Taiwan's Ambitious LNG Deal with the US: A Game Changer in Energy Supply?
Taiwan's Major LNG Acquisition Plans
Taipei: Taiwan is set to secure an annual supply of 6 million metric tonnes of liquefied natural gas (LNG) from a US project, with potential investments reaching up to USD 4.4 billion, as announced by the Economic Affairs Ministry on Wednesday. This deal has been hailed by former US President Donald Trump as 'one of the biggest deals ever made.'
The United States serves as Taiwan's primary informal ally and arms supplier amid escalating military threats from China, which views Taiwan as a breakaway province that could be forcibly annexed.
Details regarding the LNG purchase emerged as Taiwan anticipates a USD 14 billion arms sales package from the US.
According to Taiwan's Ministry of Economic Affairs, the state-owned CPC Corporation signed a letter of intent in March 2025 concerning the LNG project in Alaska. Significant progress has been made following over a year of negotiations.
The current plan includes annual purchases and participation in the Alaska project, with an estimated maximum investment of USD 4.4 billion, as stated by the ministry.
If all goes according to plan, the project could begin supplying natural gas to Taiwan by 2032 at the earliest.
The ministry emphasized that strategies like long-term energy procurement and project investment would diversify Taiwan's natural gas supply, enhance flexibility, and strengthen Taiwan-US cooperation.
It was noted that this collaboration would be based on mutual benefit and professionalism, with CPC Corp continuing to liaise with US counterparts.
Specific investment details, including shareholding ratios and related terms, will be determined through further negotiations and commercial contracts.
During a political rally in Alaska, Trump praised Taiwan's commitment to purchasing from the mega-gas project, which involves a 1,300-kilometre pipeline linking Alaska's North Slope to a liquefied natural gas export terminal in southern Alaska.
"Taiwan has just agreed to buy 30% of the gas from the pipeline for the next 20 years," Trump stated, adding, "That guarantees success. It’s one of the biggest commitments in history for anything. It’s one of the biggest deals ever made."
However, Taiwan's statement did not clarify the duration of its commitment.
Trump had previously highlighted a USD 54 billion investment from South Korea in the Alaska pipeline, but South Korean officials expressed caution, indicating they needed to evaluate the project's commercial viability before proceeding.
For Taiwan, maintaining a strong relationship with the US is crucial, especially in light of increasing military and diplomatic pressure from Beijing.
China has urged Trump to cease arms sales to Taiwan. Following a summit with Chinese leader Xi Jinping in May, a record USD 14 billion arms sales package to Taiwan was put on hold. Trump referred to arms sales to Taiwan as a 'very good negotiating chip' with China.
In September, Xi expressed hope that the US would uphold 'the correct position of opposing Taiwan independence' during his visit to Washington.
Washington approved an additional USD 11 billion arms package for Taiwan in December.
In Beijing, Chinese Foreign Ministry spokesperson Mao Ning stated that external interactions involving 'China's Taiwan region' must adhere to the 'one-China' principle.
"The DPP authorities' attempts to pursue Taiwan independence under the guise of economic and trade cooperation will not succeed," she remarked, referring to Taiwan's ruling Democratic Progressive Party.
Since 1949, China and Taiwan have been governed separately, following a civil war that led to the Communist Party's rise in Beijing, while the Nationalist Party retreated to Taiwan.