Japan’s utilities could see margins drop and potentially turn negative from a surplus of liquefied natural gas (LNG), according to an Institute for Energy Economics and Financial Analysis (IEEFA) report.
The Asian country’s demand for the fuel has fallen rapidly in recent years, forcing utilties to focus on marketing and selling the fuel abroad.
The report finds that Japan’s largest utilities — including JERA, Tokyo Gas, Osaka Gas, and Kansai Electric — are likely to face an over-contracted position of roughly 11 million tonnes per annum (Mtpa) for the remainder of the decade.
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