* Two firms to buy from Oxbow Coal
* U.S. coal a little cheaper than Australian variety
* Firms to consider extending purchase after first year
TOKYO, Nov 21 Japanese utilities Kansai Electric
Power Co and Kyushu Electric Power Co said
they have agreed to jointly buy a total of 1 million tonnes of
low-sulphur high quality U.S. coal at prices a little lower
against a similar type from Australia.
Australia is traditionally the biggest thermal coal supplier
to Japan. But given the shutdown of nuclear reactors in Japan
for safety checks after last year's Fukushima disaster,
utilities have stepped up efforts to cut fuel procurement costs.
The contract, which was signed on Wednesday, runs for a year
starting this month. Coal is to be bought on a free-on-board
The two companies, which were among the most nuclear-reliant
utilities in Japan, also said at a joint news conference that
they would consider extending the one-year contract with
Florida-based Oxbow Coal & Petcoke, a wholly-owned subsidiary of
Kansai will take about 400,000 tonnes, while the remaining
600,000 tonnes will go to Kyushu Electric, both firms said. The
coal, which is produced from Oxbow's coal mines in the United
States, will be shipped from the west coast of North America.
U.S. coal of 6,600 kcal/kg is to be imported from the
contract and it would be a little lower than a typical
Australian coal of 6,322 kcal/kg on a cost, insurance and
freight (CIF) basis, helped by the scale merit of the joint
purchase, a Kyushu Electric official said.
In 2011, Japan imported 532,793 tonnes of thermal coal from
the United States, up 46.5 percent from a year earlier. But U.S.
coal accounted for only 0.5 percent of total thermal coal
imports of 101 million tonnes last year, with a two-thirds of
the total from Australia and 20 percent from Indonesia.
Kansai Electric said it bought 3.87 million tonnes of
thermal coal in the last business year ended March. About 71
percent of that came from Australia, with 23 percent from
Indonesia, compared with only 150,000 tonnes from the United
Kyushu Electric said it bought 6.17 million tonnes in
2011/12, with 66 percent from Australia and 22 percent from
Canada. It bought 70,000 tonnes of U.S. coal in 2011/12.