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Mitsubishi Corp. to offload interest in Myanmar gas field

  • February 18, 2022
  • , Nikkei Asia , 2:47 p.m.
  • English Press

TOKYO — Trading house Mitsubishi Corp. plans to offload its interest in a natural gas project in Myanmar, Nikkei has learned, marking the latest step in an exodus from the military-ruled country by Japanese companies.

 

Mitsubishi Corp. is making the move as the project’s profitability has deteriorated due to resource depletion, while the changing business environment since the military took power in February last year also appears to be a factor in the decision. 

 

Mitsubishi Corp. has begun discussions to sell its interest in the Yetagun gas field off the southern coast of Myanmar. It plans to sell its 10% stake in a joint venture company with the Japanese government and JX Nippon Oil & Gas Exploration, a unit of Japanese oil giant Eneos Holdings.

 

Malaysian state oil giant Petronas has a 40.9% interest in the Yetagun field, with the state-owned Myanmar Oil and Gas Enterprise holding 20.5% and the Japanese joint venture holding 19.3%. Natural gas from the site is exported to Thailand by pipeline.

 

Mitsubishi Corp. joined the project in 2013, but output has decreased in recent years due to resource depletion and after production was halted for technical reasons. The company has decided the business is less profitable than other resource development projects, making it increasingly difficult to continue with.

 

Mitsubishi Corp. is also involved in operating industrial complexes in Myanmar, along with infrastructure and real estate businesses. It will make decisions on these projects considering future developments in a “comprehensive manner,” said a company representative.

 

“We are discussing various possibilities with our business partners, including responses to social issues and feasibility,” said a representative of Eneos Holdings, another investor in the gas project.

 

Earlier in the week, Japan’s Kirin Holdings announced it will unload all its stake in a beer company operated by a joint venture with a military-backed partner by the end of June and withdraw from the Myanmar market.

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