Mitsubishi Corporation Establishes LNG Carrier Joint Ventures with Chubu Electric

Mitsubishi Corporation (MC) has announced equity participation of Chubu Electric in its LNG carrier owning companies - one a fifty-fifty joint venture with Nippon Yusen Kabushiki Kaisha (NYK) and the other a fifty-fifty joint venture with Mitsui O.S.K. Lines, Ltd. (MOL).

The first joint venture, named Trans Pacific Shipping 1 Ltd. (TPS1), was set up with NYK, and the second, named Trans Pacific Shipping 2 Ltd. (TPS2) was set up with MOL.

Chubu Electric entered into a time charter party with each LNG carrier owning company in October 2012, mainly for the transportation of LNG from project sites in Australia.

Under the new arrangement, MC will transfer 10% of its shares in TPS1 to Chubu Electric while NYK will transfer 30%. For TPS2, MC will also transfer 10% of its shares to Chubu Electric while MOL will transfer 30%. This will bring Chubu Electric's equity participation in each company to a total of 40%, thereby allowing TPS1 and TPS2 to continue developing the LNG carrier business as new three-company joint ventures.

The transfer of shares will be executed after the delivery of each LNG carrier.

According to MC, demand for LNG around the world has been increasing in recent years, and the procurement of necessary LNG shipping tonnage has become a key factor in ensuring stable supplies of energy.

“MC is continuously engaged in efforts to promote and expand the LNG carrier business, including the procurement, joint ownership and operation of LNG carriers as well as the provision of LNG transportation related services, not only for LNG production and marketing projects in which MC is involved, but also for major utilities around the world,” the company said.