Japanese energy company Jera has signed a bilateral agreement with QatarEnergy to buy liquefied natural gas (LNG) for 27 years starting in 2028.
The deal involves the purchase of 3 million tons of LNG annually. Although financial details were kept confidential, the Nikkei report said the contract value could reach ¥250 billion ($1.6 billion) per year.
Japan, a country heavily dependent on energy imports, is at a critical juncture.
Western pressure to reduce its reliance on Russian gas is forcing Tokyo to look for alternative suppliers.
Qatar has emerged as the leading choice, but the move is not without risks and costs.
Meanwhile, Japan is working to revive nuclear power after the 2011 Fukushima disaster.
However, the effort has been slow and controversial.
At the same time, a surge in electricity demand from data centers and technology industries such as artificial intelligence (AI) is putting a strain on the country's power system.
Jera has also signed a 20-year LNG deal with the United States (US) to buy up to 5.5 million tonnes per year, three times the current amount.
This clearly signals a geopolitical shift in Japan’s energy sector driven by political pressures, as well as technological needs.
Japan’s approach of trying to balance energy security, cost and geopolitics now reflects the central dilemma of developed countries that rely on fuel imports.
Diversification of energy sources is no longer an option, but a necessity that could invite price instability and long-term political tensions.
