Japan to offer JERA $900 mln of loans for LNG

The logo of JERA Co., Inc., the world's biggest LNG buyer, is displayed at the company office in Tokyo, Japan July 14, 2017. REUTERS/Issei Kato/File Photo

TOKYO, Oct 6 (Reuters) - Japan has agreed to offer 130 billion yen ($899 million) in loans to JERA, the country's biggest power generator, to help to secure liquefied natural gas (LNG) amid a surge in spot prices.

The state-owned Japan Bank for International Cooperation (JBIC) on Thursday said it will extend the loans to JERA, a joint venture between Chubu Electric Power (9502.T) and Tokyo Electric Power (9501.T), in syndication with private sector financial institutions.

Japan wants to avoid an energy crunch by offering financial support before winter, when heating demand is expected to increase. Spot LNG prices remain at high levels because of the risk of disruption to supply from Russia resulting from its invasion of Ukraine. read more

Japanese utilities buy the bulk of their LNG through long-term contracts, but about 20% comes from the spot market.

($1 = 144.5800 yen)

Reporting by Makiko Yamazaki Editing by David Goodman

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