JERA charters four VLGCs to launch Japan’s first low-carbon ammonia supply chain

Japanese utility JERA has signed time charter agreements with NYK Bulkship (Asia) and Mitsui O.S.K. Lines for four dual-fuel Very Large Gas Carriers (VLGCs), securing the shipping link in what it calls Japan’s first commercial-scale low-carbon ammonia value chain. Each shipping company will supply two vessels under long-term charter, with delivery scheduled for the first half of 2027 ahead of supply chain operations starting around fiscal 2029.

The VLGCs, built by Kawasaki Heavy Industries, will run about 230 meters long with tank capacity of roughly 87,000 cubic meters and the ability to burn LPG or very low-sulfur fuel oil. JERA said the deal marks the world’s first long-term deployment of VLGC-class vessels for ammonia transport.

The carriers will move low-carbon ammonia from the Blue Point project in Louisiana, in which JERA holds a 35% stake, to Japan. Blue Point is targeting about 1.4 million tonnes per year of ammonia production, with roughly 500,000 tonnes per year contracted FOB for shipment on the chartered vessels. JERA plans to burn the ammonia at its Hekinan thermal power station at a 20% heat-value co-firing ratio and to supply industrial customers.

“These agreements with NYK and MOL represent a major milestone in JERA’s efforts to establish Japan’s first commercial scale low carbon ammonia value chain,” said Irtiza Sayyed, JERA senior managing executive officer. The project builds on memoranda of understanding signed with NYK and MOL in November 2022 and is certified under Japan’s Hydrogen Society Promotion Act, with subsidies approved by JOGMEC in February 2026.

Source: BC Insight