In a strategic move to enhance efficiency, Tokyo Gas, Japan’s largest city gas provider, announced the sale of its 25% stake in an Eagle Ford shale gas project in South Texas to Shizuoka Gas for $130 million.
The divestiture, revealed on Friday, is part of a broader asset portfolio review.
A shift in US strategy for Tokyo Gas
According to a statement released by Tokyo Gas, this decision will allow the company to concentrate on its US subsidiary, TG Natural Resources, which holds assets in East Texas and North Louisiana.
Shizuoka Gas, in a separate announcement, highlighted that the deal signifies its inaugural acquisition in a US-based enterprise and marks its entry into the upstream natural gas sector.
Shizuoka Gas’s projected gains
The shale gas production attributable to Shizuoka Gas from this project is estimated to reach 400,000 metric tons per year, calculated in liquefied natural gas (LNG) equivalent.
Shizuoka Gas clarified that the gas extracted from the project, operated by Lewis Energy Group, will be sold within the United States.
“Starting with this project, we will consider further business development in the US,” Shizuoka Gas stated, signaling its intent to expand its presence in the American market.
The company has set an ambitious goal of generating 14% of its recurring profit from its overseas business ventures by the year 2030, reflecting a strategic shift towards international expansion.
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