Today’s Key Takeaways: DOI Secretary Burgum signs order impacting Alaska energy. Canada has little leverage over U.S. in tariff talks. Japanese trading house looking at AKLNG. Ambler Road project in limbo?
NEWS OF THE DAY:
Two Critical Orders Impacting Alaska from Department of Interior Secretary Doug Burgum:
Announcing President Trump’s Revocation of Former Outer Continental Shelf Withdrawals (Secretarial Order No. 3422)
OIL:
Could Canada really stop oil flow to the US in response to Trump tariffs?
Al Jazeera Staff, February 5, 2025
Canada, which sends nearly all its crude oil to the United States, has little leverage because the US is the destination for most Canadian exports.
A major trade war between the United States and Canada has been averted after US President Donald Trump agreed to hold off on imposing a 25 percent tariff for 30 days. But anger has erupted in Canada, with people calling for a boycott of US products, and some even calling to stop the export of oil to the country’s southern neighbour.
However, blocking crude oil flow to the US could inflict an enormous economic cost on Canada, which pumps nearly all of its crude oil to the US via a network of pipelines.
Moreover, it would take some time for Canada to diversify its exports after decades of close trade ties cemented by the North American Free Trade Agreement (NAFTA), which Trump renegotiated during his first term in office from 2017 to 2021.
Hence, in theory, Canada could stop the flow of oil into the US as leverage to get Trump to back down on the tariff threats. But doing so would disrupt crude supply to refineries in Canada’s east as the pipelines pass through the US territory.
GAS:
Japan’s Mitsui could study Alaska LNG project, but no decision yet – The Japan Times
Yuka Obayashi and Katya Golubkova, February 4, 2025
Japanese trading house Mitsui could consider studying a project to liquefy natural gas in Alaska, but no decisions have been made yet, Chief Financial Officer Tetsuya Shigeta said on Tuesday.
Japan is considering offering support for a $44-billion gas pipeline in Alaska as it seeks to court U.S. President Donald Trump and forestall potential trade friction, sources said last week.
Shigeta said he hoped a meeting expected this week between Prime Minister Shigeru Ishiba and Trump would help enhance Japan’s presence in the United States, reaffirming its role as the latter’s largest source of investment.
Asked about the reported LNG development in Alaska, Shigeta said it was a natural candidate for consideration, presenting a valuable opportunity because of its proximity to Japan and other Asian countries.
“But we have nothing we can talk about now, including our policy,” he added.
China on Tuesday slapped tariffs on some U.S. imports in a swift response to new U.S. duties on Chinese goods, renewing a trade war between the world’s top two economies even as Trump offered reprieves to Mexico and Canada.
Mitsui’s automobile and steel products business in Mexico and Canada could be affected by potential U.S. tariffs, though the increasing geopolitical risks from tariffs and retaliatory measures could provide a great business opportunity for the company to help rebuild U.S. supply chains, Shigeta said.
Mitsui’s U.S. domestic businesses such as steel products, used cars and chemicals could also benefit by the tariffs, but shrinking global trade volumes would be a risk, as its business model focuses on solving issues in the global logistics supply chain, he added.
On Monday, Mitsubishi, which led all three consortia winning Japan’s first offshore wind auctions in 2021, said it was reviewing its offshore wind business at home amid soaring costs and the weak yen, signaling that Tokyo’s renewable energy plans are not immune to global trends.
Mitsui, in partnership with others, won an offshore wind farm development right in 2023.
“We are facing challenges due to soaring construction costs and foreign exchange rate fluctuations, but we plan to continue to promote our business firmly,” Shigeta said.
MINING:
Ambler Road project remains in limbo after Army Corps of Engineers waited months to revoke permits
Desiree Hagen, KOTZ, February 3, 2025
Last June, the Biden administration rejected the Ambler Road Project, a proposed 211-mile road that would branch west from the Dalton Highway to a mining district. But the Pentagon did not give the Army Corps of Engineers a directive to revoke the road’s permitting until five days before President Donald Trump’s inauguration. Now it appears that the permits – and the project – may not be dead, but in limbo.
Major development projects need dozens of environmental permits from multiple agencies to move forward. It’s federal law. And for nearly a decade, permitting for the Ambler Road project has been a back-and-forth between presidential administrations.
Several tribes and conservation organizations say the road would cause irreparable harm to the land and subsistence resources. Mining companies and development supporters, including Gov. Mike Dunleavy and Alaska’s congressional delegation, say the road is necessary to access a region that mining companies say could contain valuable deposits of copper, zinc, lead, silver and gold.
Delayed Action?
The first Trump administration greenlit the project. Then multiple lawsuits challenged it. After a lengthy review process, the Biden administration rejected part of the project in June 2024, which canceled the entire thing.
But it wasn’t until Jan. 15 that then-President Joe Biden’s Pentagon ordered the Army Corps of Engineers to kill one set of permits that are critical to the road megaproject — the 404 permits. 404 permitting is part of the Clean Water Act. When developers need to dredge or fill wetlands, they require 404 permits from the Army Corps of Engineers.
The Ambler Road project has these permits to cover the entire length of the road corridor — which includes around 1,431 acres of wetlands, including a half-acre of open water. Corps spokesperson John Budnik confirmed in an email the timeline and the directive to revoke the 404 permits. And he confirmed that the permits instead remain suspended — not quite dead.
Rob Rosenfeld, a consultant for several tribes that oppose the project, believes the Corps dragged its feet and should have killed the 404 permitting after the Biden administration rejected the project in June. Rosenfeld said the Corps’ inaction went against the wishes of 88 tribal governments that oppose the project.
“The intent for the tribes was to have that revoked,” he said. “Finally, in the 11th hour, on Jan. 15, the assistant secretary of the Army issued the order to revoke.”
Rosenfeld said it is uncommon for a commander or his staff to ignore orders issued by a superior officer.
“It was either done intentionally or accidentally,” said Rosenfeld. “The chain of command in the Department of Defense is something that is typically unbreakable. I don’t know if I’ve ever heard of it.”
An uncertain future
On his first day in office, Trump ordered that the Biden administration’s decision on the road be thrown out and replaced with Trump’s own pro-development decision. The 404 permitting remains in limbo.
Budnik shared an official statement from the Corps:
“With the change of administrations and the new Executive Order regarding this project, we are currently pending updated guidance and will have more information as soon as it is available,” it read.
Representatives of multiple pro-road interests, including the Alaska Industrial Development and Export Authority, the state-backed economic development corporation, and three mining companies with stakes in the region, could not be reached for comment.
But the project still faces major obstacles. Alaska Native Corporations Doyon, Limited and Nana Regional Corporation, both landowners along the road’s route, have withdrawn their support of the project. According to Rosenfeld, permitting that was revoked under the Biden administration, like the National Historic Preservation Act Programmatic Agreement, would have to be rewritten, which could take at least a year.
“Nothing will happen quickly,” said Rosenfeld. “I can say the collective we — the environmental organizations, the tribes and those Alaskans that don’t want that road — are going to fight it in the courts.”
Bridget Psarianos is the senior staff attorney for Trustees of Alaska, an environmental law firm based in Anchorage. She said the Army Corps could still revoke the 404 permits, reinstate them or modify them.
In the meantime, though, Psarianos said the permitting is “sort of paused.”