Tokyo Gas CEO: US is priority market for overseas expansion, Tokyo Gas.
Tokyo Gas will prioritize the U.S. for its overseas expansion because of its high growth potential, CEO Shinichi SASAYAMA said on Wednesday. Japan's biggest city gas provider is looking at a possible offtake of gas from Alaska.
Tokyo Gas, Japan's largest buyer of liquefied gas, and JERA (Japan's second-largest LNG buyer) have signed agreements to purchase 1 million metric tonnes of LNG each annually from the $44 billion Alaskan LNG project, which is supported by U.S. president Donald Trump.
Sasayama, a reporter, said that the final decision on offtake would be based on the economics and terms of the Alaska LNG project yet to be built.
According to a new management strategy announced on Wednesday, the utility plans to invest up 1.3 trillion yen (8.6 billion dollars) over a three-year period starting next April. This includes 350 billion yen in overseas projects such as U.S. Shale Gas Development.
The developer of the project is Glenfarne based in the United States. They plan to make a final investment decision (FID) for the Alaska LNG Pipeline by the end of 2025, and for its LNG Export components, they will do so by 2026.
Tokyo Gas has invested in U.S. upstream assets for gas in Texas and Louisiana.
Sasayama stated that "among our overseas operations, we focus on North America with a particular emphasis on the United States which has a strong growth potential."
During Trump's Tokyo meeting with Prime Minster Takaichi, several joint investment opportunities were announced between the U.S. and Japan. However, none of them involved gas.
Washington has asked Japan to stop importing Russian energy to put pressure on Moscow regarding the Ukraine conflict.
Sasayama said that the Sakhalin-2 deal with Tokyo Gas is not linked to any potential offtakes from Alaska. He was at a Tuesday business dinner where Trump attended.
Sakhalin-2 provides Japan with around 9% its LNG requirements, including 1.1 millions tons of LNG per year to Tokyo Gas under a contract that expires in 2031.
Tokyo Gas will consult with the Japanese Government on future Sakhalin-2 supplies, Sasayama said.
STRONG EARNINGS, REAL ESTATE ASSET SALES
Tokyo Gas, a company in which U.S. activist Elliott Management owns about 5% of the shares, has raised its profit forecast for the full year to 194 billion Japanese yen from 131 billion.
Minami Taku, CFO of the utility, said that it plans to earn 30.7 billion yen in profit for this year from property sales.
The company is planning to return more than 200 billion yen in the fiscal year 2026-2028. Its target dividend for 2028 will be 140 yen, an increase from this year's 100 yen.
(source: Reuters)
