Carbon Neutral Strategy Briefing
April 11, 2022

Securities Code
4182

©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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Index1

Carbon Neutral Strategy (Overview)

2

Examples of Our Carbon Neutral Initiatives

3

Supplementary Materials and Topics©MITSUBISHI GAS CHEMICAL COMPANY, INC.

2

1. Carbon Neutral Strategy (Overview)©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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Toward a Sustainable Society -Medium-Term Management Plan– We are committed to realizing a sustainable society by balancing social and economic value based on our
Mission of creating value to share with society.
– Initiatives aimed at carbon neutrality are one of our top strategic priorities.
Social issues
Objective

Changes ininternational situation

1

Shift to a profit structure resilient toenvironmental changes

Strengthening
differentiating
businesses

Creating andnurturing new
businesses

Rebuilding
unprofitablebusinesses-Business Portfolio Reforms-

Demographic changes
Mission

Advancements in
ICT/Mobility
Climate change
Biodiversity crisis

Solvingsocial issues

Creating values to share with society

VisionAn excellent company with uniqueness and presence
built on chemistry

Value

Principles of Conduct

AchievingsustainablegrowthEnvironmental impact
reduction
Diversity
Behavioral changes
under COVID-19

Objective

2

Balance social and economic value-Toward Sustainable Growth-Solvesocial issues

Environmental
protection

Strengthen
disciplineandfoundation©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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MGC’s Strengths in Carbon-Neutral Technologies(Accumulation of Energy Resources and Environmental Technologies)
ー Over a period of around 60 years, MGC (on a stand-alone basis) deployed a business to develop natural gas. It has exploration anddevelopment technologies that are unique among those found at chemical manufacturers.
ー Furthermore, MGC has implemented crude oil and natural gas exploration technologies on a joint basis with other resource development
companies.
ー MGC has also deployed businesses in the compatible areas of geothermal development and LNG-fired power generation.
ー Over many years, MGC developed catalysts used in methanol synthesis.

Exploratory well “Kajikawa R-1 Well”

1952
Methanol synthesis
1953
Development of waterdissolved natural gas

Fukushima Natural Gal Power Plant
Provided by Fukushima Gas Power Co., Ltd.

1981
Development ofgeothermal power

Tomakomai CCS Demonstration
Project Center

2016*1
LNG power generation

2016
CCS *22021
Production of water*3
dissolved natural gas

Accumulated intellectual property
and know-how adapted andapplied to capturing, storing andrecycling CO2, as well as tobuilding of hydrogen supply
chains1957
Ammonia synthesis*1 Investment in Fukushima Gas Power Co., Ltd.
*2 Commenced press fitting of CO2 within Carbon dioxide Capture & Storage (CCS) demonstration project conducted in Tomakomai City
*3 New production of water-dissolved gas for first time in 50 years by TOHO EARTHTECH, INC., an MGC subsidiary©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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How We Are Pursuing Carbon Neutrality (1)ー Pursue development of products and technologies conducive to carbon neutrality by leveraging distinctive technologies found only at MGC
ー Move forward with efforts such as promotion of energy efficiency, introduction of new energy, CCUS* implementation, and feedstock switching
to reduce GHG emissions (Scope 1)*Carbon dioxide Capture, Utilization and Storage

Development of Products and Technologies Conducive to Carbon Neutrality

Hydrogen manufacturing
technologies using
methanol as raw materials(catalysts)

Methanol manufacturing
technologies using CO2
as raw materials

Polycarbonates
using CO2

Energy control
systems:
Semiconductormaterials

Direct air capture (DAC):Specialty amines

Procurementof cleanammonia(fuels, greenhydrogen raw
materials)

Solid-statebatteries(for EVs)
Fuel cells(for FCVs)

