is strongest out of Taiwan by far,” Brendan Duval, the founder and CEO of Glenfarne, told Reuters.
Alaska plans to transport natural gas from the state’s remote north along a proposed $44 billion, 1,300 km (800-mile) pipeline to the south, where it will be liquefied and shipped to East Asia.
Trump, who has pushed allies to buy U.S. energy while simultaneously threatening trade tariffs, asked Japanese Prime Minister Shigeru Ishiba in February to support the Alaskan plan. In a recent address to Congress, he said Japan and South Korea wanted to partner in a project he claims could inject trillions of dollars into the U.S. economy.
Japanese energy companies, including Inpex Corp, the country’s largest oil and gas explorer, say they remain unconvinced about the project’s viability.
In Tokyo, the Alaskan delegation also met with Japan’s Minister of Economy, Trade and Industry, Yoji Muto. Earlier in Seoul, they held talks with South Korean Trade Minister Ahn Duk-geun.
Detailed project plans, including the front-end engineering design, are expected to be completed in the third quarter of this year, with a final investment decision for the pipeline part of the project likely by the end of 2025. That would pave the way for Asian buyers to commit to a project that, according to Glenfarne’s Duval, can deliver gas at a competitive price.
U.S. investors will provide most financing for the pipeline, while any equity from Japan or other Asian buyers will likely be tied to offtake from the liquefaction plant that will prepare the gas for export, Duval said.
“Some leadership out of Japan clearly is going to be helpful,” he said.
(Reporting by Tim Kelly and Katya Golubkova; editing by Tomasz Janowski)
Comments