Japan Putting Lid On Payments

May 2013, Vol. 240, No. 5

Alarmed by the 13.4% jump in its natural gas import bill last year, Japan is planning a new energy strategy that could change how LNG is traded around the world and put pressure on some of the proposed Canadian LNG export projects.

Japan, the world’s largest LNG importer, paid a $68 billion LNG import tab last year and is offering $11 billion in loan guarantees to Japanese companies to import LNG from the United States.

Tokyo is eyeing a seat at the U.S.-led Trans-Pacific Partnership negotiating table, as U.S. law only allows LNG exports to nations with which it has a free-trade agreement. The Japanese Development Bank estimates cheaper imports from the U.S. could cut LNG costs 20% by 2020.

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