Japan has agreed to offer 130 billion yen ($899 million) in loans to JERA, the country’s biggest power generator, to help to secure liquefied natural gas (LNG) amid a surge in spot prices.

The state-owned Japan Bank for International Cooperation (JBIC) on Thursday said it will extend the loans to JERA, a joint venture between Chubu Electric Power and Tokyo Electric Power, in syndication with private sector financial institutions.

Japan wants to avoid an energy crunch by offering financial support before winter, when heating demand is expected to increase. Spot LNG prices remain at high levels because of the risk of disruption to supply from Russia resulting from its invasion of Ukraine.

Japanese utilities buy the bulk of their LNG through long-term contracts, but about 20 per cent comes from the spot market.
Source: Reuters