Osaka Gas becomes third Japanese company to buy into Papua New Guinea gas


BAI logo no textJapanese investment in Papua New Guinea’s gas resources has increased, with Japan’s second largest gas company buying a 40% stake in Australia’s Horizon Oil, which has an interest in several PNG petroleum leases.

Osaka Gas becomes the third Japanese company involved in LNG exploration. Nippon Oil has a 4.7 per cent shareholding the giant PNG LNG plant. Last year, Mitsubishi Corp spent US$ 280m joining Talisman Energy Inc to develop the output from nine licences in Western Province. Mitsubishi is also a shareholder with Horizon Oil in the Stanley, Elevala and Ketu fields.

Deutsche Bank's John Hirjee

Deutsche Bank’s John Hirjee

‘Given Japan is energy hungry, it is looking at all potential sources, so this move makes sense,’ according to John Hirjee, Managing Director and Senior Research Analyst at Deutsche Bank in Melbourne. Osaka Gas will be a good partner for Horizon, he told Business Advantage PNG.

Japan is the world’s biggest importer of LNG and Osaka Gas is the second largest gas company in Japan, with about seven million natural gas customers in its service area, the Kansai region.

Osaka Gas imports over eight million tonnes of LNG annually—about 10 per cent of Japan’s total gas imports—has interests in six LNG carriers and is the owner and operator of LNG terminals and a 60,000 km pipeline network.

Story continues after advertisment...

The principle objective of the partnership is to grow and develop the PNG assets for the purposes of supporting a mid-scale LNG project located on the coast in Western Province, according to Horizon’s Chief Financial Officer, Michael Sheridan.

He said Osaka paid US$204 million for its stake in Horizon.