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Mitsui to Buy Half of U.S. Firm's Mexico Gulf Oil, Gas Interests

Posted on: Friday, 21 April 2006, 12:00 CDT

By Kyodo News International, Tokyo

Apr. 21--TOKYO -- Mitsui & Co. said Friday the Mitsui group will buy a 50 percent stake in Texas-based Pogo Producing Co.'s oil and natural gas leasehold interests in the Gulf of Mexico.

The $500 million deal will mark the trading house's first acquisition of oil and gas concessions in the United States, which Mitsui believes will serve as a useful lever to push into the North American oil and gas market, which is the world's largest.

The U.S. company said the transaction is expected to close in June.

The purchase, to be made jointly by Mitsui, Mitsui & Co. (U.S.A.) Inc. and Mitsui Oil Exploration Co., will grant the Mitsui group rights to a maximum of 85 mining sites with estimated reserves of 24 million barrels of oil and gas.

Production in more than half of the 85 drilling areas is already under way, Mitsui said, adding it expects to recoup the investment relatively quickly assuming a daily production capacity of 12,000 barrels.

To date, Mitsui's oil and gas operations have been active mainly in Oceania, the Middle East and Southeast Asia.

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Copyright (c) 2006, Kyodo News International, Tokyo

Distributed by Knight Ridder/Tribune Business News.

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MITSY, 8031, PPP,

Source: Kyodo News International, Tokyo

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