Glenfarne to Partner with Korea’s POSCO for Alaska LNG

Glenfarne Alaska LNG, LLC said it entered into an agreement with Korea’s POSCO International Corporation to advance a strategic partnership for the development of the Alaska LNG Project.

The partnership will include steel supply, liquefied natural gas (LNG offtake), and an investment in the Alaska LNG project, Glenfarne said in a news release.

The agreement defines the process for Glenfarne and POSCO to move forward on definitive agreements, which will close pending board approvals by both sides, according to the release.

The agreement will also include initial terms for a 20-year heads of agreement (HoA) for 1 million metric tons per annum (mtpa) of LNG offtake on a free-on-board basis, which will be the first announced HoA for Alaska LNG, Glenfarne said.

The agreement will also include initial terms for POSCO to supply a significant portion of the steel required for Alaska LNG’s 807-mile, 42-inch pressurized natural gas pipeline. The Alaska LNG pipeline will connect Southcentral Alaska and the Alaska LNG export terminal with Alaska’s vast, stranded natural gas resources on the North Slope, the company said.

Alaska LNG is a joint venture between Glenfarne, majority owner and lead developer of Alaska LNG, and the state-owned Alaska Gasline Development Corporation. POSCO is the largest sales representative of Korea’s largest steel producer POSCO Group and a major Korean LNG importer, according to the release.

The Alaska LNG project consists of a pipeline capable of transporting enough natural gas to meet both Alaska’s domestic needs and supply the full 20-mtpa Alaska LNG export terminal in Nikiski, Alaska, Glenfarne stated.

The pipeline will be built in two independent, financially viable phases. Phase one will deliver natural gas approximately 765 miles from the North Slope to the Anchorage region, and phase two includes the Alaska LNG facility, approximately 42 miles of pipeline under Cook Inlet, and pipeline compression equipment.

The company said it is working with Worley to complete the final engineering for the domestic portion of the Alaska LNG pipeline and targeting a year-end final investment decision.

Glenfarne CEO Brendan Duval said, “POSCO’s participation in Alaska LNG adds tremendous momentum as we drive this signature North American LNG project forward at a rapid tempo. This agreement includes critical project components and demonstrates global support for unlocking some of the most strategically located LNG in the world. Korea is a valued target market for Alaska LNG and we greatly appreciate POSCO’s engagement as we advance Alaska LNG”.

Glenfarne Alaska LNG President Adam Prestidge said, “POSCO is one of the world’s foremost steel companies, a leading LNG importer in one of Alaska LNG’s most important markets, and now a significant partner in Alaska LNG. POSCO’s involvement underscores the project’s strategic, geographic, and economic competitive advantages as we rapidly progress toward a final investment decision on the Alaska LNG pipeline”.

Glenfarne said its permitted North American LNG portfolio totals 32.8 mtpa of capacity under development in Alaska, Texas and Louisiana.

Last week, Japan’s JERA Co Inc signed a letter of intent with Glenfarne for the offtake of 1 million mtpa of liquefied natural gas (LNG) from the Alaska LNG project. The potential purchase will be for 20 years on a free-on-board basis, according to a joint statement.

To contact the author, email rocky.teodoro@rigzone.com