TOKYO (Reuters) – Japan will sign a memorandum of cooperation (MoC) with Malaysia’s state energy firm Petronas on liquefied natural gas(LNG) on Thursday, including emergency measures, a Japanese government source told Reuters.
Japan, one of the biggest importers of the super-chilled fuel, faces a historic energy security risk as the prolonged Russia-Ukraine war threatens to disrupt supply while Europe scrambles to buy more fuel to ensure adequate energy for the winter.
Japan’s Ministry of Economy, Trade and Industry and Petronas will sign the MoC at the LNG Producer-Consumer Conference in Tokyo, according to the source who declined to be named.
The memorandum would include consideration of joint upstream investment, technical cooperation on cutting climate-warming methane emissions, mutual assistance in fuel supply and the use of LNG tanks in the event of any emergency supply crunch.
For emergencies, they would consider ways to provide fuel to whichever side has a shortage, since the countries have different peak demand seasons.
Malaysia’s peak season is in summer whereas Japan’s gas demand for heating rises during the winter.
LNG consumers elsewhere in Asia are also suffering from tight supply and soaring spot LNG prices, bolstered by a global battle for the fuel, the source said.
“Japan wants to make similar collaborations with other Asian countries such as Singapore,” the source said.
(Reporting by Yuka Obayashi; Editing by Richard Chang)
