While the first international LNG shipment took place in 1959, only in the past decade or so has the super-chilled fuel blossomed into a prospering global market. Today, Japan is at the center of it, both as a major consumer, and due to its leading role in the LNG shipping industry.

Currently, Japan is the world’s second largest LNG consumer, but it also transports over 30% of global LNG supplies. Not planning to rest on its laurels, Japan’s major shipping companies seek to expand their LNG fleets by 40% through FY2030, reinforcing their dominance in LNG transportation.

This status is in large part due to Japan’s geography – with no possibilities of importing LNG via pipelines (as in Europe or U.S.), Japan has had to focus on maritime supply routes.

Yet, the fleet expansion strategy hinges on the belief that LNG will maintain its status as a vital energy source in the coming decades. While climate activists want to shut down all fossil fuel usage, LNG is seen by the U.S. and many in Asia as an inexpensive lower-carbon fuel, compared to coal.

If that holds, Japan’s maritime bet on the fuel’s future role will look as a strategically smart play. Should LNG lose its luster over time, both Japan’s shipping industry and power industry could be left in the lurch. As it is, the LNG market is a highly volatile one, particularly sensitive to geopolitical vicissitudes. Japan NRG takes a look at the lay-of-the-land in the country’s LNG transportation industry.