(Oil Price) – Japan’s trading giant Mitsubishi Corporation could consider a potential investment in the proposed $44-billion Alaska LNG project, Mitsubishi’s Katsuya Nakanishi told Reuters on Thursday, as the U.S. is pitching the benefits of Alaskan energy resources to allies in Asia.
Mitsubishi would need careful due diligence before taking any decision on a potential investment in the Alaska project, Nakanishi added.
Mitsubishi is one of the five joint venture partners in the LNG Canada project on Canada’s West Coast, which is nearing completion and set to ship out its first LNG export cargoes by the middle of 2025.
Alaska LNG would also be close to Japan and other Asian markets, Alaska Governor Mike Dunleavy and state officials said as they toured north Asia in recent weeks to attract Asian investors in the project.
State firm Alaska Gasline Development Corporation (AGDC) seeks to advance the Alaska LNG project, designed to deliver North Slope natural gas to Alaskans and export LNG to U.S. allies across the Pacific.
The project is strongly supported by the Trump Administration, which has also been pressing Japan and South Korea to buy more LNG as a way to reduce America’s trade deficit with its Asian allies.
Last month, Governor Dunleavy said that Alaska LNG could begin exports by 2030.
Also last month, Taiwan’s state-held oil and gas company CPC Corporation signed a letter of intent to invest in Alaska LNG and buy LNG from it, as part of a move to bolster its gas supply and energy security.
Despite the signals that Asian partners are willing to discuss potential participation in Alaska LNG, Japanese companies are concerned that the costs may be too high, considering the cold weather in Alaska and the scale of the pipelines needed to bring the project on stream.
Alaskan energy can power the U.S.-Japan relationship, the office of Governor Dunleavy said last week.
“We are uniquely positioned to supply Japan and other Indo-Pacific partners with natural gas and clean hydrogen for decades to come,” the press release said.
“As America seeks to rebuild manufacturing capacity to compete with China, we will need to invest in strong, reliable allies like Japan. A new LNG pipeline project would help Tokyo secure this mutually beneficial investment.”
By Tsvetana Paraskova for Oilprice.com