Biodegradable
polymers

Chemicalrecycling

Methanol: Hydrogen carrier

Initiatives Aimed at GHG Emission Reductions(Scope 1)⚫

Promotion of energy efficiency,
end use of fuel oil⚫

New energy system/
CCUS implementation⚫

Reconfiguring business portfolio⚫

Smart-factory

Also contributing to reduction of energy derived
from fossil fuels (Scope 2)

Operational streamlining:
Optical polymers for sensing
cameras for automotive use

LNG power generation+ CCUS

Geothermal power
generation©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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How We Are Pursuing Carbon Neutrality (2)ー Set qualitative targets and formulate action plans to solve energy and climate change problems as one priority
ー Expedite commercialization of carbon-negative technology by setting a target to invest a cumulative ¥12.0 billion in 2021–23 toward solving problems

Solve social issues through business

KPI

Materiality

Qualitative Targets and Action Plans

Contribute todevelopment of
ICT/mobility society(Qualitative Targets)
Contribute through business to ICT, AI, robotics, blockchain, CASE
and other digital innovations, and work to enhance corporate value(Action Plans)
Turn out new products that contribute to digital innovation and lighter
weight mobility

Solve energy and climatechange problems(Qualitative Targets)
Contribute to solving energy and climate change problems byparticipating in geothermal and LNG power generation, bydeveloping products using CO2 and biomass as raw materials, andthrough products that contribute to the environment, and work toenhance corporate value(Action Plans)
Development of manufacturing technology using CO2 as a raw
material(Ex.: CO2-derived methanol, polycarbonate)

Solve medical and foodproblems(Qualitative Targets)
Contribute through business to QOL improvements, extended
healthy life expectancy, anti-aging and reduction of food andbeverage waste loss, and work to enhance corporate value(Action Plans)
Expansion of sales of products that contribute to QOL, further
development of markets in pharmaceutical and medical fields, etc.

Fiscal 2020 results

Fiscal 2023 targets

Fiscal 2030 targets

Sales from ICT/mobility applications¥234.2 billion¥320.0 billion

Create new businesses
that accelerate digital
innovation

Investment aimed at solving problems(Three-year cumulative)¥8.6 billion¥12.0 billion

Sales from medical and food applications¥39.4 billion¥50.0 billion

Commercialization ofcarbon-negativetechnology

Advances in preventive
and predictive medicine,enhanced healthy life
expectancy
Further advances
in food storage technology⚫ Harmonize value creation with environmental protection (air quality control, reduction of industrial waste)

Other materiality management⚫ Strengthen discipline and foundation supporting business activities (job satisfaction, occupational health and safety, energy andresources efficiency, R&D)
©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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MGC’s Roadmap toward Its Ultimate Goal of Carbon Neutrality
ー Aim to achieve reduction of 36% by 2030 in comparison with 2013 and carbon neutrality by 2050
Scope2013 - 20191

• Improve energy efficiency• Reconfigure business portfolio

Main initiatives

258kt in total(CO2 Reduction)

2―2020 - 2023
• Improve energy efficiency• Stop using heavy oil

2024 - 2030

16kt

• Improve energy efficiency

2030 - 2050
• Improve energy efficiency

28kt

40kt

13kt

• Reconfigure business portfolio• Deploy new energy systems/CCUS, switch feedstocks (R&D/collaboration)• Source 10% of energy from renewables• Use transitional energy

14kt

610kt in total• Source 50% of energy from renewables

10kt• Source 100% of energy from renewables

55kt

69kt

Businesses &technologies
Fukushima Natural Gas Power Plant
Provided by Fukushima Gas Power Co., Ltd.

