Japan’s Jera, the Tepco-Chubu JV entered talks with Kogas of South Korea and China’s CNOOC to form a large LNG buyers alliance.
Hiroki Sato, Jera’s vice president of the company’s fuel buying department, told Bloomberg that the company is looking to cooperate on liquefied natural gas procurement and investment.
It is expected that a memorandum of understanding is signed on Friday.
With new supply coming from Australia and the United States, consumers had a better bargaining position recently, however, an alliance of LNG buyers could pull the advantage back in their hands.
Sato added that the alliance opens doors to lower prices with larger volumes. Lower prices would subsequently be passed on to other smaller buyers which could benefit from the formation of such an alliance.
The companies within the group would have the option of trading and swapping cargoes among each other in order to balance supply.
LNG World News Staff