Japanese Utilities Confident in Replacing 9% LNG Supply from Russia's Sakhalin-2 Amid U.S. Pressure

Japanese utilities JERA, Tohoku Electric Power, and Kyushu Electric Power, which import liquefied natural gas (LNG) from Russia's Sakhalin-2 project, believe they can secure alternative supplies if imports are interrupted amid U.S. pressure to halt Russian energy purchases. Russian LNG accounts for about 9% of Japan's total LNG imports, with contracts extending into the late 2020s and early 2030s. JERA, Japan's largest LNG buyer, handles 30 to 35 million tons annually and plans to use its broad portfolio and spot market options to offset any loss from Sakhalin-2. Tohoku Electric is diversifying sources and considering increased U.S. LNG imports to mitigate risks, while Kyushu Electric may advance deliveries from other contracts or use spot procurement if needed. Japanese Prime Minister Sanae Takaichi has communicated to U.S. President Donald Trump the challenge of fully banning Russian LNG due to Japan's energy security needs, highlighting the tension between political pressure and practical energy demands. Japan is also exploring projects like the Alaska LNG development but remains cautious about committing amid uncertainties, while expanding emergency reserves to reduce dependence on Russia.