···~·1. - [i{I/A\00~/A\ c §rn3/A\®©@ . Susitna Joint Venture Document Number

., .. -~_32-i..f~ Please Return To DOCUMENT CONTROL -I I lD6 51TURTIOD

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I NIITSUI&CO.,LTD. I TOKYO, I I I { . ' •• I I I I LNG Sl~fUA ~ftO~I IN JAPA~I I I I I I I I JANUARY 1985 l'" I l t i l" :I i

) I I l,, l l

) I i r l. l 1,. ' !'' I j I 1~..

.~ LIST C> F CONTENTS

Page I I .LNG FLOW TO JAPAN ------1 •'•;

1 ) L N G F L 0 W T 0 J A P A N ------2 I 2) L N G S U P P L Y S 0 U R C E S I N 1 9 8 2 ------3 3 ) H I S T 0 R I C A L L N G S U P P L Y B Y S 0 U R C E ---- 4 4) 0 P E R A T I N G L N G P R 0 J E C T S ------5 I 5) T Y P I C A L S P E C I F I C AT I 0 N S 0 F LNG ------8 I I. LNG SUPPLY AND DEMAND FORECAST ----9

I 1) FORECAST OF JAPAN'S LNG SUPPLY A N D D E fttf A N D ------10 2) NEW L N G P R 0 J E C T S ------12 I 3) GAS AND ELECTRIC POTHER COMPANIES LNG PURCHASES 1 9 7 8- 1 9 9 0 ------13 4) JAPAN'S LONG-TERM FORECAST OF I ENERGY SUPPLY AND DEMAND ------21 5) JAPAN'S LONG-TERM FORECAST OF I E L E C T R I C S U P P L Y A N D D E MAN D ------29 III .FINANCING ------36

I IV. LNG PRICE ------38

1) AVERAGE CIF PRICES--LNG AND I CRUDE 0 I L ------~-39 2) L N G P R I C I N G ME C H A N I S ~1 ------41 I V . L N G R E C E I V I N G T E R M I N A L S I N J A PAN ------44 I V I . L N G V E S S E L ------50 1) M A I N PART I C U LARS 0 F LNG VESSEL ------51 2) L N G V E S S E L S U S E D F 0 R P R 0 J E C T S ------52

I VI I. INTERNATIONAL LNG TRADE ------57

1) LNG EX P 0 R T BY C 0 U NT R Y I N 1 9 8 3 ------58 I 2) L N G I M P 0 R T B Y C 0 U N T R Y I N 1 9 8 3 ------59 3) I N T E R N A T I 0 N A L L N G T R AD E I N 1 9 8 3 ------60 I' I I I •• • I .. I I I LNG FLOVV TC> JAPAN I I I I I I I I I ( I \·: I I I

I -1- I ------~----~

----- ., __ ....

LNG Flow to Japan.

f~·:J,. - -· t'f018CI.~

. ' 0 • [ iiiiPat.aM' Quantities (Unit : Million tonnea)

···: ,.. O Abu Dhabi J" ~ :-, lJ I [2.061 Canada •.. Malaysia I [2.90] tJ I [6.00]

Brunei (. ' [5.14]

Indonesia Original : 7.50 Additional : 0.90 Australia Expansion : 3.30 (Arun) [5.84] 3.20 (Badak)

------·-...... ·-'<'· -·---··-·-, l ..c:==~ I

~

---·---,-·,- ~·~-,_.-•--·« ~- ~-_.,,.,. __.,., •--·--··•·-n-~·-----··-·- ,...... ,, ·.-L·.-: - ·­ ••

Q -~ L I c 0 -·­·- I ~.. I

I ., ·-"'QJ \0 c \D -~0 0 . M I -a 0...... -c - I I ! ! l I .0"\ -~ I L.f') 0 1 . 0 t ! 0 0 l N~ I - I r I i I I I I I I I -3- I fi I ------~------~---•

_..~~~ -- -- .,, ------·

Historical LNG Supply by .source TOTAL 20.59 20 UNIT: MILLION MT -----i,ill!l,llillilllllif;i~ll

U' ."L...... TOTAL 16.96 c

~5

.. .l _,•" ~ f v 1 10 I I ~ I TOTAL 8.25 ~

i 1 I INDONESIA 10.66

I; " 5 INDONESIA 8.67 (?E) BADAK 1.38

<. C· INDONESIA 1.27 FISCAL 1977 1980 1983

j

- ·---~-, ""~"·- -~' - -- -·-~·-~-- ~ ...- ...... -...-~.~- """• • ------,.------"-' -·--·-··----~.,---·· ,.----·-;···-,------·-~--.. ~ti;; ,,, . ,. ,v ·'·;;'.,.; ~-~~.~~i,,tf~---·~ '': -,:-·"' ALi - - - ~ - - - M4 - - itLXJ - - •--~J L __ J -- ,. -

I- 4) OPERATING LNG PROJECT-- EXPORT TO JAPAN --NO. 1

(as of December 1983)

COUNTRY OF ORIGIN U.S.A. BRUNEI P.BU DHABI (ALASKA) (DAS ISLAND)

QUANTITY EAPORTED TO JAPAN millon MT/year 0.96 5.14 2.06 ..

BUYERS Tokyo Electric 0.72 Tokyo Electric 3.45 Tokyo Electric 2.06 million MT/year Tokyo Gas 1.06 _,:f' Tokyo Gas 0.24 Osaka Gas 0.63 I 1{ .·,;;;·'

I START-UP November 1969 December 1972 May 1977 U1 I

PERIOD OF 15 years * 20 years 20 years CONTRAC'I' ' LOADING PORT Kenai Lumut Das Island ,, -· i -c. NAME OF GAS FIELD North Cook Inlet South West Ampa Unun Shaif, Zakurn

VESSELS USED 71,000 rn3 x 2 76,900 rn3 x 2 125,000 m3 x 4 75,000 rn3 x 5 87,600 rn3 x 1 •. ~.- MARINE DISTANCE 6,000 4,400 12,000 .,. TO JAPAN: KM (3,200) (2,400) (6,500) ():NAUTICAL MILE . * The contract was extended untill 1989.

~ ·~ •q• ------··--IBI!i------..

I-4) OPEUATING- LNG PROJECT--EXPORT- TO JAPAN--N0.2 (as of December 1983) - ·-· I COUNTRY OF ORIGIN ·-----·' INDONESIA MALAYSIA I -- (Original) (Additional) (SARAWAKU) 1983 1.37 ENTITY -:~PORTilD •ro BADAK 3.00 AHUN 4.50 I 1984/'86 0.91 6.00 AN million MT/year 1987/'97 0.68 7.50

I Kansai Electric 2.40 Chubu Electric 1.70 Kansai Electric BUYERS Kyushu Electric 1.50 Chubu Electric Tokyo E1ectric 4.00 million MT/year Osaka Gas 1.30 Kyushu Electric Tokyo Gas 2.00 l? Nippon Steel 0.60

I 0\ 0 I STARrr-UP August 1977 January 1983 February 1983

- -·---. c l PERIOD OF CONTRACT 23 years 15 years 20 years 't~(~ ,, ------· (.J

LOADI:~G POH.'l' Bon lang Lho Seurnawe Bontang/Lho Seumawe Bintu1u

~-· - .. NAME OF GAS FIELD Badak Arun Badak/Arun Central Luconia lc

.? VESSELS USED 125,800 rn3 x 1 130,000 rn3 x 5 125,000 m3 x 6

.... MARINE DIS'fANCE 4,600 6,100 Badak 4u600 (. 2' 5:00) 4,600 TO JAPAN: KM (2,500l.t (3,300) Arun 61,100 <3,:wcn (2,500) c • l (): NAUTICAL MILE -·- -

• '• ,'>·- ~------~-w..------~~~~~--•

I-4) OPERATING LNG PROJECT--EXPORT TO JAPAN--N0.3

(as of December 1983)

COUNTRY OF ORIGIN INDONESIA " ---- BADAK ARUN . - ";1;. QUANTITY EXPORTED TO JAPAN millionMT/year 3.20 3.30

Chubu Electric 1.50 ';1;:> Kansai Electric Oo8Q Tokyo Electric 0.>40 ; '' BUYERS Osaka Gas 0.40 Tohoku Electric 2.90 million t-lT/year Toho Gas 0.50 '<':

