[Reporter’s Notebook] Alaska LNG: An Opportunity to Showcase Korea’s Negotiation Power

Mike Dunleavy, Governor of Alaska, USA, is scheduled to visit Korea at the end of this month. The visit aims to discuss the Alaska liquefied natural gas (LNG) development project, in which U.S. President Donald Trump is pressuring Korea to participate.

This project involves a large-scale construction of infrastructure to transport natural gas from northern Alaska to the south for liquefaction. President Trump seeks to succeed in this project to strengthen the United States' energy hegemony. The core goal is to counter Russian and Middle Eastern energy and make Europe and Asia dependent on U.S.-produced LNG. In particular, Alaska LNG is crucial for targeting Asian markets such as Korea and Japan.

There are also benefits Korea can gain if the project succeeds. The LNG transportation period will be significantly reduced, lowering logistics costs while diversifying energy import sources. Japanese Prime Minister Shigeru Ishiba already visited the U.S. last month and showed active interest in the Alaska LNG project.

However, completing this project requires astronomical capital investment and overcoming Alaska’s harsh climate. Some estimates suggest it will take more than 10 years to complete. Even ExxonMobil, the world’s largest oil company, abandoned development due to economic feasibility issues. This is why President Trump’s proposal for participation is not entirely welcomed.

If Korea is to participate in the project, it must especially emphasize the significant risks involved. Participating in a project with already apparent failure risks is an expression of trust, accepting great uncertainty considering the alliance with the U.S. Naturally, Korea can demand commensurate compensation. During negotiations on project participation conditions, Korea should secure favorable trade terms and other tangible results.

Minister of Trade, Industry and Energy Andukgeun is scheduled to visit the U.S. this week to discuss the Alaska LNG development project with U.S. Energy Secretary Chris Wright. This energy cooperation between Korea and the U.S. can be leveraged as a kind of lever to ease the Trump administration’s trade pressure.

Of course, before deciding on participation, the economic feasibility of the Alaska LNG development must be thoroughly examined. Furthermore, Korea should envision a bigger picture, including minimizing trade conflicts, strengthening industrial competitiveness, and securing diplomatic standing. Given that the U.S. government has placed Korea on the 'sensitive countries' list, failure to strategically use the Alaska LNG development as a negotiation card could lead to continued U.S. 'Korea passing.'

President Trump’s 'invitation' to the Alaska LNG development is by no means a simple business proposal. The U.S. also needs Korea’s help to achieve its energy hegemony goals. This is an opportunity to make a concrete 'deal' with the U.S. We look forward to seeing Korea’s negotiation power.