TOKYO- Japan has decided to divert some liquefied natural gas (LNG) cargoes to Europe in response to requests from the United States and European Union amid concern over the buildup of Russian troops near Ukraine, the industry minister said on Wednesday

The extra shipments are expected to arrive next month, minister Koichi Hagiuda told reporters.

The move comes as Europe faces tight supplies of LNG as tensions in Eastern Europe remain high over the Russia-Ukraine crisis, fanning fears of serious disruptions.

"We have decided to respond to requests from the United States and EU for sending LNG to Europe, where gas supply is tight," Hagiuda said after separately meeting with the U.S. and EU ambassadors to Japan earlier in the day.

The diversions will be made with surplus supply after ensuring Japan's local demand will be met and electricity generation will remain stable, he said.

Some already-scheduled LNG cargoes sent by Japanese companies will arrive in Europe in February, with more cargoes including those to be diverted to Europe on the request by the Japanese government arriving there in March, an industry ministry official said.

The official declined to disclose the exact number of cargoes heading to Europe, but said the number to be delivered in March will be higher than February.

Also, the government has asked Japanese companies with flexible LNG supplies that are not under long-term contract with a destination clause, which mandates where a cargo can be delivered and limits buyers from reselling excess gas, to divert as many cargoes to Europe as they can.

 

NOT SO EASY

The rare move by resource-poor Japan also underlines its intention to demonstrate that the country is aligned with the West.

"In the context of the international developments over Ukraine, we need to work with the G7 countries, especially with comrade countries who share our values," Hagiuda said.

Another reason is that the United States and EU were among the countries that quickly helped Japan with LNG supply after the deadly 2011 earthquake and tsunami caused meltdowns at the Fukushima nuclear plant, forcing the nation to ramp up imports of LNG as a substitute for nuclear power, he said.

Still, Japan's contribution looks to be limited.

Japan's biggest oil and gas explorer Inpex Corp 1605.T will try to respond to the government request but it will not be easy as most of its LNG production is linked with long-term contracts, its CEO Takayuki Ueda said.

"We are also receiving requests for extra supply from Japanese customers due to strong demand for the winter, which means our surplus supply is limited," Ueda said. urn:newsml:reuters.com:*:nP8N2U604X

Kazunori Kasai, CEO of the trading arm of JERA, Japan's biggest power generator and one of the world's biggest LNG importers, also said last week that it would not be easy as Japanese utilities would have little spare supply.

(Reporting by Yuka Obayashi; Editing by Louise Heavens, Raju Gopalakrishnan and Angus MacSwan) ((ju-min.park@thomsonreuters.com; Reuters Messaging: ju-min.park.thomsonreuters.com@reuters.net))