The EU and Japan, who together, account for nearly 50% of overall global liquefied natural gas (LNG) consumption, signed a bilateral memorandum of cooperation on Tuesday 11 July on promoting and establishing a liquid, flexible and transparent global LNG market.
As part of the memorandum signed by European Commissioner for Climate Action and Energy Miguel Arias Cañete and Japanese Minister of Economy, Trade and Industry Hiroshige Seko, the EU and Japan will share experience and undertake joint activities to spread best practices to improve the functioning of the global LNG market. These include flexibility in contracts for LNG sale and purchase, the organisation of gas hubs in consumer markets, price transparency and reporting.
In addition, the European Commission and the Japanese administration will enhance their coordination in international fora and organisations in the area of energy, in particular regarding responses to unexpected gas market disruptions. The objective is to involve all LNG producers and consumers in joint activities to promote the liquidity, transparency and flexibility of the global LNG market. This will help ensure competitive LNG supplies and improve the resilience of the international market and its capacity to respond to emergencies.
“In close cooperation with the EU, Japan will lead the world’s efforts in enhancing a liquid global LNG market, including the abolishment of restrictive destination clauses”, said Seko.
The EU and Japan each have LNG strategies: - the EU adopted a strategy on LNG and gas storage in 2016 to improve security of supply through increased diversification focusing, in particular, on the most vulnerable regions such as South-East Europe, the Baltic region and the Iberian Peninsula; - Japan, the world’s largest LNG importer, also published a strategy for LNG market development in 2016, aiming to create a flexible global LNG market and develop a LNG trading hub in Japan. (Original version in French by Emmanuel Hagry)