Loan for Acquisition of Interests in and Development of Tight Oil Reserves
Supporting Japanese Participation in a Tight Oil Development Project
- Area: North America
- Energy and Natural Resources
JBIC signed a loan agreement with Sumitomo Corporation and its U.S. subsidiary Summit Discovery Resources III LLC (SDR III). This loan will provide the necessary funds for Sumitomo Corporation to acquire through SDR III a part interest in U.S. tight oil*1 reserves held by the U.S. oil and gas development company Devon Energy Corporation, and to develop and produce tight oil. The know-how on tight oil development gained by Japanese companies through this project will lead to greater opportunities for Japanese participation in shale oil and gas development projects, and help to raise the ratio of Japan's independently developed oil resources through the holding of tight oil interests.
- *1Unlike conventional oil that is extracted from wells naturally stored in the stratum, tight oil exists widely through tight strata such as sandstone, limestone and shale formations, and the methods used for its extraction are similar to those used in shale oil and gas extraction (horizontal drilling, hydraulic fracturing, etc.).