Tokyo, July 26 (Jiji Press)–The Development Bank of Japan is considering helping Japanese gas and electricity companies financially if liquefied natural gas supply from the Sakhalin-2 oil and gas project is disrupted, Seiji Jige, president and CEO of the government-backed lender, said in a recent interview with Jiji Press.
The DBJ aims to help the utilities replace Russian LNG with alternative sources so that they are not badly affected by the possible disruption of LNG supply from the project, Jige said.
“Shortages and higher prices for LNG might pose financial problems” to the utilities, he said. Loans and subordinated loans will be extended if needed to meet demand, he said, noting that it would be the best if there is no supply disruption.
Japan relies on Russia for 8.8 pct of its LNG imports, according to trade data from the Finance Ministry.
Most of the Russian supply come from the Sakhalin-2 project, which is partly owned by Japanese traders Mitsui & Co. <8031> and Mitsubishi Corp. <8058>.
Russian President Vladimir Putin has signed a decree to effectively seize control of the project, leaving LNG supply to Japan at risk.
The Japanese government has indicated that it will help the Japanese companies maintain their interests in the project.