TOKYO — Chubu Electric Power, Japan’s third-biggest utility, signed agreements to buy coal from Russia to reduce reliance on Australian imports and offset declines in Chinese shipments, company officials said.
The Nagoya City-based company has purchased at least 200,000 metric tons from Siberian Coal Energy Co., or SUEK, for delivery in the year ending March 31 under term and spot contracts, two officials at the utility with direct knowledge of the deals said, declining to be named because the information is not public.
Australian mines operated by companies such as Xstrata and Rio Tinto Group supplied 68 percent of power-station coal that was imported by Japan last year. Chubu Electric, Electric Power Development and Tohoku Electric Power, the country’s biggest importers of the fuel, are looking to Russia for supplies as China reduces exports to meet domestic demand.
“Utilities are keen to diversify their import sources,” Atsuo Sagawa, senior coal market analyst at the Institute of Energy Economics Japan, said by telephone from Tokyo. “Russia hasn’t been a major player in Japan’s power-station coal market because of the lack of ports on the Russian Pacific coast.”
SUEK built the Vanino bulk carrier terminal at Muchka Bay in the Khabarovsk region in late 2008 to increase cargo-handling capacity in the Far East and to boost exports to Asia.
The Vanino terminal handles 700,000 tons of coal for export each month, Deputy CEO Anna Belova said in September. The port’s annual capacity is 12 million tons and can be doubled, Belova said. Atsuo Sawaki, spokesman for Chubu Electric, declined to comment on the agreements with SUEK, saying the company doesn’t disclose fuel-supply deals. Alexei Naumenko, spokesman for SUEK, declined to confirm the accords.
Chubu’s purchases followed Tohoku Electric’s signing of a purchase agreement with SUEK last year. Tohoku Electric, the second-biggest coal user in Japan, started receiving fuel loaded at the Vanino terminal in June this year after signing an accord in 2008, spokesman Sota Nozu said by telephone from Sendai, a city in northern Japan.
Japan’s imports of power-station coal from Russia increased 37 percent last year compared with 2004, while Chinese exports of the fuel to Japan dropped 53 percent during the same period, data from the trade ministry show.
“Diversification helps us strengthen our supply stability and security, and this led us to signing the contract with SUEK,” Nozu of Tohoku Electric said.
Chugoku Electric Power, one of the 10 Japanese regional utilities, bought about 100,000 tons of Russian coal on a trial basis this year and will decide whether or not to sign a term contract, spokesman Osamu Ueno said.
Japan imported 105 million tons of power-station coal in 2008, according to trade ministry data. Australia shipped 71 million tons and Indonesia supplied 16 million tons, while Russian coal imports reached 6.8 million tons and accounted for 6.5 percent of the total.
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