The Japanese government has signed an energy agreement with Malaysia’s state oil and gas firm Petronas that includes supplying liquefied natural gas (LNG) tanks in the event of an emergency.
Japan’s Ministry of Economy, Trade and Industry signed a memorandum of cooperation (MoC) with Petronas at the LNG Producer-Consumer Conference in Tokyo on Thursday.
The memorandum includes consideration of joint upstream investment, technical cooperation on cutting climate-warming methane emissions, mutual assistance in fuel supply, and the emergency use of LNG tanks.
Both sides agreed to discuss ways to supply fuel to whichever side has a shortage, given that the countries’ peak consumption periods differ. Malaysia’s peak demand is in summer, while Japan’s is in winter.
Reducing LNG Reliance on Russia
Japan has been considering measures to reduce reliance on Russia—one of its biggest LNG suppliers in 2021—and to avoid a power crunch during the winter season when heating demand is expected to surge.Earlier in July, Prime Minister Fumio Kishida urged the Japanese trade industry minister to have nine nuclear reactors operational by the upcoming winter season as he warned of potential power shortages.
The nine nuclear reactors are expected to cover about 10 percent of the total energy consumption. Kishida also ordered the government to secure 10 thermal power generation units to help stabilize Japan’s power supply.
Japan had only allowed 10 of the 33 operable nuclear reactors to restart after the 2011 Fukushima nuclear disaster. But rising energy prices and the threat of a power shortage during a heat wave have pushed the government to reactivate some nuclear reactors.