Per Platts the japanese government yesterday approved a plan by Japan's utilities to purchase between 30 and 40 mt of LNG per year under a JV to be launched.  They want to both purchase for their own needs and to be able to sell to others in an attempt to curb overall net costs.  TEPCO now purchases approx 25 mt/year.

Tepco seeks up to 40 mil mt/year LNG through supply partnership

Japan's Tokyo Electric Power Company plans to seek a comprehensive supply partnership in fiscal 2014-15 (April-March) to secure 35 million-40 million mt/year of LNG, according to an new business plan approved by the government Wednesday.

Under the approved plan, Tepco's Fuel & Power Company will seek the comprehensive partnership, covering its entire supply chain from upstream fuel procurements to power generation under a joint venture intended to be launched in fiscal 2014-15.

Tepco intends to seek the supply partnership to establish a joint supply chain from upstream stakes to midstream LNG plants, giving the utility and its prospective partners "bargaining power" and "optimal options" for their procurement, according to a source familiar with the matter.

Tepco's annual LNG purchase volume is around 25 million mt.