Idemitsu seeks stake in Canadian gas field to secure supplies in japan

Idemitsu Kosan Co., Japan’s third-biggest oil refiner, is seeking a stake in a natural gas field in Canada to secure supplies for a proposed export plant in the country that will ship the fuel back home. The company wants to hedge against gas price volatility by holding the upstream interest as it builds its first LNG plant with partner AltaGas Ltd., incoming president Takashi Tsukioka, 65, pictured, said without giving a budget or identifying a target. The terminal will be located on the west coast of Canada and ship as much as two million metric tonnes annually as early as 2017, according to Tokyo-based Idemitsu. Japan’s energy companies are rushing to meet fuel demand following the Fukushima nuclear disaster two years ago. Idemitsu and AltaGas are among companies planning to build LNG plants on the west coast of Canada to export to Asian countries as a boom in output from shale formations has lowered North American gas prices. Freight costs for west coast projects will be cheaper than those shipping LNG through the Panama Canal, Mr. Tsukioka said. Shipping LNG from Kitimat and Prince Rupert, both on Canada’s west coast, to Japan takes about 10 days, Keisuke Tsujimoto, chief of stateaffiliated Japan Oil, Gas & Metals National Corp.’ s Vancouver office, wrote last month. Shipments from Sydney take about 15 days and from the Gulf of Mexico 20 days, he said, adding longer travel times increase transport costs.