JERA expects more overseas LNG sales as it expands trading portfolio

By Emily Chow

BANGKOK, Sept 17 (Reuters) - Japan's top power generator JERA expects to sell more liquefied natural gas outside Japan over the next two years as it expands its trading portfolio to help safeguard energy security against volatile power demand, the head of its new global LNG unit said.

JERA Global Energy Solutions (JERA GES), the Singapore-based entity launched in July this year, is seeking to better balance seasonal fluctuations in Japan's LNG demand by broadening its customer base beyond its home market and building greater flexibility into its portfolio, Chief Executive Irtiza Sayyed told Reuters on the sidelines of the Gastech conference.

"Japanese market demand is continuing to be volatile ... Going forward, we anticipate that further introduction of renewable energy will make the peaks and troughs also bigger," Sayyed said.

A larger, more flexible and diverse portfolio combined with sales into overseas markets would help JERA better manage those domestic demand swings, he said.

"The bigger our portfolio, the easier it is for us to essentially shrink the amplitude between the shoulder months and the winter periods," he said.

JERA, a joint venture between Tokyo Electric Power 9501.T and Chubu Electric Power 9502.T, is Japan's largest LNG buyer. It handles about 35 million to 40 million metric tons of the fuel a year, most of which is used for power generation.

The bulk of JERA's LNG volumes are currently directed to Japan, but JERA GES aims to build positions in overseas markets. JERA signed its first long-term export deal in December with India's Torrent Power TOPO.NS, which will use the LNG for its power plants and for sale to households, small industries and the transport sector.

"I'm hopeful that within the next 24 months we start to see some fruits of the labour here," Sayyed said.

He expects JERA to complete a handful of LNG sales beyond Japan during that period, building on interest in Southeast Asia while studying new opportunities in South Asia.

Sayyed also said JERA GES was monitoring emerging markets, where competition for gas turbines from data centre projects in developed economies could slow the development of power infrastructure.

"The demand for LNG will still remain, and data centres are creating that short position for LNG," he said.

"We're constantly looking for unique opportunities where we can invest in power plants, regasification terminals. We're happy to invest there, and bring in LNG."