Japanese electricity generator JERA has signed a key term sheet with Oman LNG for the long-term sale and purchase of liquefied natural gas (LNG).
Under the 10-year agreement, JERA will purchase up to 12 cargoes (approximately 0.8 million tons) per year of LNG produced from the Oman LNG project starting in 2025.
“LNG procurement competition has been intensifying and thus, stable procurement of fuel in a timely manner in line with the domestic electricity supply-demand situation is needed to secure a stable supply of energy in Japan”, JERA said in a statement.
The contract, which has high flexibility and is expected to enhance the capability to respond to uncertainties in the domestic LNG supply and demand, was signed on 27 December as the country’s industry minister Nishimura Yasutoshi is visiting Oman.
According to reports from Japanese public broadcaster NHK, two more companies, namely Mitsui & Co., and Itochu – holders of stakes in Oman’s LNG projects, are also expected to sign a long-term sale and purchase agreement during this visit.
NHK’s sources said that Mitsui & Co., Itochu and Jera have decided to import more than 2 million tons of LNG annually from 2025, over a period of about 10 years.
This was confirmed in Oman LNG’s social media update as well.
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Oman LNG announced today the signing of Binding Term Sheet Agreements with 3 Japanese firms to deliver LNG at a total volume of 2.35 Million Metric Tonnes per Annum (mtpa) starting from 2025 to ITOCHU Corporation, JERA Co and Mitsui & Co. pic.twitter.com/T6ENalTJVA
Japan’s LNG imports from Oman currently stand at over 1.9 million tons per year, accounting for 2.6% of its imports of the energy source.
The media outlet added that other Japanese firms are also negotiating fresh deals with Oman, and if they materialize, Japan’s annual LNG imports from the country could increase significantly.
While visiting Arab nations, minister Nishimura Yasutoshi signed memoranda of understanding (MoUs) with Saudi Arabia for cooperation in the areas of circular carbon economy (CCE) and carbon recycling as well as clean hydrogen, ammonia and derivatives.
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