Tokyo Electric entered a memorandum of understanding with Chubu Electric to form an alliance covering the entire energy supply chain.
Details of the alliance will be negotiated in the coming period aiming to conclude a final agreement concerning and to establish a legal entity for the purpose of realizing the JV within the second half of the fiscal year ending March 2015.
The mission of the JV of Japan’s energy companies to ensure the stable supply of energy on an internationally competitive basis, according to Tepco statement.
Underpinned by the world’s largest LNG procurement scale of 35 million to 40 million tons annually, establishing a fuel procurement portfolio that is outstanding in terms of economy, stability and flexibility is one of the goals of the alliance, the statement said.
Other goals highlighted by the company are the use of an enlarged scale of fuel procurement as a springboard, jointly conducting on an expanded basis the upstream, transportation and trading businesses that the companies previously operated individually, to expand earnings opportunities and further strengthen fuel procurement capabilities.
Tepco intends to apply combined management resources to replace old and energy-inefficient thermal power plants with the latest high-efficiency power generation facilities, yielding substantial thermal efficiency improvements and allowing the realization of low-cost power supplies.
LNG World News Staff, October 7, 2014; Image: Tepco