WSJ: Turn Gas Into Geostrategy

After the Fukushima disaster, Japan shut down its nuclear power plants, eliminating overnight 30% of its capacity to produce electricity. To fill that gap, Japan imported some 80 million tons of liquefied natural gas this past year at a cost of $66 billion. Meanwhile, Alaska is poised for an explosion in natural gas production. This should mean a good trade for both countries, but U.S. politics—no surprises here—is getting in the way.

Japan's demand for natural gas is high and growing. With the nation's nuclear power unlikely to make a full comeback, Japanese companies will continue to consume vast amounts of imported LNG from various corners of the world.

But one corner of the world that has hardly made a dent in this new market is Alaska. America's northernmost state has the gas reserves to meet a substantial part of Japan's demand. Estimates suggest that the North Slope fields and reserves on the outer continental shelf hold as much as 236 trillion cubic feet of gas—enough to serve the Japanese utilities' needs for over 90 years at current rates of consumption.  MORE