Tokyo Electric Power Co., the largest Japanese LNG importer and now controlled by the government after the disaster at its Fukushima nuclear plant, forecast net losses for the year to March 2013 of 120 billion yen ($1.3 billion), just a fraction of the previous year's losses.
The loss is in line with what Tepco forecast in May 2012. The stricken utility, whose LNG purchases are now running at around 18 million tonnes per annum, lost 620Bln yen ($6.7Bln) in the previous fiscal year.
Analysts said the net loss forecast should be viewed relative to the rising costs of LNG imports in Japan. Tepco currently pays for about one-fifth of the nation's supplies.
While Tepco was brought to the brink of bankruptcy by the disaster and had to be bailed out by the government to the tune of 1 trillion yen in exchange for 50 percent of its shares, it is slowly emerging from one of the biggest disasters in corporate history.
Japan has 10 power utilities using regasified LNG for generation and Tepco's LNG purchases are followed in scale by those of Chubu Electric.
There are also 200 or so city-gas companies in Japan about half a dozen are major LNG buyers on world markets, including companies such as Tokyo Gas and Osaka Gas.
Currently only two of the nation's 54 nuclear reactors are in operation and LNG has been one of the main replacement fuels for lost nuclear capacity as gas-fired power generation has increased.
Japan's future LNG requirements depend also on how the new government tackles the shutdown for safety reasons of nuclear power plants nationwide.
Tepco shares fell almost 2 percent to 205 yen on February 5 on the Tokyo Stock Exchange, a 90 percent decline since the day before the March 11 earthquake and tsunami almost two years ago caused the meltdown of three reactors at Fukushima.
The utility is still facing a growing bill for compensation payments, estimated at more than 10 trillion yen, and for the work to dismantle the Fukushima plant and for cleaning up areas polluted by radiation.
A public-private body, the Nuclear Damage Liability Facilitation Fund, which was created to deal with the disaster, is providing the aid. This must be repaid by Tepco at some time in the future.
