Alaska, major LNG financier in Japan sign agreement

Alaska’s Department of Natural Resources and the Japan Bank for International Cooperation signed a memorandum of agreement to explore ways Alaska resources, particularly natural gas, might be developed and exported to Japan.

Dan Sullivan, the state’s natural resources commissioner, and JBIC Managing Director Koichi Yajima signed the MOU on Sept. 11 in Tokyo. “We are pleased to begin this formal dialogue with JBIC,” Sullivan said afterward.

“The agreement we’ve signed focuses on opportunities for Japanese companies and JBIC to become involved in resource development projects in Alaska—in particular, a large-volume [LNG] pipeline and export facility,” he indicated.

Sullivan was in Japan to speak on Sept. 10 at the opening session of the Japanese government’s second LNG producer-consumer conference, which attracted more than 800 participants from 50 countries, including senior executives from some of the world’s largest energy companies and utilities, and senior government officials from several Asian countries.

His schedule there during the week included meetings with senior officials from Mitsui & Co., Osaka Gas Co., Tokyo Gas Co., Anadarko Petroleum Corp., Resources Energy Inc., BP-Asia Pacific, ExxonMobil Corp., Apache Corp., Korea Gas Corp., DOWA Metals & Mining Co., and Sumitomo Metal & Mining Co.

Sullivan also was scheduled to meet with senior Japanese government officials from the Ministry of Economy, Trade and Industry, Japan (METI), JBIC, the Japan National Security Council, and Japan Oil, Gas & Metals National Corp.

‘Extensive engagement’

“The goal of this trip was to build upon the extensive engagement that the Parnell Administration has undertaken in the past few years to develop strong relationships with the world’s leading LNG buyers, their governments, and consumers,” Sullivan said.

His trip came as experts in Washington emphasized the importance of the US moving more aggressively to supply more LNG to Japan. It not only is a major US trading partner, but is also a critical player in the region, noted US Rep. Michael R. Turner (R-Ohio), who chairs the House Armed Services Committee’s Tactical Air and Land Forces Subcommittee.

“Exporting more LNG to Japan is one way the US can bolster Japan’s security,” he said in remarks Sept. 11 to an American Enterprise Institute conference on energizing the US-Japan relationship through more energy exports.

Turner introduced HR 580, the Expedited LNG for American Allies Act, on Feb. 6. The bill would expedite approval of applications to export LNG to other North Atlantic Treaty Organization members; Japan, for as long as the Treaty of Mutual Cooperation and Security between it and the US remains in effect; and any other foreign country if the US Secretary of State determines that such exports promote US national security interests. US Sen. John Barrasso (R-Wyo.) introduced similar legislation Jan. 31 in the Senate.

“Normally, we knock on other countries’ doors, asking them to lower their barriers,” Turner said. “Here, we’ve erected our own barrier and are knocking on our own door. It’s absolutely incredible that we look to assets we have here and find there’s a barrier to our exporting them.”

Japan’s situation

“It’s no secret Japan has an energy problem, but the news is getting worse,” said Gary J. Schmitt, co-director of AEI’s Marilyn Ware Center for Security Studies, during a panel discussion that followed Turner’s remarks.

It’s possible that only nuclear power will provide only 35% of its total electricity once it recovers from the Fukushima disaster, and its high oil-indexed natural gas prices and reliance on Russian and Middle Eastern LNG suppliers are troublesome, he observed.

More US LNG exports to Japan would benefit both countries, Schmitt maintained. “It’s much better for Japan to have part of its supplies coming from a trusted ally like the US instead of from countries vulnerable to political instability,” he said.

Alaska potentially could be a major LNG supply to Japan, he continued. “The total amounts of reserves there are tremendous, and there’s a direct export route to Japan and North Korea,” Schmitt said. “But it’s not happening as quickly as it should. While US corporations have talked about building a pipeline and export facility, they’re moving slowly. A Japanese delegation visiting Alaska expressed strong interest in possibly investing, but said things need to move faster.”

Japanese companies already have invested in the Freeport LNG liquefaction and export terminal in Texas as well as other US projects, noted Dan Blumenthal, AEI’s Asian studies director. “Both Japan and the US will benefit from the shale gas revolution,” he said. “Japan already has begun to demand henry Hub prices for gas it imports from other suppliers.”

“If the US doesn’t begin to move expeditiously, the money required to finance these facilities may move elsewhere and we’ll miss this opportunity,” said Schmitt. “If we snooze, we lose.”

Contact Nick Snow at nicks@pennwell.com.

Related Articles

Deloitte studies oil supply growth for 2015-16

02/04/2015 A Deloitte MarketPoint analysis suggested large-field projects, each producing more than 25,000 b/d, could bring on 1.835 million b/d in oil supply...

Oil, gas infrastructure investments essential, House panel told

02/04/2015 Investments in oil and gas transportation and storage should move ahead because they are essential in continuing the US economic recovery and North...

Petrobras CEO, five other senior executives resign

02/04/2015 Maria das Gracas Foster, chief executive officer of Petroleo Brasileiro SA (Petrobras) since 2012, has resigned along with five other senior execut...

