TOKYO -- Tokyo Gas has decided to acquire part of a shale gas development in Texas from U.S. oil major Chevron, Nikkei has learned, as the Japanese energy company looks to expand profit through trading.
The deal, estimated at tens of billions of yen (10 billion yen equals $66.6 million), is expected as early as April. Tokyo Gas will use the natural gas it extracts from the development to trade on the market, as well as supply the fuel to power plants and other customers.
Because natural gas produces about half the carbon dioxide at fossil fuel plants compared with coal, Tokyo Gas anticipates that demand will continue to rise. The enthusiasm for shale gas expressed by U.S. President Donald Trump also was a factor.
At the end of 2023, Tokyo Gas bought Rockcliff Energy, a Texas-based shale gas developer, for around 400 billion yen. The Japanese utility will acquire a new interest close to Rockcliff and reduce the costs of laying pipeline to transport shale gas.
Tokyo Gas is in the process of replacing inefficient assets. In February, the company reached a basic agreement to sell its stake in a shale gas development in southern Texas to Shizuoka Gas for around 20 billion yen.