Japanese power company and LNG importer, Kansai Electric, scrapped plans to build a liquefied natural gas power plant in Wakayama.
The company originally started looking into the construction of the LNG thermal power plant with a capacity of 3.7 GW back in 1995.
“In the 1990s, our company promoted the Wakayama power plant construction project to cope with the substantial growth in the demand for electrical power; however due to factors such as decline in demand, in 2004, the construction was suspended,” Kansai Electric (Kepco) said in a statement.
Kepco planned to launch the plant as early as fiscal 2033.
Taking into consideration the business environment surrounding the electricity business, today, Kepco said it has decided to cancel the development for lack of prospect of promoting the project, and to take actions toward exploring alternative use of the project planned site.
Loss of about $858 million
Kepco said it will develop a part of the planned site as an enterprise zone by fiscal 2026, ahead of the whole site.
“Working together with relevant administrative agencies and involved persons, we will endeavor to recruit companies to the site, so that the site may serve as a place where companies from various industrial sectors congregate,” it said.
Due to cancelation of the project, Kepco said that a loss of about 123 billion yen ($858 million) will be recorded in its third quarter financial statement.
Kansai’s nuclear power utilization rate in the six months that ended this September increased 78.3 percent from 33.9 percent a year earlier.
The company’s income increased to 371 billion yen due to a decrease in fuel prices and the increase in nuclear capacity factor.
Kansai Electric recently signed a binding term agreement with Hartree Partners for the supply of LNG alongside investment in a nature-based carbon project in Australia.
The firm uses LNG as fuel for thermal power generation, including for its Himeji No. 1 and No. 2 power stations, Nanko power station, and Sakaiko power station, according to its website.
The firm buys LNG from US, Qatar, Australia, Indonesia, UAE, and also operates the Himeji and Sakai LNG import terminals, GIIGNL data shows.
