Japanese monthly LNG imports edge lower but record 2012 deliveries are still expected

Friday, 21 September 2012
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Japanese LNG imports dropped 3 percent last month to 7.3 million tonnes as Japan's utilities and city-gas companies paid a total of $6.8 billion for LNG in August, and still expected to receive record deliveries in 2012.

The country's LNG buyers paid an average price of $17.85 per million British thermal units for cargoes, according to preliminary monthly Japanese customs figures.

The price Japan pays for its LNG continues to be a sensitive issue because of oil-indexation applied to Japan's imports, as opposed to the hub prices available in Europe and the US.

Earlier this week, the powerful Japanese Ministry of Economy, Trade and Industry (METI) held a ministerial-level LNG conference in Tokyo for representatives from producing and consuming countries.

The conference came up with no new issues or positions, with Japanese delegates opposing oil-indexation and producers defending it.

Japanese Economy Trade and industry Minister Yukio Edano told the conference that as Japan increased its LNG use because of changing energy policies after the Fukushima disaster it was seeking efforts to rectify the huge price disparities in different regions.

"LNG imports have grown rapidly since the nuclear crisis, shooting up from 70 million tonnes in 2010 to an expected 90 million in 2012," Edano said, in urging a change in pricing regimes.

Mohammed Saleh Al-Sada, Minister of Energy of Qatar, the world's largest LNG prodcuer, told the Tokyo conference the oil-indexed pricing system was reliable, and provided a stable investment environment to produce LNG.

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