TEPCO in Talks to Buy LNG from BP

Tokyo Electric Power (Tepco) is in talks with BP to buy 500,000 mtpy of liquefied natural gas, two people with knowledge of the discussions told news agency Bloomberg.

The Japanese utility will pay for the fuel using a formula linked to gas and oil prices, the news agency reports.

Tepco currently buys 20.56 MMtpy of LNG through term contracts, according to data compiled by Bloomberg.

Prices in long-term LNG purchase contracts, which usually run for more than 10 years, are typically linked to Brent crude, or the so-called Japan Crude Cocktail.

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