Qatar looks to enhance 'existing, future' energy ties with Japan during minister visit

Qatar's Minister of State for Energy Affairs Saad al-Kaabi held talks in Tokyo this week with Japanese buyers of Qatari LNG and other project partners focused on strengthening energy ties between the two countries, QatarEnergy said Nov. 6.

During a visit accompanied by senior QatarEnergy and QatarEnergy LNG executives, Kaabi met with executives from companies including JERA, Chubu Electric, Mitsui, Marubeni, Idemitsu Kosan, Kansai Electric, Tohoku Electric, as well as Mitsui O.S.K. Lines, NYK Line, and "K"-Line.

QatarEnergy said the discussions with the Japanese companies "focused on existing and future cooperation, and further strengthening the bilateral relations in the energy sector."

Asked if it was discussing long-term contracts, JERA, Japan's largest power generator, is in the midst of talks with Qatar as an important LNG supplier, a JERA spokesperson said Nov. 6, declining to elaborate. Chubu Electric and TEPCO Fuel & Power each hold a 50% stake in JERA.

JERA and Tohoku Electric are current LNG buyers from the Qatargas 3 project, in which Mitsui has a 1.5% stake. Mitsui was also a partner with Marubeni in the Qatargas 1 project until QatarEnergy took over the project at the start of 2022.

A Tohoku Electric spokesperson said the latest meeting was for building a bilateral relationship, declining to elaborate further. Comments from Mitsui, Marubeni and Kansai Electric were not immediately available.

Contractual expiry

Japan's existing Qatari LNG contracts are set to expire around the end of the decade, with Kansai Electric's 500,000 mt/year contract ending in 2027, followed by JERA's 700,000 mt/year contract in 2028, and Tohoku Electric's 180,000 mt/year contract in 2030.

The latest visit by the Qatari energy minister signaled Doha's intention to enhance its bilateral relationship, which might eventually lead Japanese companies to sign LNG sales and purchase contracts and participate into LNG projects in the country, said Takayuki Nogami, chief economist at Japan Organization for Metals and Energy Security, or JOGMEC.

"On the other hand, coming to terms by both sides including on destination restriction clauses and contractual periods will be a key for reaching an agreement on LNG sales and purchase contracts between Japanese companies and Qatar," Nogami said.

The share of Qatari supply in Japan's LNG imports plummeted to just 4% in 2022 from 12% a year ago after Japanese companies in 2021 allowed a total of more than 7 million mt/year of Qatargas 1 LNG offtakes to expire, amid disagreements over contractual flexibility as well as uncertainty over Japan's future LNG demand due to its 2050 net zero target.

JERA's Qatargas 1 LNG contractual expiry amounted to about 5.5 million mt/year, part of which was shared with Shizuoka Gas, with the rest of the expiring contracts held by Tohoku Electric, Kansai Electric, Chugoku Electric, Tokyo Gas, Osaka Gas and Toho Gas.

In September, Japan imported 293,598 mt of LNG from Qatar, which accounted for 5.4% of the total LNG imports in the month, according to the latest Ministry of Finance data.

South Korean cooperation

Kaabi's visit to Tokyo came after visiting South Korea on Nov. 4, when the Qatari energy minister met the country's Minister of Trade, Industry and Energy Ahn Duk-geun and Korea Gas Corp. President and CEO Yeon-Hye Choi.

The Qatari energy minister and the MOTIE minister agreed to deepen energy ties focused on LNG and maintain strong cooperation on energy supplies amid geopolitical tensions and expand their ties into a wide range of sectors, such as renewable energy resources and hydrogen.

"The two ministers affirmed their commitment to ensure stable LNG supplies to South Korea," the MOTIE said in a statement.

During the meeting with the Kogas CEO, Kaabi discussed "enhancing bilateral cooperation and expanding business relations," QatarEnergy said separately, describing Kogas as "an important buyer of Qatari LNG."

Qatar had long been the biggest LNG supplier to South Korea. In 2023, Qatar was replaced by Australia as South Korea's biggest LNG supplier.

South Korea imported 8.6 million mt of LNG from Qatar last year, accounting for 19.5% of its total imports. South Korea's LNG imports from Qatar has been decreased recently.

Over January-September, imports of Qatari LNG fell 6% year on year to 6.513 million mt, compared with 6.932 million mt a year earlier.

Kogas has three import deals with Qatar's RasGas Company: 4.9 million/mt (1999-2024), 2.1 million mt/year (2007-2026) and 2 million mt/year (2013-2032). Under a new 20-year deal signed in July 2021, Kogas will import 2 million mt/year from Qatar Petroleum from 2025.

Qatar's North Field East project, along with the North Field South and North Field West expansions, will increase the country's LNG production capacity to 142 million mt/year by 2030, from 77 million mt/year currently.