JERA Partners with Torrent Power for Long-Term LNG Supply Deal

Japan’s leading power generator, JERA, has entered into a significant long-term agreement with India’s Torrent Power to supply liquefied natural gas (LNG). The deal, announced on December 8, 2023, establishes a commitment to deliver four LNG cargoes annually for a duration of ten years, starting in 2027.

This agreement marks JERA’s first long-term LNG export contract with an Indian partner. The LNG will be delivered on a cost basis to support Torrent Power’s energy requirements, particularly for its extensive fleet of power plants, which have a combined capacity of 2,730 megawatts. Additionally, the LNG will be utilized for domestic sales, catering to households, small industries, and the transport sector.

Strategic Partnership to Meet Seasonal Demands

JERA’s statement highlighted the strategic nature of this partnership, which aims to optimize the seasonal demand patterns experienced by both Japan and India. The agreement allows JERA to utilize its global fleet during periods of lower demand in Japan, while simultaneously supplying Torrent Power during the peak summer months in India, when energy consumption typically surges.

The collaboration is seen as mutually beneficial, addressing the growing energy needs in India while providing JERA with a stable export market. As part of its broader strategy, JERA is focused on expanding its LNG portfolio across regions including the Middle East, Asia, and the United States. This diversification is intended to enhance the company’s resilience against the inherent volatility of global energy markets.

JERA is a joint venture formed by Tokyo Electric Power and Chubu Electric Power, two of Japan’s largest energy providers. The move into the Indian market underscores JERA’s commitment to international expansion and its goal of securing long-term energy supply contracts in key markets.

As demand for cleaner energy sources continues to rise globally, partnerships like this one between JERA and Torrent Power may play a crucial role in ensuring both energy security and environmental sustainability.