CO2 emissions(kt of CO2/year)

1,107
2013
baseline

Collaboration

Wasabizawa Geothermal Power Station
Provided by Yuzawa Geothermal Power Corp

Pilot plant for consideration of
circular carbon methanol

23% reduction

28% reduction

36% reduction

258

308

394

849

799

714

2019
actual2023

2030

Feedstock switching

2050
Achieve carbon neutrality

45% reduction502

55% reduction

610
2050

Date of public announcement: March 29, 2021
©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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Carbon Neutral Promotion System
ー Climate change risk and other CSR priority issues deliberated and decided by the CSR Council, comprised of members of the Boardand chaired by the President

ー Establishment of Carbon Neutral Technology Liaison Committee, enabling centralized management of MGC Group technology
information and promotion of initiatives
Carbon Neutral Promotion System

Climate Change Governance System

Management level
CSR Council
Presentation/Deliberation
CSR Committee
Presentation/Deliberation
Climate Change Action Technical Committee (CAT)

Carbon Neutral Technology Liaison Committee
Basic Chemicals
Business Sector

Carbon Neutral
Promotion Team

Energy Resources &Environmental Business DivisionCorporate Planning
Division

Specialty Chemicals
Business Sector

Climate Change Action
Technical Committee (CAT)
Production
Technology Division

CSR Department

Environment
Safety & Quality
Assurance
Division

Research & Development
Division©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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2. Examples of Our Carbon Neutral Initiatives©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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Examples of Our Carbon Neutral Initiatives
1. Circular Carbon Methanol

2. Clean Ammonia
3. Promotion of Utilization of CCU (Carbon dioxide Capture & Utilization)ーManufacture of polycarbonate from CO2ーDirect air capture (DAC) technology

4. Renewable Energy Business Developmentー

Geothermal and biomass power generation

5. Promotion of Utilization of CCS (Carbon dioxide Capture & Storage)ーLarge-scale CCS demonstration project in TomakomaiーCollaborative study of effective CO2 utilizationーCollaborative study of CCUS (Carbon dioxide Capture, Utilization & Storage) in water-dissolved natural gas fields©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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1. Circular Carbon Methanol (1): Overview
ー We have been manufacturing methanol from CO2 and H2 on a pilot basis at our Niigata Plant since August 2021
ー We are pursuing a comprehensive approach that includes out-licensing of methanol production technologies, operational support andproduct sales thorough cross-industry collaborations with Japanese and foreign companies and local governments

CO2 emitted into atmosphereH2 derived fromrenewable energy sources

CO2 Recycled

Technology
Power generation

Renewable H2

FuelCircular Carbon Methanol(Wind, geothermal and solar energy, etc.)

Gas derived fromrecycled materials

Gasification,gas, etc.

Catalyst development
Process development
Plant operation

Chemicals
Plastics(Non-fossil biomass, waste plastics, etc.)©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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1. Circular Carbon Methanol (2): Selection as a NEDO GI Fund Project
ー MGC and Mitsubishi Chemical selected for Green Innovation Fund ／Development of Technology for Producing Raw Materials for
Plastics Using CO2 and Other Sources／[Research and Development 4] “Development of technology for producing chemicals fromalcohols” (period of FY2021 to FY2028)

Development and demonstration of technology for
producing basic chemicals from CO2

Ethylene

Artificial Photosynthetic Chemical
Process (ARPChem)
Photocatalyst
Water decomposition

H2

Propylene

Membranereaction/separation
Methanol synthesis

Methanol

MTO catalyst

OlefinMitsubishi Chemical

MGC
Mitsubishi Chemical

CO2

Chemical productraw materials

Joint implementation:
The University of Tokyo,
Tokyo Institute of Technology

Plastic

MTO: Methanol to Olefin

Aiming for high-efficiency production of methanol using CO2 andgreen hydrogen as raw materials
13

1. Circular Carbon Methanol (3): Business Model
ー Establish foundation for sustainable methanol production business that converts sustainable resources into Circular Carbon
Methanolー Promote carbon neutrality and resource recycling through cross-industry initiatives and develop businesses that contribute both
environmentally and economicallySustainable resources(CO2, waste hydrogen, biomass)

Expanded application based on
Circular Carbon Methanol

Circular Carbon Methanol Business
Deployment in society of our methanol production technology
in combination with other companies’ related technologies

Other companies’ related technologies
CO2 capture facilities

Renewable energy
Electric power

Hydrogen production facility(water electrolysis)

