by Caleb Jasso, RealClear Energy
President Trump's ambition to make the United States as energy independent as possible has helped give Alaska the recognition it deserves as one of America's most strategic assets. A fifth the size of the contiguous United States, America's “Last Frontier” boasts an abundance of oil and gas reserves, critical minerals, and an Arctic coastline of ever-growing importance.
Following Interior Secretary Burgum's earlier direction for BOEM (Bureau of Ocean Energy Management) to take the first steps for public commentary on the initiative to develop a new schedule for offshore oil and gas leases on the Outer Continental Shelf (OCS), in the first week of June, President Trump sent Burgum, along with Secretary of Energy Chris Wright, and Environmental Protection Agency Administrator Lee Zeldin, to Alaska to demonstrate how serious he is.
The recent visit from Burgum, Wright, and Zeldin, combined with the exciting BOEM announcement, has opened the possibility for expanded offshore hydrocarbon exploration in the High Arctic. Developing these resources is crucial for domestic prosperity and maintaining America's leading position in the global oil and gas market. Additionally, the development of Alaska's energy resources and the completion of the Alaska LNG Project's pipeline will further solidify America's position as a leading Arctic power and a deterrent to Russian expansion.
As of 2023, it's estimated that Alaska has 100 trillion cubic feet of natural gas, ranking it third among all states. A sizable portion of this natural gas is located on Alaska's infamous North Slope, which contains 6 of the 100 largest oil fields, and one of America's largest natural gas fields. The steps taken to reverse years of preventive energy development policy in Alaska have already begun encouraging foreign investment discussions, notably with South Korea, Taiwan, and Japan; this interest was exemplified by the announced attendance of representatives of each of these nations, as well as the Philippines, India, and the UAE during the recent Trump administration trip to Alaska. Furthermore, although controversial, leveraging the ongoing tariff negotiations between the United States and other countries to encourage foreign investment in Alaskan energy development may prove advantageous.
The development of Alaska's natural gas should come with the completion of the Alaska LNG Project, not only because of the domestic economic value it will create, but also because of the geopolitical significance it will have for East Asia. Once operational, the 800-mile-long pipeline will bring millions of tonnes of Alaska LNG to the global market per year, which will then make Alaska the closest source to East Asia of American-produced LNG. This will drastically reduce shipping time, as LNG will be able to sail directly from Alaskan ports without needing to use the Panama Canal, unlike the Gulf LNG export terminals. Additionally, with the opening of the Northwest Passage as a viable trade route, Alaska LNG could also reach the European market, further diversifying Europe's global supply chain. The mutually beneficial relationship between Alaska and the East Asian and European natural gas markets will ensure that Alaskans have access to affordable natural gas while simultaneously providing a greater supply to nations seeking to reduce their overall reliance on Russian gas.
Further integrating Alaskan natural gas into the global market will also come with the added benefit of an increased American presence in the strategically important Arctic. America's direct regional adversary, Russia, currently has thirty-two active arctic military bases and the world's only nuclear-powered icebreaker fleet; Russia has upwards of forty icebreakers while the U.S. has only recently begun expanding its fleet to three. Additionally, although Russia boasts the most extensive Arctic coastline and substantial continental shelf claims, it is the only Arctic nation not part of NATO.
Leveraging the generally friendly relationships the United States has with the other Arctic nations will add more possibilities for economic cooperation in the region, especially with Alaskan natural resources and the growing demand for LNG in Europe.
Russia is keenly aware that the Arctic is rich in natural resources, a sizable portion of which is a NATO lake, and has therefore invested substantially in Arctic regional claims and energy resource exploration; Russia relies heavily on the Arctic for most of its natural gas, which accounts for 80% of total production. Not maintaining the same pace for regional military development as Russia, let alone energy resource exploration and production, has been a strategic mistake, given that Russia's coastline controls most of what will be one of the three viable Arctic trade routes, the Northern Sea Route (NSR).
Alaska is rich in natural resources and provides the United States with a vital Arctic coastline. With the Arctic becoming a viable region for trade routes, including the NSR and the Northwest Passage, geopolitical interest has placed Alaska rightfully in the spotlight. Unfortunately, the United States is lagging in the scramble for the Arctic, but Alaska's natural resources, especially oil and gas, may be the key to making up lost ground.
Read the Full Article