Foreign Policy: For Alaska (and Qatar and Mozambique and Russia) China is the hub of hope

What do you do if you have the natural gas equivalent of 6 billion barrels of oil, and no way to get it to a market? And what if you are uncertain that there will ever be a profitable market for this stranded treasure, at least in the coming couple of decades?

If you are Alaska and the Big Oil companies drilling there, you check the numbers, and check them again, but know that ultimately you will be gambling based on the following calculus: In the glutted U.S., natural gas prices are at their lowest in a decade, under $2 per 1,000 cubic feet; in Asia, the same volume of gas is selling for up to ten times that sum, or $20.

So it is that BP, ConocoPhillips and ExxonMobil are contemplating spending $40 billion for a liquefied natural gas system to emancipate their natural gas riches on Alaska's North Slope, and shipping it on to Asia, as I have written at EnergyWire.

If they proceed, which seems likely, they will be locked in battle with far-flung gas sellers -- Qatar, Russia, Australia and Mozambique among them -- who are already piling in to take advantage of Asia's high prices and voracious appetite. In particular, they are piling in to China.  MORE