I ' • -J ,. ,I START-UP 1983 1984

PERIOD OF CONTRACT 20 years 20 yea.rs ,•

-,_~ " LOADING PORT Bon tang Lho Seumawe

~ NAME OF GAS FIELD Badak Arun

' VESSELS USED 125,000 m3 x 3 125,000 m3 x 4 .,,, l

,-,~ ~~RINE DISTANClB TO JAPAN: KM 4,600 6,100 I

;,~ (3,300} ..- .... I ():NAUTICAL MILE (2,500) l ~

~

~ q ',) --- ...... ______

I-5)

TYPICAL SPECIFICATION OF LNG IMPORTED TO JAPAN . . INDONESIA ALASKA BRUNEI ABU DHABI BADAK ARUN SARAWAK

COMPOSITION MOL % "

Methane cl 99.8 89.83 77.2-89.4 89.95-90.09 85.12 91.6

Ethane c2 0.1 5.89 9.1-21.3 5.35- 5.46 9.32 4.1 ,1': '_. Propane c3 - 2.92 1.3- 1~4 3.13- 3.14 4.58 2.7 :. .,:.i

Butane c4 - 1.3 0.1 1.37- 1.39 0.97 1.5 I + i .•: en Pentane cs+ I - 0.04 - 0.04 - 0.1 "' ' Nitrogen N2 0.1 0.02 0.1 0.01- 0.02 0.01 - 'I

'·· SPECIFIC GRAVITY 0.424 0.464 0.470 0.462 0.475 N. A.

-I-·

·~ GROSS HEAT VALUE MMBTU/MT 52.6 51.594 51.659 51.56 51.45 N. A.

TON-CUBIC METER 1,397 1,226 1,262 1,226 1,215 N. A. CONVERSION NM3/MT

"-- ...... ,,...... ,_. __ ~~ ,___. ···-- ---~~'·"_...,__.. ______,.~ ...... __..._._....._..,..._.,. ______....__~..-_ . .__._...... _7'""'_" -~;;------:.--~~---~- t

I~ I I I I LNG SUPPLY AND DE:rv.I.AND FC>R.·ECAST I I I I :I I •I I I I I I I· I -9- I I --~IJB1MII\Jala...... ~------

------·----·. ··-- ··------. --·- -·- -

Forecast of Japan's LNG Supply and Den~and . :~

"-,_·

-.. 37.70 40.00 40 r UNIT: MILLION MT 37.76 * It is assumed that the existing contracts of ALASKA and BRUNEI will be extended.

J' ,•;,,•··c·.~ 34• 00 •d ...... ltlt lEE DEMAND FORECAST (Jun. 1984) (::; 30 r MITI DEMAND FORECAST (Nov. 1983) I I,lit PAJ DEMAND FORECAST (Jul. 1984)

I 1-" 0 20 I

c • • . ~·m·.,{····< • ,,••• ,.,; • . .4 ~ • 't-'Jl'•· INDONESIA 1-i.70 10 INOOIESIA INDONESIA 10.66 OFIGJNAL 7 .50) ORIGINAL 7 .50) ~0.70 ADOI1'IONAL 0.70 ARUN . 3.30 ARUN 3.30. ORIGINAL 7.50\ ( ( BADAK ; ~ 3.20 aAoAK 3.20 AOOmONAL i'; ~ 0.89J ~~- '~~-~-- ~j ARUN 0.89 ~;;. ·t'~t ~ ~ ( ._ .. BADAK 1.38 1995' FISCAL 1983 1990

---.., ,. . -· .. --- ··-- ·-~ ·' • C/ ~

FORECAST OF JAPANESE LNG SUPPLY AND DEMAND

UNIT: MILLION MT/ ~ FISCAL YEAR 1983 1990 1995 2000(ESTIMATE) DEMl~ND The MIT! forecast 20.59 36.50 40.00 41.90-43.30 SUPPLY (IN OPERATION) USA/ALASKA * 1.04 0.96 0.96 - BRUNEI * 5.23 5.14 5.14 5.14 ABU DHABI 1.81 2.06 2.06 2.06 INDONESIA 10.66 7.50 7.50 7.50 MALAYSIA 1.85 6.00 6.00 6.00 '"li ·- (SUB-TOTAL) 20.59 21.66 __21.66 .._....,: 20.70 I (NEW CONTRACTS) INDONESIA/ADDITIO~ - 0.70 0.70 0.70 BADAK - 3.20 3.20 3.20

I ARUN - 3.30 3.30 3.30 l-' AUSTRALIA - 6.00 6.00 6.00 l-' I CANADA/DOME - 2.90 2.90 2.90 ·:::;. (SUB-TOTAL) - 16.10 16.10 16.10 ,:~ SUPPLY GRAND-TOTAL 20 .. 59 37.76 37.76 36.80 --

I SUPPLY SHORTAGE -1.26* 2.24 5.10-6.50 . ~ .; - I PLANNED PROJECT (NO COMMITtJ.IENT)

THAILAND 3.00 I J USSRfSAKHALIN} 3.00 -c QATAR 6.00 r " l ,( TOTAL 12.00 I NOTE: * It is assum~d that 1) the Alaska contract will be extended for 5-10 years from 1989. 2) the Brunei contract will be extended for 10 years l from 1993. l ~· I * Negative figures indicate that commitments exr Jed estimated demand. l

'! 'L '. ---"-;;- ~--··""·-~~·-·--~---··"""~"' ...... ".... '~·--~~ ...... ~ ...... ---...-,-,- ...... -,..,...... ---~--r/"'"'....._.. _____~-·--··-----~..--.....,..~-..-...- ...... ,_., ___,. .. _ .. ___~--...~-~k· .. ---...... --~----·---..._,__,.,..,_4_ _.__....,., ~ - iiil .. - liB IIIII ;a aB .. FBI - .. .. a. ._ -· - --

II-2) NEW LNG PROJECT--EXPORT TO JAPAN--

I COUNTRY OF ORIGIN CANADA AUSTRALIA I (DOME PROJECT} (NORTH WEST SHE~F)

QUANTITY EXPORTED TO JAPAN rnillionMT/year 2.90 5.84

Tokyo Electric 0.90 Chubu Electric 1.60 Chubu Electric 0.90 Kyushu Electric 0.30 Kansai Electric 0.90 BUYERS Chugoku Electric 0.30 Chugoku Electric 0.90 ' -1 million MT/year Osaka Gas 0.55 Kyushu Electric 0.90 Toho Gas 0.15 Tokyo Gas 0.58 Os~ka Gas 0.58 I Toho ·Gas 0.18 I-' N . I START-UP 19'87 1988

PERIOD OF CONTRACT 20 years 19 years ':·,.

J; ~: LOADING PORT Grassy Point Dampiar ·'

NAME OF GAS FIELD Gas in Alberta and British North Rankin -:"!_ I Columbia I VESSELS USED 125,000 m3 x 5 125,000 m3 x 7 I I I MARINE DISTANCE TO JAPAN: KM 6,600 5,900 (): NAUTICAL MILE (3,600) <3,200)

~.-,_,.,~--~·~~--_,.,-~-----·~--- '>"~- ~---~·-~~~ iii .------,--~--~-=:~=~--:·~-~-::_------~=~=--=~ ;~ -~--=-~~--=:-:---::-::--:-:~:~~8 -=·::-~~..,--=·:-:,}'-~,\ :'•"f;~~ ;•c ::rl,-F -, :t~\' .~-:-::--<--:'>t"?-/ ~~'"" ,p:jfZ~~~l ·-=-~ " ...... __ - . • • C' ~ . - 0 " ~, I . - .. • 4 91 • 'D ' ' ~ ' • • •

~.iF"~ • ~~ ·-·~·

...... ___.. . . --' ~------~---~--'

_ _...~ -~'" - --- ..,., ______

Service Areas of the Nine Electric Power Companies

,,

:;::: ! ~ t. '·

0 shows company using LNG. I J· I-~

n The Japanese Sea

Hokuriku TohokUl I I I-' Electric l,..J Electric 'j --..-::.~ I Chugoku ' 0 Electric 0

Tokyo Electri:c ; Kyushu Electric Shikoku Chubu Electric Electric The Pacific Ocean o#' Kansai Electric

L ·--- ...... ------·----~-··,-- ·----- .. ·------~~·-····----;-~------~------·:-·--·-·-:-- -. ..··.:.~·-'.:~-;;r::-1li:~-~"j;~~-.------~------

