Executives say that Japanese utilities could find a replacement for Sakhalin-2 in the event of LNG supply interruption.

Executives said that Japanese utilities JERA, Tohoku Electric Power Co and Sakhalin-2 can find alternative sources of gas if the flow is interrupted. This comes amid U.S. demands to stop energy imports from Russia.

This month, the U.S. urged Japan and other Russian energy consumers to stop imports as they push the Kremlin toward ending the Ukraine war. Japan's contracts with Sakhalin-2, which are long-term agreements, cover approximately 9% of its imports of LNG.

JERA receives about 2 million tonnes of LNG each year under two contracts that expire in 2026 or 2029. JERA is a major LNG trader. It handles between 30 and 35 million tons per year, both for its own use as well as to be resold elsewhere.

Naohiro Makawa, a JERA executive officer, said that if the Sakhalin supply needs to be replaced "there's a good chance" we'll be able do something, he added.

Takayoshi Enomomoto, the senior executive of Tohoku Electric Power who gets about a 10th of its LNG supply from Sakhalin said that they are working to diversify their supplies in order to reduce the risk of an abrupt interruption.

Tohoku’s contract with this project expires 2030. Another senior official stated in February that the company was considering a possible halt to Russia purchases. Tohoku could also increase its U.S. Liquefied Natural Gas purchases.

Two Japanese government officials claim that Sanae Takaichi, Japan's prime minister, told Donald Trump at their meeting this week in Tokyo that it would be difficult to ban Russian LNG imports.

Japan also buys LNG to meet its emergency needs, a program it could expand in the future for increased energy security.

Support for Alaska LNG is still uncertain

Scott Bessent, U.S. Treasury secretary, reiterated on Thursday that he believes Japan will eventually stop receiving Russian gas supplies and join Trump's Alaska LNG project.

Bessent said that South Korea and China may also support the U.S. pipeline project.

JERA and Tokyo Gas have only announced preliminary orders for the $44 billion Alaska LNG project.

Maekawa, of JERA, said that the company continues to collect information about Alaska's supply and feasibility.

Enomoto, from Tohoku, said: "It's not clear what the cost of procurement will be... but it is possible there will be positive impacts in terms energy security and diversification," (Reporting and editing by Kate Mayberry; Yuka Obayashi, Katya Glubkova)

(source: Reuters)