Japan, the world’s largest importer of liquefied natural gas, plans to seek more U.S. cargoes to ensure adequate power supplies after its use of nuclear reactors fell to an all-time low.
Japan’s senior vice minister of trade and industry, Seishu Makino, asked U.S. Energy Secretary Steven Chu at a meeting yesterday in San Francisco to increase LNG exports, Akinobu Yoshikawa, deputy manager for the Petroleum and Natural Gas Division, told reporters today in Tokyo.
“I believe we gained the U.S.’s understanding to some extent,” said Yoshikawa. “We can’t buy LNG from the U.S. unless the Department of Energy approves LNG plant owners to export. There is one plant that recently won the approval and there are two others in progress.”
Cheniere Energy Inc. (LNG), the Blackstone Group LP-backed owner of Sabine Pass terminal in Louisiana, got approval to ship LNG to Japan in May. The Freeport LNG terminal in Texas and the Lake Charles terminal in Louisiana are now seeking approval for exports, according to Yoshikawa. Japan imported 70,873 metric tons of LNG from the U.S. in the four-month period by July, down 60 percent from the same period last year, according to data compiled by the Ministry of Finance.
Annual LNG output at Sabine Pass is around 15 million tons, Yoshikawa said. “Not all of the 15 million tons will be exported to Japan, but I believe the impact for our imports will be big,” he said.
Tokyo Electric Corp. and Tokyo Gas Co., the first Asian buyers of LNG, had a joint contract to buy the fuel from a plant in Alaska owned by ConocoPhillips (COP) and Marathon Oil Corp. (MRO) The contract, initially signed in 1969, expired at the end of March this year, Tokyo Electric’s spokesman Ryo Shimizu and Tokyo Gas spokesman Takeshi Ujiie said by phone today. They declined to comment whether the two companies still buy spot cargoes of LNG from the project.
Japan’s 10 regional power utilities’ imports of liquefied natural gas rose to a record for a second month in August. Of the 54 reactors in the country, 41 units were idled because of the meltdown at the Fukushima Dai-Ichi plant after the March 11 earthquake and tsunami, maintenance and other disruptions at the end of August, according to data compiled by Bloomberg News.
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