The EU and Japan agreed July 18 to strengthen their energy cooperation by establishing an EU-Japan energy security dialogue on global LNG "architecture."
Receive daily email alerts, subscriber notes & personalize your experience.Register Now
In a statement, the EU said the dialogue would see collaboration on a global "early warning" system to help pre-empt possible supply shocks and ensure global LNG security of supply.
"The EU and Japan will build on their expertise in developing resilient energy security policies based on cooperation between regions and countries," it said.
"The parties see the transparency of energy markets as the backbone of the security of supply and therefore believe that it should be part of the future global LNG architecture," it said.
The two sides agreed there was a need to enhance the exchange of critical data of relevance for energy security across the consuming and producing regions.
"The EU will also share its security framework, strengthened during the 2022 supply shock, supported by a pan-EU gas storage policy and the gas demand aggregation tool, AggregateEU," it said.
In addition to bilateral cooperation, the EU and Japan also agreed to pursue engagement with the International Energy Agency and proactively contribute to discussions on the IEA's role in the gas sector.
The new cooperation pact came as EU and Japanese officials met July 18 for LNG talks during the 2023 LNG Producer Consumer Conference taking place in Tokyo.
The latest agreement follows an EU-Japan summit on July 13 in Brussels where the two sides -- as two of the world's largest LNG importers -- agreed to step up cooperation to develop secure and transparent global LNG markets.
LNG supplies to the EU last year totaled 97 million mt (133 Bcm), according to S&P Global Commodity Insights data.
Japan's LNG imports in 2022 totaled 72 million mt, according to both S&P Global and official government data.
The combined 169 million mt of imports by the EU and Japan represented some 42% of total global LNG trade last year.
The EU and Japan already agreed in May last year to cooperate and help each other's security of LNG supply as well as to work together to reduce Europe's dependency on Russian imports through diversification.
At the time, they said they would cooperate "to keep global energy markets stable and help ensure each other's security of supply, in particular for the supply of LNG."
The EU said it also appreciated Japan for the "solidarity" it showed earlier in 2022 in ensuring sufficient and affordable LNG supplies to EU markets.
In February last year, Japan said it was diverting some surplus destination-free LNG cargoes to Europe at the request of the EU and the US.
It came as spot LNG prices surged to record highs last spring.
Platts, part of S&P Global, assessed the benchmark JKM spot LNG price for delivery to northeast Asia at a record $84.76/MMBtu on March 7, 2022.
Prices are currently well down on those levels, though still relatively high. The JKM was last assessed on July 18 at $10.60/MMBtu.
Separately, the European Commission and Japan were also co-signatories July 18 of a statement reinforcing continued efforts toward the reduction of methane emissions arising across the LNG value chain from production to consumption.
The joint statement was signed by the EC, Japan, the US, South Korea and Australia in Tokyo during the LNG Producer-Consumer conference.
The initiative builds on already strong cooperation between the EU and other global leaders on methane abatement across the gas value chain.
According to the statement, the five parties agreed to collaborate on reducing greenhouse gas emissions, particularly of methane, across LNG imports and exports.
"The participants reiterated their commitment to the Global Methane Pledge, led by the US and the EU and launched at COP26 in November 2021," the statement read.
They agreed to continue cooperation to achieve the goals of the pledge, including achieving reductions of methane emissions in the fossil energy sectors consistent with reducing global methane emissions by at least 30% by 2030 from 2020 levels.
The signatories also affirmed the importance of "robust measurement, monitoring, reporting, and verification" as well as transparency for methane emissions data in the fossil energy sector.
Japan's JERA and South Korea's Kogas also launched July 18 an initiative of the Coalition for LNG Emission Abatement toward Net-zero (CLEAN).
CLEAN is an initiative taken by LNG buyers, together with LNG producers, to reduce methane emissions in the LNG value chain.
In a statement, JERA said both companies recognized LNG as a transition energy for a decarbonized society and believe that efforts to reduce emissions in the LNG value chain would become more important in the future.
"We will work to increase the visibility of methane emissions through dialogue with LNG producers, and to develop and disseminate best practices to reduce methane emissions," JERA said.
Kogas and JERA also confirmed they would strengthen their strategic relationship and work to ensure a stable supply of energy for both South Korea and Japan, it said.