Trump says S. Korea will invest in Alaska LNG, but Seoul says it's still under review

President Donald Trump announced South Korea's participation in the Alaska liquefied natural gas project as though it were a done deal, but official documents released by both governments describe it only as a preliminary review — a gap that has raised questions about the binding nature of the announcement.

Based on the agreements made public so far, South Korea cannot be said to have taken on a firm obligation to invest in the Alaska LNG project. The joint fact sheet released by the two countries states that they have agreed to commence work on the project subject to "commercial reasonableness" and compliance with all applicable domestic legal requirements. The Ministry of Trade, Industry and Energy said the final investment decision would be made only after a feasibility review and the completion of required domestic legal procedures.

Even so, Trump's formal announcement naming Alaska LNG as one of South Korea's investment targets — and Commerce Secretary Howard Lutnick's reference to an investment figure exceeding $50 billion — has effectively cast South Korea's participation as a foregone conclusion on the US side.

The central question is whether Trump's announcement can substitute for South Korea's own final investment decision. Under the bilateral strategic investment MOU, the US Investment Committee recommends commercially viable projects to its Korean counterpart, and South Korea then evaluates not only commercial viability but also strategic and legal considerations before committing.

Trade, Industry and Energy Minister Kim Jung-kwan made this structure explicit when the MOU was signed last November, saying only investments with commercial merit would be recommended to the US president.

The joint fact sheet released this week reflects the same conditionality, stating that the two sides agreed to commence work on the Alaska LNG project "subject to meeting commercial reasonableness under the Strategic Investment MOU and all applicable domestic legal requirements."

The ministry reiterated Thursday that the Alaska LNG project is being taken up for review on the premise of commercial viability and compliance with domestic law, and that no decision has been made on whether to invest or on the scale of any investment.

The ministry added that it understood Trump's remarks about the Alaska LNG project as an expression of the US position on moving the project forward.

In other words, regardless of Trump's political and public announcement, South Korea's actual investment execution still faces additional hurdles — a feasibility review and the required domestic legal process.

South Korea has never formally committed to joining the Alaska project. The project involves transporting natural gas from the Prudhoe Bay and Point Thomson oil and gas fields on Alaska's North Slope through roughly 1,300 kilometers of pipeline to the southern coast, where it would be liquefied and shipped to markets in Asia and elsewhere.

Concerns about commercial viability have consistently been raised, given the enormous upfront capital required and uncertainty over profitability. Even major US energy companies, including ExxonMobil, have previously pulled out citing risks to investment recovery.

Kim told the National Assembly last November that the Alaska pipeline project was a "high-risk venture," adding that commercial reasonableness was limited to projects capable of generating cash flow and that participation would not be easy by South Korea's standards.

President Lee Jae Myung also addressed the issue at a press conference at Cheong Wa Dae on Sept. 18, saying commercial viability had become a sticking point once concrete investment discussions began. "We only pursue projects with commercial merit. The national interest is truly important," he said.

For these reasons, the South Korean government had maintained that it would decide whether to invest in the Alaska project only after further review.

Unlike the Encinal gas-fired power plant and the construction of eight large nuclear power plants — both included as confirmed projects — the Alaska project had not even disclosed an estimated cost.

Trump's definitive announcement Thursday has nonetheless placed the South Korean government under considerable pressure to join what is widely regarded as one of the highest-risk projects on the table.

A separate dispute has also emerged over the translation of the phrase "working on" in the joint fact sheet. The South Korean government rendered it as "commencing a preliminary review," but some academics argue it should be interpreted as "commencing the project" itself.

The Korean-language version of the fact sheet released by both governments Thursday reads: "The United States and the Republic of Korea have agreed to commence a review of the Alaska LNG project, subject to meeting commercial reasonableness under the Strategic Investment MOU and all applicable domestic legal requirements."

The English-language version states: "The United States and Korea have agreed to commence working on the Alaska LNG project, subject to meeting commercial reasonableness under the Strategic Investment MOU and all applicable domestic legal requirements." Some argue that "working on," when the stated conditions are met, implies actually starting the project rather than merely reviewing it.

Regardless of how the English phrase is interpreted, however, the sentence as a whole carries explicit conditions — commercial reasonableness and compliance with domestic law — that make it difficult to read the language as an unqualified commitment to begin the project.

Alaska is a key battleground state for the US midterm elections in early November and one of Trump's top political priorities. The state is considered critical to Republicans' effort to hold their Senate majority, and observers have noted that Trump effectively used the South Korean investment announcement event as a platform to boost the reelection campaign of Alaska's Republican senator.

The government also pointed to potential upsides if the project moves forward. According to the fact sheet, the United States has agreed to offer tariff reductions on materials such as steel, guarantee long-term LNG purchase contracts on economically viable terms, and grant South Korea preferential access to Alaska LNG supplies.