By SUZANNE DOWNING
Aug. 19, 2026 – The Alaska Legislature’s third special session on the Alaska LNG project is effectively dead, and the gasline project’s lead developer says the failure to act will delay the gas line and drive up its cost.
Glenfarne issued a statement Wednesday morning after the Democrat-led leadership of the House and Senate made clear lawmakers would not reconvene to take final action on the property tax legislation sought for the Alaska LNG pipeline.
“Glenfarne remains fully committed to Alaska LNG and to delivering the reliable, affordable energy and economic benefits Alaskans have sought from North Slope gas for decades,” the company said.
“We are disappointed the Legislature has stated they will not take final action on property tax legislation to facilitate the development of the Alaska LNG pipeline,” Glenfarne said. “This will cause schedule delay and cost increase on the gas line.”
The warning confirms what Gov. Mike Dunleavy and supporters of the legislation have said throughout months of negotiations: Every additional delay increases costs, complicates financing and pushes farther into the future the delivery of North Slope gas to Southcentral Alaska.
The legislation would have replaced the conventional property tax on the pipeline during construction with a predictable tax based on the volume of gas transported through the line. Glenfarne has said that certainty is necessary to finance a project expected to cost tens of billions of dollars.
Lawmakers have now spent two special sessions debating the proposal without passing it.
The House approved a clean version of House Bill 381 in June. The Senate then added several unrelated tax provisions, including a corporate income tax targeting privately held oil and gas company Hilcorp. The House rejected those changes, sending the legislation to a conference committee.
The conference committee produced another version, but it failed in the House on a 19-19 vote in July. The Senate had passed that version 11-8.
Dunleavy subsequently called lawmakers into another special session and proposed a compromise that lowered the proposed that S-corporate income tax to a flat 2% and delayed its implementation until Jan. 1, 2030, or until Alaska LNG began delivering commercial gas. The governor also removed a provision that could have reduced state education funding to boroughs along the pipeline route.
Even with those changes, House and Senate leaders declined to bring lawmakers back to Juneau for a final vote.
Glenfarne said the failure to act will make it harder to deliver North Slope gas before declining Cook Inlet production creates an even more serious energy shortage.
“This outcome hinders our efforts to deliver North Slope natural gas to Alaskans as quickly and affordably as possible and to offset declining production and rising costs from Cook Inlet,” the company said.
The developer stressed, however, that Alaska LNG itself is not dead.
“We are evaluating alternative paths forward while continuing to advance the commercial, engineering and financing work required to deliver the full Alaska LNG project, including the LNG export terminal,” Glenfarne said.
The company pointed to Alaska’s need for a dependable long-term gas supply, the enormous natural gas reserves on the North Slope and continued international demand for secure Pacific liquefied natural gas.
“The fundamental case for Alaska LNG remains strong: Alaska needs a long-term solution to its energy supply challenge, the North Slope has one of the largest natural gas resources in the world, global customers continue to value secure Pacific LNG supply, and the project continues to have strong support from Alaskans and the federal government,” the statement said.
Glenfarne also thanked Dunleavy and the lawmakers who worked toward an agreement.
“We appreciate Governor Dunleavy and the many legislators who worked constructively toward a solution,” the company said. “Alaska still needs a long-term solution to its energy supply challenge, and we will continue working with Alaska’s leaders and our global construction and LNG offtake partners to find the best path forward.”
The Legislature’s refusal to act does not end Alaska LNG, but it leaves Glenfarne searching for another way around a problem lawmakers had the opportunity to solve.
Meanwhile, Cook Inlet gas production continues to decline, utilities are preparing to import natural gas, and Alaska families and businesses face the prospect of paying increasingly higher energy bills.