Alaska governor seeks Korean partners for $44 bn LNG project

Alaska Governor Mike Dunleavy arrived in South Korea on Monday to hold a series of one-on-one meetings with top executives from Korean energy and steel companies as the state seeks partners for its $44 billion liquefied natural gas (LNG) development project, according to diplomatic and energy industry sources.

Originally scheduled for two days, Dunleavy’s trip has been extended to Wednesday to accommodate individual discussions with firms including SK, POSCO and SeAH Steel groups on Wednesday.

The governor is also arranging a meeting with Hanwha Group, the parent of Hanwha Energy Corp. and shipbuilder Hanwha Ocean Co., during his stay in Seoul.

On Tuesday, Dunleavy met with South Korea’s Minister of Industry, Trade and Energy Ahn Duk-geun, along with other trade and energy government officials. The governor is also coordinating a separate meeting with Minister of Foreign Affairs Cho Tae-yul.

Alaska’s LNG project involves transporting natural gas from the North Slope’s Prudhoe Bay – where temperatures plunge to minus 40 degrees Celsius year-round – to a liquefaction facility near Nikiski, south of Anchorage. It is estimated to cost about $44 billion.

Officials from the US state have been touring Asia since last week in search of partners for the LNG project.

PRESENCE IN US LNG SUPPLY CHAIN

Several Korean firms have already established a presence in the US LNG supply chain.

SK Innovation E&S Co. operates gas field projects in the US, while POSCO Holdings Inc. supplies specialized steel plates and LNG storage tanks.

Last year, POSCO International Corp. completed the construction of an LNG terminal – the country’s first non-government-run LNG storage and regasification facility. It is now looking to advance into the North American natural gas market.

SeAH Steel Corp. previously secured LNG pipeline orders from Canada, Mozambique and Qatar.

Hanwha Ocean is touted as a candidate to supply icebreaking vessels for building a 1,300-kilometer gas pipeline route in Alaska.

Officials of the companies invited for one-on-one meetings with the Alaskan governor said they would carefully assess the project's commercial viability, citing Alaska’s harsh environmental conditions and high development costs.

“We’ll listen to the governor’s plans in detail and consider various angles before making any commitment,” said one executive involved in the discussions.

Last week, Alaska LNG struck a preliminary deal with Taiwan’s CPC Corporation for the state-owned company to invest in the $44 billion LNG project.

On March 20, the US Department of Interior Doug Burgum announced that it is taking initial steps to reopen up to 82% of the National Petroleum Reserve in Alaska to make it available for leasing and expanding energy development.

Write to Ji-Eun Ha and Hyung-Kyu Kim at hazzys@hankyung.com
 


Yeonhee Kim edited this article.