MGC’s methanol production technology

CO2
H2

Methanol synthesis
facility

Methanol distillation
facility

Gasification furnace facility
CO, CO2, H2

Product methanol

Waste plastic, biomass, etc.
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1. Circular Carbon Methanol (4): Image for Commercialization and Increasing Scale
ー We will aim for the commercialization of Circular Carbon Methanol in the amounts of 100,000 tons by FY2030, and amaximum of 1,000,000 tons from FY2030 onward.
FY2021 onward

FY2025 onward

FY2030 onward

Phase 1

Phase 2Phase 3▎ By-product hydrogen, etc. + Utilization of CO2 Recycled▎ Demonstration of circular carbon methanol▎ Commercialization of circular carbon methanol, using
renewable hydrogen▎ Larger scales for circular carbon methanol▎ Full introduction to primary materials industry

Up to

Up to

Up to

100,000

1,000,000

tons

tons

ー Overseas: Dawn of market for materials and fuels
ー Japan: Encourage adoption among sources of demand

ー Overseas: Expansion of market for materials and fuels
ー Japan: Start valuation of CO2 methanol→ Establishment as a manufacturing and sales
businessー Expanding value of circular carbon methanolー Decarbonization in domestic petrochemical industrial
complexes→ Improvement and extension of business⚫

⚫

Tens ofthousandsof tons

New project creation**Waste plastic-based projects also considered in parallel

Utilization of international projects, domestic renewableenergy-based projects, and existing business©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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2. Clean ammonia
ー We are studying CCS in collaboration with an Indonesian investee that manufactures ammonia
ー We have started to work on jointly sourcing clean ammonia with three other chemical manufacturers

Ammonia as next-generation clean energy
Ammonia⚫ Does not emit CO2 when burned⚫ Transportable and storable with existing infrastructure⚫ Rich in hydrogen

Ammonia producer/PAU (MGC investee)
involved in joint CCS study in Indonesia
Participating members

Sourcing of clean ammonia⚫

PAU (MGC investee)

on jointly sourcing clean ammonia with MGC⚫

Mitsubishi Corporation

playing a key role.

⚫

Japan Organization for Metals andEnergy Security (JOGMEC)

We aim to secure stable and competitive clean⚫

Participating members

Four chemical manufacturers have started working

ammonia in Japan.

University of Indonesia /Bandung Institute of Technology

⚫

UBE

⚫

Sumitomo Chemical⚫

Mitsui Chemicals⚫

MGC

Pursuing widespread adoption of clean ammonia fuel
©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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3. Promotion of Utilization of CCU (1):
Pilot Production of Polycarbonate (PC) from CO2 (CO2 to PC)
ー We have promoted technological development of producing polycarbonate by melt polymerization method since the 1990s
ー In FY2020, we conducted a foundational study under the NEDO’s Leading Research Program; target level of basic research now
completed
Overview

Diphenyl carbonate (DPC) is the raw material for the melt polymerization process, the main
manufacturing method for polycarbonate (PC) resin, over 5 million tons of which is produced
worldwide each year.
The purpose of this research is to develop a new process for efficiently generating DPC
precursor dialkyl carbonate (DRC) from CO2 and alcohol.

Implementation
periodJune 2020 to March 2021

Implementation
structure

Mitsubishi Gas Chemical Company, Inc.

MGC is examining this new process’s potential for reducing carbon emissions to make net
zero and negative carbon-emitting societies a reality.

