Japan's JERA to buy Mozambique LNG with Taiwan refiner
TAIPEI, NNA - JERA Co., the world's largest liquefied natural gas importer equally owned by TEPCO Fuel & Power Inc. and Chubu Electric Power Co., will purchase LNG from Mozambique with the Taiwan government-backed refiner CPC Corp.
The deal marks the first long-term joint LNG purchase by JERA with a foreign partner to enhance supply and demand flexibility.
The Japanese and Taiwanese companies said in a joint statement on Monday that they will source 1.6 million tons per annum from Mozambique LNG1 Company Pte. Ltd. for a term of 17 years after the start of Mozambique Area 1 Project operations.
The project, led by Anadarko Petroleum Corp. of the United States, liquefies gas at a planned complex in northeastern Mozambique, JERA spokesman Hiroyuki Usami told NNA.
LNG production and shipments are expected to begin in the middle of 2020 with an annual output of 12.9 million tons, he said.
JERA and CPC said in the joint statement that the procurement from Mozambique “may exchange LNG flexibly depending on each other's supply and demand balance” and also “enables JERA to expand opportunities for optimizing its LNG portfolio.”
CPC's joint purchase deal with JERA comes after decades of cooperative relations with Japanese and South Korean LNG importers.
A European gas price index is used as part of the contract price formula for the sale and purchase agreement with Mozambique LNG 1. JERA and CPC can respond appropriately to uncertainties in the domestic LNG supply and demand by redirecting the destination from Asia and Europe, the joint statement said. (NNA/Kyodo)