A New Dawn for Alaskan Energy? The ambitious Alaska LNG Project, a decades-old dream, is back in the spotlight, and this time, it seems like it might actually happen. Houston-based Baker Hughes (NYSE:BKR) is playing a pivotal role, injecting both technology and investment into this massive undertaking. But what does this mean for the future of energy, and is it all smooth sailing? Let’s dive in.
Baker Hughes has inked definitive agreements with Glenfarne Alaska LNG LLC, a subsidiary of Glenfarne Energy Transition. This partnership is significant, with Baker Hughes set to supply essential power generation equipment and main refrigerant compressors for the long-delayed project. This positions them as both a technology provider and a key investor in a project estimated to cost a staggering $44 billion—making it one of the largest energy infrastructure projects in the United States.
This project aims to unlock the vast natural gas reserves of Alaska’s North Slope, which have been stranded due to their remote location and associated costs. The plan involves a two-phase approach: first, an 807-mile, 42-inch pipeline will transport gas from the Prudhoe Bay and Point Thomson fields to the Kenai Peninsula. Then, a liquefaction terminal will be built, capable of producing up to 20 million tonnes of LNG annually. This is roughly a quarter of Japan’s annual gas imports. The system is designed to handle approximately 3.3 billion cubic feet of gas per day, supplying local needs before exporting the remainder to Asia.
The Road to Revival: Momentum has been building since January 2025, when Glenfarne took over as the lead developer. Glenfarne agreed to fund about $150 million of pre-FID (Final Investment Decision) development costs. Engineering firm Worley Ltd is currently conducting the front-end engineering and design (FEED) study, which is expected to conclude by December 2025. If all goes according to plan, the pipeline phase could kick off in 2026, with the liquefaction plant following about two years later. Glenfarne reports that over 50 companies have expressed interest in supply or construction contracts worth over $115 billion, spanning the United States, Japan, South Korea, Taiwan, India, Thailand, and the European Union. Preliminary commercial commitments cover over 60 percent of the planned capacity, including non-binding deals with major players like Japan’s JERA Co. and Tokyo Gas Co., and South Korea’s POSCO International.
The Price Tag and the Challenges: The total cost of the Alaska LNG project is estimated at around $44 billion. The high capital intensity is due to the challenging Arctic construction conditions and remote logistics. In contrast, projects on the U.S. Gulf Coast benefit from existing infrastructure, where liquefaction trains typically cost between $6 billion and $7 billion for a capacity of 6 to 8 million tonnes per year. Alaska’s geography requires an integrated pipeline and gas-treatment system before liquefaction can begin.
The Strategic Advantage: Despite the high costs, the location offers strategic benefits. Shipments from Nikiski to Asia take less than ten days, avoiding the Panama Canal and significantly reducing transit times compared to Gulf Coast routes. This could translate to competitive delivered costs, though it hinges on post-FEED economics and final sales contracts.
Political Winds of Change: Federal and state politics have become more supportive of the project. Under President Donald Trump, the U.S. emphasized energy exports as a tool for diplomatic leverage, encouraging allies to source more LNG from American projects. Alaska’s political leaders have used this policy backdrop to attract Asian partners. Senator Dan Sullivan led trade missions to Japan and South Korea, building on outreach that began after supply-security concerns spiked following Russia’s 2022 invasion of Ukraine.
Baker Hughes’ Contribution: Baker Hughes’ involvement brings crucial technical and financial support. The company will provide LM6000 aeroderivative gas turbines and refrigeration compressors, technologies already proven in U.S. and Qatari LNG plants. This will power the gas-treatment unit and drive the liquefaction process.
But here’s where it gets controversial… Challenges remain. Only a portion of the offtake is binding, and financing depends on securing firm sales agreements. Environmental groups continue to voice concerns about pipeline routes and emissions. Analysts warn of potential oversupply by 2028 due to new capacity from Qatar and other U.S. projects. The FEED results and financing package, due next year, will be crucial in determining whether the Alaska LNG project finally moves from the drawing board to reality.
A Glimmer of Hope: Unlike previous attempts, this time there’s a defined developer, a global equipment supplier, and a clear timeline. If Glenfarne and Baker Hughes can convert interest into firm sales and secure project finance, Alaska’s untapped gas fields could become the next frontier in U.S. LNG exports.
What do you think? Will this project succeed, or are there too many hurdles to overcome? Do you believe the strategic advantages outweigh the costs? Share your thoughts in the comments below!