LNG

Électricité de France, the French utility business known as EDF and a former large player in the LNG market before partially pooling its activities separately with Japan’s JERA Co. Inc., is now being overtaken by its financial difficulties amid concerns about future power shortages in the country.

The French government outlined its plans to take full control of the utility EDF whose assets include gas-fired power and nuclear plants as well as LNG volumes and trading, mostly now handled by JERA Co. Inc. of Japan under a joint venture.

July 19 (LNGJ) - EDF Trading, a wholly-owned subsidiary of French utility and energy company EDF S.A., has named Alex Watson as its new Head of Gas Trading. Watson took up the role on July 19 and reports to Marcello Romano, Head of Trading. “I’m delighted to welcome Alex to EDF Trading,” said Marcello Romano.

   “He has extensive knowledge of the natural gas and LNG markets and will help us to expand our global gas footprint and the services we provide to the EDF Group and our third party customers,” added Romano. Watson joined EDF Trading from Freepoint Commodities where he was a Cross Commodity Trader. Prior to that, he was a European Natural Gas Trader at Citigroup.

EDF Trading, a wholly-owned subsidiary of French utility EDF SA, has made several executive changes along with many other companies in the energy business emerging from the Covid-19 pandemic.

EDFT has named Valentino Scavardone as its new Head of Origination for Europe and appointment of Sylvie Billion as its new Chief Financial Officer.

Scavardone in his now role in Origination for Europe will report to Philipp Büssenschütt, EDF Trading’s Chief Commercial Officer.

“The energy market landscape continues to evolve with new opportunities developing especially in the renewables markets and the European Gas markets through increasing LNG imports,” explained Büssenschütt.

“Valentino and our Origination team will be working alongside our trading teams to develop new products, identify areas for expansion and continue to grow our customer flow business,” stated Büssenschütt.

Scavardone said he was looking forward to growing the Origination business and supporting the EDF Group and its customers.

Valentino joined the previous EDF Trading (EDFT) entity in 2010 as a Senior Originator and was appointed Head of Southern Europe Origination in 2013.

Prior to joining EDFT, he was at the French-Belgian firm Electrabel-GDF Suez and E.ON of Germany.

EDF Trading named a new CFO in Sylvie Billion, who will report to Béatrice Bigois, Chief Executive, and will be a member of the company’s Executive Committee.

“I’m delighted to welcome Sylvie to EDF Trading. She has extensive international experience of leading and working in financial risk and asset liability management,” stated CEO Béatrice Bigois.

Billion joins EDF Trading from EDF where she was also CFO and an Executive Committee Member for the International Division.

Previously Billion held roles at French bank BNP Paribas, multi-national firm Accenture and Dutch bank ABN Amro Group before joining EDF in 2001 as Group Financial Risk Controller.

She later became Group Treasurer in charge of Treasury, Group Financing, Capital Markets and Asset Management and in 2010, she moved to EDF distribution subsidiary ERDF as CFO and a member of the Executive Committee.

Billion left EDF temporarily in 2013 to 2019 to join the Executive Committee of the Global Fund, a multilateral financing institution as CFO and Head of the Finance, IT, Sourcing and Administration Division.

French firm EDF Trading, a leader in the international wholesale energy markets and a partner of Japanese LNG trader JERA Global Markets, has entered the Japanese power market.

Axpo, the Swiss renewable energy producer and global energy trading firm, is opening an office in Singapore to become the latest firm to join Asia's growing liquefied natural gas trading market in the city-state where 50 LNG trading and shipping firms have offices.

JERA Co. Inc., the Japanese utility and energy company and the world’s largest LNG buyer, said Chita LNG terminal in Aichi Prefecture received its 4,000th shipment with the arrival of the 126,000 cubic metres capacity “Senshu Maru” carrying volumes from Indonesia.

April 10 (LNGJ) - JERA Global Markets, the merged trading entity of JERA of Japan and French firm EDF Trading, launched its LNG activities with the purchase of an cargo from Woodside Energy Trading of Singapore. The cargo will be sourced from the Wheatstone LNG project in Western Australia and will be delivered to one of JERA’s LNG terminals in Japan during May. “We are delighted to be up and running as JERA Global Markets and the team and I look forward to expanding our LNG activities in the Asia-Pacific region,” said Kazunori Kasai, Chief Executive Officer, JERA GM.

JERA Co Inc., the largest Japanese liquefied natural gas buyer and power assets owner, said it was overhauling its business while increasing its medium-term LNG activities with a larger carrier fleet as it aimed for 3.6 trillion yen ($33 billion) of sales in fiscal 2019.

The company said it now had volumes of LNG amounting to 35 million tonnes per annum, upstream investments in five projects and was increasing its LNG fleet from 18 vessels to 25 to ship its cargoes.

However, while LNG activities would focus on growth through 2030, after that date Japan’s needs for power generation could be different.

