Years of successful deliveries of Canadian propane to Japan raise confidence in the upcoming LNG trade between the two countries, says the chair of the Institute of Energy Economics, Japan (IEEJ).

Thanks to new export facilities in Prince Rupert, B.C., Canada went from zero propane exports to locations outside the United States in 2017 to nearly 34 million barrels of propane last year, according to the Canada Energy Regulator.

Canada is now Japan’s second-largest supplier of propane, according to World Bank data, where uses include automobiles, electric power generation and petrochemical feedstock.

“The long history of reliability in the supply of propane from Canada serves as the basis for the high expectation for Canadian LNG to Japan,” said IEEJ chair Tatsuya Terazawa.

“We see LNG from strategic partners like Canada as important to our energy security and our country’s efforts to significantly reduce our dependence on coal as well as to provide dispatchable power to deal with the intermittency of renewable power.”

During a recent trade mission to Japan, leaders from Canadian organizations Energy for a Secure Future and the First Nations LNG Alliance signed a memorandum of understanding with IEEJ to advance energy trade.

“There is a real commitment between the three organizations to work together to support Canadian LNG projects being successfully built and getting our product to markets in Asia that need energy security and low-emission energy options,” said Shannon Joseph, chair of Energy for a Secure Future.

“It is an extremely positive thing.”

The agreement comes at a pivotal moment with multiple Canadian LNG projects in various stages of construction and advancement, and 10 per cent tariffs on U.S. imports of Canadian energy now in place.

“Canada must act now and diversify our energy systems and begin the process of exporting to other countries who are in desperate need of our resources,” said First Nations LNG Alliance CEO Karen Ogen.

With the LNG Canada terminal expected to ship its first cargo of LNG in July and two smaller projects, Cedar LNG and Woodfibre LNG, under construction, Canadian LNG will soon be able to service an expected 60 per cent increase in world demand by 2040, mostly driven by Asia.

By 2040, Japanese LNG imports could rise as high as 74 megatonnes per year compared to 66 million tonnes in 2024, according to Japan’s Ministry of Trade, Economy and Industry.

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