JERA, the world’s biggest buyer of liquefied natural gas (LNG), said a cargo of LNG from the U.S. Freeport project arrived at its Kawagoe thermal power station in Mie on Thursday, marking the first delivery from the project to Japan.
The Freeport LNG project in Texas, United States, started production at its first liquefaction train last August and shipped its first cargo in September, adding to a global LNG surplus.
JERA’s first cargo, carrying about 70,000 tonnes, is also the first cargo from Freeport’s LNG project to reach Japan, where a mild winter has added to the over-supply and prompted another LNG company Osaka Gas to sell on some of its contracted LNG from Freeport to Europe.
Osaka Gas and JERA, a joint venture between Tokyo Electric Power Company Holdings Inc and Chubu Electric Power Co Inc, are expected to each lift half of the first train’s total contracted capacity of about 4.64 million tonnes per annum (mtpa).
Freeport has liquefaction tolling agreements with Osaka Gas and JERA from Train 1 for approximately 20 years. Under the deal, both companies will secure LNG without destination restrictions, increasing selling and pricing options.
JERA plans to bring some supplies to Japan and sell others to companies mainly in Europe, a JERA spokesman said.
Source: Reuters (Reporting by Yuka Obayashi; editing by Barbara Lewis)