The government is continuing to carefully review whether to participate in the Alaska liquefied natural gas (LNG) development project being promoted by the United States. Although there are concerns about the project's viability, considering domestic and international circumstances, there is a prevailing sentiment both inside and outside the government that participation is virtually inevitable. Therefore, it is expected that the government will make a final decision by taking into account the scale and pace of participation by neighboring countries in similar situations, such as Taiwan and Japan.
An official from the Ministry of Trade, Industry and Energy said in a phone interview with Asia Economy on the 28th, "We are currently monitoring the extent to which Taiwan and Japan will participate in this project, and we are examining the most appropriate method and timing for Korea's participation from various angles while referring to the trends of surrounding countries." This means that the government plans to determine the scope and speed of participation based on how these countries participate and under what conditions.
The Alaska LNG project is a large-scale energy infrastructure project that transports natural gas produced in northern Alaska about 1,300 km via pipeline to the southern coast, liquefies it, and exports it to the Asian region. The total project cost is estimated at approximately $44 billion (about 59 trillion KRW). The United States aims to expand its energy exports and strengthen strategic alliances with Asian allies through this project.
The reason the Korean government is cautious is due to the enormous investment cost and the long-term nature of the project. This project, which covers LNG development, transportation, liquefaction, and export, requires securing a stable demand base and profitability over at least several decades. Especially if private companies participate, ensuring project feasibility and profitability is crucial. Therefore, rather than making a hasty decision, the government must inevitably take a cautious approach that comprehensively considers external environments and market trends when signaling its position.
Taiwan has already taken a step ahead. Taiwan's state-owned oil company, Taiwan CPC Corporation, is reported to have signed a letter of intent (LOI) with the Alaska Gasline Development Corporation (AGDC) regarding LNG purchase and investment. This is interpreted as Taiwan considering not only importing Alaska LNG but also investing in infrastructure. However, the specific conditions or investment scale of the LOI have not been officially disclosed to date.
Japan is also showing interest in this project. Although there has been no official announcement from the Japanese government, it is reported that in February, Japanese Prime Minister Shigeru Ishiba visited the U.S. and discussed ways to expand energy cooperation.
While the Korean government maintains a cautious stance on the U.S. Alaska LNG development project, analysis suggests that Korea's participation is virtually unavoidable given domestic and international circumstances. Complex factors?from political and diplomatic pressure to energy security and trade strategy?are limiting the government's options.
When former President Donald Trump mentioned that "Japan will also participate," making allied participation a foregone conclusion, Korea found itself in a position where avoiding diplomatic burdens by not joining the project would be difficult. Concerns that additional tariffs on steel and aluminum, as well as intensified tariff pressures on Korea's key industries such as automobiles, semiconductors, and batteries, could follow add credibility to this analysis.
If participation is inevitable, it is important to consider which method would be most advantageous for Korea. Monitoring the situations of Taiwan and Japan is also interpreted as an effort to establish reference points for such a decision.
An energy industry official said, "Even if Korea does not directly jump in, it is difficult to ignore this project politically, diplomatically, and industrially," adding, "If possible, securing at least some leadership through strategic early participation could be a realistic approach."
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