-· ··- -- -·------·----·-~-----

Service Areas of the Town Gas Co~npanies

• Service Area of Major 'Town Gas Company ·Location of l'own Gas Company

~"~~~'1.'i&: :.,_ ...':1 :'( '.·· ·~ ?( ~ I .t:· ''!< The Japanese Sea

I ,...... c. I Toho Gas 0 0 ...... ; . . .. ;""' :· : ' ,...... - ~

\:\_

Osaka Gas Tokyo Gas The Pacific Ocean ~ a/ t.. (_) I ,.~ - ~-- """ '"------._,.._,_0~,._,.--~~.,...«w•~:~~,_ ·:--~·-... --·--··-_.-.-....-"'"''-,_--;>'-~...... ---(}_____ -. ·;,,-'":----- __,:~,#: ~~--~~ ... jf~":,:t ,•~~.~;~i~t~ ~ -•

"; s~ • ·-...... >· :J~ • ; . - '_· ---·------~ -;;:;-;:- • 7'".·- ,.. - - .;;-; - ". - ... _..., ,c:;;;·, ______

------~a. .... a...... ----

Electric Power Cotilpanies LNG Purchases 1978-1990 6

. ·, ~ TOTAL 28.9 30 r (Unit : Million MT) CHUGOKU 1.2

-. •> 25

20 ·J I 'I....

'!:'

.....I U1 15 I

10 TOTAL 8.1

TOKYO 11.5

5 TCJt(YO 7.0 ·J TOKYO 5.3 ~ 4 ... ~f.

L L 0 1978 1983 1990

I4 ,_ u:;aaam ~--- _ ~~--~...... ,.~·~-.... ··------.~·-~~~---. ~·~-"~r-'-'-'·----.-. ~-y'-~ -~;~-~~-: ~~~~~ ~ ·;~-~t~:-~G'~~~~~:rJWJJIJB •

·~· .. ~. -~··" . __ , ·-~~-"" •""""""' .. , -:<._ -~-·-~----· ·;. ·- .. ... --. .. - - .. .. - ...... u. - .. '-1m ~ ~ - -] --• •

Gas Companies LNG Purchases 1978-1990

10 r (Unit: Milliortl :MT)

TOTAL 8.2

8

·c.l 1'~ f I < ~;\ . . """ 6

._.I TOTAL 4.6 0'\ I

4

TOHO 0.02 a ·-.. . .'7 .. :=:1

TOKYO 3.9 2

TOKYO 2.3

TO'

i I I 1 1 d C• j ol I 1978 1983 1990 '

. . i u ,., ...... -.. ... ~._,.,.-.-....----~ -*~·~,....,.-.....~~--~--.,_~'::7.2!...... -~'"---=..-.~~~- ..t' :··.~ . _;'. ' ..~-~i~~.~~:-~·;:;,ljiiJi~ifli'i~~~~~·;,tQ!:i~l • "' 'k...... • "' ~- t:. j

ll!llaia!QMCIIJIQBialll~------~------' -~

. ... --- ... _ ·- cC Gas and Electric Power Companies LNG Purchases (Unit : Million MT) ,, TOTAL in 1983 by Source 7.0 7 r::·;:;:;.;:::::::::::::;' :·:·:·:·:·:·:1 ALASKA 0.9 -BRUNEI - DAS ISLAND 6 1 il~_;;;\i \f;~i!il\\l\\l .

5 ! 1 ~...... __ "

4

I 1-' 't I TOTAL TOTAL 3 r F .-~-~:.· I 2.9 . . . . I TOTAL .. I 2.3 · · 1 1 r TOTAL . ~0 • i. '3 TOTAL 2 1.6 I I 1.0 ,_....,... f I 2.9 TOTAL 1 . h··•·· I TOTAL .. :··-· 0.6 : '~:3,)l - _;. 0.4 r:·-:-·-:-.::. ··:· ..· cr4::~\=:::·: : ::1~1

Ql I - KYUSHU TOHOKU TOHO TOKYO KANSAI CHUBU TOKYO OSAKA ELECTRIC GAS ~oooo •• - !:1 ~:rTRir l=ll=r.TRir. Fl Fr.TRtr. GAS GAS ELECTRIC I 7 .-----·-·------~--,--~-·-·----~- ~--~~. --~-.;.~~~};::::' !.911~~

u :

.11....:'--- ...... :>...- • "--*' ~ --~ ""-" •>" ,-.~•,>-, o•~ .-.. ~~ 't•o> ·-·,; "; ...... ~ .. . - ' ...... :( - ..\:: .

1/ ;_;,. A.";.> ~\~ ..... u.Q~,._,...... _:~~:·__ iJ..~...

--ra.-.klMIOMICIII~3111--~~CliiiBII ~­~ ... ~ -• - -" I ! ~ I l 1 \ l Gas and Electric Power Companies LNG Purchases

~I un,t: Million MTJ in 1990 by Source 1 f,.: ',, ~:( I TOTAL 11.5 ·.·. ' . 0.7 :; \ -BRUNEI \1 [M DAS ISLAND iO (f(~{fJ INDONESIA ! @M SARAWAK -..' ~ ' I f : :1 N.W. SHELF . ] ! I I~ANADA I I I l{ 8 ·*' \ i ["2~:~:J ALASKA

TOTAL 6.2 I ~-~ ()j 6 l 1.6 I TOTAL 4.3 TOTAL a·g 3.9 TOTAL 41- r""'-c: . ·,_'E""'~'al- I I I O.Q l 3.45 m02 TOTAL TOTAL ·.. ):)·1 h ' :-: ::·~ ::: •-, 1 __ ___ r o.ss 1 '\0 2.9 Ill' .....

2 . 3.7' '

0 L - I ., J I I l I I .. I I . ' ' . I t:·:·: ·:·:·:-• ·. ·, I I· . ... ' . .. . ( l TOKYO CHUBU KANSAI TOKYO OSAKA KYUSHU TOHOKU - --- ~-·-- - - I r1 rnTnll' r• rnTn•" rt r('Tn'n l'ftCl l"ftCl r1 f'I"TOII" [I Cf'TDif"

I ~~ --~-~~ - _ • .,_ • •• > ··~ • - ••• '') • ~-- ~ ~ - ,..,.,. • ___ ...., ··-~- --- ~-- II. • ~ ~ ~­ _, ------~ - ...... -I

POWER COMPANIES LNG PURCHASES IN 1'990

UNIT: million MT/year

SOURCES TOKYO CHUBU KANSAI KYUSHU TOHOKU CHUGOKU

ALAS AKA 0.72

BRUNEI 3.45

ABU DHABI 2.06

I INDONESIA t-' \!) (original} ( 1.70 } ( 2.40 ) ( 1.50 ) I (additional) ( 0.46 ) ( 0.18 ) ( 0.06 ) . ( Arun ) ( 0.40 ) ( 2.90 ) ( Badak ) ( 1.50 ) ( 0~80 ) ' Sub-total 0.40 3.66 3 .. 38 1.56 2.90 li~ MALAYSIA 4.00

AUSTRALIA 0.90 0.90 0~90 0.90 0.90 t . CANADA/DOME 1.60 0.30 0.30

TOTAL 11.53 6.16 4.28 2.76 2o90 1.20

POWER CO,.JPANIES GRAND-TOTAL: 28.83 million !vlT/ year L i! .. ~ - ...... -,.

