PERU LNG, the company that operates the first Natural Gas Processing Plant in South America, has reached an agreement with the Japanese companies Osaka Gas Co. (Osaka Gas) and Marubeni Corporation (Marubeni) to conduct a joint pre-feasibility study to evaluate the production of synthetic methane (e-methane) in Peru and the sale of this e-methane to potential markets including Peru and Japan.
PERU LNG, Marubeni and Osaka Gas have been conducting an initial study for the project since July 2022. The initial study investigated the renewable energy procurement potential and CO2 required to produce approximately 60,000 tons of e-methane per year. As a result, Peru's abundant renewable energy sources, mainly solar, wind and hydropower, together with CO2 recovered from PERU LNG's liquefaction terminal would allow the project to produce approximately 60,000 tons per year of e-methane at a competitive price.
The next stage will be to initiate a Pre-FEED, which will include discussions on the procurement of renewable energy and feedstock (including CO2); specification studies for plant construction; and economic and other detailed feasibility studies. Upon completion of the Pre-FEED, Marubeni, Osaka Gas and Peru LNG will consider the results and assess whether an investment decision can be made in 2025, with the goal of starting e-methane production and sales by 2030.
As mentioned above, PERU LNG is very excited to participate in the evaluation of this opportunity, as e-methane can contribute to achieving carbon neutrality in the gas industry considering that e-methane production requires CO2 that would be recovered from emissions. As an example of the importance of e-methane in the future, the Japanese government set a target for e-methane injection into existing urban gas infrastructure at 1% by 2030 and is expected to reach 90% by 2050, to promote the transition to carbon neutral gas.
*1 E-methane: Methane produced from CO2 and green hydrogen.
*2 Green hydrogen: Hydrogen produced through a process of electrolysis using electricity generated from renewable energy, which involves the extraction of hydrogen from water that has been split into hydrogen and oxygen.
About Osaka Gas
Name: Osaka Gas Co., Ltd
Central Office: 4-1-2 Hiranomachi, Chuo-ku, Osaka 541-0046, Japan
Founded: April 10, 1987
President: Masataka Fujiwara
Website: https://www.osakagas.co.jp/
About Marubeni
Name: Marubeni Corporation
Central Office: 4-2 Ohtemachi 1-chome, Chiyoda-ku, Tokio, Japan
Founded: December, 1949
President: Masumi Kakinoki, President and CEO
Website: https://www.marubeni.com/en/