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Friday, February 17, 2012

Japan top oil buyer to keep importing Iran crude

Friday, 17 Feb 2012

Japan's top buyer of Iranian crude, Showa Shell Sekiyu KK was buying about 100,000 barrels per day of crude oil from Iran steady with last year despite the mounting pressure from the United States to cut imports.

Mr Jun Arai president of Japan said that "We will carefully watch the ongoing bilateral discussions between Japan and the United States. Iran is an important source of crude for Japan as well as our company, and we will wait for the government's guidance on the matter."

The comment comes as US sanctions on Iran look set to make it difficult for refiners in Japan; Iran's number three crude buyer to pay Tehran for its oil. Japan is seeking an exemption from US sanctions which if enforced would penalize some Japanese banks for doing transactions with Iran's central bank.

Mr Arai said that Iranian crude accounted for 8.8% of Japan's total imports in 2011. Iran is the fourth-biggest crude supplier to Japan. The company has raised the operating rate of its group refineries with total capacity of 395,000 barrels per day to more than 99% of capacity in the Q4 of 2012 after the closure of its 120,000 barrels per day Ohgimachi facility in September. That figure is up from the 2011 average of 93.2% and 84.2% in 2010.

He said that the power venture with Tokyo Gas, the gas fired 814 MW Ohgishima Power Station in Yokohama, operated at near full capacity following the March 2011 earthquake that forced indefinite shutdowns of many nuclear reactors and some fossil fuel fired plants in quake-hit northern Japan.

(Source: Reuters)

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