Japan depends on imports to meet its oil consumption needs and the government-controlled oil stocks to guard against a supply interruption. Oil demand in Japan has primarily declined due to fuel substitution, declining and aging population, and energy efficiency measures.
Japan has a robust oil sector comprised of various state-run, private, and foreign companies. Japan Oil, Gas and Metals National Corporation( JOGMEC), a state-run enterprise is responsible for Japanese companies involved in oil and gas exploration and production overseas.
The largest companies are Inpex and Japan Petroleum Exploration Company( Japex). Chevron, BP, Shell, and BHP Billiton are the foreign energy companies involved in providing products and services in Japan. The domestic oil reserves in Japan are available along the western coastline. Most of Japan’ s domestic oil production is from the country’ s large petroleum refining sector with limited resources. Chunxiao / Shirakaba and Longjing / Asunaro are the four natural gas fields that are jointly explored and developed by Japan and China due to the territorial claims.
Japan is investing more funds in overseas oil and natural gas operations. Japanese companies are involved in more than 140 oil and gas projects worldwide such as the Middle East, Southeast Asia, and Australia. Japanese oil companies involved in exploration and production projects overseas are Inpex, Cosmo Oil, Idemitsu Kosan Company, Japan Energy Development Corporation, Japex, Mitsubishi, Mitsui, Nippon Oil, and others.
Japan’ s natural gas production has ceased due to the declining natural reserves in the past decade. Japan is using innovative methods to produce hydrocarbons and to discover methane hydrates. However, the costly innovations are sure to delay production plans. The Japanese government implemented carbon abatement policies and pledged to lower greenhouse gas emissions by 26 % by 2030.
Japan owns the highest efficiency rate of coal-fired technology in the world. Japan is installing new, clean coal plant technologies, such as ultra-supercritical units or integrated gasification combined-cycle technology, to meet environmental targets and to replace some of the decades-old coal power plants.
Japan has three natural gas-fired power plants with a combined 4.8 GW of capacity under construction and scheduled to start operations by 2020. It is expected that Japan’ s nuclear reactors will utilize renewable energy resources in the coming years. By the year 2030, LNG is expected to provide for around 27 % of Japan’ s power generation.
An oscillation was observed in the Japanese oil and gas construction market in the past years. The oil and gas infrastructure exports are a pillar to Japan ' s growth strategy and the oil and gas construction in Japan has witnessed strong technology and innovation. Japan is Asia ' s most advanced economy and oil demand has declined for many years due to the ageing and declining