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Sustainable Business

Japan's Astomos Energy buys carbon-neutral LPG cargo from Shell

2 minute read

A Shell logo is seen at a gas station in Buenos Aires, Argentina, March 12, 2018. REUTERS/Marcos Brindicci/File Photo

TOKYO, June 11 (Reuters) - Astomos Energy Corp, Japan's biggest importer and wholesaler of liquefied petroleum gas (LPG), said on Friday it had signed to buy from Royal Dutch Shell (RDSa.L) a cargo of LPG with offset carbon emissions.

The purchase of carbon neutral LPG cargo at the scale of the Very Large Gas Carriers (VLGC) is believed to be the world's first case, Astomos said in a statement.

The move comes as carbon reduction targets tighten around the world and global gas producers step up to offer cleaner supplies as more buyers commit to environmental targets.

Shell will use carbon credits from its nature-based projects to offset lifecycle CO2 emissions generated across the value chain from production to consumption, including transportation, Astomos said.

Astomos is 51% owned by refiner Idemitsu Kosan Co Ltd (5019.T) and the rest is held by trading house Mitsubishi Corp (8058.T).

In 2019, Tokyo Gas Co Ltd (9531.T), Japan's biggest seller of city gas, bought a cargo of carbon neutral liquefied natural gas (LNG) from Shell, which also supplied a similar cargo to South Korea's GS Energy, Taiwan's CPC Corp and China National Offshore Oil Corp, or CNOOC (SASACY.UL).

Carbon neutral fuel typically involves companies supporting nature-based projects that reduce emissions to offset those generated from exploration and production activities.

Reporting by Yuka Obayashi; Editing by Rashmi Aich

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