Inpex, Japan’s biggest oil and natural gas explorer, plans to accelerate its expansion of production and sales of liquefied natural gas (LNG) as it expects the LNG market will remain tight in the mid-term.
“Global LNG market is expected to remain tight in the mid-term due to the structural change of the global natural gas market, especially LNG, since Russian invasion of Ukraine,” Inpex CEO Takayuki Ueda told Reuters in an interview.
The global gas supply chains have changed, with European countries looking to import more LNG to replace Russia’s pipeline gas and the US boosting export of LNG, while Russia is seeking to provide more gas to India and China, possibly through pipelines, he said.
“We’ll make more efforts to acquire assets that can respond to future demand growth of LNG, including expanding Ichthys,” Ueda said, referring to its LNG project in Australia, reported the news agency.
To ensure a stable supply of the fuel, Inpex aims to boost its LNG production and sales volumes earlier than it had targeted under its mid-term plan unveiled last February, just before the Ukraine crisis, he said.
Inpex, which is on track to boost yearly production capacity of Ichthys to 9.3 million tonnes in 2024 from 8.9 million tonnes now, will explore the surrounding areas for additional gas sources while accelerating its consideration of an expansion of the project in around 2030, Ueda said.
Inpex, 19.97% owned by Japanese government, has said it wants to make a final investment decision on Indonesia’s Abadi LNG project in the latter half of this decade and start production early in the next.
However, the Abadi project, which is in the Masela Block operated by Inpex has stalled. Project partner Shell is seeking to divest its share of the development and the scheme cannot move forward until a buyer is found. The Indonesian government is pushing national oil company Pertamina to buy Shell out. Talks are ongoing.