(EnergyAsia, June 29 2011, Wednesday) — Faced with dwindling domestic oil demand, Japan’s top refiner JX Nippon Oil and Energy Corp is looking to shut down its 180,000 b/d Muroran refinery in the north.

It has been planning to reduce its crude refining capacity by 200,000 b/d by March 2014 after having slashed around 400,000 b/d at the end of the last fiscal year.

Japan is estimated to have a surplus refining capacity of over one million barrels per day.

However, planners are wondering if they should slow down the pace of capacity reduction following the uncertainty in the country’s energy outlook caused by the loss of the Fukushima nuclear capacity after the March 11 earthquake and tsunami.