Japan's Astomos to start taking Ichthys carbon neutral propane this year

Japan's top LPG supplier Astomos Energy plans to start taking carbon neutral propane from the Ichthys project in Australia this year, following the signing of a sales and purchase agreement with INPEX Sept. 16, a company official told S&P Global Platts.

INPEX's sales of carbon neutral propane comes as Platts reported July 15 that it was expanding its portfolio of carbon neutral products at the Ichthys project in Australia using carbon credits to include condensate and LPG, after arranging its maiden carbon-neutral LNG cargo shipment in July.

Astomos and INPEX declined to reveal volumes and terms of carbon neutral propane supply from the Ichthys project.

INPEX, which markets its equity share of Ichthys LPG and condensate output, has a separate sale and purchase agreement with Astomos to supply Ichthys LPG but the companies declined to comment whether the latest carbon neutral propane supply is part of the Ichthys LPG supply.

The start of the Ichthys carbon neutral propane supply, which marks INPEX's first sales of the product, comes as Astomos is looking at ways to expand its procurement and provide a sales option of carbon neutral LPG supply in Japan as part of its efforts toward carbon neutrality.

Astomos, which is 51% held by Idemitsu Kosan and 49% by Mitsubishi, received Japan's first carbon neutral LPG cargo bought from Shell at its Chiba import terminal in Tokyo Bay on Aug. 17.

Ichthys GHG

INPEX is accelerating its efforts to achieve its 2050 net zero strategy launched in January, under which it aims to cut by 30%, or more, its scope 1 and 2 net-carbon intensity by 2030, from 2019 levels.

Greenhouse gas emissions from the Ichthys project account for roughly 60% of INPEX's GHG emissions of around 7.5 million mt on an equity basis in 2020.

INPEX is the operator of the the Ichthys project with a 66.245% stake. The project has the capacity to produce about 8.9 million mt/year of LNG, 1.65 million mt/year of LPG and 100,000 b/d of condensate.

INPEX uses a portion of the carbon credits acquired from Indonesia to arrange the first carbon-neutral LNG cargo and plans to use the carbon credits as the main source of its prospective supply of carbon-neutral condensate, LPG and LNG from the Ichthys project, together with other carbon credits.

In February, INPEX signed an agreement with conservation firm InfiniteEARTH to acquire 5 million mt of carbon credits over five years by supporting the Rimba Raya Biodiversity Reserve REDD+ project in Indonesia.

INPEX, Japan's largest upstream company, plans to produce around 571,000 b/d of oil equivalent in 2021.