Tokyo Bay LNG Bunkering Moves Forward Despite Demand Uncertainty

Wednesday July 11, 2018

A project to bring liquefied natural gas (LNG) bunkering to Japan's Tokyo Bay is moving forward with help from the government despite uncertain demand for the alternative marine fuel.

As Ship & Bunker previously reported, in April Sumitomo Corp, Uyeno Transtech Ltd, and Yokohama-Kawasaki International Port Corporation (YKIP) signed a memorandum on conducting a join study for the project.

The trio have now been awarded a subsidy by theĀ Japanese government, who say they will now form a joint venture to own and operate an LNG bunkering vessel in the area and commence a STS (Ship-to-Ship) bunkering operations in 2020.

The size of the award was not revealed.

"In pursuit of promoting cleaner marine energy for the future, with little forecast of local demand in sight, YKIP believes that this challenge requires to ally and justifies to receive the governmental aid from national fund, YKIP said in a statement.

"Through tremendous efforts made and progressive initiatives taken by the trio to achieve the prior investment for future such government decision was finally made."

A separate group of Kawasaki Kisen Kaisha, Ltd., Chubu Electric Power Co., Inc., Toyota Tsusho Corporation, and Nippon Yusen Kabushiki Kaisha are also working on a separate LNG bunkering plan, with an LNG bunkering vessel scheduled for delivery around September to December 2020 that will operate in the Chubu (central) region of Japan.

And OECD report this year concluded that Japan has the potential to become a LNG bunkering hub, but success could be hampered by future emissions regulations.

Japan is currently the world's largest importer of LNG.