Japan has approved JERA as the first supplier for the country's "Strategic Buffer LNG," or SBL framework, Minister of Economy, Trade and Industry Yasutoshi Nishimura said Nov. 24, ahead of the launch of the new supply contingency system in December.
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The move came as part of Japan's efforts to enhance its LNG supply security after facing a series of supply issues in recent years, followed by Russia's invasion of Ukraine and the ensuing European energy crisis last year.
Under the SBL framework, Japan aims to secure buffer LNG cargoes to be prepared for any supply contingency, starting with a minimum of one LNG cargo a month during the country's peak winter demand months over December 2023-February 2024.
"As the certified SBL supplier, we will supply secured SBL based on the Ministry of Economy, Trade and Industry's request and hope to contribute to Japan's energy security by steadily maximizing our efforts to secure fuels stably," a JERA spokesperson said.
When asked if JERA has already secured minimum three LNG cargoes for SBL over the three-month period, the spokesperson said: "We are working to establish our system internally to be able to secure and operate a minimum of one cargo a month for SBL over December-February this fiscal year," declining to elaborate further.
The SBL framework is the first of its kind for Japan, where it has only had commercial stocks for LNG unlike crude oil and refined product reserves held by the government and the private sector, as well as national LPG reserves.
JERA is Japan's largest power generation company that handles close to 40 million mt/year of LNG, with a controlled fleet of 20 LNG carriers held by JERA Global Markets, a joint venture between JERA at 67%, and France's EDF Trading at 33%.