- Japan’s Hokuriku Electric is seeking a liquefied natural gas (LNG) cargo for delivery in November as the company’s LNG consumption rose in 2018.
- The cargo is for delivery in the second half of November and offers are due this week
- The company started importing LNG late last year but is not a regular buyer of the super-chilled fuel.
Japan’s Hokuriku Electric has bought a liquefied natural gas (LNG) cargo for delivery in November, as searing hot temperatures drew down inventory in the country and as lower spot prices lured buying of cargoes, reports Reuters.
Cargo for delivery
The Japanese utility likely bought the cargo for delivery in second half of November from Malaysia’s Petronas.
The utility started importing LNG late last year and has been buying LNG cargoes from Petronas, though its requirements have not been regular, one of the sources said.
Hokuriku did not immediately reply to an email requesting comment.
Toyama Shinko thermal power station
However, according to a presentation to investors in April, the company said it started up its first LNG-fired power generation unit, the Toyama Shinko thermal power station, in November 2018, which reduced its oil purchase.
Escalated LNG consumption
The company’s overall LNG consumption rose to 40,000 tonnes in 2018, compared with none in 2017, while its heavy oil consumption reduced by nearly one-third and its crude oil consumption halved from a year ago, according to the presentation.
It is also currently in talks to purchase LNG through term supply, one of the sources said, though details were not immediately clear.
Spot market purchase of LNG
Hokuriku Electric is among several Japanese utilities looking to buy more LNG from the spot market, where prices LNG-AS are hovering near multi-year lows and are at about half the average contract import price for buyers in Japan, the world’s biggest importer of the super-chilled fuel.
Higher-than-usual temperatures in the country had also prompted some buying interest from Japanese buyers this month, including Tohoku Electric Power and JERA, a joint venture between Tokyo Electric Power Company Holdings Inc and Chubu Electric Power Co Inc, traders said.
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Source: Reuters
