Tokyo Gas to Acquire Additional U.S. Assets through Castleton JV
Japanese energy & utilities group Tokyo Gas Company Ltd. has announced plans to acquire certain oil & gas assets in Louisiana and increase its stake in Castleton Resources LLC, a subsidiary of Connecticut-based commodities trading and infrastructure investment company Castleton Commodities International LLC (CCI).
Tokyo Gas America Ltd. (TGA) will acquire the Louisiana assets through its ownership interest in Castleton Resources, which will fund the acquisition with additional equity capital raised from TGA and CCI. Upon completion of the transaction, TGA will increase its stake in Castleton Resources from 46% to approximately 70%. In addition, Castleton Resources also plans to change its name to ‘TG Natural Resources LLC’ by March 2021.
The acquisition of the Louisiana assets will increase Castleton Resources’ net average daily production by 1.6 times, adding approximately 177 million cubic feet per day (MMcf/d) to the company’s portfolio.
The transaction marks TGA’s first acquisition of an operator in the shale gas business in the U.S. The company will continue to expand its upstream business in North America, according to Tokyo Gas’ management vision.
“Tokyo Gas America participated in Castleton Resources in May 2017, and have grown steadily with Castleton Resources by acquiring shale and tight sand assets since then. We are pleased that Castleton Resources has joined Tokyo Gas group companies, and with Castleton Resources as the base, we will continue to aim for further business expansion in East Texas and Louisiana,” said TGA’s President & CEO, Kazuya Kurimoto.
“With this transaction, Tokyo Gas America will become our major shareholder. We are very pleased with this outcome as it puts us in a very strong position to continue to build a world-class natural-gas portfolio,” said Craig Jarchow, President & CEO of Castleton Resources.
The transaction is expected to close by August 14th, 2020.