Trading companies Mitsubishi Corp. and Mitsui and Co. reached agreement April 17 to jointly import shale gas from the United States.
Under the plan, the companies will ship a combined 8 million tons of liquified natural gas to Japan a year from 2016, which represents more than 10 percent of current total annual imports.
They struck a deal with Cameron LNG of San Diego on usage rights for liquefied natural gas.
The companies said they expect the purchase price of LNG to be lower than in the past.
While most of the LNG will be bound for the Japanese market, some will go to South Korea.
Improved technology in the United States has made drilling for shale gas cheaper than in the past.
Although shale gas until now had only been exported by the United States to nations with which it has a free trade agreement, there are signs it may expand its customer base to other nations as well.
Expanding the procurement of LNG is a major issue for Japan because 40 percent of the fuel used in thermal power plants is LNG.
Until now, between 60 million and 70 million tons have been imported from the Middle East and Southeast Asia.
Demand for gas as a fuel at power plants rose after last year's disaster at the Fukushima No. 1 nuclear power plant and the halt of operations at nuclear plants for periodic inspections.
Total demand in 2011 reached 78.5 million tons.
To meet that demand, trading companies have been seeking ways to increase their gas supply for sales to electric power and gas companies.
The United States and Canada were considered prime candidates for diversifying supply routes of gas because of their large reserves of shale gas.
Until now, Japanese companies had paid more than their Western counterparts because natural gas prices were linked to petroleum prices.
The price for the shale gas will be determined through future negotiations.
However, one source said there was a likelihood of acquiring the gas at lower prices because shale gas from the United States was inexpensive.
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