Tokyo Gas to Book $90 mn Impairment Loss on US Shale Gas Project

Tokyo Gas announced Friday it expects an impairment loss of 10.6 billion yen ($90 million) in the October-December quarter on its Texas shale gas development project, reflecting the recent slide in energy prices.

The company is participating in through its wholly owned subsidiary Tokyo Gas America Ltd. via its subsidiary TG Barnett Resources LP (wholly owned by the Tokyo Gas Group).

TG Barnett Resources LP posted an impairment loss of 23.0 billion yen in the year ended March 31, 2015, and combined with the additional posting of the impairment loss on the Texas shale gas project, the actual value of the shares of Tokyo Gas America Ltd. held by Tokyo Gas has significantly declined, the company said. So Tokyo Gas expects to post a valuation loss on shares of affiliated companies of 24.6 billion yen.

This valuation loss on the shares of affiliated companies concerning Tokyo Gas America Ltd. will be offset in the consolidated settlement, so it will have no impact on the consolidated earnings of Tokyo Gas, the company added.