Trump Pressures South Korea Over $50 Billion Alaska LNG Investment

U.S. President Donald Trump is exerting pressure on South Korea to invest over $50 billion in the Alaska liquefied natural gas (LNG) project, despite limited federal loan guarantees from the U.S. government. An analysis by Rep. Choi Soo-jin's office of a U.S. Congressional Research Service report reveals that the federal loan guarantee for the LNG sector is capped at $2 billion, raising concerns about the fairness of the deal. Choi described the contract as "unfair and toxic," noting that South Korea would bear significant financial risks without adequate U.S. federal backing.

The Alaska LNG project aims to transport natural gas from northern Alaska to southern Nikiski via a 1,300-kilometer pipeline, liquefy it, and export it to Asia. The total project cost is estimated between $44.5 billion and $54.5 billion. During a recent summit, President Lee Jae Myung and Trump discussed the project, with Trump stating that South Korea would invest more than $50 billion. However, Trump also threatened to "double" the investment demand if South Korea refused to participate.

Critics point out that the project lacks commercial rationality and presents substantial risks. Environmental challenges, including the need to build pipelines through permafrost and wetlands, could lead to delays. Additionally, major energy companies like Exxon Mobil, BP, and ConocoPhillips withdrew from the project in 2016 due to economic feasibility concerns. Reuters noted that the project's cost is more than twice as high as recently approved LNG projects in the U.S. Gulf of Mexico.