GAS COMPANIES LNG PURCHASES IN 1990

UNIT: million MT/year

SOURCES TOKYO OSAKA TOHO NIPPON STEEL CORP. . ALAS AKA 0.24 ·- BRUNEI 1.06 0.63

INDONESIA (original) ( 1.30 ) ( 0.60 ) I N ( Badak } ( 0.40 ) ( 0.50 ) 0 I .- Sub-total 1.70 0.50 0.60- ' MALAYSIA 2.00

AUSTRALIA 0.58 0.58 0.18

CANADA/ DOME 0.55 0.15

TOTAL 3.88 3.46 0.83 0.60

:.:_ ' GAS COMPANIES GRAND-TOTAL: 8.17 million MT/ year (;: ; ~ l. L_. ' ·":-~·-:;-y-·· ----~----c-·-··-·c-,.·------~~~0:"*:,:~f~~~c~:f~~-.. ·'· ."~. ·_~,- "": '. ·, \ I~ Novermber 25, 1983 Mitsui & Co., Ltd. I~ Gas Division

I Sununary of Japan • s Long-term Forecast of Energy Supply and Demand I (published by MITI on Novermer 18, 1983> I 1) Basis of the Forecast (1) Although oil continues to be in plentiful supply internationally, it is generally thought that the I supply will tighten again in the 1990s and that accordingly, oil prices have a good chance of rising I again in the late 1980s and especially in the 1990s. It is necessary to base any forecast of future energy I supply and demand on this view. (2) rt is expected that Japan's energy demand will grow I gradually in line with the growth of the economy and will reflect ongoing changes in the industrial struc­ ture, the trend towards energy conservation and so I forth. I (3) In view of this anticipated gradual demand growth, the following points must be borne in mind in order to promote an energy supply that is stable in terms I of both quantity and price. I (i) As the energy supply structure of Japan is still extremely fragile, it is necessary to

~ achieve energy security by means of furthe~ j I reduction of Japan's dependence on oil based on l. t 1 .. the systematic and steady development and ! introduction of alternative energy sources. I I ! r (ii) It is necessary to reduce energy costs by I expanding the supply of economical energy I sources. I I

c . I~ (iii) It is necessary to pay due consideration to the balanced attainment of energy supply stability and reduced energy costs.

2) Main Points of the Forecast

(1) Target Years

The forecast for fiscal 1990, which was the target I year for policy achievement in the previous forecast, was drawn up in as realistic a manner as possible~ Fiscal 1995 was chosen as the ne~ target year for· I policy achievement. In addition, energy supply and demand in fiscal 2000 ~as tentative forecast with a I view to making possible a ].ong..,.term perspective with regard to energy supply and demand.

I (2) Energy Demand I Recent changes in the energy supply and demand struc­ ture have been incorporated in the forecast, which also takes into co&sideration the direction of the I expected changes in the Japanese economy described in "The Economy in the 1980s - Overview and Future I Directions" (approved by the Japanese cabinet on August 12, 1983) and other such materials. The fore- I cast is given in table 1. I Main Features (a) The share of energy demand from the indusrial sector is expected to fall, reflecting changes I in the indusrial structure and the promotion I of energy conservation. I

I -22- I

·······----J--·-_·' __-··. . " t : ·---· ' . t (b} The share of energy demand from the residential r and commercial sector is expected to increase, reflecting the impr~ved standard of living, the expansion of the commecial sector and so forth.

Units: million kl, (%) I Average Annual 1995 Growth Fiscal Year 1982 1990

(1982-95)

2.2 Total Demand 375 {100) 443 (100) 500 (100) (Supply losses, etc. excluded)

Industrial 218 (58} 240 (54) 261 (52) 1.4

Transportation 64 ( 17 > 78 {18) 88 ( 18) 2. 5

Residential/ 94 (25) 125 (28) 151 (30) 3.7 commercial

(3) Energy sup~ly

The forecast of the energy supply takes into con­ sideration, among other things, the promotion of stable energy supply in terms of both quantity and costs, the characteristics of the various energy sources and the international supply and demand

-23- I situation with regard to these energy sources. The I forecast is given in Table 1. I Main Features (a) Future increases in energy demand are expected to be met primarily by increases in the supply of I alternative energy sources. I Increase in energy I demand during 1982-1995 140 million kl Increase in the supply of I alternative energy sources 129 million kl

expec·ted either to remain (b) The demand for oil is slight I at the current level or to show only a dependence on oil increase, and Japan's rate of total primary energy I is expected to fall as the supply increases.

1995 I Fiscal year 1982 1990

48% I Oil dependence 62% 53%

(c) The supply of coal, especially that of steaming I coal for power generation, is expected to I increase steadily. (d) Nuclear power will play a central role in electricity generation, and the promotion of I electric power produced by nuclear facilities is I expected to increase steadily. I I -24- I - I· I (e) The use of natural gas as a fuel for thermal power generation in urban areas and as a I feedstock for utility gas is expected to grow. However, the long-term supply growth of this I energy form is expected to decelerate unless the current pricing formulae and the current I inflexible supply terms are revised.

< fl The development of hy;droellectric and geothermal I power is expected to continue since the stable supply can be anticipated from these energy I forms .. (g) The development of new energy sources is to be I promoted in a systematic, selective and efficienl:. manner, and the suppJ.y of energy from these sour--' I ces is expected to increase steadily. I I I I I I I I I -25- I

""'"~----...·"~""''..,_ .. .,..,__,, ___ ..... ,,_ -~~ -·-· .. ---~.. ---~r----.... -·---- .. --··- ...... -....- (.)'I . I -. ... J ' ~~~-·- ••· .~ •.•'..y I­ I. MIT/ Long Term Forecast I of Energy Supply and Demand in 1990

million ( ) Share in Terrras of I kiloliter Oil Equivalency I 600 590 {Supply I Demand) I

500 I 460 {Supply I Demand) Hydroelectric I Geothermal/ Others 400 Nuclear I 150 million I tonnes (19°/o) LNG

300 101 million C I tonnes (17%) oal I 200 ·~ I " .. million kiloliters ( 44 I 240 million Oil (including LPG} kiloliters( 53°/o 100 I . .

\ '.. ' , ...... '!,'...... ;"1.• I .. ~ ~·...... o~~------~----~------~------April 1982 Noven1ber 1983 I Forecast Forecast I -26- I

• < ' ., • ' • ,<" ~ :., ill ' ' ' • • • J • • • • 1 • " ... ~ • ~ • • • - ......

,~, - ··• • Y~~ ~;<~~~~-~-~-_,_,.:J, ,\'-"r{-t''t•·~i-·

--~(81--~l!llrmiC.. :;-""- .. !lB Ia ...... ~ .. ..•

Long Term Forecast of Energy Supply and Demand (PUBLISHED BY MITI Nov. 1983) UNIT: MILLION KL 600 100 200 300 400 500 0 ------, I NOTE · FIGURES ARE OIL EQUIVALENTS

240 (.:.. ,: ~.' (61.9%) tf -~·. I'• 1982 ~ ~ >--•• 4 (0.9%) 23 (5.0%) 8 (1.7%) 1.5 (0.3%)

I I'.) -.J I 240 1990 (53%)

5(0.9 01o) 25 (5%) 19 (4%) .5(0Pu)

250 1995 (48%)

• -' ~ l.

GEOTHERMAJ... OIL ENERGY SYNTHETIC FUEL OIL, DOMESTIC NATURAL GAS NEW ENERGIES, ETC. HYDROELECTRIC POWER---' ~ ~,..

~~ ~- ...... ,_,,__ • .,.o __ ,__.~-~- -· - ~---·------...... -- -·~- ·- ...... -·~ .....·-·- ·r· ····-.,..-..---··~--.,.,-~-·---.,.~.~------, • ~:;:;:;;:;.~·~ •"·;::-~_.., ..-~).:r:<~!'~.i~~~OGWIICM \illll tali ~ Jill ...... 118 !Ill ~ ~ IIIII ~ - ...... •

Table 1 Long-term Energy Supply and Demand Forecast

I f I I FISCAL YEAR 1 9 8 2 1 9 9 0 1 9 9 5 (Actual) (Forecast) (forecast)

TOfAL ENERGY DEHANO million kl • 380 460 530

TYPE £F ENERGY QJANTITY SHARE~ QJANTITY SHARE% WANTITY ISHARE~

17.5 COAL million HT 94.5 18.5 108 128 18

!0.6 f'.UCLEAR ENERGY million kw 17.30 6.9 34 48 14

12.1 NATURAL GAS million kl • 27.00 7.0 56 61 12 I L !'\) (Domestic N.G.) billion mJ (2.10) (4.3.) (5.0) m (LNG imported) million HT (17.60) (36.'5) (40.0) I

HYDROELECTRIC POWER million kw 33.30 5.4 40 5.0 43.5 5 ' "tl. a It "•.'·i ·~·'· GEOTHERMAL ENERGY million k1 0.4 0.1 1.5 0~?· tl!t\ 3.5 1

It SYNTHETIC FUEL OIL, million kl ·11.9 0.2 8.0 1.7 19.0 4 NEW ENERGIES, etc.

