HomeNewsU.S. LNG export permit pause may affect Japan's fuel security

U.S. LNG export permit pause may affect Japan's fuel security

1/31/2024

(Reuters) - Japan's top power generator JERA expects the temporary suspension of U.S. LNG export permits may affect Japan's fuel security, and even the world's, if the issue persists, a company official said on Wednesday.

JERA is one of the world's biggest LNG buyers and Japan is the world's second-biggest buyer of the super-chilled fuel after China.

U.S. President Joe Biden last week paused approvals for pending and future applications to export LNG from new projects, a move cheered by climate activists that could delay decisions on new plants until after the Nov. 5 election.

"We are not aware of any immediate impact from the U.S. action," Tetsuo Yoshida, JERA's head of global investor relations, told a news conference.

"But the United States is the world's largest LNG exporter, so if this issue persists, it could affect the LNG security not only for us, but also for Japan and the world," he said.

JERA, which has signed 20-year agreement to buy 1 million metric tons per annum of LNG from Venture Global LNG's Calcasieu Pass (CP2) plant in Louisiana, will work together with the public and private sectors to address the issue while keeping a close eye on the situation, Yoshida said.

On Tuesday, Japan's industry minister Ken Saito raised concerns over the U.S. suspension of LNG export permits and said the Japanese government will take necessary steps to ensure that Japan's stable energy supply is not compromised.

JERA, a joint venture between Tokyo Electric Power Company Holdings 9501.T and Chubu Electric Power 9502.T,

returned to profit in the April to December period, backed by lower fuel costs and stronger earnings in its renewable energy and overseas power businesses.

Net profit was 338.9 billion yen ($2.3 billion) for the nine months through Dec. 31, against a loss of 133.2 billion yen a year earlier.

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