Japan’s Top LNG Buyer to Sell Excess Gas in Global Markets

Japan's primary LNG consumer and principal power generator, JERA, has announced plans to sell liquefied natural gas in international markets in the future, as part of its strategy to access global LNG markets and dispose of any surplus gas supply when domestic demand is reduced, according to a senior executive. Irtiza Sayyed, the chief executive officer of the newly-formed JERA Global Energy Solutions, disclosed this in an interview with Bloomberg on Wednesday.

Earlier this summer, JERA disclosed its intention to establish a wholly-owned subsidiary to develop and oversee its LNG, upstream, low-carbon fuels, and shipping businesses. The new entity, JERA Global Energy Solutions (JERA GES), is JERA's response to the increasingly unstable and complex energy markets. JERA GES, which will be based in Singapore, will concentrate on "creating a stable and diversified long-term LNG portfolio that balances supply sources with market opportunities, while advancing lower-carbon fuels such as ammonia and hydrogen," the company declared in July.

Due to the current instability in global LNG markets, JERA signed a 20-year contract with Malaysia's state-owned company Petronas to supply liquefied natural gas starting in 2028 in early this year. Japan is one of the world's most energy-dependent nations, with a significant portion of its oil and gas historically originating from the Middle East.

The war-induced disruptions in export flows have compelled Japan to accelerate its efforts to secure alternative sources. JERA GES aims to capitalize on market opportunities in LNG sales as numerous other importers are seeking to diversify their gas supply in light of the Middle East crisis and the intermittent LNG supply from Qatar and the United Arab Emirates for months.