Republicans in Alaska want tax breaks for a Trump-backed megaproject that Indigenous activists oppose.
By Mike Ludwig ,
June 26, 2026
An oil pipeline stretches across the landscape outside Prudhoe Bay in North Slope Borough, Alaska, on May 25, 2019. The proposed Alaska LNG megaproject includes an 800-mile fossil gas pipeline running from the North Slope to a processing plant and export terminal in the Cook Inlet that would damage permafrost and disrupt caribou migration routes.Bonnie Jo Mount / The Washington Post via Getty Images
Republican Gov. Mike Dunleavy of Alaska has ordered state lawmakers to attend special legislative sessions over the summer and pass lucrative tax breaks for Alaska LNG, a proposed massive fossil gas export terminal on the Cook Inlet with an 800-mile pipeline across pristine wildlife preserves and much of the state.
With plans to export liquified “natural gas,” or LNG, to Asia, the fossil fuel megaproject is a top priority for President Donald Trump that Dunleavy is rushing to greenlight before his final term ends in December. Alaska LNG would accelerate the thawing of Arctic permafrost — potentially crossing a dangerous tipping point leading to a full-scale climate crisis — and threaten subsistence hunting and fishing grounds belonging to Arctic Indigenous communities.
For Iñupiat subsistence hunters who rely on animals such as moose and caribou to survive, disruptions to migratory routes from fossil fuel projects can be devastating. Rosemary Ahtuangaruak, former mayor of Nuiqsut and founder of Grandmothers Growing Goodness, said people in her tribal fishing village on the Colville River are also dealing with toxic industrial accidents and breathing problems from air pollution released by existing fossil fuel infrastructure on Alaska’s North Slope.
“This gas project can’t go through,” Ahtuangaruak told Truthout in an interview. “We should not be doing this just so some people can line their pockets today without thinking about tomorrow.”
With estimated costs currently up to $54.5 billion, some state lawmakers are also weighing whether Alaska LNG is bad economics. Trump, Dunleavy, and Glenfarne Group, the developer behind the project, are relying on lucrative state and federal subsidies to attract investors and political support. The climate activists at Friends of the Earth call the proposal “corrupt” and a “carbon bomb.”
Trump Admin Uses Iran War Oil Shock to Push Drilling in Alaskan Wilderness
The five-year plan is expected to cause 4,000 additional oil spills and the destruction of fragile ecosystems. By Michael Arria , Truthout May 31, 2026
Lois Parshley, a climate researcher at Public Citizen and co-author of a new report on the growing costs of the rush to export fracked gas as LNG, said the actual costs of building and operating Alaska LNG are likely much higher than the nearly $55 billion estimate provided by Glenfarne Group. The average cost overrun of operating LNG terminals in North America has been 59.7 percent, according to the report.
“The financial hazards in the LNG sector aren’t anomalies, they’re built into the business model,” Parshley said in email.
With the rise of renewable energy and future revenue dependent on global markets, building massive LNG export terminals is a big financial risk. Parshley said developers work with politicians behind the scenes to pass costs onto the government and consumers. For example, Alaska owns a 25 percent stake in Alaska LNG through a state-owned corporation, but its share would be diluted as more investors come on board and does not guarantee the state will receive 25 percent of future profits.
“We should not be doing this just so some people can line their pockets today without thinking about tomorrow.”
“The most comparable recent example is LNG Canada, which ran more than 130 percent over budget,” Parshley said. “Alaska’s proposed pipeline route traverses a longer distance, and more severe terrain, in a labor market that is structurally thinner.”
Billed as one of the largest energy projects in state history, Dunleavy and allied Republican lawmakers are currently haggling over tax breaks that Glenfarne Group says are necessary to make Alaska LNG viable for investors. Democrats, Independents, and even some Republicans say the megaproject risks leaving Alaskans on the hook for billions of dollars in hidden costs.
