Japan's JERA looks to Alaska and Qatari LNG to meet demand, diversify supply
Japan's top power generator JERA is ramping up its interest in U.S. liquefied natural gas, particularly from Alaska, and is in talks with QatarEnergy to secure faster, more efficient supply routes to Japan, a senior company executive told Reuters.
The company is actively exploring new LNG sources beyond its traditional suppliers, to meet Japan’s growing energy needs as AI-driven data centers drive up demand for power, said Ryosuke Tsugaru, JERA's Chief Low Carbon Fuel Officer.
Besides increasing its long-term commitment to U.S. LNG, JERA is keen on securing supplies from Alaska LNG due to its proximity to Japan, Tsugaru said during an interview at the Gastech conference in Milan.
"Alaska has huge reserves, otherwise stranded. And Alaska is close to Japan, as opposed to 35-40 days required to bring (U.S. Gulf Coast) cargo to Japan. You can take Alaska LNG probably within eight days," he said.
On Wednesday, JERA signed a letter of intent with Alaska LNG developer Glenfarne to explore 1 million metric tons a year offtake for 20 years on a free-on-board basis.
Meanwhile, JERA is pushing for a swift conclusion to its current talks with QatarEnergy, one of the world's largest LNG suppliers, for a long-term supply deal from Qatar's North Field expansion project.
JERA did not renew a 5.5 MMtpy supply agreement with Qatar when it expired in 2021.
"We see significant presence or exposure of Qatar in global LNG markets... Because of that, I'm very keen to re-establish the long-term LNG partnership between Qatar and JERA," said Tsugaru, adding that several issues still need to be resolved before a deal is finalized.
He added that JERA is also open to equity investment opportunities in Qatar: "Anything we consider mutual interest, I'm happy to look into, that includes potential equity participation."
Russia's Sakhalin-2 project remains an important part of JERA's supply mix. The company currently holds two contracts with Sakhalin-2, one for 0.5 MMtpy through 2026 and another for 1.5 MMtpy until 2029.
JERA handles 30-35 million tons of LNG annually, with almost half sourced from the Asia-Pacific region, including Australia, Malaysia, Indonesia and Russia.
Looking ahead, Tsugaru warned of a potential global supply glut due to capacity additions, but later than earlier predictions of 2028.
"Real timings of capacity addition will be pushed back. So that massive capacity addition will occur, in my view, later in 2030 to 2031."
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