Tokyo: Japanese and Qatari companies have signed a monumental 27-year agreement to supply 3 million tons of liquefied natural gas (LNG) annually starting in 2028, as reported by media outlets on Saturday. The agreement is between Japan's major energy company Jera Co. and Qatar's state-run QatarEnergy.

According to Anadolu Agency, Jera is firmly committed to establishing a resilient and well-balanced LNG procurement portfolio by sourcing from various regions, including the Middle East, Asia-Pacific, and the United States. Jera is recognized as one of the world's largest LNG buyers, emphasizing the significance of this long-term agreement.

LNG-fired thermal power continues to play a crucial role in Japan's energy mix, even as the country seeks to expand its nuclear and renewable energy sources. Under Japan's latest energy plan, the share of thermal power is anticipated to decrease to between 30% and 40% by fiscal 2040, a significant reduction from the 68.6% reported in fiscal 2023.

In 2023, Japan imported a total of 66.15 million tons of LNG, with 4.4% of this sourced from Qatar. Australia was the largest supplier, accounting for 41.6% of imports, followed by Malaysia at 15.6%.

In addition to the supply agreement, Japan's Ministry of Economy, Trade and Industry signed a memorandum of understanding with JERA and QatarEnergy. This allows Tokyo the ability to request additional LNG supplies during natural disasters or other energy security emergencies.