Tokyo / Bloomberg
The world’s biggest buyer of liquefied natural gas said imports fell the most in more than six years as nuclear reactors restarted and warm weather cut demand.
Shipments of the super-cooled fuel to Japan fell 14.1 percent in January, the biggest drop since May 2009, to about 7.2 million metric tons from a year earlier, according to preliminary data from Ministry of Finance. Since August, Japan has restarted three of its 43 nuclear reactors that were shut following the 2011 Fukushima nuclear disaster. The country has had warmer-than-normal temperatures the last three months, according to the Japan Meteorological Agency.
The country’s annual LNG purchases last year fell for the first time since 2009 as its atomic fleet began restarting and as electricity consumption dropped to the lowest since 1998 amid a shrinking population and more energy efficiency. A decline in Japan LNG imports may add to a global glut as new projects start in Australia in the U.S. and prices for the fuel delivered to Northeast Asia slump to the lowest in at least five years.
“LNG imports will certainly decline this year as reactors are brought back online,” Junzo Tamamizu, the managing partner of Clavis Energy Partners LLC, a Tokyo-based consulting and advisory firm, said by phone. The nation’s increased use of solar power will also continue to reduce LNG consumption for power generation, Tamamizu said.
Japan’s LNG demand is forecast to fall by about 30 percent by 2030 to 62 million tons from its peak in 2014, according to a government projection. Utilities could resume operations at 21 of Japan’s 43 functioning reactors by the end of 2017, according to one scenario forecast by Bloomberg New Energy Finance.