The Alaska State Capitol building in Juneau. (Loren Holmes / ADN)

The Alaska House Finance Committee on Wednesday unanimously voted to move a bill to the House floor that would give the Alaska LNG megaproject a major tax break to support its construction.

The project developer, Glenfarne, and Gov. Mike Dunleavy immediately expressed support for House Bill 381, which eliminates property taxes for the megaproject and creates a much smaller tax based on the amount of natural gas that flows through it.

The action, in a bipartisan 11-0 vote, opens the door for the full House to take up the bill starting Friday morning.

The legislation still has a long way to go.

If it passes the House, it would then head to the Senate, where lawmakers have generally been more resistant to a steep tax cut for the project.

“The hard work by committee members produced a thoughtful bill that, if passed by the legislature, will enable Alaska LNG to go forward and unlock the long-awaited benefits of Alaska’s North Slope natural gas resources while protecting the state’s interests,” said Adam Prestidge, Glenfarne Alaska LNG president, in a statement.

Glenfarne Alaska LNG president Adam Prestidge gave an Alaska LNG update during the Legislative Budget and Audit Committee meeting at the Anchorage LIO on Nov. 19, 2025. (Bill Roth / ADN)

Dunleavy, on social media, said the legislation provides “certainty and stability” for the project.

“I appreciate the committee’s work and look forward to continued progress as this important bill now moves to the House floor and on to the Senate,” he said. “Alaska has a tremendous opportunity before us, and this bill is a critical step toward making the Alaska LNG Project a reality.”

The vote marks a key step for a proposal that has been generations in the making — selling vast quantities of natural gas from the North Slope to Alaskan and Asian buyers.

Alaska LNG, the latest iteration of that concept, has been in the works for more than a decade.

Alaska LNG would consist of three primary facilities: a gas treatment plant on the North Slope, an 800-mile gas line to Southcentral Alaska, and a plant in Nikiski to make liquefied natural gas, or LNG, for overseas exports.

Glenfarne has proposed building the pipeline in Phase 1, to provide gas for use in Southcentral, starting in 2029. The exports, after construction of the rest of the project, would start in 2031, the developer has said.

Glenfarne has also estimated the project will cost as much as $55 billion, though critics say the price tag will likely be higher.

Supporters of the project have argued that even with the property tax cut, Alaska LNG will still bring tens of billions of dollars in other revenue for the state and local communities over 30 years.

They say it will also create thousands of new jobs and support the state’s future economy while providing an affordable source of natural gas to replace a shortfall in Southcentral Alaska as production levels continue to decline in Cook Inlet.

Those benefits won’t happen if the gas stays in the ground, Alaska LNG supporters say.

Opponents of the project have raised concerns that Glenfarne has not provided sufficient information about the project to support a tax cut from the state. They fear the massive project could falter partway through, leaving Alaskans with extremely high energy costs and, potentially, part of the project bill.

The Alaska Gasline Development Corp., a state agency, is a 25% owner of the project.

The bill advanced by the House Finance Committee is a modified version of a measure Dunleavy introduced in the Legislature halfway through the regular session, in March.

Committees in the Senate and House spent weeks studying that project and modifying the bill.

But negotiations to move a bill forward in the House fell apart near the end of the regular session in May.

At the time, House Majority Leader Chuck Kopp, an Anchorage Republican, had introduced a measure meant to satisfy the governor’s demands.

But it failed to move forward after House members adopted an amendment, by one vote, to allow the North Slope and Kenai Peninsula boroughs to retain some property taxing authority over the plants in their region, and to use tax relief to gain equity in the project.

Glenfarne had said that path wouldn’t work for the project.

In response, Dunleavy vetoed a bill creating a new public pension system that had been a top priority for lawmakers.

He immediately called lawmakers into a special session, which ends on June 19, to work on a gas line tax package.

On Wednesday, the House Finance Committee removed the language that provided the boroughs with that autonomy.

Several committee members voted to add language establishing the tax structure the governor sought, with the property tax eliminated in exchange for the tax on gas volumes.

Approving that change were Reps. Will Stapp of Fairbanks, Jamie Allard of Eagle River, Jeremy Bynum of Ketchikan, Elexie Moore of Wasilla and Frank Tomaszewski of Fairbanks — all Republicans in the minority caucus — along with independents Alyse Galvin and Calvin Schrage, both majority members from Anchorage.

Reps. Andy Josephson of Anchorage, Neal Foster of Nome, Sara Hannan of Juneau and Nellie Unangiq Jimmie of Toksook Bay, all Democrats in the majority caucus, opposed that change.

Under the bill, the so-called alternative volumetric tax would bring in $120 million in annual revenue once the project is at full operation and exporting gas, said Ken Alper, an aide to Josephson, who is co-chair of the House Finance Committee.

That’s more than the $76 million alternative tax that Dunleavy had originally proposed, said Alper, who has a background in Alaska oil and gas taxation.

But it’s less than the $450 million that the Senate version had proposed.

It’s also much less than the property tax would have brought in, potentially $1 billion in the project’s first year alone.

House Majority Leader Chuck Kopp, an Anchorage Republican, standing, spoke in support of overturning Gov. Dunleavy’s veto of a public pension bill during a joint session at the Alaska State Capitol in Juneau on May 19, 2026. (Bill Roth / ADN)

After last month’s breakdown in negotiations and the governor’s veto of the pension bill, Kopp had expressed frustration with Dunleavy’s relationship with the Legislature.

But on Wednesday, the House majority leader expressed high hopes that the House will pass the bill.

The bill is a “good compromise” that supports the project, Kopp said.

“While I’m sure that technical cleanups may arise on the House floor this week, I don’t foresee major changes being needed to get this bill to the Senate,” he said.

The bill that moved to the House floor contains requirements for a spur line to Fairbanks; that the developer will pay into a community impact fund of at least $40 million and up to $80 million; and for a labor agreement for construction.

The House Finance Committee this week also added a cap on natural gas prices of $16 per MMBtu, rising with inflation, to protect Alaska ratepayers.

That amendment, brought by Josephson, is based on a proposed contract between Enstar, Southcentral Alaska’s gas supplier, and Glenfarne.

Josephson had argued in the committee Wednesday that the tax abatement should end after 10 years, rather than the 30 years that’s proposed in the bill.

He said in an interview after the vote that he has additional concerns that the proposed tax cut is too large, and that the North Slope and Kenai Peninsula boroughs won’t receive enough revenue.

He said he didn’t oppose moving to the bill to the floor, recognizing that it had enough support to advance out of the committee.

But he said his position on the bill may change when the bill is up for a floor vote.

It’s possible the House could approve the bill as early as Friday, sending it to the Senate, Josephson said.

House Finance this week also added a measure to prevent energy ratepayers from being saddled with costs related to any cost overruns. That was proposed by Galvin.

After the vote by the committee, Allard called the measure “historic.”

“It’s good for every single child, man and woman across Alaska,” she said.

Tomaszewski called the bill a “reasonable compromise” and likened the construction of a major gas line project to the 800-mile trans-Alaska pipeline project built in the 1970s.

“I’m looking forward to the groundbreaking ceremony on this project,” he said. “It will be transformational for the state.”