Report: Toshiba shedding Freeport LNG capacity

Toshiba Corporation is reportedly looking to sell some of the capacity it booked in the Freeport LNG terminal on Quintana Island near Freeport, Texas.

Japanese company that signed a 20-year liquefaction tolling agreement with Freeport LNG for a capacity of 2.2 mtpa in 2013 is now seeking to offload some of the capacity, as it faces $370 million a year LNG processing fees.

Akira Nakatani, a manager in Toshiba’s LNG group told Reuters that US LNG is losing the competitive edge over JCC prices, forcing Asian buyers to turn to the cheaper spot market and cut on the long-term LNG import deals.

Toshiba initially planned to offer LNG supplies to buyers of its gas turbines used in gas-fired power plants.

The lack of firm turbine deals pushed Toshiba to engage in talks with potential buyers of the tolling rights for LNG on short-term or spot basis during the early phase of the contract term, Nakatani said.

He added that Toshiba expects to have turbines as well as LNG deals in place during 2015 or 2016, with long-term deals expected from 2020 or 2021.

LNG World News Staff; Image: Freeport LNG