·'I OIL million kl 240.0 61.9 240 52.6 250.0 48 .... <;) '- (Domestic Oil) million kl (0.48) (1.5) (1.9) ,. . . • TOTAL ENERGY SUPPLY million kl 388 I 100.00 I 460 100.00 530.0 100 I l I i Notes) (i) • Oil equivalent (ii) 4~ p.a. of GNP growth rate is assumed. ""

~·:::- -·- ----·-·· "- ~"-·-~:'-;: .. ·--:-:::---:-··-.-~.---T;c-, --·~....,.;.:-~:::,~-~,v~

I In parallel with its long-term energy. forecast, MITI has prepared a long-term forecast for Japan's electric power I supply and demand, which is a revision of the last forecast published in April 1982.

I The revised forecast was issued on November 17, 1983.

I 1. ______DEMAND FORECAST ...___ The projections for electric power demand have been revised I downward substantially from the figures in the forecast I issued in April 1982. Forecast of Electric Power Demand (Unit: billion kwh) I New Forecast Previous Forecast Change 1982 (actual) 521.7 521.7 -17.2% 1990 658 79 5 768 no forecast made 1995 '~ --19 ~ 7% 2000 899 1,120

(Remark> Electric power demand is expected to increase at the following rates:

1982-1990 2.9%/year 1990-1995 3~2%/year I 1995-2000 3. 2%/!rear I I -29-

-~---~--.- •;"'" --~ __. ·------'li ! ' - ~· . - ' I*

I The major reasons for the large reductions in the forecast demand figures are as follows:

I (1) It is expected that considerable efforts will be made to I conserve energy, especially in the industrial sector~ (2) Overall growth of energy demand has decreased due to the lengthy recession, and this trend is likely to I continue in the future.

I (3) The assumed annual GNP growth rate on which the forecast was based was reduced from 5% to 4%.

I 2. SUPPLY FORECAST I Reflecting the lower demand projections described above, the forecast for installed power generation capacity also has I been reduced substantially.

I Forecast of Installed Power Generation Capacity (Unit: million kw) I New Forecast Previous Forecast Change 1982 (actual) 140 14~ 1990 177 209 -15.3% I 1995 205 no forecast made 2000 232 300 -22.7%

I vetailed figures for installed capacity by source in the new forecast is given in Table 1. Although the estimate for I nuclear power capacity is lower than in the last forecast, the proportion of nuclear power in the total electric power I supply is still expected to increase steadily. In this con­ nection, it should be pointed out that ~he MITI forecast specificall_y notes that nuclear power development should be I aggressively promoted as the primary source for baseload supply. I I I -30-

. ~·~-·.·~···-.....,~ . '

. ' .~

I Forecast of Nuclear Power ~eneration Capacity (Unit: million k,...r) New Forecast Previous Forecast Chang:e I (Share) (Share) (12.3%} 1982 (actual} 17.3 (12.3%} l7o3 (22.0%) -26% 1990 34 {19.2%) 46 I forecast made 1995 48 (23 .. 4%) no -31% I 2000• 62 (26.7%) 90 (30.0%) I I I I I I I I I I I I l I I -31- I ,.j\ I I {. / ...... :' u ' ...... ) ...... }' .., ...-"

~ ~r- ;~ .~ ;'111111!1 .--. ,_ .:­ Ia! .. 1111 Jill 1111 ~ WI!!!!!!!!!!~~~~~~~t-..._~1- ,._ "-. .... -

_...... -.---... ------·---- ___ , ------·---

Long Term Forecast of Generating Capacity in Japan (PUBLISHED BY MITI NOV. 1983)

150 200 million kw 50 100

I I

6.7(4.8%) ., 17'.2•::: Total Capa. 63.4 (12.3\) 1982 (45.3o.o} 139.9 : I .. .,;t l.: ... • (• -

G

I ... ~ .. ~ ~ ·l~ : .~ ~· N ~• ..... • .34 ' .... Total Capa. I 50 • •• ~:~ ! • ,(1. n.ar) '. ! ;J]Di ~· t. 177.1 1990 (28°u} !;~' '."':t. ~· f" .{.·:.. \·! thfl\1' . .\. .,. ,4~!• . '"; j...~~to. - ''!,. ...

'· ''

r 1 5(0 7uo)

48 Total Capa. 49 (23%) 205 1995 (24::·,)

i ~- . t - -::;, ! t t NUCLEAR OIL HYDROELECTRIC LNG COAL GEOTHERMAL (including LPG)

!All flqt1rus an: ;1~ , It the end of ench fisco.l year.)

- --··-··"····--····'"'-······- ·-·---- () ..• t .. • • • • • • ' • ~ • • • • ~

··--"'-·"'· .. ...--.·· ~.. ~ ...:.w.- ·te t4..:.t...

;'­ '_:: )Iii ... ~ jJi &IJ 1!'.,!1 liE ·~··--~~;~>- .. 1!1111 \.i!!!!!!!!!! ~... all ...... 1- ...... -

0

Long Term Forcast of Electric Power Generation in Japan

... - -_, {PUBLISHED BY MITI NOV. 1983)

BOO billion kwh 400 600 - r 0 200 ------r -f)

t~\ 1 (0.2%) .. <· '

Total 209.8 101.8 (20%) 522.5 1982 (40%) l 1 I . "'

'·· I l.,..; w Total I 190 150 (28%) 685 1990 (22%)

0

0 ~~· 10 (1.2; o) 19 (3°o)

Total 285 125 (35%) 805 1995 {16%)

NUCLEAR COAL I OTHERS OIL I LNG (including LPG) GEOTHERMAL HYDROELECTRIC (All figures are as at the end of eacln fiscal year.)

...... -- .. ------·-~·-----··-····-~------·~-.-· --~ -:---:c;:c,._. •.•..;..,_. ~'.\ft~;fi:~,;;>~~-"'T~JWillJJ£. I IIJI\IIflt,# .• 'IJffll! .. --. ····· ......

·--- _ ..- -··----- ~-- ..,,__ ·-::_•_.:_ ____::___,;;...,.:.._ ---<>~ :ll!ll Jl!!!ll 11!!!11 ~' ..\_ • -> ...... '•~ - '• ..~. >~ ,-. -•<'•·---~~" '-~K~~"•"'""'~ .~·:-11 ·-~ .•-a.~· ;-~ -~,;..;;- __._,,•~_..t- ..''-'!""'.·'

rrable 1

Fofecast of Installed Power Generation Caoacity

(unit: million kw)

FY1995 FY2000 Source FY1982 (Actual) FY1990 I {26.7) (19 .. 2) 48 (23.4) 62 Nuclear 17 .. 3 (12.3) 34 I ' ·l (23.9) 47 (20.2) 63 .. 4 (45.3) 50 (28.2) ~9 Oil & LPG \ 30 (12.9) ( 8 ~ 2) \ 21 (10.2) Coal 6.7 (4 .. 8) 14 I r 43.5 (18.9) (22o6) LJ3 o5 ( 21 .. 2 ) I 20u2 {14.5) 40 w LNG ~ I I ! i ... I \ :o5 ("; .. 7) .j C!.• 3 > Geothermal 0 .. 2 ( 0 01) I •0.6 (0~3> I I ~ 'l .t,;_ it !'!'· ~ I .., ~ I I 205 (:!.00u0) 232 (100.0) 1 140 (100.0) 177.1 (100.0') l "' Total J .. f'. I

Note: Figures in parentheses represent the percentage share c~ e~ch source i~ total installed capacity .

.. ------~--·--;;------·----·-,---.----.-----~---. ---~~<:;t:.• :~t<·* ._-----;;;::.:~~·~..,+ P~_v~.'·~£~~.. ·-~~~ .. . '

<'., ."'>;."'·

-- - _ ~, ~ ll a ------"

Forecast of Power Generation in Japan

(unit: billion kwh)

FY2000 I, So~rc':: l''Yl982 (Actual) FY1990 FY1995 '

Nuclear 101.8 (19.5) 190 (28) 285 ( 35) 370 ( 39)

Oil & LPG 209.8 (40.1) 150 (22) 125 (15) 115 (12)

(10) 95 (12) 140 (15) _,, Coal 35.5 ( 6. 8) 65

LNG 79.2 (15.2) 165 (24) 170 (21) 170 (18) I w ln 110 (12) I Hydro 77.4 (14.8) 92 (13) 101 (13) '

( 1) 20 ( 2 ) Geothermal .L ( 0. 2) 4 ( 0. 6) 10

' Others 17.8 ( 3 . 4 ) 19 ( 3) 19 ( 2) 25 ( 2 )

(100) Total 522.5 {100.0) 685 (100) 805 (100) 950

Note: Figures in parentheses represent the percentage share of each source in total power generation.

