Mixed Fates for Japan's Pacific Coast LNG Terminals

---

Researched by Industrial Info Resources East Asia (Kofu-shi, Japan)--Several liquefied natural gas (LNG) terminals were affected by the magnitude 9.0 earthquake that struck off the coast of Miyagi prefecture on March 11. Sendai City Gas Bureau (Sendai, Miyagi), headquartered in one of the most affected areas, has announced that its Minato LNG terminal in Sendai is unreachable. The terminal's storage tank, which has a capacity of 98,080 square meters, was not damaged by the earthquake, but significant amounts of LNG stainless steel piping were swept away by the subsequent tsunami. Electrical equipment, including boilers and compressors, as well as several manufacturing processes, suffered significant damage. Sendai Gas is currently unsure if Minato's control room, although not damaged by flooding, will be salvageable. The company does not think that that the terminal will be able to resume operations within the next month.

JX Nippon Oil and Energy Corporation (TYO:5001) (Tokyo) is in the middle of land works for a new LNG terminal in Hachinohe, Aomori, but may be forced to delay further work. The company had just finished levee protection works and soil improvement in the first week of March. JX expects fuel necessary for the next stages of construction to be limited due to affected refineries and storage facilities, as well as power shortages.

Currently JX cannot reach the Hachinohe site and is unable to confirm when construction may continue. The Aomori Prefectural Port Authority manager said that the site had suffered no significant damage, only soil loss.

Full mechanical construction was scheduled to commence in early 2012. However, this could be delayed by at least a year. The $600 million Hachinohe LNG terminal will feature three, 140,000-square-meter cryogenic storage tanks when completed, although the completion date is now uncertain.

The LNG terminal, owned and operated by Tokyo Electric Power Company Incorporated (TYO:9501) (TEPCO) (Tokyo) in Kawasaki, Kanagawa, was unaffected by March 11's earthquake and tsunami. However the associated power station, Higashi-Ogishima, is still offline due to damage to electrical systems. Higashi-Ogishima has an operating capacity of 2,000 megawatts and produces electricity for the TEPCO service area, which is currently experiencing rolling blackouts directly related to a damaged electrical infrastructure. Rolling blackouts could end as early as next week. However, other sources have noted that they could continue over the course of the next year as power demand rises in the summer.

View Plant Profile - 1076018

Industrial Info Resources (IIR) is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. IIR's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.