JERA Secures LNG Supply Through October as Quarterly Profit Jumps 31 Percent
Japan’s largest liquefied natural gas buyer has locked in adequate inventories for the peak summer season while posting a sharp rise in quarterly earnings, signaling resilience against seasonal demand shocks and volatile wholesale power prices.
Japan’s largest power generator, JERA, confirmed on Friday that it has secured sufficient liquefied natural gas inventories to last through October. The utility stated it faces no risk to stable power delivery, even if a severe summer heatwave drives up electricity demand.
"We have secured sufficient LNG stocks for the peak summer demand season from August to October, and there are no issues regarding stable power supply," said Masato Otaki, an executive officer at the company. As Japan’s top LNG buyer, JERA handles approximately 35 million metric tons of the fuel annually, making its procurement strategy a critical bellwether for regional energy markets.
The supply assurance accompanies a robust financial performance. JERA reported a net profit of 123.1 billion yen ($766 million, based on an exchange rate of 160.6700 yen to the dollar) for the April-June quarter, representing a 31 percent increase from the previous year.
The company raised its full-year net profit forecast to 280 billion yen, an increase of 86.4 billion yen year-on-year. Otaki attributed this earnings growth primarily to stronger results in domestic thermal and gas operations, alongside higher-than-expected wholesale electricity prices.
Despite the current profit boost from elevated wholesale prices, JERA is actively reselling long-term power purchase agreements, including coal-fired contracts. This strategic move aims to lower costs for end consumers, even at the expense of near-term margins.
"While this would weigh on our earnings, it would contribute to social stability in the long term and support more stable profits from next year onwards," Otaki noted. This indicates a deliberate shift toward predictable, socially aligned revenue streams over volatile spot market gains.
Looking ahead, the utility plans to leverage its global trading division to optimize procurement for the winter months. Otaki also clarified that Qatar currently accounts for only a minor fraction of JERA’s overall LNG supply portfolio, highlighting a diversified sourcing strategy.
On the topic of international expansion, JERA declined to confirm reports of a new large-scale gas-fired power plant in the United States. However, Otaki emphasized that North American independent power producer operations remain a core business area under active evaluation.
