March 22, 2023 - Japan's Kansai Electric said March 20 it will restart later in the day power generation at the 900 MW No. 2 coal-fired unit at Maizuru power plant, just days after an unexpected shutdown early March 15 following a fire at biomass-fuel supply facilities at the power plant in Kyoto prefecture.

Kansai Electric now expects to resume power generation at the No. 2 Maizuru unit at around 09:55 pm local time (1255 GMT), using only coal as feedstocks as the company is still in the midst of investigating into the cause of the late March 14 fire, a company spokesperson told S&P Global Commodity Insights.

The restart of the No. 2 Maizuru unit comes as Kansai Electric has been on a spotlight for potential spot purchases of LNG cargoes in Asia, where the region's Northeast is entering shoulder-month demand season.

Market sources, however, have told S&P Global that Kansai Electric had not been hunting for spot LNG cargoes in the wake of the recent fire incident.

"Electricity demand is getting weak now. That may be the reason for not buying as well," said a Japanese utility source.

The Asian LNG market has been relatively weak, partly due to the weak sentiments in the European market, with plentiful supply in Asia.

"Supply is more than demand, which could be the reason JKM is weak," said an LNG trader based in Singapore.

Platts assessed June JKM 74.7 cents/MMBtu lower to $12.678/MMBtu on March 20 from March 17, the lowest since March 9, S&P Global data showed.

The spot price softened amid ample supply in Asia as well as in Europe, where LNG prices in Europe have also been bearish due to further falls in natural gas, and the return of flows from Dunkerque LNG in France.

Resuming Operations

Kansai Electric, which is currently using coal at its coal silos, expects to resume receiving coal carriers once it has confirmed fine at the coal receiving facility, the spokesperson said.

The restart of the No. 2 Maizuru unit comes after the company had restarted the unit March 18 for burning the remaining coal and biomass pellets in a facility, where it stores fuels temporarily, and it was shut in the same day, the spokesperson added.

At the time of the outbreak of fire, Kansai Electric was in the midst of carrying out planned repair works at the 900 MW No. 1 Maizuru coal-fired unit, with the No. 1 Maizuru coal-fired unit remains shut to date.

Coal-fired power accounts for 12% of Kansai Electric's 14.566 GW of operable thermal power generation capacity, with LNG and oil accounting for 62% and 26%, respectively.

The local fire department and Kansai Electric have confirmed that the fire had occurred at the the biomass-fuel supply facilities following the outbreak in the March 14 evening that had been extinguished in the March 15 morning.