LNG

Japanese liquefied natural gas imports increased again in May even at higher prices while thermal coal deliveries dropped and nuclear plant re-starts plans continued to advance.

Japanese liquefied natural gas imports dropped again last month as storage increased and North Asian prices declined with thermal coal deliveries also plunging while nuclear plant usage is increasing.

JERA Co. Inc., the largest Japanese LNG importer, has resumed operations at the gas-fired Anegasaki Thermal Power Station located on the eastern side of Tokyo Bay and currently under a long-term planned shutdown scheduled for February 2023.

JERA explained that that Unit 5 facility at the station was scheduled to resume operations on October 24 to supply auxiliary steam for the restart of Unit 6 at the Anegasaki power plant.

“Because the Unit had deteriorated over time and its utilization rate had declined, the Unit has been in a long-term planned shutdown since April 2021,” said JERA.

However, discussions at the Ministry of Economy, Trade, and Industry's electricity and gas policy committee led to an agreement for a re-start to help underpin Japan’s energy security.

“JERA has lifted the Unit’s long-term planned shutdown and will operate it as part of measures to provide additional power supply capacity for this winter,” added JERA.

The utility company added that it would “make every effort” in cooperation with related parties to ensure a stable supply of energy to the plant and at other power facilities.

The 600-megawatts Anegasaki plant is a conventional gas plant and in operation using LNG as fuel since 1979.

The decision to shut the plant was taken in April 2021 before the current energy crisis deepened with the Russian invasion of Ukraine.

JERA is the largest corporate LNG buyer in the world with annual volumes of around 35 million tonnes and controls a fleet of around 20 LNG carriers.

Additionally, it is Japan’s biggest fossil-fuel generator being owned jointly by Tokyo Electric Power Co. and Chubu Electric, the two largest power companies.

The company currently operates and provides fuel for a total of 26 power plants in Japan and imports LNG into 11 of Japan’s network of 37 terminals.

Japanese liquefied natural gas imports declined last month by 0.4 percent, the same amount as the previous month, with shipments increasing from Australia, Russia and the spot market while monthly costs rose to over $6 billion for the first time.

Japanese liquefied natural gas imports increased for a second successive month in May as they rose by 16.3 percent and Russian deliveries were twice as much as those from the US.

Shipments of LNG to Japan amounted to 5.76 million tonnes last month, or 85 cargoes, compared with 4.95MT, or 73 cargoes, in May 2021, according to the preliminary trade figures from the Japanese Ministry of Finance.

Japanese LNG deliveries to the network of 37 terminals around the main islands had been 5.57MT in April, or 82 cargoes, compared with 4.97MT, or 73 cargoes, in April 2021.

LNG costs for the nation last month surged year-on-year by 155 percent to 601.40Bln yen ($4.47Bln) compared with 236.15 Bln yen ($1.76Bln) in May 2021.

Yen plunge

The effect on the balance of payments was even more severe as the Japanese yen has dropped to a 24-year low against the dollar, meaning dollar-based commodities like energy are more expensive when converted back into yen.

The country lost the No. 1 LNG import position in 2021 to China, though in certain weeks in May and June Japan has been the biggest North Asia importer as China reduced shipments amid Covid-19 lockdowns.

Shipments to Chinese terminals in 2021 had amounted to 78.93MT which was 18.3 percent more than in 2020.

Japan’s 2021 cargo deliveries were 74.31MT, down 0.2 percent on 2020 and 4.62MT less that the Chinese total for 2021.

Thermal coal shipments also increased in May to 8.54MT at the nation’s coal terminals, a rise of 7.1 percent year-on-year.

On a fiscal year basis, Japanese LNG imports had dropped in the April 2021 to March 2022 period by 6.4 percent to 71.46MT versus 76.35Mt in the previous fiscal year, according to Ministry statistics.

Russian deliveries

During May 2022 shipments of LNG from Russia declined by 5.4 percent to 559,000 tonnes, though were higher than April’s 396,000 tonnes of deliveries. The shipments come frm the Gazprom-run Sakhalin plant in the Russian Far East.

They were also more than double the amount of shipments imported from the US, which dropped by more than 51 percent to 267,000 tonnes.

Imports from the US had dropped in April by 12 percent to 344,000 tonnes as the Russian invasion caused Asia-bound shipments to be re-directed to Europe.

Middle East cargo deliveries from nations like Qatar were down by 16 percent last month to 545,000 tonnes.

Shipments of LNG to Japan in May from Asian countries surged by 56.7 percent to 1.36MT, though were down on the 1.49MT received in April 2022.

The balance of imports in May 2022 came from Australia, African nations and the spot market.

That segment of the imports was higher at 3.03MT versus the 2.30MT received in May 2021 and up on the 2.95MT delivered in April.

Thermal coal shipments to Japanese ports in the fiscal year to the end of March 2022 had increased by 8.8 percent to 114.46MT, outpacing the LNG volumes of 71.46MT during the same period.

The almost parity levels between thermal coal imports and LNG shipments disappeared in 2021 with thermal coal deliveries moving well ahead.

Nuclear power generation in Japan is still well down. Nine reactors from a total of 16 plants with 50-plus reactors are operating from those that have gained the regulatory safety agreements.

Japanese liquefied natural gas imports plummeted by more than 22 percent as the nation opted for more than twice the amount of coal than LNG for thermal power generation and only imports from Australia and the US held up as cargo numbers from Asia, the Middle East and Russia dropped.

JERA Co. Inc., the Japanese LNG buyer of 35 million tonnes per annum of volumes and with control of a fleet of 20 LNG carriers, has drawn up measures to address supply and demand issues in Japan through the Northern Hemisphere summer season.

Japan’s liquefied natural gas imports soared by more than 21 percent last month, backed by a doubling of US supplies and more cargoes from Asia and Russia as stocks were rebuilt after the high winter season usage.

Japanese liquefied natural gas imports fell again in November as Asian and Middle East deliveries dropped and were offset by more cargoes from Australia as the nation headed for an annual fall in LNG imports to under 73 million tonnes as overall power use declined in the economic slowdown.

China's liquefied natural gas imports increased by 25 percent in October, though were still short of the monthly shipments received by the world’s No. 1 LNG importer Japan as the Japanese are failing to reach nuclear re-start targets as a replacement power generation fuel.