·--~ -· .... ~-----~------·--~------~------~~---~~~ ·-:-::· .. , .,. ,,,:-:-~~:,_ .. ,"\· .....,.;;o:;_.,~·~,r'~..,·r..~i'f~i!tllllij ...... J!IJP. _: . . ... , - ,...... : , . . .. .·. ·: ·. !. . . •• f - ·I I I I FINANCING I I I I .I I I I I I I I I I -36-

lI I l I' i

-~··,--, .. ,_..... ---~~~~-·~-..--··•"·-·----- .. v~-·~r-;·--,,---·~"· •••· ··--~-...... , ..... ·-··- ••• ,.. , .. ,. ····-··-·•·• •' ' '.' :~ .. t~. \ ; ·, ~ f ~ t . ,•, " '<" • ~ (~i :-:, ,,, <;.. • .-·, . '·* 0 !

·' ''"lGT ."" ,-

IJIIII; ~ , ------.. .. - - .. - - .. -: -~! ~

LEVELS OF JAPANESE ~QUITY PARTICIPATION IN THE EXISTING AND PLANNED LNG PROJECTS

U.S.A, {Alaska) Brunei Abu Dhabi !Oasl Indonesia {Badak} Jndonesia ~Arunl Hal9xsia !Sarswakl Australi!! !NWS} 'goads !Western) - [P.T. Badak [P. T. Arun [Malaysia LNG [unincorporated [to be (Kenai LNG [Brunei LNG [Abu Dhabi Gas incorporated] Corp ration] Ltd.] Liquefaction Co.] Natural Gas Natural Gas Sdn Bhd] joint venture!] Liquefaction Co.] Liquefaction Co.]

