Energy developer Glenfarne will supply Japan’s biggest power generator, JERA, with one million metric tons of LNG annually for 20 years, an advance for the $44 billion Alaska LNG project that has attracted doubts because of its high costs.
Glenfarne is targeting a final investment decision (FID) for the Alaska LNG pipeline in late 2025 and a 2026 FID for the project’s LNG export components.
Since taking a 75% stake and assuming the lead developer role in the Alaska LNG project in March, Glenfarne has lined up preliminary agreements covering more than half of the project’s available third-party offtake capacity, including deals with Taiwan’s CPC and Thailand’s PTT.
Today’s agreement highlights Japan’s growing drive to secure stable and flexible LNG supplies as it seeks to bolster energy security and meet soaring electricity demand, fuelled in part by a boom in data centres.
Japan is the world’s second-largest LNG importer, a major backer of global energy infrastructure and is positioning itself as a trading hub that could channel U.S. gas into emerging markets in Southeast Asia.
The letter of intent marks a modest but meaningful step forward for the export project, which has been floated in various forms for decades but has struggled to secure binding contracts and investment commitments.
Since returning to office, U.S. President Donald Trump has pledged to push the project, which aims to transport stranded gas from Alaska’s remote north across the state before liquefying it for export overseas.
Despite Trump’s optimism, some Japanese officials and energy executives have raised concerns that the project’s projected costs could make its gas less competitive than that from other sources.
Reuters reported earlier that Japan had hired consultancy Wood Mackenzie to review the proposed 800-mile Alaska gas pipeline and LNG plant, signalling that Tokyo is considering deeper involvement in the project.
(Reporting by Rishav Chatterjee in Bengaluru Editing by David Goodman )