Visions - Fall 2017 - 7

Natural gas serves as a nearly indispensable resource
in daily life now, but almost no domestic natural gas
is available in Japan, so this project aims to support
Japan's residents by maintaining a stable LNG supply
with a reasonable price tag.

resource. LNG is produced by cooling natural gas
to 162 below zero degrees Celsius for easier transportation and storage. An LNG import facility was
constructed in Maryland in the 1970s, but in the late
2000s, the shale gas boom caused the US to switch
its position from an importer of LNG to an exporter.
This led Dominion to construct a plant to liquefy
natural gas and export LNG to overseas countries.
Sumitomo Corporation Group concluded a terminal
service agreement for the utilization of Dominion's
LNG facility in 2012 through Pacific Summit Energy. Furthermore, through this subsidiary, Sumitomo
Corporation established a joint venture company, ST
Cove Point, with Tokyo Gas in 2014. Since then, the
agreement was assigned to this newly founded joint
venture.
PSE has been engaged in the natural gas trading business since 2004, with a huge trading network across
the country, enabling PSE to procure natural gas at
the optimal price from the US market. The process is
that procured gas is sold to ST Cove Point, and then
liquefied by Dominion Energy Cove Point LNG at
its terminal. Finally, the produced LNG is shipped to
customers outside of the US, including Japan.

Another feature of the project is the flexibility in
trading.The amount of LNG ST Cove Point exports from the terminal is approximately 2.3 million
tons per year. Subject to the export authorization
granted by the US Department of Energy, LNG can
export to countries including Non-Free Trade Agreement countries.
Pacific Summit Energy has been developing its ability
to procure US natural gas over many years, and ST
Cove Point has Dominion Energy Cove Point LNG
liquefy natural gas and implement flexible LNG
export operations, contributing to the value chain
through Sumitomo's integrated corporate strength.
"Our greatest integrated corporate strength comes
through PSE's experience and intelligence in the
US natural gas market," Kakizawa said, "and that
combines with SC Group's global LNG experience
acquired through the operation of our affiliated
company LNG Japan."
When operations commence at Dominion's
LNG terminal, Sumitomo will continue its
relationship with both domestic and international
players, committed to working with both US
natural gas producers and LNG buyers. This means
a commitment to a stable LNG supply from the US
to various energy users in Japan, and in the future,
around the world.
Sumitomo Corporation of Americas

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