Japan's Ministry of Economy, Trade and Industry is expected to announce an action plan for the LNG market by the end of this month in a bid to boost liquidity and transparency in the spot market and to help create a trading hub in Japan, a ministry official said Wednesday.
Receive daily email alerts, subscriber notes & personalize your experience.Register Now
The plan will be presented at the G7 energy ministers' meeting in Kyushu in May, the official added.
"Gas prices are expected to remain low for a while and we want to call for better utilization of gas and create a global market," the official said. The plan follows a study by a group comprising industry participants including Japanese power and gas utilities, oil companies and foreign energy firms and government officials.
One of the key issues discussed was the creation of a hub and infrastructure such as third party access to LNG terminals, connecting pipeline networks and building underground storage facilities, the official said.
Article Continues below...
The group also discussed possible government funding for infrastructure building, he added.
"Japan does not have to be the only hub in Asia. It is probably natural for multiple hubs to coexist, each with its own index," he said. The group also looked at pricing options including assessments by price reporting agencies and over-the-counter platforms, documents on the study obtained by Platts showed.
Also discussed were destination clauses in LNG contracts and anti-trust cases in Europe, as well as the potential use of floating storage and regasification units though safety measures against tsunamis have not been established yet, according to the documents.
--Eriko Amaha, firstname.lastname@example.org
--Edited by E Shailaja Nair, email@example.com