Gas Processing & LNG is Produced by Gulf Publishing Holdings LLC

Turn up the gas: Japan LNG imports hit 5-year high as cold bites

SINGAPORE (Reuters) - Japanese imports of liquefied natural gas (LNG) hit their highest in at least five years in January, with shipments expected to continue at a brisk pace this month as freezing weather keeps its grip on the world's top buyer of the fuel.

Japan's imports of LNG rose to nearly 8.7 million tonnes last month, up 8 percent from December and the largest volume since at least January, 2013, according to ship tracking data on Thomson Reuters Eikon that stretches back five years.

That upturn is piling further pressure on the region's spot markets for the commodity, which marked three-year highs last month as China rushed to snap up cargoes for its drive to use gas to heat millions of homes and power thousands of factories <LNG-AS>.

"A recent cold snap contributed to LNG demand for power (in Japan) as well as in city gas sector," said Boseok Jin, a research analyst at IHS Markit.

Unusually frigid conditions swept parts of Japan in January, with snow blanketing Tokyo at one point later in the month.

Jin added that volumes of LNG delivered to the Nagoya area in central Japan surged by 10 percent in the November to January period compared with the same time a year before, while deliveries into Tokyo Bay increased by more than 4 percent.

"We were all caught by surprise with the cold weather and (LNG) inventory is very low now," said a source with a Japanese utility, declining to be named as he was not authorised to speak with media.

Four months of maintenance at a nuclear reactor run by Kyushu Electric Power Co could also be boosting demand for LNG, the source said.

And at least one utility is rushing to find a cargo for the second-half of February, the sources said, with cold conditions forecast to continue this month.

But demand for LNG could fade as the weather heats up with spring's arrival in March and as some nuclear reactors are due to restart around the same time, said IHS Markit's Jin.

(Reporting by Jessica Jaganathan; Additional reporting by Osamu Tsukimori and Aaron Sheldrick in Tokyo; Editing by Joseph Radford)

Copyright © 2018. All market data is provided by Barchart Solutions. Futures: at least a 10 minute delay. Information is provided 'as is' and solely for informational purposes, not for trading purposes or advice. To see all exchange delays and terms of use, please see disclaimer.

                                  CMEGroup                                     Icelogo


Editorial Comment
-Adrienne Blume
The US Energy Information Administration (EIA) reported in April that the US set records for natural gas production in 2017.
- Energy Web Atlas
Since market reforms first started in 1978, China has shifted from a centrally planned economy to a market-based economy, experiencing rapid economic and social development.
Industry Perspectives
-Eugene Gerden
Russia aims to ally with Qatar in LNG competition with Australia and other LNG-exporting majors over the coming years.

Maximize Profitability with Advanced Analytics at Natural Gas Processing Plants

View On-Demand

Incorporating economic data into process modeling is key to optimizing operations and maximizing profits at gas processing plants. However, maintaining optimal operations are often challenging due to changing market dynamics, contract structures and increasing process flexibility. Today, gas processors are leveraging Predictive Control and First Principles models to accurately determine and control the optimal operating targets in real time based on the most current plant conditions and profitability, optimizing recovery of natural gas liquids. Learn how real-time analytics, combined with decision support tools, empower companies to:
•Improve processing margins by up to 5%
•Maximize NGL production through improved availability and optimized process conditions
•Improve compositional control to operate closer to product specifications

May 22, 2018 10am CDT

View On-Demand


Please read our Term and Conditions, Cookies Policy, and Privacy Policy before using the site. All material subject to strictly enforced copyright laws.
© 2018 Gulf Publishing Holdings LLC.