Japan's JERA sees no impact on its LNG supply from sanctions on Gazprombank

TOKYO : Japan's top utility JERA sees no impact from new U.S. sanctions on Gazprombank on its procurement of liquefied natural gas from Russia's Sakhalin-2 project, as it does not use the lender for payment settlements, its president said.

The U.S. imposed new sanctions on Russia's Gazprombank last week as part of a wider push to punish Moscow for its invasion of Ukraine, barring it from any new energy-related transactions that touch the U.S. financial system, among other restrictions.

"The U.S. sanctions on Gazprombank have no impact on our procurement as we don't use the Russian bank for settlement for Sakhalin-2," Hisahide Okuda, JERA's president, told a briefing on Wednesday.

JERA is a major buyer of LNG from Sakhalin-2, with two contracts with the project - for 0.5 million metric tons per annum deal running until 2026, and for 1.5 million metric tons per annum expiring in 2029.

Gazprombank is one of Russia's largest banks and is partially owned by Kremlin-owned gas company Gazprom. The sanctions made exemptions for transactions related to the Sakhalin-2 project until June 28, 2025.

Japan's Industry Minister Yoji Muto said on Friday the country would take all possible measures to prevent disruptions in securing stable LNG supply from Sakhalin-2 following the new sanctions.

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