Tokyo Gas Prioritizes U.S. Expansion, Eyes LNG Offtake From $44 Billion Alaska Project
Tokyo Gas will prioritize the U.S. market in its overseas expansion strategy, including potential LNG offtake from the $44 billion Alaska LNG project. The company plans to invest up to $8.6 billion over three years, with $2.3 billion allocated to overseas and U.S. gas asset development.
(Reuters) - Tokyo Gas will prioritize the U.S. market for overseas expansion due to its strong growth potential, CEO Shinichi Sasayama said on Wednesday, as Japan's largest city gas provider eyes a possible gas offtake from Alaska.
Tokyo Gas and JERA, Japan's top buyer of liquefied natural gas, have recently signed preliminary agreements to buy 1 million metric tons of LNG annually each from the $44 billion Alaska LNG project favored by U.S. President Donald Trump.
The final offtake decision would depend on whether the terms and economics of the yet-to-be-built Alaska LNG project are favorable, Sasayama told reporters.
Under a new management plan unveiled on Wednesday, the utility will invest up to 1.3 trillion yen ($8.6 billion) over three years from next April, including 350 billion yen overseas such as U.S. shale gas development.
U.S.-based Glenfarne, the developer of the project, plans to make the final investment decision for the Alaska LNG pipeline in late 2025 and a 2026 FID for its LNG export components.
Tokyo Gas has invested into U.S. upstream gas assets in Texas and Louisiana.
"Among our overseas operations, we are focusing on North America, with particular emphasis on the United States, which shows strong growth potential," Sasayama said.
Japan and the U.S. have announced several possible joint investments during Trump's meeting with Prime Minister Sanae Takaichi in Tokyo, but none on gas.
Washington has urged Japan to cease Russian energy imports to pressure Moscow over the Ukraine war.
Potential offtake from Alaska is not tied to Tokyo Gas' Sakhalin-2 import deal, said Sasayama, who attended a business dinner with Trump on Tuesday.
Japan gets around 9% of its LNG needs from Sakhalin-2, including 1.1 million tons per year for Tokyo Gas in a deal expiring in 2031.
Sasayama added Tokyo Gas would consult with the Japanese government on future supplies from Sakhalin-2.