21 February 2012 08:31 [Source: ICIS news]
SINGAPORE (ICIS)--Standard & Poor's Ratings Services said on Tuesday there will be no impact on its ratings (A+/Stable/A-1) on Mitsubishi Corp following the Japanese firm’s announcement that it will acquire a stake in a shale gas project in Canada.
Mitsubishi Corp said on 20 February that it will pay Canada-based Encana Corp C$1.45bn ($1.46bn) for a 40% stake in Cutbank Ridge, which was formed to develop a natural gas asset located in the Montney land of northeastern ?xml:namespace>
The Japanese trading firm will further invest C$1.45bn over five years to develop the area.
The field is estimated to hold more than 35 trillion cubic feet of gas resources, which is equivalent to about nine years of
The shale gas project is the largest in
The project is expected to begin exporting gas in 2018 or later, the ratings firm cited un-named media reports as saying.
Mitsubishi Corp’s deal with Encana, as well as its investments in other natural resources projects, is generating robust cash flows amid currently strong commodities prices, according to Standard & Poor's.
“Therefore, we believe Mitsubishi's risk volume will remain within levels we consider sound for the current ratings, given Mitsubishi's financial profile,” it added.
($1 = C$0.99)
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