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Japan Considering Supporting Alaska Gas Pipeline To Strengthen Ties With Trump Administration

Japan is considering backing a $44 billion Alaska gas pipeline to strengthen ties with President Trump, sources say.

Japan is weighing the possibility of backing a $44 billion gas pipeline project in Alaska, which aims to bolster US-Japan relations and address potential trade tensions, according to three government officials familiar with the matter.

The proposed pipeline, which would transport liquefied natural gas (LNG) from Alaska to Asia, is seen as a strategic move to curry favour with US President Donald Trump and prevent any escalation of trade disputes.

The 800-mile pipeline, designed to connect Alaska’s northern gas fields to a southern port where the gas would be liquefied and shipped to Asian customers, has faced scepticism in Japan due to high costs compared to other LNG sources.

However, Japanese officials have indicated they are open to exploring the deal if President Trump raises the matter during his anticipated meeting with Japanese Prime Minister Shigeru Ishiba in Washington next week.

Officials in Tokyo expect Trump to highlight the project as essential for US economic prosperity and security, as he has previously emphasised.

“This project is key to ensuring that US allies in Asia, including Japan, have access to a stable energy supply,” Trump said in an earlier statement.

Despite the potential geopolitical benefits, Japan remains cautious about the financial viability of the pipeline.

“While we understand the strategic importance of diversifying energy sources, we need to ensure that any deal is commercially viable,” one official noted.

Japan already imports substantial amounts of LNG, trading approximately 38 million tonnes in 2023, over half of its domestic consumption.

Prime Minister Ishiba, who is expected to meet Trump next week, acknowledged Japan’s energy needs in a parliamentary statement, saying, “While Japan needs to reduce reliance on fossil fuels, there are things that we should request from the US in terms of stable energy supply.” However, he did not specifically mention the Alaska pipeline.

To address potential trade friction, Japan is considering including the LNG deal among a broader set of economic concessions.

These could include increasing purchases of US gas, ramping up defence spending, and boosting investment in US manufacturing.

This approach aims to reduce Japan’s $56 billion bilateral trade deficit and stave off potential tariffs that President Trump has threatened on foreign goods.

“Any deal on LNG would need to offer reasonable pricing and flexibility, such as allowing Japanese companies to resell the gas,” a fourth official explained.

While Japan is prepared to discuss these terms, no firm commitments are expected during the upcoming summit.

The Alaska gas project was a central part of President Trump’s energy agenda during his first term, with an executive order promising to unlock the state’s resource potential.

The pipeline is framed as a critical step toward ensuring energy security for both the US and its Pacific allies, including Japan.

However, Japan’s energy needs are already well-served by existing sources. The country imports LNG from diverse regions, including Russia, which accounts for approximately 10% of its gas supply, and the Middle East.

Still, diversifying sources, particularly to reduce reliance on unstable regions like Russia, remains a priority.

Japan’s involvement in the Alaska pipeline could also involve financing support. The Japan Bank for International Cooperation (JBIC) is one potential source of funding, offering loans for projects that benefit Japanese companies abroad.

Trading firms like Mitsubishi Corp and Mitsui & Co, which manage Japan’s overseas energy reserves, could also play a role, though neither company has committed to the project thus far.

Mitsubishi has previously entered into an agreement with Alaska Gasline Development Corporation (AGDC) to assess the feasibility of producing ammonia at the project site, but has not yet made a commitment to invest in the pipeline.

AGDC, the state-owned entity responsible for the LNG project, has held discussions with Japanese energy leaders, though specifics have not been disclosed.

“We have had talks with Japanese partners about the project,” a spokesperson for AGDC said, without elaborating on the details.

The pipeline project, first approved during Trump’s earlier administration, has faced opposition from environmental groups and regulatory hurdles.

Despite this, the project received key approvals, including from the Federal Energy Regulatory Commission in 2020, and is now advancing under the leadership of developer Glenfarne.

The upcoming meeting between Ishiba and Trump will be closely watched in Japan, where political observers are focused on whether the new prime minister can establish the same rapport with Trump that former Prime Minister Shinzo Abe enjoyed during his tenure.

Abe, who was assassinated in 2022, formed a close personal and diplomatic relationship with Trump, but Ishiba’s government lacks such established ties.

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