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Japan Petroleum Exploration Co.. or Japex. would consider procuring LNG through spot or mid- to long-term contracts after Canada`s Pacific NorthWest LNG project in which Japex has a 10% stake fell through. a spokeswoman for Japex said Wednesday.
`We rather think that this has given us more choices.` said the spokeswoman. adding that the company could take advantage of low LNG prices.
Japex was supposed to receive around one million mt year of LNG from the Pacific NorthWest project and use that for its planned gas-fired power plant and also market to domestic gas users.
However. Malaysia`s Petronas. the lead developer of the Pacific NorthWest LNG export terminal. and other developers announced Tuesday that the project was canceled as the global glut of LNG had made such a facility uneconomical.
Japex currently buys around 400.000 mt year of LNG from Malaysia LNG. which is held by companies such as Petronas. Shell and Malaysian state of Sarawak. under a 20-year contract to 2022.
Japex is building the Soma LNG terminal in Fukushima prefecture. its first LNG receiving terminal. which is scheduled to start operations in March 2018. And next to the terminal is a new planned 1.18 GW gas-fired plant expected to start commercial operations in 2020.
Japex has already tied up with Mitsui &. Co.. Osaka Gas. Hokkaido Electric and Mitsubishi Gas Chemical to operate the power plant and the five companies would procure necessary LNG independently according to the amount of electricity they planned to generate.
Under these alliances. Japex will own 33% of the power plant business. while Mitsui`s stake will be at 29%. Osaka Gas at 20%. and Mitsubishi Chemical and Hokkaido Electric to have a 9% stake each.
