LNG

The Japan Bank for International Cooperation has accorded and underwritten loans of more than $800M for a natural gas field, gas pipelines and power projects in Vietnam.

The Japan Bank for International Cooperation (JBIC) has signed a US$1 billion loan agreement to help finance the Scarborough Gas Project in Western Australia to provide feed-gas supplies for the Train II development at Pluto LNG operated by Woodside Energy.

Petróleo Brasileiro S.A., the Brazilian major known as Petrobras, has signed an accord with Turkey’s Karpowership to combine their expertise to expand projects in Brazil in the floating liquefied natural gas, regasification and liquefaction sectors.

April 1 (LNGJ) - Japan Bank for International Cooperation (JBIC) confirmed the signing of a loan agreement amounting to up to US$390 million (JBIC portion) with Singapore- headquartered Trafigura Pte Ltd. The loan is co-financed with Japan’s Sumitomo Mitsui Banking Corp., bringing the total co-financing amount to around US$560M.

   “Trafigura is a major supplier of resources including liquefied natural gas as a market leader in the global commodities industry. The loan is intended to provide the funds required for a Japanese utility company to import LNG from Trafigura,” said JBIC. “Amid the growing global demand for LNG and the increasing uncertainty over resource prices, the loan, which supports the Japanese utility company in procuring term LNG through Trafigura, will contribute toward securing a stable supply of LNG, which is an important energy resource for Japan,” added JBIC.

Sempra Infrastructure, a subsidiary of US utility Sempra and whose projects included Cameron LNG in Louisiana, Port Arthur LNG in Texas and Costa Azul LNG in Mexico, has signed a collaboration accord with the state-backed Japan Bank for International Cooperation (JBIC) covering future financial structuring opportunities.

Sempra said that through the memorandum of understanding, Sempra Infrastructure and JBIC aimed to further project structuring to improve the global energy supply chain through LNG and other decarbonization efforts in both the US and Japan.

“Sempra Infrastructure is thrilled to expand its collaboration with JBIC as we look forward to advancing projects that lower the carbon intensity of our energy delivery assets in North America,” said Justin Bird, Chief Executive of Sempra Infrastructure.

“We have built our relationships with customers and the export credit agencies in Japan over the past decade and are excited to expand our relationship with JBIC as we continue developing projects in support of our net-zero business,” Bird explained.

JBIC LNG role

“This collaboration will help us continue advancing our mission of developing energy infrastructure that provides access to safe, secure and affordable energy to our global partners,” the CEO declared.

Sempra noted that it had partnered in various ways with Japanese companies for many years.

“More recently, these partnership efforts are reflected in Sempra Infrastructure's Cameron LNG facility and a recently announced strategic collaboration with a Japanese consortium, which calls for an evaluation of potential enhancements of the energy supply chain through e-natural gas,” said Sempra.

“In addition, the company is developing the Hackberry Carbon Sequestration Project, which contemplates the participation of two Japanese companies. Both development projects are in close geographical proximity to the Cameron LNG facility,” Sempra stated.

As Japan's policy-based financial institution, JBIC has a mission to continue to financially support the creation of business opportunities for Japanese companies and to underpin the Asian nation’s energy security.

Mexico and Texas plants

Sempra Infrastructure in 2023 completed the sale of a stake in the Port Arthur LNG project in Texas to US asset management firm Kohlberg Karvis Roberts (KKR), which is already a stakeholder in the Infrastructure unit.

KKR now holds a 42 percent indirect, non-controlling interest share of the Port Arthur LNG Phase 1 project.

The transaction resulted in Sempra Infrastructure retaining a controlling 28 percent indirect interest in Port Arthur Phase 1 at the project level, and ConocoPhillips owning the remaining 30 percent interest.

The Sempra Infrastructure unit in 2023 reached a positive final investment decision for Port Arthur Phase 1 and contracted US engineering firm Bechtel Energy to build the facility.

Progress also continues at Energía Costa Azul LNG Phase 1 on the Pacific Coast of Mexico where construction at the Mexican export project remains on track to reach commercial operations by the summer of 2025.

The San Diego, California-based company is also pursuing a Phase 2 development project at the Cameron plant in Louisiana.

The Japan Bank for International Cooperation (JBIC) has signed an agreement with Abu Dhabi National Oil Co. (ADNOC) to proceed with further discussions for financing under the bank’s decarbonisation programme as ADNOC and a subsidiary have also pledged to continue supplying LNG to the Japanese along with long-term crude oil supplies.

“ADNOC is a leading energy company wholly owned by the Emirate of Abu Dhabi with a clear intent to decarbonise its operations,” said JBIC.

