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Shale Oil/Gas Development in Texas Accelerated expansion and participation by MOECO

Sep. 24, 2013


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Mitsui & Co., Ltd. ("Mitsui", Head Office: Tokyo, President and CEO: Masami Iijima) approved the accelerated expansion of the Eagle Ford Shale development in Texas, USA ("the Project"), which is currently owned through Mitsui's 100% subsidiary Mitsui E&P Texas LP ("MEPTX"), as well as the participation of Mitsui Oil Exploration Co. Ltd. ("MOECO") in the Project.

Mitsui initially acquired the interest in the Project in December 2011 and since then has participated in the development and production, approving its expansion in November 2012. Based on the high profitability outlook of shale oil production assisted by the recent firm oil prices, as well as the ability to focus the development on high productivity areas based on the expertise accumulated to date, Mitsui approved a further accelerated expansion of the Project as outlined below. It is expected that the total production and recoverable reserves throughout the project life will increase as a result of increase in peak production levels and extension of peak production period. Capital will be spent as drilling activities and facility expansion progress.

Project Life Outlook at the Time of Previous Expansion (November 2012, MEPTX net)

Peak Production approx. 24,000 - 30,000 boed (barrels of oil equivalent per day)
Total Production approx. 110 million boe
Total Development Cost USD 1.8 billion plus
Life of Production approx. 30 years

Latest Project Life Outlook (MEPTX net)

Peak Production approx. 26,000 - 32,000 boed
Total Production approx. 135 million boe
Total Development Cost USD 2.2 Billion plus
Life of Production approx. 30 years

Above figures are based on Mitsui's latest estimate

In addition, Mitsui has approved that MOECO, a subsidiary of Mitsui, will acquire 40 percent of MEPTX's equity and participate in the Project in October 2013. Mitsui aims to further enhance the value of the Project, leveraging MOECO's expertise and experience in the E&P business.

The Eagle Ford Shale area is located in Texas, USA, which is one of the major oil & gas consuming areas. Mitsui will aim to maximize the value and profitability of the Project through the accelerated expansion as well as the participation by MOECO, and expects the Project will continue to be one of its core businesses, contributing to its cash flow and net income over the long term.

MEPTX Company Profile

Name of Company Mitsui E&P Texas LP
Head Office Houston, Texas, USA
Establishment June 24, 2011
Shareholders As of September 2013
Mitsui & Co., Ltd: 100%

October 2013 onwards
Mitsui & Co., Ltd: 60%
Mitsui Oil Exploration Co. Ltd: 40%

Project Scheme after MOECO's Participation

Project Scheme after MOECO's Participation

Notice:
This announcement contains forward-looking statements. These forward-looking statements are based on Mitsui's current assumptions, expectations and beliefs in light of the information currently possessed by it and involve known and unknown risks, uncertainties and other factors. Such risks, uncertainties and other factors may cause Mitsui's actual results, financial position or cash flows to be materially different from any future results, financial position or cash flows expressed or implied by these forward-looking statements. These risks, uncertainties and other factors referred to above include, but are not limited to, those contained in Mitsui's latest Annual Securities Report and Quarterly Securities Report, and Mitsui undertakes no obligation to publicly update or revise any forward-looking statements.
This announcement is published in order to publicly announce specific facts stated above, and does not constitute a solicitation of investments or any similar act inside or outside of Japan, regarding the shares, bonds or other securities issued by us.

Information

For inquiries on this matter, please contact

Mitsui & Co., Ltd.
Corporate Communications Division
Yusuke Yamauchi
Telephone: +81-3-3285-7540
Facsimile: +81-3-3285-9819