LNG

Osaka Gas, the Japanese utility and leading liquefied natural gas importer, plans to launch the company’s first ship-to-ship LNG bunkering business for customers in the Osaka Bay and the Seto Inland Sea areas of Japan.

The operations will be led by a specialized LNG bunkering vessel from fiscal 2026.

“This commercial undertaking will see Osaka Gas supplying fuel to LNG-powered ships using stocks taken from Osaka Gas import terminals” said the company, a unit of the Daigas Group.

The Osaka Gas import facilities, which additionally offer truck-loading for fuel users, include the Himeji terminal with eight storage tanks with a combined 740,000 cubic metres of capacity.

The utility’s biggest terminal is the Senboku II facility with 1.43 million cubic metres of capacity in 16 storage tanks.

The Osaka Gas global LNG supply portfolio includes cargoes from the US Freeport plant in Quintana Island in Texas, Oman LNG and from the Chevron-operated Gorgon export plant in Western Australia.

It also has Australian offtake from the Woodside-operated North West Shelf plant and the Darwin plant in the Northern Territory.

Its other main suppliers include Papua New Guinea LNG and the Russian Far East plant on Sakhalin Island.

Partners

The company said that the bunkering vessel construction would be led by Osaka Bay LNG Shipping Co., a company jointly established by Osaka Gas International Transport, NS United Coastal Tanker Kaisha Ltd. (NSUT) and Kobe-Osaka International Port Corp.

Under the agreements, Osaka Bay LNG Shipping would own the LNG bunkering vessel to be constructed under the government’s subsidy programme for clean energy and NSUT, an established LNG coastal vessel operator, will manage and operate the vessel.

Osaka Gas said that HPC would promote the business and LNG bunkering across the shipping industry in Japan in cooperation with the relevant government agencies.

The utility company said it was broadening its business to benefit from the increasing number of LNG-powered vessels expected to come into operation due to the global trend for cleaner marine fuel.

“The Daigas Group intends to expand the LNG bunkering business and achieve the commercialization of e-methane and its application to bunkering,” Osaka Gas added.

Osaka Gas, the Japanese utility and liquefied natural gas buyer, reported increased net sales for the first nine months of the fiscal year, though posted losses blamed on the June 2022 fire at the US Freeport LNG export plant.

The company, which is part of the Daigas Group, said nine-month 2022 sales to the end of December increased to 1.59 trillion yen ($12.16Bln), a rise of 536.4Bln yen ($4.8Bln) over the same period of the previous fiscal year.

“This was primarily due to an increase in sales from a rise in the LNG selling prices and the higher unit selling price of city gas under the fuel-cost adjustment system in the domestic energy business and an increase in sales from the upstream project in the USA and Australia in the International Energy Business,” said Osaka Gas.

However, Osaka Gas whose President is Masataka Fujiwara, said ordinary profits decreased by 78.5Bln ($597 million) to a year-on-year nine-month loss of 6.8 billion yen ($51.8M).

Profit attributable to owners of parent company fell by 56.5Bln yen ($430M) to a net loss of 1.3Bln yen ($9.9M).

“A fire broke out at the liquefaction plant of the Freeport LNG project, one of the Daigas Group’s investments and LNG sources and the project’s operations at the plant have been suspended since,” said Osaka Gas in its earnings report.

Replacement cargoes

“In response to the shutdown, we have been preparing to secure replacement LNG for the volumes the Group originally planned to procure from the project during the shutdown period and has been arranging modification regarding the contracts related to its LNG procurement from the project,” added Osaka Gas.

The utility said that considering recent trends in its performance and other factors, the company has increased its full-year sales forecast to the end of March 2023 but will forecast a loss on the problems at Freeport.

“Net sales are expected to exceed the previous forecasts mainly due to the rise in the unit selling price of city gas under the fuel cost adjustment system,” it added.

It additionally expects operating profits and ordinary profits to remain unchanged from the previous forecasts.

“This means they will feel the negative impact, including increases in costs and losses associated with the fire at the liquefaction plant of Freeport LNG, but offset by positive impacts, including an increase in profits from city gas caused by the improvement of our long-term LNG contract competitiveness,” explained Osaka Gas.

Osaka Gas said the revised full-year earnings forecast to March 2023 includes the estimated negative impact of around 149.5 billion yen ($1.14Bln) due to costs, losses and a  revenue decrease associated with the Freeport fire.

Osaka Gas, the Japanese utility and LNG importer, has reached an agreement with trading house and LNG sector participant Marubeni Corp. and Peru LNG for a feasibility study on the production of synthetic methane (syngas) in the South American nation.

Osaka Gas, the Japanese utility and one of the nation’s top six LNG importers, said its engineering subsidiary was awarded a contract for the large expansion project at the Tai-Chung LNG import terminal in Taiwan.

A group of Japanese utilities and energy companies will be receiving more liquefied natural gas volumes for the Soma LNG terminal after the new Fukushima Natural Gas Power Plant started to generate electricity at full capacity from its two units in the prefecture where the nuclear plant exploded during an earthquake and tsunami in 2011.

Osaka Gas, the Japanese utility is advancing its strategy of US shale investments and with world-class LNG supplies backed by a gas-fired power generation model for Japan and Asia.