. -. .. . I

~~~; .. , Ill! ••. •.•.•.··.• •·.· •• ·.-.·.·

-II

{under negotiation) (under negotiation) l.oJ -1 I

Note) 1. Japanese portions.

2. t Mitsui group consists of H1tsui & Co., Ltd. (22.05~) and Mitsui Liquefied Gas Co. Ltd. (2.45~) JlLCO: Japan ·Indonesia LNG Co. Ltd • • Japanese buyers 66.33~-(Kansai Electric: 19 .• 31~, Chubu Electdc: 13. 75~, other cos.~ 33.27~) Japanese trading companies 19.60!'0 -(Nissho: lO:'e, MitsuiL: 1.6:'e, other c~bs.; 8.0!'0) Shareholders ( Japanese banks 7.40~ far East Oil Co. Ltd. 6.66~ •~ HiHi: Mitsui & Co., Ltd. and Hitsubishi Corporation (50/50 participation). They are now being invited as n~w participants.

J. The equtty in the Abu Dhabt project was originally div1ded into the followwg percentages:

ADNOC 20~ 62/ ... BP 2 . J. l CfP 1} I 3"'.

'H1tsu1 ! Co., Ltd. 36~ HltSUl 0 group 4U j l H1 tsu1 Ltqueft~d Gas 4~ 4. The equit> 1n the Orun•-n ;:>rl]t>Ct wa·; oru,Jlnalh •ll"t•lt!d tntu the fallawtng percentages:

Brunt!! Go.. It}', Shell ~···· H!t•luhl'•' : •'

-~---~ ·.....-~-·.__._ ...... ,_.,,._~,-·..-- ...... ~., ---~-----·--··---·-·---~.-.-----.... -:---,..,.-:--·-~~ .... --...,----....--..--...... -~------·--·...... --~¥--:-;~. :"'~~- . r!i!t d.·9m~.J· -. --,N~"'!iiiiiiD ·~-'\.-,--,.,.,..,~ ... ._ - c ?TTli~llili'Sh~. !lil1illlY I MQi. •• I I I IV LNG PH. I CE I I I I I I c I

' I I I I I I I I -38-

-,,i' ; ~ :t ·~i .. t 1'':1 f ; 0 t' oa .. t'

------·--·------' l

7·00• (Us StM1Miiu) Average CIF Prices 1.oo

·~50u.,. .I 6.0J I .. ..-/ 5.sor ..~.-- 1 .... ~!~ 5.0t / 5.00

4.50 4.50'1 I , w ~. '\.0 4.00 I 4.00

3.50 3.50 l t ',. { ,' ' ~ ------·- CRUDE OIL ,· ! 3.00 3.00 ---BRUNEI

f ---ALASKA • I' --- U.A.E.

::;: ,< J2.5'0 2.50 --- INDONESIA --- MALAYSIA --- ARUN {) _r.oo 2.00L I ; lJ -r- 1 I I I I I I I I I i I I I I I I I I I I I I I I I I l_j 11!1111!111111111!1111111 i l!!l!!l 9 10 11 12 I 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 0 l d 9 10 11 12 1 2 3 4 5 6 7 8 --- ___ 1 .. ·--··--'83 ··-- '84------~---~··----'80 ·--·-- 1. - . - '81 .. 1. -·-- .... -- '82

.. , ___..,.-- IJ ... ..; ~ ' . ' ~ .. • • ~ ~· • ~ • • . ; ~ : I

AVERAGE CIF PRICES - LNG AND CRUDE OIL

•• UNIT: US$/MMBTU INDONESIA LNG CRUDE ABU SARAWAK ALASKA BRUNEI ARUN OIL I DHABI ORIGINAL ADDITIONAl AVERAGE 1969 0.52 0.52 0.31 I 1970 0.52 0. 52 0.31 1971 0.54 0.54 0.38

I 1972 0.55 0.49 0.55 0.44

1973 0.57 0. 51+ 0.56 0.57

I 1974 o. 13 1.58 1. 35 1.89 I 1975 1. 36 1. 78 1.68 2.07 1976 1. 64 1.87 1. 83 2.20 I 1977 1. 95 2.02 2.00 2. 57 2.07 2.36 1978 2.18 2.17 2. 20 2.79 2.38 2.43 I 1979 2.30 2.36 2.30 3.42 2.83 3.24 1980 4.85 4.91 5.50 5.24 5.14 5.70 I 1981 5.94 5.98 6.5 7 5.57 5. 83 6.44 1982 5.76 5.79 6.25 5.62 5.76 5.98 I 1983 5.13 5.16 5.38 5.18 5.23 5.20 5.32 1984 I Jan. 4.90 4.92 5.23 4. 66 4.96 5.07 4.89 5.03 Feb. 4.89 4.92 5.24 4.75 5.22 5.07 4. 93 5.04 I Mar. 4.89 4.92 5.29 4.87 5.39 5.03 5.06 5.03 I Apr. 4.88 4.92 5.22 4.89 5.35 5.04 5.00 4.99 I May 4.87 4.92 5.27 4.87 5.43 5.05 5.02 5.03 Jun. 4.89 4.92 5.23 4.92 5.61 5.05 5.08 5.05 I Jul. 4.85 4.91 5.22 4.68 5.26 5.03 4.95 5.03 Aug. 4.39 4.92 5.22 4.67 5.12 5.04 4.92 5.01

I Sep. 4.90 4.91 5.25 4.55 5.14 5.05 4.88 4.98

Oct. 4.88 4.91 5.24 4.49 4.96 5. 0 1+ 4.80 4.97

I Nov. 4.85 ll.,91 5. 24 4. 59 5,05 5.01 4.86 4.97 I ... I -40-

•• . I)

--··'' IJ

I I III-1} 2) LNG PRICING MECHANISMS CURRENTLY APPLIED TO JAPANESE I LNG IMPORTS

I The CIP prices of LNG imported into Japan and the imported crude oil prices are almost equivalent in term$ of calorific I value, no matter what the oriain of the LNG is.

LNG was introduced into Japan by electric power and uti~ I lity gas companies as an alternative to fuel oil, naphtha,

LPG and so on. Japan is almost fully dependent on imports ' ! for its oil supply, and this is one of the main reasons why I Japan currently accepts the linkage of LNG prices to I imported crude oil prices. Japan's crude oil imports represented approximately 62 percent of Japan's total energy supply in 1982. According to I the latest forecast drawn up by the Japanese Ministry of International Trade and Industry (MITI), Japan's dependence on imported oil will decrease to 52 percent in 1990 and 48 percent in 1995, but imported oil will rem~in a major energy I source in Japan through 2000. Consequently, LNG pricing for­ mulas will probably remain more or less as they stand at I present. However, it should be noted that LNG consumers in Japan I may attempt to exert a downward pressure on LNG prices. They have begun to complain that there is little advantage in using LNG unless the LNG price is lower than the imported I crude oil price mainly because of the tremendous cost of constructing LNG receiving terminals and the limited flexi­ I bility of the LNG supply arising from the rigid contract conditions ( take-or-pay, etc.). I

~ I I f I I -41- I I I Electric power companies are the major consumers of LNG in Japan. They accounted for more than 75 percent of Japan's I LNG imports in 1982 and will remain the major consumers of I LNG through 2000. The electric power industry's dependency on oil was 40 percent in 1982, but according to a forecast published by I MITI, this dependency will decrease sharply to 15 percent 1n 1995~ At the same time, nuclear power and coal are expected to became major sources of electric power supply in Japan. I Together they accounted for 27 percent of total electricity supply in 1982, and this figure will grow sharply to 47 per- I cent in 1995.

The unit costs (per kWh) of nuclear power generation and I coal-fired power generation are currently much lower than I those of oil-fired and LNG-fired power generation~ I POWER GENERATION COSTS BY SOURCE I Power Sources Yen/kWh(l983 yen) Oil 17 I LNG 17 Coal 14 Nucle.ar 12 .. 5 Il. l i I L Source: 1983 Projection of the Japanese Agency of I Natural Resources and Energy, MITI I I I I I -42-

'~! /) I

I As a result, the electric power'industry may try to bring about a downward revision of LNG prices toward a level I LNG-fired power generation would be competitive with coal­ fired power generation or even with nuclear power genera­ I tion. This feeling of Japanese LNG customers has been incor­ I porated in MITI's report entitled "Japan's Long-term Energy Supply and Demand Forecast", which was made public in I October 1983. (See II-3)) I I

I I I I I I I I

-43- '': ?' -:..' ,_'!"' •

I I I

V LNG RECEIVING I TEH.NIINALS IN JAPAN I I I I I I I I I I I I I I -44- 'I I .. -- .... --&.-· it 1 . ' ~~ - ,' ~ ., ~ --- '.~ .. ~ ..

---~IIIII'AIIIIii .. B'IIIIIIIIIIIIIIIIIIRIII!IItllfl __ _

LNG Receiving Ter~ninals in Japan (AS OF Dec. 1983) :a IN OPERATION • UNDER CONSTRUCTION 3 TANK CAPACITY (thousand m )

Higashi Niigata 520

Himeji I 280 Himeji II 560 Kita Kyushu 480

0

I .;:... U1 I Negishi 680 Higashi Ohgishima 420 ·sodegaura 1,580 Futtsu 360

Shin Ohita 400 Chita I 300

Yanai 560 Senboku I 180 Chita II 480 Senboku II 975 Yokkaichi 320-

------~"···~·- ·-··---· ~----~ ·-·- ---.-·---.,-·~·~·---·----·~-----·-----~--·----·---~~.-,.------• ~;;~" .l'(; ,. ' > .,. r-;:;;:sr...,"''i I wa Ci~:X _411 llti:IIPJiiatlftJti... -,.- J•¥.!1&111'W!L:.lllfill . • • ' ' . I . . ~\. ~ ,,, _,",.. · ' .,_ ..... ~ . ·~· .,, ~ ~ -. .. ~/ '"·~:-- ... - - - - .. 1.111 - ...... - - ...... --

..

LNG RECEIVING TERMINALS IN JAPAN IN OPERATION Noel

SENBOKU N0.1 SENBOKU NO.2 RECEIVING TERMINALS SODEGAURA NEGISHI

Osaka Prefecture Osaka Prefecture LOCATION Chiba Prefecture Kanagawa Prefecture

Osaka gas(Operator> Tokyo Gas (Operator) Tokyo Gas (Operator) Osaka Gas (Operator) IOWNER IU''I Tokyo Electric Tokyo Electric " 630 Osaka Gas 1,700 CONSUMER (lOOOMT) Tokyo Electric 5,060 Tokyo Electric 1,170 ,! Osakq Gas Kansai Electric 300 I Tokyo Gas 720 Tokyo Gas 580 """0\ I 3 75,000 X 13 TANK CAPACITY (m ) ~ 62,000 x 1 95,000 X 4 45,000 X 4 60,000 X 17 60,000 X 1 58,000 X 1 45,000 X 3 45,000 X 4 35,000 X 2 130,000 X 2 25,000 X 1

