When the world’s largest publicly traded oil majors walk away from a $44 billion gas megaproject, that should be a warning sign. But in Alaska, the response has been to hand a 75% stake to a private firm that has never operated an LNG export terminal—and to keep the deal’s details from the state legislature. This is not energy strategy. This is a fiscal gamble dressed in geopolitical ambition.
The Alaska LNG project, which would tap the North Slope’s 35 trillion cubic feet of gas, has been on the drawing board for a decade. ConocoPhillips and Exxon Mobil, no strangers to Arctic engineering, have both backed away, citing prohibitive costs and a lack of firm buyer commitments. Independent analysts now warn the price tag could blow past $70 billion. Yet the state has already sunk at least $600 million into planning and permitting, and initially floated paying the new developer—Glenfarne Group—an additional $50 million even if it decides to walk away.
Proponents, including Governor Mike Dunleavy, argue the pipeline will deliver energy security to US allies and economic salvation to Alaska. But the numbers tell a different story. No binding offtake agreements exist. No experienced LNG operator is at the helm. And the project’s backers are already eyeing $30 billion in federal loan guarantees—a staggering sum that would transfer the bulk of financial risk to American taxpayers. Every taxpayer should be furious that the federal government is chasing this project, as The Center for Biological Diversity’s state director put it, while the developer faces lawsuits over threats to endangered species.
This is not a niche concern. The Alaska LNG saga mirrors a broader pattern in fossil fuel infrastructure: megaprojects that survive on political momentum long after economic logic has evaporated. In a world where LNG oversupply is already compressing margins and buyers are increasingly skittish about long-term contracts, betting on a $44 billion Arctic pipeline is less a vote of confidence in natural gas than a testament to the power of regulatory capture. The no-bid deal, the opaque financing structure, and the absence of major industry participants all point to a project that exists primarily as a political artifact—one that could leave Alaska and the federal government holding a very expensive bag.
Read the full report at Energy Central.