Japan's JERA Intends to Expand US LNG Purchases to Diversify Energy Supply

JERA, Japan's largest LNG buyer, intends to increase its purchases of liquefied natural gas from the United States in order to diversify its supply and meet demand growth driven by data centres and artificial intelligence, according to a senior executive.

U.S. President Donald Trump promised to unleash the US energy industry to boost output and threatened the EU with tariffs if it did not buy more gas, implying that JERA may have to compete with other buyers for more US gas.

Japan's largest utility, which handles between 30-35 million metric tons (mt) of LNG per year, currently sources nearly half of it from Asia Pacific countries such as Australia, Malaysia, and Indonesia.

"This explains the very high exposure. My plan is to rebalance that and diversify our LNG supply portfolio," Ryosuke Tsugaru, JERA's head of LNG division, told Reuters on the sidelines of the World Economic Forum annual meeting in the Swiss resort of Davos.

"My plan is to increase our exposure to US energy projects. We are now buying 3.2 million tons in long-term contracts from America, which is a small portion of the total purchase amount," he added, without specifying the expected increase.

However, JERA will closely monitor the long-term viability of LNG policies in the United States, the world's largest LNG exporter, which will ship 88.3 million tonnes of super-chilled gas in 2024 alone.

Trump directed the US Energy Department to resume considering LNG export applications after the Biden administration halted them.