Japan power firm makes move into US shale gas, buys Sabine

By Luke Geiver | July 30, 2019

For the first time, a Japanese company has acquired a U.S. shale gas producer. Osaka gas has agreed to a deal that will include 175,000 acres in the Haynesville shale gas play owned and operated by Sabine. The purchase is part of Osaka’s long-term vision called, “Going Forward, Beyond Borders 2030,” which the power company said will focus on overseas energy markets.

Osaka has already been working to establish a presence in the U.S. Gulf Coast to develop shale gas assets. The company is working to develop Freeport LNG liquefaction. Osaka’s interest in Sabine grew strong in June 2018, when it acquired a 35 percent working interest in the company for $146 million.

Through the total buyout of Sabine, Osaka will gain 1,200 operating wells that are producing roughly 210 MMcf/d along with a large remaining drilling inventory.

According to the company, when Osaka acquired its initial 35 percent, wells being developed by Sabine have been producing more than expected volumes.

Sabine’s management team will remain and run the operations in the Haynesville.

Osaka also owns and operates power assets in Asia, Australia and North America.