IMPLEMENTATION LEVEL

NFI

AFFECTED FLOW

Outflow (subsidised)

ANNOUNCED AS TEMPORARY

No

NON-TRADE-RELATED RATIONALE

No

ELIGIBLE FIRMS

firm-specific

JUMBO

No

TARIFF PEAK

No
← back to the state act
Inception date: 14 Jul 2014 | Removal date: open ended
Still in force

Financial assistance in foreign market

The overseas investment loan agreement between JBIC and American Petra Nova Parish Holding LLC was signed on 14 July 2014. The loan agreement has a maximum value of USD 175 million in project financing. Additionally, the loan is co-financed by a private financial institution amounting to an approximate value of USD 250 million. The governmental agency Nippon Export and Investment Insurance will provide an insurance for the co-financed portion. Japanese JX Nippon Oil & Gas Exploration Corporation and American NRG Energy Inc. equally own the Petra Nova Parish Holding LLC.

The loan supports the post-combustion carbon capture-enhanced oil recovery project. In this project, the consortium between the Japanese company Mitsubishi Heavy Industries America, Inc., an American subsidiary of Japanese Mitsubishi Heavy Industries, Ltd, and American The Industrial Company will build a carbon capture system. According to JBIC, the system: "increases oil recovery at West Ranch oil field in Texas, by pressure injecting the carbon dioxide (CO2) removed from the flue gas of the power plant (ed. W.A. Parish coal-fired power plant)". By owning 50% of Petra Nova Parish Holding LLC, the Japanese JX Nippon Oil & Gas Exploration Corporation holds a 25% interest in West Ranch oil field, which enables the company to acquire a disposal right of the crude oil production.

In this context, JBIC stated: "The loan will partially fund the capital required for the acquisition of the interests and procurement of plant facilities." and added "JBIC will continue to actively support the development and interest acquisition of important resources by Japanese companies, by drawing on its various financial facilities and schemes for structuring projects, and performing its risk-assuming function."

Overseas investment loans 
JBIC provides direct loans named overseas investment loans to Japanese companies, overseas affiliates or joint ventures where Japanese companies hold equity interests and governments or financial institutions partying with such overseas affiliates. Loans support projects in specific sectors or with a specific purpose of interest to Japan. Further information can be found on the Bank’s website under overseas investment loans.

Project finance 
Project financing loans include preferential terms such as repayments being solely made from the project’s cash-flow generation and secured on the basis of the project's assets alone. As such the loan agreement is tied to the project's finances and not the company in question.

The GTA includes state guarantees and other financial incentives that are likely to affect the restructuring and performance of firms facing international competition, whether from imports, in export markets and from foreign subsidiaries.

AFFECTED COUNTRIES

MAP
TABLE
EXPORT

AFFECTED SECTORS AND PRODUCTS

949 Other environmental protection services n.e.c.

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