Implementation Image for Entire Process

Fossilenergy users

CO2
captureCO2 to DRC synthesis

Pressurization/transportation

Recycling of dehydrating agent

Nippon Steel Corporation
Nippon Steel Engineering Co., Ltd.
Tohoku University

DRC to DPC synthesis

DRC: Dialkyl carbonate
DPC: Diphenyl carbonate

Dehydrating agent

New Energy and Industrial Technology Development Organization (NEDO)
Source: NEDO FY2020 Report of Results -Development of Technologies for Reduction, Effective Use and Commercialization of CO 2 Emissions
https://www.nedo.go.jp/content/100932837.pdf©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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3. Promotion of Utilization of CCU (2):Pilot Production of Polycarbonate (PC) from CO2 (CO2 to PC)
ー MGC and Tosoh were selected for Green Innovation Fund ／Development of Technology for Producing Raw Materials for Plastics Using CO2
and Other Sources／[Research and Development 3] “Development of technology for producing functional chemicals from CO2” (period of
FY2021 to FY2028)
ー Joint research: Tohoku University, University Public Corporation Osaka, others
New melt polymerization process *3

Direct synthesis of dialkyl carbonate

Polycarbonate(PC)⚫ Outstanding safety⚫ Mild reactions

DRC*1

CO2

DPC*2

⚫ Sole byproduct is water

Aliphatic alcohol

Biomass naphtha

Phenol

BPA*4*1 Dialkyl carbonate*2 Diphenyl carbonate (raw material for PC)*3 Manufacturing method not using
dangerous substances*4 Bisphenol A

We are considering biomass
derivative⚫ DPC bench plant verification is to be completed by FY2024.
⚫ We aim to complete DPC pilot plant (2000t/y) and PC pilot plant (600t/y) verification by FY2028.
©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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3. Promotion of Utilization of CCU (3): Direct Air Capture (DAC)ー Together with Kobe Gakuin University, we are conducting proof of concept testing of a DAC system that uses meta-xylenediamine (MXDA)
ー Viability of new amines (under development) will be determined by around 2030 through basic research and scalability testing

Water is blocked from infiltrating

MXDA

CO2

Hydrophobic layer

CO2
CO2

Hydrophilic layer

Hydrophobicgroup

Hydrophobic layer

Hydrophilicgroup

CO2 source
CO2 concentration

Principal
technologies

Heating
duration

Selective absorption of CO2 alone withno impact on atmospheric water content

IGCC (Integrated coalgasification combined cycle)

40%
Separation
membraneHighly energy-efficient CO2 desorption by
virtue of absence of water

Blast furnace gas

Thermal power
generation

Atmosphere

22%

13%

400ppmAbsorbent
solution
Solid absorbent
New amine (under development)©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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4. Renewable Energy Business Development (Geothermal and Biomass Power, Others)
ー Since 1981, we have been developing geothermal resources using exploration and development technologies. In addition to operating threegeothermal power plants in Japan, we are also doing feasibility study in new regions.
ー Capitalizing on our experience in the electric power business, we are involved in biomass power generation in Hokkaido.
Hachimantai Green Energy Corporation

Yuzawa Geothermal Power Corporation

Appi Geothermal Energy Corporation
Conceptual rendering ofcompleted power station

Geothermal
power
generation

Biomass
power
generation

Sumikawa Geothermal Power Station

Wasabizawa Geothermal Power Station

Appi Geothermal Power Station

In operation since 1995

In operation since 2019

Under construction;scheduled to begin operating in 2024

Output: 35,000 kW

Output: 43,000 kW

Joint venture with
Mitsubishi Materials Corporation

Joint venture with
Electric Power Development Co.,Ltd.,
Mitsubishi Materials Corporation

Planned output: 14,900 kW
Joint venture with
Mitsubishi Materials Corporation,
Electric Power Development Co., Ltd.

