Alaska's Gas Dreams Awaken

CALGARY — In the shadow of Canada’s burgeoning liquefied natural gas (LNG) industry, a colossal project looms just north in Alaska—one that has been dormant for decades. With the first Canadian LNG export terminal gearing up for launch this summer, the Alaskan megaproject may soon re-enter the spotlight.

New Presidential Orders Ignite Interest

Following U.S. President Donald Trump's executive order on his first day in office focused on resource development, interest in the potential of Alaska’s natural gas exports surged. State officials, led by Governor Mike Dunleavy, have been courting Asian buyers with long-term contract proposals, hoping to capitalize on renewed enthusiasm.

Skepticism Lingers Among Experts

Despite the fresh push, experts remain cautiously skeptical about the feasibility of the Alaska LNG project, which carries an eye-popping price tag of $44 billion. Enverus senior analyst Josephine Mills stated, "This has been discussed for the past 30-40 years. There are monumental hurdles ahead. Yet, if there's ever a time to build it, it's now."

What’s at Stake for Canada?

The proposed Alaska LNG project would see a 1,300-kilometer pipeline snake through challenging terrain, delivering an estimated 3.5 million mmBTU of gas daily to a liquefaction plant in Nikiski, south of Anchorage. A significant portion of the gas is intended for Asian markets, directly competing with Canadian developers aiming to secure similar footholds.

Mills emphasizes that if Alaska LNG moves forward, it would clearly impact Canadian interests, stating, "It would be beneficial for Canada if Alaska LNG doesn’t get built." However, any realization of this project is likely at least a decade away, with a final investment decision expected later this year.

Trade Turbulence and Economic Implications

Kent Fellows, an economist at the University of Calgary, noted that long-term contracts in the LNG sector usually precede plant operations, meaning that the ongoing trade chaos—sparked by tariffs and political unrest—could hinder Alaska's project viability. He warned, "The U.S. had a reputation for stability and free trade, which has significantly changed."

Global Demand: A Silver Lining?

While competition for Asian buyers may restrict projects in British Columbia, Mike Rose, CEO of Tourmaline Oil Corp., reassured investors that global demand could rise dramatically by 2035—potentially accommodating multiple projects. "We need all of them," he stated confidently.

Canada's Response: A Unified Front?

In a recent address, TC Energy CEO François Poirier advocated for a "Team Canada" approach to LNG development, suggesting that a unified message could elevate Canada's presence in international markets. He highlighted Alaska's proactive strategies in courting Asian clients, emphasizing the urgency for Canada to demonstrate its commitment to global LNG competition.

With the landscape rapidly evolving and both opportunities and challenges ahead, the race to dominate the LNG market has only just begun. Canada must rally and assert itself effectively to stake its claim in the lucrative Asian markets.