Japan's Mitsubishi to acquire shale gas assets in U.S. for $7.5 billion

Mitsubishi Corporation said on Friday that it will acquire shale gas assets in the U.S. in a $7.53 billion deal, including debt, as the Japanese trading house looks to build on its presence in the country's energy market. Mitsubishi is looking to capitalize on rising power needs from data centers, manufacturing, as well as LNG exports, by expanding in the the world's largest gas market, citing domestic consumption, production, exports, and further demand growth. It will acquire the assets from Aethon Energy Management in Texas and Louisiana in a transaction that includes $5.2 billion in equity purchases and $2.33 billion in Aethon's debt. In a filing with the Tokyo Stock Exchange, Mitsubishi said that the investment will strengthen the earnings base of the company's natural gas and LNG businesses. It will also accelerate efforts to build an integrated value chain in the United States, "from upstream gas development to power generation, data center development, chemicals production, and related businesses," the company said. Shares of Mitsubishi fell 2% after the transaction was announced. The company has multiple investments in natural gas, with projects in Alaska, Malaysia, Canada and Indonesia, among others. Mitsubishi has total LNG production capacity across projects of about 15 million metric tons per year currently, and Atheon assets are estimated to add a similar capacity, doubling overall output. The company said it also plans to expand in the U.S. by engaging in power generation and manufacturing businesses that capitalize on competitive upstream gas projects. Mitsubishi currently has partnerships in upstream shale gas development with U.S. energy company Ovintiv in British Columbia, Canada, midstream marketing and logistics through subsidiary CIMA Energy in Houston, and LNG exports via LNG Canada and Cameron LNG.

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