TOKYO :Top Japanese electricity generator JERA and trading houses Mitsui & Co and Itochu Corp plan to sign a basic agreement with supplier Oman LNG on Tuesday for long-term LNG contracts, a Japanese government source said.
JERA, Japan’s biggest importer of LNG, confirmed it would sign a basic agreement with Oman LNG later on Tuesday for a long-term contract, while trading houses Mitsui & Co and Itochu Corp said they were in talks with Oman.
The comments followed a report by broadcaster NHK that all three companies would sign a basic agreement for contracts to import a total of about 2 million tonnes of LNG annually from Oman over 10 years beginning in 2025, giving Japan greater energy security.
Other Japanese companies were also in negotiations with Oman LNG for term contracts, the government source said, adding that Japan’s LNG procurement from Oman could top 3 million tonnes a year if all discussions were successful.
Global LNG supply has been tight since Russia invaded Ukraine and since Western countries imposed sanctions on Russian energy.
JERA would give details of its new long-term Omani LNG contract after the agreement was signed, its spokesperson said.
Mitsui was “involved in” an LNG deal with Oman, a spokesperson for the trading house said, declining to give details due to a confidentiality agreement.
Itochu has a 20-year contract with Oman LNG to buy 0.7 million tonnes of LNG a year that will expire in 2025. It would continue discussions with Oman LNG about a long-term contract, its spokesperson said, without elaborating.
NHK said Japanese industry minister Yasutoshi Nishimura, currently visiting the Middle East, would attend the signing ceremony.
Japan imported 1.9 million tonnes of LNG from Oman in 2021, 2.6 per cent of its total LNG imports.