Tokyo Gas sells US shale-gas stake to Shizuoka Gas at $130 million

Tokyo Gas, Japan’s largest city gas supplier, has announced that it will sell Shizuoka Gas its 25% stake in the Eagle Ford shale project in South Texas for $130m as part of an asset portfolio review in order to improve efficiency.

Tokyo Gas, in a press release, said that the move would allow it to concentrate on its U.S. division, TG Natural Resources. This unit has assets in north Louisiana and east Texas.

Shizuoka Gas stated in a separate press release that this deal marked its first acquisition of a U.S. based business, and entry into upstream natural gas.

Shizuoka Gas's shale-gas production is estimated to be 400,000 metric tonnes per year of LNG equivalent.

Shizuoka Gas announced that the gas produced by the project, operated by Lewis Energy Group will be sold to the United States.

Shizuoka Gas stated that they will be looking at further business expansion in the U.S. after this project.

The company set an ambitious target of expanding its overseas business in order to generate 14% its recurring profits by 2030. (Reporting and editing by Rachna uppal; Yuka Obayashi)

(source: Reuters)