Japanese companies will get more control over liquefied natural gas (LNG) joint ventures with state-backed JOGMEC and recover investments faster under measures aimed at strengthening the nation's energy security, the industry ministry said on Tuesday.
The Ministry of Economy, Trade and Industry (METI) told a committee on resource and fuel policy that it would take steps to encourage Japanese companies to invest in LNG projects.
METI aims to introduce a mechanism prioritising dividend payments to companies from joint investment vehicles with the Japan Organisation for Metals and Energy Security (JOGMEC), enabling earlier recovery of investments in LNG projects that are in production and deemed critical to energy security.
The framework will also allow companies to potentially buy JOGMEC's stakes, giving them greater scope to engage in management.
The measures aim to spur corporate investment in LNG projects to secure mid- to long-term supplies of the fuel as geopolitical risks rise. Japan, the world’s second-biggest LNG buyer after China, has returned to the spotlight for producers as a boom in artificial intelligence, rising renewable energy costs and a new national energy plan drive appetite for long-term LNG deals.
METI also flagged the need to reduce risks in LNG transportation as long-term contracts increasingly shift to free-on-board (FOB) terms, under which buyers handle shipping and bear related costs and risks.
The shift places more transport risk on Japanese LNG buyers, making it essential to improve the business environment to mitigate maritime risks, METI said, without giving details.
On critical minerals, METI said it would work to secure stable supplies by diversifying sources and expanding stockpiles as top supplier China tightens export controls on some minerals.
The ministry has requested more than JPY90 billion ($581 million) in a supplementary budget for the fiscal year through March 2026 to support critical mineral value chains, including bolstering stockpiles, a METI official said.
The official declined to provide details on the contents or quantities of the stockpiles.
(Reporting by Yuka Obayashi. Editing by Muralikumar Anantharaman and Mark Potter)