Toshiba Mulling Withdrawal from Texas LNG Project

Economy

Tokyo, Aug. 8 (Jiji Press)--Toshiba Corp. <6502> is considering pulling the plug on a liquefied natural gas project in Texas due to the possibility of huge losses, Chief Financial Officer Masayoshi Hirata said Wednesday.

The Japanese company has signed a contract to acquire 2.2 million tons of LNG a year from the project from a U.S. company for 20 years starting 2020.

Toshiba estimates that it will incur a maximum loss of one trillion yen if it fails to resell the gas.

"LNG is not Toshiba's core business and poses a risk," Hirata told a press briefing. The company "will evaluate all options," including terminating the contract with the U.S. company, he said.

A cancellation of the contract could leave Toshiba with losses of several tens or even hundreds of billions of yen stemming mainly from penalties.

[Copyright The Jiji Press, Ltd.]

Jiji Press