Japan govt to back $10.75 bln in loans for shale energy projects -Nikkei

Thu Feb 14, 2013 1:14pm EST

Feb 15 (Reuters) - The Japanese government will give guarantees for up to 1 trillion yen ($10.75 billion) in loans for projects that generate shale gas and other lower-cost energy supplies, the Nikkei said.

The new loan program, which will be presented on Monday by Economy and Industry Minister Toshimitsu Motegi, will give preferential treatment to U.S. shale gas projects, the paper said.

The first to benefit from the program will likely be U.S. shale gas projects planned by three groups -- an alliance of Osaka Gas Co and Chubu Electric Power Co, a partnership between Mitsui & Co Ltd and Mitsubishi Corp , and a coalition consisting of Sumitomo Corp and Tokyo Gas Co, the Nikkei reported.

Under the plan, state-run Japan Oil, Gas and Metals National Corp (JOGMEC) will expand its loan guarantee program for energy businesses. JOGMEC'S guarantee cap will increase to 75 percent from 50 percent, the business daily said.

The paper also said the guarantee fee will go down by a 0.1 percentage point from the current rate of 0.8 percent.

Besides U.S. shale gas projects, the loan program will also accommodate gas projects in Russia, Australia, Africa, the daily reported.

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