December 16, 2023
Company:
Representative:

Contact:

Tokyo Gas Co., Ltd.
SASAYAMA Shinichi
Representative Corporate Executive Officer,President and CEO(Securities code: 9531, TSE Prime Market &NSE Prime Market)
ISHII Wataru
Chief Manager of Legal Sect.Ⅰ, Legal Dept.

Acquisition of Shares in Rockcliff Energy II LLC and Change in Subsidiaries

Tokyo Gas Co., Ltd. (“Tokyo Gas”) announced that Tokyo Gas America Ltd. (“Tokyo GasAmerica”), a wholly owned subsidiary of Tokyo Gas, decided to acquire all shares of Rockcliff
Energy II LLC (“RC”), a portfolio company of Quantum Energy Partners, through its ownershipinterest in TG Natural Resources LLC (“TGNR”).
1．BackgroundTokyo Gas has been expanding its upstream business in the U.S. through TGNR, which became
its subsidiary in 2020. With demand for gas expected to increase in the U.S. due to the constructionof new LNG export terminals, “Compass Transformation 23-25”, Tokyo Gas Group’s Mediumterm Management Plan for FY 2023-2025, states that Tokyo Gas will expand its shale gas business.
TGNR has been seeking to acquire superior assets around its existing assets in Texas and Louisiana.
With this acquisition, the outcome from TGNR will become the base of overseas earnings.
2．Overview of TG Natural Resources LLC (before the acquisition)（１） Corporate NameTG Natural Resources LLC（２） Address

Houston, Texas, USA（３） President

Chief Executive Officer, Craig Jarchow
Upstream development in Texas and Louisiana targeting
Haynesville and Cotton Valley formations
Approximately 850 million USD（４） Main business（５） Capital（６） Establishment（７） Shareholder（８）

Relationship withTokyo Gas

April, 2017
TG East Texas Resources LLC (100% Subsidiary of Tokyo Gas
America): 79%
CCI U.S. Asset Holdings LLC (100% Subsidiary of Castleton
Commodities International LLC): 21%
CapitalTokyo Gas America 79%
Human
Three directors from Tokyo Gas and someResources
secondees
Transaction
N/A3．Overview of companies involved in the change（１）

Corporate Name

Rockcliff Energy Ⅱ LLC（２）

Address

Houston, Texas, USA（３）

President（４）Main business（５）

Establishment

Chief Executive Officer, Alan L. Smith
Upstream development in Texas and Louisiana targeting
Haynesville and Cotton Valley formations
October, 2015（６）

Shareholder（７）

Relationship withTokyo Gas（１）

Corporate Name

Rockcliff Energy Operating LLC（２）

Address

Houston, Texas, USA（３）

President（４）Main business（５）

Establishment

Chief Executive Officer, Alan L. Smith
Upstream development in Texas and Louisiana targeting
Haynesville and Cotton Valley formations
August 2015（６）

Shareholder（７）

Relationship withTokyo Gas（１）

Corporate Name

Rockcliff Operating LA LLC（２）Address

Houston, Texas, USA（３）

President（４）Main business（５）

Establishment

Chief Executive Officer, Alan L. Smith
Upstream development in Texas and Louisiana targeting
Haynesville and Cotton Valley formations
November, 2015（６）

Shareholder（７）

Relationship withTokyo Gas

Rockcliff Intermediate Holdings LLC
Capital
N/A
Human
N/A
Resources
Transaction N/A

Rockcliff Energy II LLC
Capital
N/A
Human
N/A
Resources
Transaction N/A

Rockcliff Energy II LLC
Capital
N/A
Human
N/A
Resources
Transaction N/A

100%

100%

100%

Consolidated operating results and consolidated financial position of the companies involved inthe change for the last three years (in million US dollars)
2020
2021
2022
Member’s equity
932
777
899
Total assets
1,810
2,300
2,592
Total revenues
483
1,345
2,378
Operating income
116
803
1,709Adjusted EBITDA
411749936
Net income
58(70)
522
Figures corresponding to ordinary income, EBIT, member’s equity per share and net income pershare were not provided.
Adjusted EBITDA is calculated by RC. The following table sets forth a reconciliation of net
income (loss) as determined in accordance with US-GAAP to Adjusted EBITDA.
Millions
Net income (loss)
Interest expense, net
Depreciation, depletion, amortization and accretion
Loss on derivatives instruments
Settlement paid on derivative instruments(Benefit) provision for deferred income taxes
Income on equity method investmentAdjusted EBITDA

2020
582621541812(12)
411

2021
(70)
35312
866
(365)
(10)
(19)
749

2022
522
54367
1,131(1,139)
1936

4．Overview of the counterparty to the share acquisition（１） Corporate Name

Rockcliff Intermediate Holdings LLC（２） Address

Houston, Texas, USA（３） President

Chief Executive Officer, Alan L. Smith
Upstream development in Texas and Louisiana targeting
Haynesville and Cotton Valley formations
September, 2021

（４） Main business（５） Establishment（６） Shareholder（７）

Relationship withTokyo Gas

Rockcliff Holdings LLC
Capital
N/AHumanN/A
Resources
Transaction
N/A

100%

5．Number of shares acquired, acquisition price, and share ratio before and after the acquisition
Share before the（１）acquisition(Voting right ratio: 0.0%)
Acquisition of all shares（２） Share（３） Purchase price（４）

Share after theacquisition

About 2,700 million USD
100%
All shares(Voting right ratio: 100.0%)

6．Schedule (Plan)（１） December 15, 2023 Signing of contracts(US local time)（２） December 29, 2023 Closing(US local time)7．DetailAs a result of this acquisition, the production volume of gas and natural gas liquid held by TGNR
will increase by approximately 4 times from approximately 330 million cubic feet per day (9.3million m3/day, gas equivalent) to 1,300 million cubic feet per day (37 million m3/day, gasequivalent).
Tokyo Gas Group is committed to tripling its overseas profits, based on the Tokyo Gas Group’s
Management Vision, Compass 2030. We will continue to invest in building a stable earnings
base overseas, including North America. The impact of this transaction on consolidated results
for the fiscal year and next year is being reviewed. We will promptly notify of any matters thatneed to be disclosed.