Larry Persily, a newspaper publisher and former federal coordinator of Alaska Natural Gas Transportation Projects, acknowledged the environmental concerns but said many voters are interested in promises of economic growth and access to cheap fuel in a state that shares oil revenues with residents — promises which Alaska LNG backers are loudly promoting.
“The environmental opposition to a proposed natural gas pipeline in Alaska is sincere, and they have some valid points, but it’s not resonating with the public very much because it’s not oil, it’s a very different product,” Persily said in an interview.
However, Persily said construction of an 800-mile pipeline across Alaska would be challenging on the accelerated timeline proposed by developers, and claims by officials that Alaska LNG could begin delivering cheap gas to residents by 2029 are unrealistic. Alaskan households could be exposed to high costs for gas if any utility “is irresponsible enough to sign a bad contract” before the project begins exporting gas overseas.
Even then, future global demand for LNG is uncertain. The shortages and high fuel prices associated with Trump’s tariffs and war on Iran won’t last forever.
“[Lawmakers] are in a tough political position in the state legislature, they really are,” Persily said. “I am one of those who thinks this is not going to happen, it’s not economic, but the sales job they are putting on is impressive.”
So far, lawmakers have been unable to pass tax breaks that both the Alaska House and Senate can agree on. Dunleavy ordered lawmakers to attend a second special legislative session that began on June 20 to hammer out a deal. Meanwhile, climate activists and some Indigenous people want to stop Alaska LNG altogether. In April 2025, a federal court rejected a lawsuit filed by the Center for Biological Diversity and other environmental groups against a federal export permit for Alaska LNG.
“The outlook for the project is so bad that the Trump administration is looking for foreign countries to pay for the project,” said Andrea Feniger, director of the Sierra Club’s Alaska Chapter, in a statement at the time.
Cooper Freeman, Alaska director for the Center for Biological Diversity and resident of Homer, said pro-industry politicians have pushed to build a pipeline connecting the state’s southern ports to gas fields on the North Slope for decades. With key lawmakers reluctant to approve huge tax breaks for Alaska LNG developers, Cooper criticized the legislature for wasting its time with fossil fuels as much of the world moves on.
“For lack of a better word, it’s a complete shitshow, and it’s unclear who is going to pay for it,” Freeman said in an interview. “If we had spent this time on transitioning to renewable energy and updating the grid here, we could be reducing our need for gas, which would be better for Alaskans and for wildlife and the places they live.”
Cooper said taxpayers across the United States should be aware of the Alaska LNG proposal and Trump’s broader push to rapidly scale up fossil fuel exports to the rest of the world. The U.S. is the world’s top producer of oil and gas, but utility bills are rising for households nationwide. Trump and Dunleavy are essentially asking Alaskans to take a 25 percent stake in a hydrocarbon megaproject that will send resources to other nations.
“I’m concerned that the only way this project can pencil out is with state tax cuts that put the costs of the project on the backs of Alaskan communities,” Freeman said. “It’s an extremely challenging construction environment, there’s a lot of environmental problems…and it’d be horrible for the climate.”
Trump has sought to rapidly expand fossil fuel production and exports in the frontiers of Alaska since his first day in office, when the president signed an executive order on “unleashing” the “extraordinary resource potential” in Alaska. The political push to open up pristine wilderness in the Alaskan Arctic to oil and gas drilling precedes the current administration.
Under President Joe Biden, federal regulators approved the Willow Project, a controversial oil drilling push by ConocoPhillips now underway near Ahtuangaruak’s village. As the former mayor of Nuiqsut, Ahtuangaruak became an outspoken opponent to the Willow Project, which inspired climate protests across the country.
“There’s lots of oil and gas development,” Ahtuangaruak said. “The Trump administration has allowed year-round drilling while previous administrations only allowed seasonal drilling, so the rapid development of these sites with increased risk of permafrost instability is only wreaking havoc.”
