 |
POSCO International Headquarters in Songdo, Incheon, South Korea. (Photo: POSCO International) |
[Alpha Biz= Kim Jisun] POSCO International (KRX: 047050) has finalized its participation in a $64 billion liquefied natural gas (LNG) development project in Alaska, USA. The company will purchase 1 million tons of Alaska-sourced LNG annually while making capital investments to kick off the development project in earnest.
A senior POSCO International official stated on January 14, “We plan to sign the Final Investment Decision (FID) contract for the Alaska LNG project between January and February.” Unlike previous preliminary agreements, the FID represents a legally binding contract that confirms the company’s full commitment to the project. POSCO International previously signed a preliminary agreement with Glenfarne in September for LNG procurement and finalized a Heads of Agreement (HOA) in December covering certain contract terms. Signing the FID indicates that POSCO International has completed its feasibility review and officially committed to the project.
In addition to LNG procurement, POSCO International plans to make equity investments in the project, though the exact size of the investment has not been disclosed. “This information is covered under a non-disclosure agreement (NDA) and will be disclosed in detail when possible,” the official added.
The Alaska LNG project involves developing gas fields in the North Slope region of northern Alaska. The project will require the construction of approximately 1,300 km of pipelines traversing Alaska north to south, along with liquefaction terminals and other infrastructure. Initial estimates suggest total capital investment will exceed $45 billion.
Under the agreement, POSCO International will purchase 1 million tons of LNG per year under Free On Board (FOB) terms for 20 years. FOB terms mean the seller bears all costs and responsibilities until the cargo is loaded at the shipping port. This volume represents approximately 2.2% of Korea’s 2024 LNG imports of 46.32 million tons. POSCO will also supply large quantities of steel required for the construction of 42-inch high-pressure natural gas pipelines for the 1,300 km pipeline network supporting the Alaska LNG project.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
