OPINION : “Lessons in Gas and LNG Governance from Japan”

At the recent IGS Indo-Pacific LNG Summit 2026, one of the most interesting presentations came from Tokyo Gas Group. Rather than simply promoting its technology, Japan's largest gas utility company presented a case study on how Japan has developed a highly resilient national gas system despite having almost no domestic natural gas reserves.

Ironically, a country with limited gas resources has managed to establish one of the most comprehensive LNG networks in the world. In contrast, Indonesia, which holds the largest gas reserves in Southeast Asia, continues to face infrastructure gaps, leaving many industrial areas and power plants with insufficient gas supplies. Tokyo Gas's presentation offered highly valuable lessons for Indonesia.

Japan Does Not Rely on a Single Terminal

Japan currently has more than 45 LNG receiving terminals, comprising 37 primary LNG import terminals and 8 secondary LNG receiving terminals, along with hundreds of satellite LNG terminals distributed across various regions.

These facilities are interconnected through transmission pipelines, distribution networks, storage terminals, LNG truck fleets, and small-scale LNG carriers.

This means that Japan has not built a single massive terminal to serve the entire country. Instead, it has developed a multi-tier system structured as follows:

Primary Terminal → Secondary Terminal → Satellite Terminal → Consumers

This model provides significantly greater flexibility in gas distribution.

Tokyo Gas presented a particularly interesting LNG supply chain model. Liquefied natural gas is first received at a primary LNG import terminal. A portion is then regasified and delivered directly into the city gas pipeline network. The remaining LNG is transported in liquid form to secondary receiving terminals, then to satellite terminals, and ultimately to industrial areas, power plants, and commercial customers.

These deliveries utilize several transportation options, including LNG carriers, small-scale LNG carriers, ISO containers, and/or LNG trucks.

Consequently, the gas distribution network does not depend solely on pipelines. Where pipeline development is not yet economically feasible, LNG distribution can continue through land-based and maritime transportation.

The "Hub-and-Spoke" Philosophy

Interestingly, Japan has implemented a concept that has long been discussed in the context of Indonesia's gas sector development.

Under this concept, primary terminals serve as the main hubs, secondary terminals function as regional hubs, while satellite terminals act as the "spokes" that distribute LNG to end consumers.

This model enables nearly all regions of Japan to access natural gas, even though the country's pipeline networks are not fully integrated at the national level.

Looped Pipeline Network

Another important lesson is the development of a "Looped Pipeline Network." Tokyo Gas operates approximately 66,870 km of high-pressure gas pipelines. More important than the total pipeline length, however, is the network configuration, which is designed in interconnected loops.

As a result, if one section of the network experiences a disruption, gas flows can still be redirected through alternative routes. This significantly enhances security of supply.

Four Major Terminals Providing Backup Supply

In the Tokyo metropolitan area, four major LNG terminals provide mutual support: Negishi, Ohgishima, Sodegaura, and Hitachi.

These terminals have LNG storage capacities of approximately 1.6 million m³ for each terminal group, with regasification capacities reaching approximately 2.0–2.1 million m³ of gas per hour.

This backup system ensures that if one terminal experiences an operational disruption, gas supplies can be redirected from other terminals without interrupting deliveries to customers.

Gas Is Stored Beyond LNG Tanks

Another interesting concept is that Japan effectively "stores energy" not only in LNG tanks, but also throughout its pipeline networks, receiving terminals, satellite terminals, and even its continuously operating fleet of LNG trucks.

With multiple storage points across the system, operators can manage when LNG is regasified and when gas is delivered to customers in response to daily and seasonal fluctuations in demand.

This flexibility is one of the key factors underpinning Japan's energy resilience.

Satellite Terminals Come in Various Sizes

Tokyo Gas also presented examples of LNG terminals with different capacities. For instance, Sodegaura LNG Terminal, which serves as a primary terminal, has a storage capacity of approximately 1 million m³ across 15 tanks.

Akita LNG Terminal, operating as a secondary terminal, has just one tank with a capacity of approximately 12,000 m³. Meanwhile, Onahama Satellite Terminal operates with a single tank capable of storing approximately 1,000 m³.

This demonstrates that LNG terminals do not always need to be large. What matters is that their capacity is aligned with market demand.

LNG Trucks as a Backbone of Distribution

Tokyo Gas has been distributing LNG by truck since 1970. Today, its LNG trucking operations handle approximately 550,000 tonnes of LNG annually, using tanker trucks with capacities ranging from 7.1 to 15.7 tonnes. This approach is far more economical for serving areas where pipeline development is not yet financially viable.

Indonesia Actually Has Greater Resources

Interestingly, Indonesia possesses significantly greater resources and assets than Japan. Indonesia has the Masela Block, Andaman, IDD (Delta Mahakam), the Tangguh, Bontang, and Donggi Senoro LNG plants, as well as several other newly discovered gas fields. The gas reserves are already available. What remains is the development of a national distribution network.

Historically, LNG development in Indonesia has been more export-oriented, while the development of domestic receiving terminals remains very limited.

Sulawesi–Maluku as an Example

Tokyo Gas has also participated in the development of the Sulawesi–Maluku LNG project, which connects one floating hub, six onshore receiving facilities, and one small-scale LNG carrier to supply power plants at six locations.

This concept demonstrates that the multi-tier LNG distribution model is not merely theoretical, but has already been implemented in Eastern Indonesia.

Such an approach is particularly relevant for Indonesia's archipelagic geography, where long-distance pipeline networks are difficult to develop.

Time for Indonesia to Strengthen Its Gas Infrastructure

The greatest lesson from Japan is not the scale of its investment, but its approach to planning and development. Japan has developed its gas network gradually, in an integrated manner, and based on market demand. It did not wait until its entire pipeline network was completed before beginning gas distribution.

Instead, Japan combined primary terminals, secondary terminals, satellite terminals, pipeline networks, small-scale LNG carriers, and LNG trucks into a mutually supporting energy logistics system. Indonesia should be able to adopt a similar approach.

Major gas fields such as Masela, Andaman, IDD, and Tangguh could serve as supply hubs, connected to regional receiving terminals serving industrial areas and power plants. Gas could then be distributed to satellite terminals through small-scale LNG networks, LNG trucking, and/or CNG.

Through this "hub-and-spoke" model, natural gas utilization would no longer be focused solely on exports, but could also expand access to cleaner energy for industrial areas, smelters, power plants, and communities throughout the Indonesian archipelago.

If Japan, despite its limited natural gas resources, has managed to develop more than 45 LNG terminals and hundreds of satellite facilities, Indonesia, blessed with abundant gas reserves, should be capable of achieving even more.

Our greatest challenge is not a shortage of natural gas, but the determination to build an integrated and forward-looking gas distribution infrastructure.

It is time for Indonesia to move beyond merely being an LNG exporter. We must begin developing a national gas ecosystem capable of delivering clean, reliable, and affordable energy to every corner of the country. This is where the true meaning of energy self-sufficiency can be realized.

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Yogyakarta, after Isha prayer

July 25, 2026