Reuters is reporting that Japan’s Tokyo Gas is aiming to renegotiate its long-term LNG contracts.
This action is reportedly being taken with the aim of eliminating fixed-destination clauses and increasing supply flexibility.
In 2017, Japan’s Fair Trade Commission ruled that destination restrictions preventing the resale of LNG cargoes were in breach of competition rules. However, Japanese LNG buyers have since been slow to comply with the ruling – prices of long-term contracts are typically reviewed every four to five years.
This latest news demonstrates that Tokyo Gas is stepping up its efforts to make its LNG supplies more flexible and more diverse.
Notably, Japan’s JERA, the largest global purchaser of LNG, has also renegotiated some its supply contracts in order to remove destination clauses.
Read the article online at: https://www.lngindustry.com/liquid-natural-gas/26092019/tokyo-gas-to-renegotiate-lng-contracts/