Japan, US target Alaskan test gas hydrate output

Japan, US target Alaskan test gas hydrate output  

Argus Media

“Japan and the US have agreed to co-operate on methane hydrate production onshore Alaska, targeting test output within the next five years.

Japan’s state-owned energy agency Jogmec and the National Energy Technology Laboratory, affiliated with the US Department of Energy, have signed an initial deal on test production spanning five years from 2015. Jogmec will carry out various research and preparatory activities including project planning, exploration and a site survey.

Jogmec is hoping to gain expertise in gas production from methane hydrate bearing sands in permafrost onshore Alaska, similar to the reserves offshore Japan’s central Pacific coast. Jogmec last year managed test production of gas from offshore deposits, prompting a group of Japanese firms this year to set up a joint venture to help realise commercial gas hydrate production.

Japan estimates the ice-like solid containing natural gas in its domestic waters is equivalent to meeting the country’s gas demand for 100 years. It wants to develop cost-effective technology to produce gas from domestic methane hydrate reserves to slash the country’s huge fuel import bills. Meti has continued to allocate more than 10bn/yr ($88mn/yr) for domestic methane hydrate exploration and technology development.

Today’s initial deal was done on the sidelines of the third annual LNG producer-consumer conference hosted by Japan’s trade and industry ministry. The conference has representatives from about 50 countries discussing LNG pricing and the future market outlook, part of Tokyo’s efforts to campaign for reduced LNG purchase costs to ease the financial burden on the country’s LNG importers.

Japan continues to see record-high LNG imports because of the slow process in restarting closed nuclear reactors, forcing its power utilities to turn to LNG for power generation. The country’s LNG imports during the first nine months of this year totalled 66.4mn t, up 3pc on the same period a year earlier. These imports are valued at 5.8 trillion, up 11pc from a year earlier.

Jogmec also yesterday signed an initial deal with Canada’s ministry of natural resources for co-operation on unconventional oil and gas technology, targeting support of Japanese investment in unconventional oil and gas development projects in Canada. Jogmec is backing trading house Mitsubishi’s shale gas project at the Cutbank Ridge shale assets in British Columbia, a potential future LNG supply source for Japan.”

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