For its power generation arm of Tokyo Electric Power and Chubu Electric, JERA controls domestic power capacity of 67 gigawatts and a total of nine gigawatts of overseas output.

JERA said the direction was uncertain for Japan’s future power mix, though by 2030 it could have 20-22 percent nuclear power units in operation, 24-22 percent made up of renewable energy projects, 27 percent gas-fired plants supplied with regasified LNG, 26 percent coal-fired plants and 3 percent oil-fired plants.

Under the transition, Japan could replace more plants requiring LNG with renewable projects than other generating facilities, leading to a possible future decrease in LNG imports of around 14 percent after 2030.

The 2030 energy mix numbers differ significantly from the 2016 figures of 16 percent nuclear, 41 percent gas-fired plants using LNG, 33 percent coal and 10 percent oil.

“Population shrinkage and sluggish demand means that a constant growth of domestic demand for electricity can’t be expected in the future,” according to JERA.

Its figures suggest the Japanese population could drop to 93 million people by 2060 from 128 million at present.

JERA explained that its company structure would now comprise three separate departments overseeing the five main sectors of its business, fuel markets, fuel procurement, power plants, electricity sales and the domestic electricity market.

JERA said the role of its “Optimization Department” would assume greater importance in the future.

“It will be responsible for increasing profits through operational excellence in power plants and fuel terminals, as well as market trading of fuel, electricity and gas, based on the existing agreements,” said the company.

The company’s “Business Development Department” would also have a key role.

“It would increase returns by achieving the optimal asset portfolio through new installations and the replacement and restructuring of power plants,” added the company.

JERA’s “Operations & Maintenance Department” would be responsible for boosting returns by achieving high value-added services through “agile operations and cost reductions” in utilizing its infrastructure.

The company said it would use LNG and renewables to spark the transition to a clean-energy economy up to 2025.

“Through enhancing the LNG value chain and undertaking large-scale renewable energy development and constructing a complementary relationship between LNG-fired power and renewables, JERA will provide stable, economic and clean energy,” stated the company.

JERA said it would also implement “six measures” to achieve its strategy goals and to be a world leader in LNG and renewables.

“For LNG, we would maintain and expand our fuel procurement scale through replacement of domestic power plants with more efficient facilities and with expansion of generation,” it explained.

“We would leverage that scale for LNG trading expansion and upstream project participation and improve profitability along the entire value chain,” JERA added.

“For renewable energy, we would leverage our large-scale project development competence that we gained from the existing projects, promote development focusing on offshore wind power in particular, and grow it as one of the main pillars of the business in our future portfolio,” stated the company.

Jera Trading (Jerat), the joint trading venture between Japanese LNG and fuel procurement and utility company Jera Co. Inc. and French firm EDF Trading established in April 2017 following the acquisition of EDFT’s coal business, is continuing its countdown to becoming Jera Global Markets.

Jerat is strengthening its team by hiring a senior trader from global commodities firm Vitol.

Jerat said Alex Baileff would join the company in April as Senior Vice President for Coal.

“We are looking forward to welcoming Alex to Jera Trading. He brings with him a wealth of knowledge and trading experience which will be an asset to our coal and freight activities as we develop Jerat’s global footprint,” said Sunao Nakamura, Chairman of the Board of Jera Trading.

Jera and EDF Trading signed an agreement last year to form an LNG optimization and trading joint venture whereby Jera’s and EDFT’s LNG trading activities would be merged into Jerat, which will be renamed Jera Global Markets.

This agreement is expected to be completed in early 2019. Baileff will join Jerat’s senior team comprising Kazunori Kasai, Chief Executive; Robert Quick, Director of Corporate Affairs; Hisaki Endo, Director of Group Coordination; Ronan Lory, Chief Operating Officer; and Sarah Behbehani, senior Vice President of LNG.

Jera Co. Inc is the main company in all the operations. It was set up by Tokyo Electric Power Co and Chubu Electric to combine their LNG and other trading activities and ultimately to run their power businesses as the industry in Japan reformed and was deregulated.

On the trading front, the new Jera Global Markets will have more than 300 people and offices in Japan, Singapore, the UK, the US and the Netherlands, Jerat will become one of the largest utility-owned seaborne energy optimizers, spanning Asia, the Pacific and the Atlantic Basins.

The two firms noted that as the demand for LNG in Japan becoming increasingly variable and difficult to predict and with the ramp-up in US liquefaction and exports, Europe has become a key balancing market for excess global LNG.

Jera and EDFT have said there is significant room for optimizing LNG on a global basis, establishing a more liquid market, and over time developing a clear pricing signal for LNG in Asia.

Jera Co. Inc. holds 66.67 percent of the equity in Jerat through its wholly-owned subsidiary Jera Trading International while the French firm holds 33.33 percent of the Jerat shares.