Trump Warns South Korea to Sign On to Alaska LNG or Face Higher Charges, as Seoul Says No Commitment Has Been Made

President Donald Trump has warned that South Korea will face higher charges if it does not commit to the Alaska LNG project, escalating pressure on Seoul days after he announced a Korean investment in the venture that South Korean officials say went beyond anything they had agreed.

Asked by reporters on 2 October about South Korea's hesitation, Trump said that if Korea did not back the pipeline, he would charge it more. "I'll just charge them more," he said, according to CNBC, adding that he had not jumped the gun in announcing the investment.

The remarks underline how the Trump administration is using trade leverage to secure foreign financing for large US energy projects, and how such announcements can run ahead of the commitments made by partner governments.

A disputed announcement

On 30 September, Trump announced that South Korea would invest "more than $50 billion" in Alaska LNG. "The colossal package of investments we are announcing today is a major step toward securing our critical energy supply chain," he said. Industry reports put the figure at about $54 billion, as part of a broader $200 billion package of South Korean investment in US energy projects. Separately, a $22.3 billion Korean investment in a 6.47-gigawatt gas-fired power plant in Encinal, Texas, was described as finalised.

South Korean officials quickly pushed back on the Alaska element. Trade, Industry and Resources Minister Kim Jung-kwan said Trump's claims "went beyond what had been agreed." He said the joint fact sheet stated only that the two countries "agreed to commence working on the Alaska LNG project, subject to meeting commercial reasonableness."

"It doesn't include the amount mentioned earlier or any statement that we are directly committing to the project, just that we are beginning the review process," Kim said. A senior official from South Korea's ruling Democratic Party also said the investment had not been finalised.

What Alaska LNG is

Alaska LNG is one of the most ambitious energy infrastructure projects in North America. It envisages a pipeline of roughly 807 miles carrying natural gas from Alaska's North Slope to a liquefaction and export terminal at Nikiski, on the Kenai Peninsula, with capacity of up to 20 million tonnes of LNG a year aimed mainly at Asian buyers.

The project has been discussed for decades but has repeatedly stalled because of its cost and the difficulty of securing buyers. Glenfarne, the US energy developer that acquired a 75% stake in 2025, has put the total cost at about $55 billion. The state-owned Alaska Gasline Development Corporation retains 25%.

The project received federal approval from the Federal Energy Regulatory Commission in 2020, and federal permitting was completed in 2025. Glenfarne has targeted a final investment decision on the pipeline in 2026 and full start-up around 2031.

The critical gap is commercial. Glenfarne has preliminary offtake agreements for about 13 million tonnes a year, short of the roughly 16 million tonnes it needs to proceed. Commitments from large Asian importers such as South Korea and Japan are therefore central to the project's viability.

Glenfarne said after Trump's announcement that "details of any South Korean investment remain under negotiation and further steps are required before reaching FID."

Trade leverage at work

The dispute is rooted in the trade agreement reached between Washington and Seoul in 2025, under which US tariffs on South Korean exports were set at 15% in exchange for large Korean investment commitments in the United States. Trump has said Korea's investment in Alaska LNG is part of its payment under that deal.

For South Korea, the calculation is difficult. The country is one of the world's largest LNG importers and has an interest in diversifying supply away from the Middle East, where tensions have pushed oil above $100 a barrel. But Korean companies and the government are wary of committing tens of billions of dollars to a project with a long history of delays and uncertain economics.

Seoul also has domestic constraints. Large state-backed investments abroad are politically sensitive, and the government will want to show that any commitment meets commercial tests rather than simply responding to pressure from Washington.

Politics in Alaska and Washington

The timing has a domestic dimension in the United States. The announcement came about a month before midterm elections that include a competitive Senate race in Alaska between Republican incumbent Dan Sullivan and Democratic candidate Mary Peltola. Alaska LNG has long been promoted by the state's political leaders as a source of jobs and revenue.

In the same remarks, Trump also sought to calm energy markets, saying he would "never" impose a ban on diesel exports. That statement removed one source of uncertainty for refiners and fuel importers at a time when Group of Seven governments have announced a release of 100 million barrels of crude and diesel to ease supply pressures. ## A crowded LNG market ahead

Alaska LNG would also enter a global market expecting a large wave of new supply later this decade, as major export projects in the United States and Qatar come online. That prospect strengthens the bargaining position of buyers and raises the bar for a high-cost Arctic project to compete on price.

Implications for Asian energy buyers

For Asian importers, including India, the episode highlights both an opportunity and a risk. Additional US LNG supply aimed at Asian markets could improve energy security and add competition among suppliers. India has expanded its purchases of US energy in recent years and is seeking long-term LNG contracts to support its goal of increasing the share of gas in its energy mix.

At the same time, projects of Alaska LNG's scale and complexity carry significant execution risk. Buyers that commit early may obtain favourable terms, but they also take on the risk of delays and cost overruns.

What to watch

The key questions now are whether South Korea moves from a review to a binding commitment, on what terms, and whether Japan and other Asian buyers follow. Glenfarne's ability to secure the remaining offtake volume and reach a final investment decision will determine whether Alaska LNG moves from a long-discussed idea to a construction project.

For now, the gap between Trump's announcements and Seoul's statements shows the limits of using trade pressure to finance infrastructure. Governments can be pushed to the negotiating table. Commercial investors still need a project that pays. </content> </invoke>