U.S. President Donald Trump announced on the 13th (local time) that Taiwan has decided to invest $4.4 billion (about 5.9 trillion won) in the Alaska liquefied natural gas (LNG) development project.
In this process, Korea, which has not yet confirmed its participation in the project, repeatedly claimed that it had 'promised to invest $50 billion (about 67 trillion won) in Alaska.'
In a campaign speech in support of the midterm elections in Wasilla, Alaska, President Trump said, "Taiwan has just agreed to purchase 30% of the gas coming from the (Alaska) gas pipeline over the next 20 years."
“This is about ensuring the success of the business,” he said. “It is one of the largest commitments in history and one of the largest transactions in history.”
He also claimed that “Taiwan will pay the price, and a 20-year period guarantees success.”
The Taiwanese government also officially confirmed its plan to purchase Alaska LNG and participate in the development project.
Taiwan's Ministry of Economic Affairs announced in a statement released on the 14th that Taiwan Heavy Oil, a state-run energy company, plans to purchase 6 million tons of Alaska LNG annually when production begins and participate in development projects.
The Ministry of Economy predicted that the expected investment amount would reach up to $4.4 billion, and explained that significant progress had been made through intensive negotiations and careful evaluation for about a year and six months since Taiwan Heavy Oil signed a Letter of Intent (LOI) for LNG purchase and investment with the United States in March last year.
However, he added that the specific investment plan, shareholding ratio, and related conditions will be decided through additional negotiations and commercial contract procedures, and that Taiwan Heavy Oil will proceed with the business review and budget approval procedures in accordance with internal procedures.
In addition, it is predicted that if the Alaska LNG development project proceeds as planned, natural gas will be able to be supplied to Taiwan as early as 2032.
The Ministry of Economy emphasized that Alaska has the geographical advantage of being able to directly transport natural gas to Taiwan via the Pacific route, and that this project will help diversify natural gas supply sources and strengthen the stability of energy supply.
Regarding the agreement with Taiwan, President Trump explained, "Taiwan will invest $4.4 billion in this project in addition to the $50 billion that Korea has already promised to Alaska."
On the 30th of last month, President Trump announced Korea's $200 billion energy investment project in the U.S. and announced that Korea had decided to invest more than $50 billion in the Alaska LNG project. However, the Korean government maintains that the investment has not yet been confirmed.
President Trump then pressed for a speedy agreement, saying he would charge Korea a larger fee if it did not invest in Alaska LNG.
The reason President Trump is so enthusiastic about the Alaska LNG project is because this region is classified as one of the major battlegrounds in the November midterm election, which is just three weeks away. The Republican Party, whose Senate majority position is threatened, is engaged in a fierce battle with the Democratic Party in Alaska.
Therefore, it is interpreted that President Trump personally visited Alaska to help secure the Republican Senate seat, made investment in Korea and Taiwan's LNG business a fait accompli, and highlighted this as a major achievement of the current administration.
In his speech that day, President Trump mentioned Sullivan, who is seeking re-election, by his real name, saying, "Two weeks ago, I stood in the Oval Office of the White House with Dan (current Alaska Senator Dan Sullivan) and announced a historic federal project to build an 800-mile (approximately 1,300 km) long Alaska LNG gas pipeline."
He then introduced, “This is the largest energy infrastructure project in Alaska’s history and one of the largest projects in U.S. history.”
Commerce Secretary Howard Rutnick also went up to the podium and mentioned that President Trump had concluded a historic trade agreement, and then claimed, "President Trump elevated this (LNG) project to a federal level project, and as a result, Koreans and Korea promised to invest $50.1 billion in building a gas pipeline in Alaska."
This can be interpreted as President Trump's emphasis on attracting large-scale investment from Korea through tariff negotiations. The investment size mentioned by Secretary Rutnick is $100 million more than the $50 billion previously announced by President Trump.
Immediately after making these remarks, Secretary Rutnick shouted, “Build the line,” and the audience applauded and cheered, chanting the same slogan.
Minister Rutnick then explained, "President Trump told me, 'We need to do better in this business,'" adding, "After consulting with the Taiwanese government all week, Taiwan agreed to purchase 30% of the volume produced through this gas pipeline and invest $4.4 billion."
President Trump also appealed for voter support by emphasizing the effect the Alaska LNG project would have on the local economy.
“This massive project we just created for Alaska will create more than 13,000 jobs and save the average Alaskan household more than $2,000 a year in energy costs,” he said.
Also, regarding this project, he claimed, "All necessary permits have been approved. Construction can begin even tonight," and "If the Democratic Party candidate is elected, all of these projects will be stopped."