10 1 fl;l'.'~;')· X 1 -·- •01;'11 .....:.:.--=------180,000 'rOTAL 975,000 TOTAL 1,580~000 TO'!•f.'.;~>. 680,000 TOTAL

(75,000 ~ 2) UNDER CONSTRUCTION (130,000 X 3) OR PLANNING ( 90,000 X 6} ( TOTAL 150,000) ( TOTAL 930,000)

i L•~

-~·.,~------.--.,-~--~--r~·--·--·------·------~--~------···----~------.------. --~---- -.~~·_____,...,. '' ,-,; ,_,, .. · "·~~~W'IIdllli k ae.~P~t~M!I!JfttJ~I~"'*liJiiiiJI.II1i/llli&Qi~'lf!JI ~ , 0 • I • • • • \\ IJ ., .,,,,,.- "~-· - - - .. .. - - .. liD .. IIIII - .. 1111 .. .. - ....

..

LNG RECEIVING TERMINALS IN JAPAN IN OPERATION No.2

KITA KYUSHU HIGASHI N!IGATA RECEIVING TERMINALS I CHIT A NO.1 CHITA N0.2

Fukuoka Prefecture Niigata prefecture LOCATION I Aichi Prefecture

Chubu Electric Kyushu Electric Tohoku Electric OWNER Chubu Electric (Operator: I Toho Gas Nippon Steel Corp. .. (Operator: Nihonka l LNG Co. ) Ki ta Kyushu LNG Co. ) I ~ ...... I Chubu Electric 1,500 Kyushu Electric 1,50ol Tohoku Electric 2,600' CONSUMER (lOOOMT) Chubu Electric 1,550 ' Nippon steel corp. 1 Hokuriku and other Toho Gas 150 Toho Gas 500 60~ gas companies 300

3 60,000 X 8 100,000 X 2 TANK CAPACITY (m ) 15,000 X 4 80,000 X 6 80,000 X 4 ------TOTAL 480,000 TOTAL 520,000. TOTAL 300,000 TOTAL 480,000

l. UNDER CONSTRUCTION OR PLANNING

.{

-•-..--•- ,.,_ ~""'--~---- .-.,_._.... ~---.-,-·r·•._...... ,_,_, .. ~-..~,.._~ -"------·-·-~ ... ------····-··-~-~------·-c-·------___,....,~ " ,. " 0"" •··.r,.,·lJI

·~·-·• ' ---··~-~ -~, .. "'·'II

\.) ---JCIIIIIIIIliiiiBr.AI_BI_IIIIIIIIIIIIIIIII ___ _

LNG RECEIVING TERMINALS IN JAPAN IN OPERATION No .. 3 ~-- ... .,t

HIMEJI/OSAKA GAS RECEIVING TERMINALS I HIGASHI OOGISHIMA HIMEJI/KANSAI

Hyogo Prefecture LOCATION 1 Kanagawa Prefecture Hyogo Prefecture

Tokyo Electric Kansai Electric Osaka Gas "' OwNER

CONSUMER (l,OOOMT) Tokyo .Electric 3,3001 Kansai Electric 1,70~ Osaka Gas 1,400 I Kansai Electric 600 ~ 00 I 40,000 X 1 TANK CAPACI'rY (m3) _§0,000 X 7 80,000 X 6 [ TOTAL 520,000) ' t TOTAI~, 420,000J (80,000 X. 7) UNDER :CONSTRUCTION 1(60,000 lC 2) ( TOTAL 560,000) OR PLAINNING ( TOTAL 120,000)

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LN.G RECEIVING TERMINALS IN JAPAN UNDER CONSTRUCTION No.1

YOKKAICHI RECEIVING TERMINALS SHIN OHI'fA YANAI FUT'lJ'SU

Mie Prefecture LOCATION Ohit.a Prefectu.re Yamaguchi Prefecture Chiba Prefecture

Chubu Electric OWNER ~. Kyushu 'Electric Chugoku Electric Tokyo Electric l,;; I Kyushu E1ectric Chugoku Electric I Tokyo Electric I Chubu 'Electric CONSUMER (lOOOMT) I I ...,. '" ' o, I ·~· """\0 PLANNED TANK I 3 {90 000 X 4) (80 1 000· X 4) CAPACITY (m ) ~80,000 X 5) ('80,000 X 7) 1 36(]),000) 'l'OTAL 320,000 ( TO~t~AI, 400 I 000 >I ( TOTAL 560 I 000 >I ( TOTAL

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I I Main Particulars of 125,000 CBM Single Screw Turbine Driven l Liquefied Natural Gas Carrier (Moss spherical Tank Type> I l ) i) Principal Dimensions (all about) I Length overall 282.00 M

I Breadth(moulded) : 44.80 M

I' Depth(moulded) : 2s.oo·M II Designed draught(moulded) ~ lO •. 80 M Scantling draught(moulded) 11.50 M I Deadweight : 6lr000 MT (at the draught of I 10.'80- M)

ii) Cargo Tanks 125r000 CBM I (100% at minus 163 I degree C) iii) Main Engine : Steam turbine x 1 unit Maximum output 40,000 I p.s.

I iv) Degigned Speed about 19.3 knots (with lS% sea margin on the draught of I 10.80 M at the normal I output of 36;000 p.s.) V) Fuel Oil Consumption : about 196 MT per day (basis burning fuel I oil only at normal output) l I l r I ! -51- I ·~ 11!1 ...... IIIII IIIII all -- - .... - - - .... - ----~J

LNG VESSELS USED FO~R LHG PROJj!:CTS TO JAPAN No.1

,, ,. _, ·- I ' Name of vessel OWner Speed Capa~it}l Type Year of Shipyard

GARI · SHELL TANKERS 18.00 75,000 TECHNIGAZ !M) 1973 II . (UK} "'

: GASTRA~m II 18 .. 00 75,000 TECHNIGAZ \M) 1974 II

GEOMITRA It 18.00 76,900 GAS TRANSPORT (M} 1915 C.N.I.M. {FRANCE)

:) . GOULDIA It 18.'DO 75,000 TECHNIGAZ (M) 1975 CHANTIERS NAVAL DE

I LA CIOTAT (FRANCE) L! ~~ .

·~? GENOTA II 18.00 76,900 GAZ TRANSPORT (M} 1975 C.N.I.,M. {FRANCE) .o' - *(M) Membrane

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LNG VESSELS USED FOR LNG PROJECTS TO JAPAN No.2

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I Capacity Type Year of Shipyard Name of vessel owner ISpeed (knots) (M3) Constructior

125,000 MOSS 1975 MOSS ROSENBERG DAS HILL I GOTAA.S LARSEN 19.50 VERFT (NORWAY) ISLAND I

II .. MOSS 1976 GIMI .. 19.50 125,000

I II U1 II MOSS 1977 w KHANNUR 19.50 125,000 I !I .• '

., 1977 HOWALDTSWERKE GOLAR FREEZE " 19.50 125,000 MOSS (WEST GERMANY)

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MOSS .. j ~~~ ' 1~73 MOSS ROSENBERG NORMAN LADY METHANE CARRIER 18.00 87,600 VERFT (NORWAY) I ' ''

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LNG VESSELS USED FOR LNG PROJECTS. T~JAPAN No.3

( Name of vessel Owner Speed Capacit~ Type Year of Shipyard I {knots) (M3} Constructior

~ INDO- ARIES LNG TRANSPORT INC. 20.40 125,000 MOSS 1977 GENERAL DYNAMICS .... ' NESIA . .~·· (USA) ., '·'"'·'' ' J .-~ :~·h: ' .~, J' (I) ·•:··· ; . • CAPRICORN LIQUEGAS TRANSPORT 19.00 1215,000 MOSS ' 1978 II I ' .' ~ ,, ~ ~ ~~j~- t • ,·, II GEMINI CHEROKEE I 20.40 125,000 MOSS ~ t~ t: .. : .,_ ;1.978 ~---~ '· <: •'1 ; : ') ~ .. I SHIP.PING CORP. ji,. ·. { )•t ~ ln ' .. ~~-· M:>- ·, ~. . t. :;· ·: : i' 1 ' LEO CHEROKEE II 20.40 125,000 MOSS . k: ~.~78 II ~ ' i . . , . SHIPPING CORP. . j 'i • ' ~·. '\"' ' . ~ ::. . 'W!! . !f; .. · ,. l ~ .. 1 ell ,!J . l~··· ;~· t~n9 II I.IBRA CHEROKEE V 20.40 125, 000) MOSS , .~,.; ' ~. 'f~i: ,., ,.::- SHIPPING CORl?. fJ\ I 0~. \ .: . -~ <, •. ,: ,. 1 !· ·~ .~.a : _· 1• :~ '.t _f!l_:t~ I ., . f '. 1 . r·· II . ' ; . • . ' ~• ~ t i ,;* 1979 TAURUS CHEROKEE III 20.40 125,000 MOSS ~ ·I' , :·J: l "'!•. I ;.· :, ' SHIPPING CORP. ' ' ~ ·- ~~ ~ . . ~ . K" · I· . > .. 'T II VIRGO CHEROKEE IV 20.40 . 125,0.00 MOSS .. 1979 SHIPPING CORP.

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LNG VESSEI,S USED FOR LNG PROJECTS TO JAPAN No.4

- ,_,_,__ I Name of vessel Owner I Speed cara.ci tj Type Year of Shipyard (knots) (M3} Construction

~ -~-~ J-·- INDO- a 5HUUMARU K.LINE 19 .. 3 125,000 !-lOSS 1983.8 KAWAJUU NES1A NYK {II) MITSUI ,·_-. ) . :·1, II ·I· ··,· ,! - BADAK BANSHUUMARU ' 19.3 125:000 MOSS 1983.10 MITSUIBISHI . ,,,, I ·' '.; !k CONTRACT SENSHUUMARU II 19.3 125,000 MOSS :i.984.2 MITSUI I j . - I .. I U1 I ''"-; U1 ECHJGOMARO K.LINE 19.3 125,000 MOSS 19 83.8 MITSUBISHI I ·I NYK . MITSUI J-LINg ARUN CONTRACT KOTOWAKAMARU II 19.3 125,000 MOSS 1984.1 KAWAJUU ' DEW AMARO K.LINE 19.30 125,000 MOSS 1984.7 MI'rSUBISHI NYK MITSUI SHOWA LINE YS LINE '• I II MITSUI I WAKABAMARU 19.3 125' 000 IMOSS 1984.12 I

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LNG VESSELS USED FOR LNG PROJECTS TO JAPAN No.5

Name of vessel Owner Speed Capacit~ Type Year of Ship},rar1 (knots} (M3) Construction I

MALAYSIA TENAGA SATU MALAYSIA INT. 20.7 130,000 GAZ TRANSPORT (M) 1982 CHANTIERS DE

(SARAWAK) SHIPPING CORP. FRANCE DUNKERQUE I II_ _,_,.1 .· i I TENAGA DUA II 20.7 130,000 IGAZ TRANSPORT (M} 1981 II I

'l'ENAGA TIGA II 20.7 130,000 GAZ TRANSP0RT (M} 1981 II

I ' Ln ()) II I TENA·GA EMPAT 20.7 130,000 GAZ TRANSPORT (M) 1981 CONSTR.NAV.&IND. ' ~- DE LA MEDITERANEE

TENAGA .f_,I MA II 20.7 130,000 GAZ TRANSPORT (M) 1931 II

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International LNG Trade in 1983

Unit: million MT Exporters Alaska Brunei Abu Dhabi Indonesia Malaysia 1 Algeria Libya Total Importers

Japan 1.02 5.25 1.79 9.61 1.20 18.87 ( 62% ) ll!illit'~l!'lllJ'tiitili t::~ U.S.A. 2.36 2.36 (8%) l I I., France 6.43 6~43 (21%) I m 0 I J Belgium 1.14 1.14 (4%) '

Spain 1.07 0.64 1.71

(5%) ~','

Total 1.02 5.25 1.79 9.61 1.20 11 .. 00 0.64 30.51 {3%) (17%) (6%) (32%) (4%) (36%) (2%) (100%) -

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