We are involved in biomass power generation in Hokkaido,using domestically grown timber (from forest thinning)
Scheduled to begin operating in 2022
Output: 19,800 kW©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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5. Promotion of Utilization of CCS
ー CCUS positioned as a vital measure toward achieving carbon neutrality

Contribution to Reductions in CO2 Emissions from Energy Sources Worldwide(Billion tons)

2019

2030

2040

2050

2060

2070

0
Changes in demand
Energy efficiency-10
Electrification
Hydrogen-20

Biomass
Renewable energy-30

Global rise in temperature
2°C or less by 2100
(achieving carbon neutrality in 2070)

Fuel conversion
CCUS**CCUS: Carbon dioxide Capture, Utilization and Storage-40

Emission reduction of approx. 35.8 billion tons per year required to achieve carbon neutrality
Emission reduction from CCUS is approx. 6.9 billion tons per year
Reference: IEA “Energy Technology Perspectives 2020” Figure 2.2
Source: “NEDO Environment Department Activity Report 2020” https://www.nedo.go.jp/content/100932840.pdf©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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5. Promotion of Utilization of CCS:
Large-scale CCS Demonstration Project in Tomakomai (1)ー We are involved in the NEDO’s large-scale CCS demonstration project in Tomakomai. **through our investee Japan CSS Co., Ltd.

ー We synthesize methanol as a chemical raw material and fuel from captured CO 2, H2 produced as a byproduct by oil refineries andH2 produced by water electrolyzers.
Technology for CO2
Capture & Storage (CCS)

Technology for CO2 Capture & Utilization (CCU)

CO2 and other Gas emitted
from oil refineries

Renewable energy facility

CO2 capture facility

Water electrolyzer
Methanol
synthesis facility
CO2 injection facility

CO2 storage

Hydrogen (H2)

Raw material

Fuel

Chemical products

Power generationand logistics

Carbon dioxide (CO2)Methanol©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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5. Promotion of Utilization of CCS:
Large-scale CCS Demonstration Project in Tomakomai (2)ー We launched demonstration project in FY2012 and achieved cumulative underground storage of 300,000 tons in November 2019
From FY2012 to FY2015, drilled two observation wells and two injection wells.

Demonstration
timeline

From April 2016, initiated CO2 injection.
In November 2019, achieved underground storage of a total of 300,000 tons.
Currently, we are busy monitoring to verify the behavior of stored CO2.

Land seismometer

Gas supply facility(Inside Hokkaido Refinery ofIdemitsu Kosan Co., Ltd.)Two injection wells (wellhead)
Moebetsu formation observation
well OB-2 (vertical)
Takinoue formation
observation well OB-1

CCS Demonstration
Project Center

Takinoue formation observation
well OB-3 (vertical)(CO2 separation & capture/
injection facilities)

Revamped from survey well

(wellhead)

Takinoue formation
observation well(OB-1)Takinoue formation
injection well (IW-1)

OBC connection cable
Scope of 3D seismic
acquisition area
Moebetsu formation injection well (IW-2)
OBC (Ocean Bottom Cable)
Used for small vibration, natural earthquake
measurement and 2D seismic acquisition
OBS (Ocean Bottom Seismometer)
Used for small vibration and natural earthquake
measurement

Halted and withdrew from OBS and land seismometer operation in FY2021

Source: processed “LC81070302016141LGN00, courtesy of the U.S. Geological Survey”

Photo credit: Japan CCS Co., Ltd.

©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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5. Promotion of Utilization of CCS:
Collaborative Study of Effective Utilization of CO2 with JAPEX
ー We are conducting study with JAPEX of effective utilization of CO 2 from the Niigata Plant
ー Injection of CO2 from hydrogen production and excess CO2 into the Higashi-Niigata Oil and Gas Field for use to increase oiland natural gas production (EOR/EGR*)
Higashi-Niigata Oil and Gas Field(Niigata City, Niigata Pref.)How EGR (enhanced gas recovery) works

CO2 from production
processes

Natural gas well

Natural gas pushed
out by CO2Natural gas

Local hydrogenstationHydrogen produced
from natural gas

Point

CO2 injected underground remains there,
contributing to carbon neutrality
Source: Niigata Nippo (Niigata Daily News), January 1, 2022

*EOR: Enhanced oil recovery*EGR: Enhanced gas recovery©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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5. Promotion of Utilization of CCS:
Collaborative Study of CCUS in Water-Dissolved Natural Gas Fields
ー We are promoting of EGR (enhanced gas recovery) initiatives
ー Business feasibility study will be conducted until FY2023; decision to achieve proof-of-concept by 2030

After extracting natural gas and iodine from water-dissolved natural gas brine, oncehydrogen is separated from the natural gas, the resulting CO2 will be injectedunderground with the brine, allowing secondary gas recovery to be attempted.

