Exxon Mobil has decided to pull out of the proposed natural gas export terminal in Alaska amid growing concerns over the profitability of the project.

The company said that it would work with its partners- BP and Conoco Phillips- to sell its stake in the project to the state government, The Wall Street Journal reported.

Exxon spokesman was quoted by the publication as saying that the company will not invest in the next stage of the development of the project, which is “transitioning to a state project.”

Currently, Exxon holds one-third of stake in the project, according to the state. The other players in the project BP and ConocoPhillips hold a stake of 20% each.

In November 2015, the Alaskan government acquired 25% interest in the project from TransCanada for $65m.

The project known as Alaska LNG is expected to cost between $45bn and $65bn.

BP and ConocoPhillips have also decided not to continue with the project. The two companies, including Exxon, have told the state legislators that the project is not economically viable, Platts reported.

However, the state of Alaska is examining various alternatives for the development of the project, including its ownership.

BP's Alaska regional manager Dave van Tuyl said: “BP is not giving up on the project. Instead, we need to change gears and figure out how to reduce the cost of supply so that the project can be competitive.

"We believe that the best way to make that happen is with a state-led project and we support the state's efforts."

Exxon manager Steve Butt said that the preliminary engineering for the project will be completed in mid-September

However, under the current ownership structure, Alaska LNG will not go head with the “more costly" final engineering phase, which was scheduled for 2017.