(Bloomberg) -- The state of Alaska is in talks with Hilcorp Energy and ConocoPhillips to secure natural gas for a project that would that would liquefy the fuel for export to Asia.

Governor Mike Dunleavy and Frank Richards, president of Alaska Gasline Development Corporation, met with officials from both companies during a visit this week to Houston about securing feedgas for the Alaska LNG project, the governor told Bloomberg in an interview. While terms of the discussions were not disclosed, the project has a federal permit to make and export 20 million tons of liquefied natural gas per year.

ConocoPhillips said it supports selling gas from the wellhead to the Alaska LNG project. Privately held Hilcorp didn’t respond to a request for comment. 

Both companies are active drillers in Alaska, with ConocoPhillips producing 70.9 billion cubic feet of natural gas last year and Hilcorp nearly 3.4 billion.

The feedgas talks come on the heels of a June trade mission to Japan where Dunleavy and Richards met with company officials from JERA, Tokyo Gas, INPEX and other potential customers. The project has signed letters of intent with Asian buyers whose identities are protected by non-disclosure agreements, Richards said. A final investment decision is expected by early 2024 and production could start in 2027. 

Global natural gas prices have increased dramatically following Russia’s Feb. 24 invasion of Ukraine, increasing the prospects of LNG exports to Asia along the Pacific Coast. From the Alaska site, costs to deliver the fuel to Asian ports are $6.70 per million British thermal units. U.S. Gulf Coast projects are producing LNG for $7.50 per million Btu, while buyers are paying $50 in Europe and $39 in Asia for spot cargoes, according to BloombergNEF. 

(Updates with comment from ConocoPhillips in third paragraph.)

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