“It has ambitions of achieving net zero emissions by 2045, promoting renewable energy, hydrogen and ammonia, carbon capture and storage (CCS), and other green energy initiatives,” explained JBIC in regard to the leading energy company in the United Arab Emirates.

“The heads of agreement is intended to aim at building a consensus in which JBIC will provide a credit line to ADNOC under ‘green operations’ to support projects related to decarbonisation and the energy transition implemented by ADNOC or its subsidiaries,” the state-owned Japanese bank added.

Carbon-capture and storage (CCS) is a technology that separates and captures CO2 that would otherwise become a greenhouse-gas and stores it in deep-water caverns or other geological formations.

ADNOC spin-off

ADNOC Gas, which was spun-off in March 2023 to become a separate company, is estimated to have the seventh-largest gas reserves globally and has signed supply agreements with Japanese companies.

The latest was signed in October 2023 with the trading subsidiary of Japan's power generation company Jera Co. Inc.

The multi-year agreement with Jera Global Markets, a utility-backed energy trader specialising in LNG and other fuels, builds on the energy partnership between the UAE and Japan.

The ADNOC gas subsidiary also signed a five-year LNG supply agreement with Japan Petroleum Exploration (JAPEX) in August 2023.

JBIC noted that in addition to supplying LNG to Japanese import terminals the UAE emirate of Abu Dhabi was also key and long-term supplier of oil to Japan.

“As a stable and important supplier of crude oil to Japan for more than 40 years, Abu Dhabi is a strategic partner and a very important ally for Japan's energy resources strategy,” said JBIC.

High potential

“In addition, Abu Dhabi has high potential in the sector of decarbonisation and energy transition as it has abundant resources for renewable energy and subterranean structures suitable for CCS,” JBIC explained.

“The credit line under the HOA aims to support ADNOC’s initiatives for decarbonisation and to create opportunities for collaboration between Japanese companies and ADNOC, and it is expected to contribute towards realising the decarbonised societies that Japan and Abu Dhabi are aiming for,” JBIC declared.

As Japan's policy-based financial institution, JBIC said it would continue to provide financial support for sustainable development efforts, including those for global environmental preservation, by drawing on its various financial facilities for structuring projects financially and by “performing its risk-assuming” function.

The Philippines, the newest liquefied natural gas importing nation, has held talks with the Japan Bank for International Cooperation and said the JBIC had expressed interest in energy joint ventures.

Japan Bank for International Cooperation (JBIC) has signed loan agreements underwriting project financing amounting to over US$2.3 billion for a power interconnector between  UK and German LNG import locations to also help guarantee against any future natural gas and LNG shortages.

A US company backed by Japanese utility and LNG importer Tokyo Gas is in talks with US natural gas producer Rockcliff Energy as a possible buyer of the company from private equity firm Quantum Energy Partners for around $4.5 billion.

The transaction, which is being talked about by US investment bankers, would be another move by a Japanese company to secure natural gas assets.

This follows renewed concerns in Japan about its future energy resources since the Russian invasion of Ukraine and has led Japan’s state banking and energy agencies to support new moves by companies to expand the nation’s foreign resources base.

Tokyo Gas Natural Resources, based in Houston, Texas, is 70 percent owned by Tokyo Gas and with the balance held by Castleton Commodities International (CCI).

Tokyo Gas started acquiring its stake in CCI in May 2017 because of its natural gas assets in Louisiana and Texas, including the Haynesville shale play.

The Haynesville shale lies under parts of three southern states, including East Texas, northwest Louisiana and southwest Arkansas.

Previous deals

CCI had also previously purchased the Carthage upstream and midstream assets in East Texas from subsidiaries of the former Anadarko Petroleum Corp. for over $1 billion.

CCI subsequently combined the acquired assets with the company's existing East Texas upstream assets.

Tokyo Gas currently has volume and tolling agreements with the Cameron LNG plant in Louisiana and the Cove Point project in Maryland and is said to be considering other deals with US export projects under development in Texas and Louisiana.

Japan's Economy, Trade and Industry Minister (METI) recently oversaw deals by Japanese companies, including JERA Co Inc., the largest LNG importer, to secure future LNG supplies from Oman.

Japan had been so keen to secure enough LNG supplies during the Northern Hemisphere winter season that it asked state-run banking agencies to financially back utilities and trading companies to buy spot cargoes even at elevated prices.

The Japan Bank for International Cooperation and another state body, JOGMEC, which recently changed its name to the Japan Organization for Metals and Energy Security, have also increased their backing for energy asset transactions and are encouraging Japan's banking sector to do the same..

The Japan Bank for International Cooperation has signed a loan agreement in project financing for a floating storage and regasification unit (FSRU) to be operated by Japanese shipping company Mitsui OSK Lines and linked to a gas-for-power project in the West African nation of Senegal where plans are also underway for LNG exports.