Kyushu Electric Power Co. said Wednesday it has signed an agreement with an international consortium to buy liquefied natural gas to be tapped at the Sakhalin 2 gas field in Russia for 22 years beginning fiscal 2009.
Kepco is the first major Japanese utility to conclude an LNG purchase accord with the consortium, Sakhalin Energy Investment Co.
The deal calls for Kepco to buy 500,000 tons of LNG per year, the company said. Sakhalin Energy Investment is owned 55 percent by the Royal Dutch/Shell Group, with the remainder put up by Mitsui & Co. and Mitsubishi Corp.
A preliminary agreement concluded with the consortium in July called for starting LNG deliveries to Kyushu Electric in 2010.
But Kepco has decided to move up the start of LNG purchases by one year in view of the larger LNG reserves at the Sakhalin 2 gas field compared with those possessed by its other LNG suppliers