MARKET WATCH: NYMEX crude oil prices reach 2015 high

02/04/2015 Crude oil prices surged more than $3/bbl on the New York market Feb. 3, closing at the highest level so far this year, but some analysts believe th...

Chevron unit farms into Mauritania offshore blocks

02/04/2015 Chevron Mauritania Exploration Ltd., a wholly owned subsidiary of Chevron Corp., has agreed to acquire 30% nonoperated working interest in Blocks C...

Saetre named Statoil president, CEO

02/04/2015

Eldar Saetre has been named president and chief executive officer of Statoil, succeeding Helge Lund, who resigned in October.

BG’s 2015 budget ‘significantly lower than 2014’

02/03/2015 BG Group plans capital expenditures on a cash basis of $6-7 billion in 2015, a range it says is “significantly lower than 2014” due to “a lower oil...

BP trims capital budget by $4-6 billion

02/03/2015 BP PLC plans an organic capital expenditure of $20 billion in 2015, down from the previous guidance $24-26 billion. Total organic capital expenditu...

EPA suggests DOS reconsider Keystone XL climate impact conclusions

02/03/2015 The US Department of State might want to reconsider its conclusions regarding potential climate impacts from the proposed Keystone XL crude oil pip...
White Papers

AVEVA’s Digital Asset Approach - Defining a new era of collaboration in capital projects and asset operations

There is constant, intensive change in the capital projects and asset life cycle management. New chall...
Sponsored by

Transforming the Oil and Gas Industry with EPPM

With budgets in the billions, timelines spanning years, and life cycles extending over decades, oil an...
Sponsored by

Asset Decommissioning in Oil & Gas: Transforming Business

Asset intensive organizations like Oil and Gas have their own industry specific challenges when it com...
Sponsored by

Squeezing the Green: How to Cut Petroleum Downstream Costs and Optimize Processing Efficiencies with Enterprise Project Portfolio Management Solutions

As the downstream petroleum industry grapples with change in every sector and at every level, includin...
Sponsored by

7 Steps to Improve Oil & Gas Asset Decommissioning

Global competition and volatile markets are creating a challenging business climate for project based ...
Sponsored by

The impact of aging infrastructure in process manufacturing industries

Process manufacturing companies in the oil and gas, utilities, chemicals and natural resource industri...
Sponsored by

What is System Level Thermo-Fluid Analysis?

This paper will explain some of the fundamentals of System Level Thermo-Fluid Analysis and demonstrate...

Accurate Thermo-Fluid Simulation in Real Time Environments

The crux of any task undertaken in System Level Thermo-Fluid Analysis is striking a balance between ti...
Available Webcasts


Prevention, Detection and Mitigation of pipeline leaks in the modern world

When Thu, Apr 30, 2015

Preventing, detecting and mitigating leaks or commodity releases from pipelines are a top priority for all pipeline companies. This presentation will look at various aspects related to preventing, detecting and mitigating pipeline commodity releases from a generic and conceptual point of view, while at the same time look at the variety of offerings available from Schneider Electric to meet some of the requirements associated with pipeline integrity management. 

register:WEBCAST



On Demand

Global LNG: Adjusting to New Realities

Fri, Mar 20, 2015

Oil & Gas Journal’s March 20, 2015, webcast will look at how global LNG trade will be affected over the next 12-24 months by falling crude oil prices and changing patterns and pressures of demand. Will US LNG production play a role in balancing markets? Or will it add to a growing global oversupply of LNG for markets remote from easier natural gas supply? Will new buyers with marginal credit, smaller requirements, or great need for flexibility begin to look attractive to suppliers? How will high-cost, mega-projects in Australia respond to new construction cost trends?

register:WEBCAST


US Midstream at a Crossroads

Fri, Mar 6, 2015

Oil & Gas Journal’s Mar. 6, 2015, webcast will focus on US midstream companies at an inflection point in their development in response to more than 6 years shale oil and gas production growth. Major infrastructure—gas plants, gathering systems, and takeaway pipelines—have been built. Major fractionation hubs have expanded. Given the radically changed pricing environment since mid-2014, where do processors go from here? What is the fate of large projects caught in mid-development? How to producers and processors cooperate to ensure a sustainable and profitable future? This event will serve to set the discussion table for the annual GPA Convention in San Antonio, Apr. 13-16, 2015.

This event is sponsored by Leidos Engineering.

register:WEBCAST


The Future of US Refining

Fri, Feb 6, 2015

Oil & Gas Journal’s Feb. 6, 2015, webcast will focus on the future of US refining as various forces this year conspire to pull the industry in different directions. Lower oil prices generally reduce feedstock costs, but they have also lowered refiners’ returns, as 2015 begins with refined products priced at lows not seen in years. If lower per-barrel crude prices dampen production of lighter crudes among shale plays, what will happen to refiners’ plans to export more barrels of lighter crudes? And as always, refiners will be affected by government regulations, particularly those that suppress demand, increase costs, or limit access to markets or supply.

register:WEBCAST


Emerson Micro Motion Videos

Careers at TOTAL

Careers at TOTAL - Videos

More than 600 job openings are now online, watch videos and learn more!

 

Click Here to Watch

Other Oil & Gas Industry Jobs

Search More Job Listings >>
Stay Connected