Update On Natural Gas Exports To Japan And South Korea -- RBN Energy -- May 7, 2015; Japan, South Korea Back To Coal?

This is a very, very interesting post. Many, many data points. The post will be archived at the source, by the source.

Some data points from today's RBN Energy posting:

Japan:

Japan’s effort to restart most of its idled nuclear fleet has not been going well. As of May 2015, none of Japan’s nuclear units is back online, though it’s possible Kyushu Electric Power may finally get the OK to restart two units at its Sendai station as soon as June.

The overall outlook for nuclear in Japan remains pretty bleak—odds are, only a handful of idled nuclear units will return to service in the next two or three years.

It’s possible that half or more of Japan’s nuclear units will never be restarted—it may simply cost too much to bring them up to the nation’s new, tougher earthquake and other standards.

With nuclear unlikely to provide more than 10 or 15% of Japan’s power needs, the Land of the Rising Sun is turning to renewables (mostly wind and solar) and to more fossil-fired generation, initially in the form of more gas-fired units but possibly (according to a new government plan unveiled in April 2015) with several new coal units.

The bottom line is that Japan’s LNG imports are expected to remain pretty much where they are (in the 90 MTPA range) for the next 10 to 15 years.

South Korea:

Korea in 2014 imported more LNG (38 MTPA; 4.8 Bcf/d) than China and India combined (China received 19 MTPA; 2.4 Bcf/d and India 14.5 MTPA; 1.9 Bcf/d).

But LNG imports into Korea were off 7% last year from 2013, due in part to milder-than-normal weather and in part to the Korean government’s efforts to rein in power costs (and become more competitive generally) by using its nuclear and coal units more (and using its gas-fired units less).

The 2014 drop in LNG imports appears to be an anomaly, though, and very gradual growth in imports seems likely over the next few years.

Several thousand megawatts of new gas-fired generating capacity is under construction, and state-run Korea Gas (KOGAS) is expanding its LNG import, regasification and gas pipeline network to handle an expected increase in LNG demand.

Like its Japanese counterparts, KOGAS (which gets well over one-third of its LNG from one source—Qatar) has been on a diversification/hedging kick, contracting for U.S.-sourced, Henry Hub-indexed LNG (KOGAS has signed up for a total of 3.5 MTPA—or 450 MMcf/d—of liquefaction capacity at Sabine Pass LNG’s trains 3 and 4, which come online in 2016-17).

As the world’s largest LNG buyer (at least until the Tepco-Chubu alliance ramps up and edges KOGAS out of the top spot), KOGAS also is pressing its long-term LNG suppliers for oil-index and destination-flexibility changes to its contracts—again, to cut costs and prepare for that Whole New World.