Canada's Alberta eyes Japan for new LNG deals amid US tariff threat, minister says

By Katya Golubkova

TOKYO (Reuters) - Canada's Alberta province, a major gas producer, needs to find new export markets in face of a U.S. tariff threat, and expanding in Japan is an important target, its minister of environment and protected areas, Rebecca Schulz, told Reuters.

"Given what we've seen in the United States, this is reinforcement that we need to diversify our export markets, and Japan, our already existing relationship, is going to be a key area of focus," Schulz said during an interview in Tokyo late on Wednesday.

She has been meeting officials, business lobbies and company representatives, including from JERA, Japan's top LNG buyer, JOGMEC, Japan Gas Association, chaired by a Tokyo Gas executive, and others, over the past week.

"Energy security is a hugely important focus for many countries, including Japan and Canada as well," Schulz said. "A lot of our conversations were about the balance of meeting energy demand."

While LNG demand in Japan overall is falling, its needs could increase if its renewable energy roll-out is too slow, a senior industry ministry official said. This week, Mitsubishi said it is reviewing offshore wind operations in Japan while others also warned of rising costs.

U.S. President Donald Trump and Japan's Prime Minister Shigeru Ishiba are set to meet on Friday and are expected to discuss a huge proposed Alaska LNG project, among other topics, sources said, as competition for major LNG buyers is rising.

U.S. Senator Dan Sullivan on Wednesday urged Japan and other U.S. allies in Asia to back the Alaska LNG project, warning that if they were not interested in buying the gas, strategic rival China would be.

Canada is preparing to start exports to Japan later this year from the LNG Canada project where Mitsubishi is a shareholder, but the country is looking to add more export facilities.

Asked about Alberta's competitive advantages versus the U.S., Schulz pointed to a shorter shipping time compared to the U.S. Gulf Coast, and "given just geographic realities, less geopolitical risk", among other factors.

"There are a number of projects that are being worked on ... four or five for additional market capacity," she said. "We see a huge amount of opportunity in expanding on our partnerships with Japan, and so that's a main focus of our government."

(Reporting by Katya Golubkova; Editing by Sonali Paul)