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Taiwan is considering buying 30% of the annual output of the Alaska LNG project and investing up to $4.4 billion in it. Although negotiations have advanced, questions over financing and binding contracts remain unresolved.
Taiwan’s Ministry of Economic Affairs said on Wednesday that state-owned CPC Corp. had been negotiating with the project operator for about 18 months. Under the proposed agreement, the company would buy 6 million tons of LNG a year once production begins. That volume matches a letter of intent signed last year.
The statement came after U.S. President Donald Trump said at a rally in Wasilla, Alaska, on Tuesday that Taiwan had agreed to buy 30% of the project’s planned output. Taiwan, however, said no final decision had been made on investment terms, ownership stakes or commercial agreements. The ministry did not confirm whether a binding gas purchase contract had been signed.
Project costs could reach $54.5 billion
The Alaska LNG project involves building a roughly 1,300-kilometer gas pipeline from Alaska’s North Slope to an export terminal in Nikiski on the state’s southern coast. The project’s total cost is estimated at $44.5 billion to $54.5 billion, with annual production capacity of 20 million tons of LNG.
Glenfarne Group owns 75% of the project, while the State of Alaska owns the remaining 25%. The Trump administration supports the project as part of efforts to increase energy exports to Asia and expand trade ties with countries in the region.
Preliminary commitments have been secured for about 13 million tons of gas a year. Potential buyers include Asian companies and French energy firm TotalEnergies. To secure financing, the project needs to find buyers for another 3 million tons and convert existing preliminary agreements into binding contracts.
South Korea has also taken part in investment discussions with Washington. Trump previously said Seoul had agreed to invest in the project, but South Korean officials said no final commitment had been made.
High costs complicate project financing
Despite political support, the project faces significant financial and engineering challenges. Building a pipeline across difficult terrain is driving up costs. Industry estimates put the pipeline’s construction cost alone at $13.2 billion to $16.9 billion.
Reuters has previously reported that analysts question whether the Alaska project can compete with exporters on the U.S. Gulf Coast and Canadian projects supplying LNG to Asian markets. Supporters say Alaska’s location on the Pacific coast is an advantage: cargoes can reach Asia without taking longer routes through the Panama Canal or around Africa. It remains unclear whether potential savings in shipping time and costs will offset construction and development expenses.
The developers aim to make a final investment decision on the pipeline in 2026 and on the export terminal in 2027. The first LNG deliveries are expected to begin in 2031. Taiwan’s Ministry of Economic Affairs said supplies to the island could start in 2032 if construction stays on schedule.
Taiwan’s potential investment is part of its efforts to diversify energy supplies and strengthen economic ties with Washington. Taiwanese officials said in February that they planned to raise natural gas purchases from the United States to about one-third of the island’s LNG imports in 2026.
Washington is putting increasing pressure on its trading partners to reduce trade imbalances. A direct supply route across the Pacific could strengthen Taiwan’s energy security amid concerns about possible disruptions in global energy markets. The project’s future, however, depends on finalizing commercial agreements, securing financing and making construction decisions.