Reinjected
water

I2
Iodineseparation

Oil field
brine

Iodine
CO2
CH4

H2

CO2

Water-dissolved
natural gas

Hydrogen generation system

Reinjection

Water-dissolved
natural gas brine

Tap water

Hydrogen station©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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カーボンニュートラル戦略（全体像）

Carbon Neutrality Promotion Goals

2030

Circular carbon methanol

Clean ammonia

CO2 to PC

DAC

Judgment on demonstration(up to 2025)

2050

Larger scales and full introduction
to primary materials industry

Commercialization (up to 2030)

Consider factors such as where to conduct procurement and conditions thereof

Bench plantverification (Up to 2024)

Pilot plant verification (up to 2028)

Commercialization

Basic research to scale-up

Implementation
実証判断 （～’30）

EOR/EGR in the HigashiNiigata Oil and Gas Field

EGR in water-dissolved
natural gas fields

FS of viability as
business (Up to 2023)

Judgment on commercialization (Up to 2030)

Implementation

Judgment on commercialization (Up to 2030)

Implementation©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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Carbon Neutral World of 2050 as Imagined by MGC– We have many products and technologies that contribute to preventing global warming, conserving energy andother resources and preserving the environment– As a chemical manufacturer, we are in a perfect position to positively impact the earth’s environment.

Supply/benefit society©MITSUBISHI GAS CHEMICAL COMPANY, INC.

27

3. Supplementary Materials and Topics©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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Topic: Selection for Green Innovation Fund Project (1)February 18, 2022 News Release

Green Innovation Fund, the Development of Technologies for Producing Raw Materials for Plastics Using CO 2 and/or Other Sources

4. Development of Technology to Manufacture Chemicals from Alcohols (i)- Development for commercialization of chemical raw material production through artificial photosynthesis- (2) Development and demonstration of technology for production of basic chemicals from CO 2
Project objectives and overview
a. Development of methanol membrane reaction/separation process When synthesizing methanol from CO2, because it is a static
reaction, previous technologies enabled a yield of around 30 to 40%, thus requiring a significant amount of recycling. With development of a
new membrane reaction/separation process, we aim to improve the inversion rate by a wide margin.
b. Development of innovative MTO catalytic process We will develop catalysts to enable high-yield manufacture of target ethylene andpropylene. Development of continuous catalyst regeneration technology will enable more than 10,000 hours of continuous regeneration,equivalent to more than 1 year. MTO: Methanol to olefine

Implementation structure

Project scale□ Project scale (a+b) :□ Support scale (a+b) :Mitsubishi Chemical Corporation [the contact company]
Mitsubishi Gas Chemical Company, Inc.

Approx. ¥21.11 billion
Approx. ¥13.38 billion**Includes incentives. Subject to change.

□ Subsidy ratea, b : 2/3 subsidy→1/2 subsidy (incentive rate: 10%)

Project period
From FY2021 to FY2028 (eight years)
Project concept

b. Innovative MTO catalytic process

a. Methanol membrane reaction/separation process
Membrane reaction/
separation process

Existing process

Reaction/separation
membrane unit

Recycling(largecycle)High pressure
Low inversion rate

No recycling

Low pressure
High inversion rate

Source: Mitsubishi Chemical Corporation and Mitsubishi Gas Chemical Company, Inc.
©MITSUBISHI GAS CHEMICAL COMPANY, INC.

29

Topic: Selection for Green Innovation Fund Project (2)February 18, 2022 News Release

Green Innovation Fund, the Development of Technologies for Producing Raw Materials for Plastics Using CO 2 and/or Other Sources

3. Development of Technology to Manufacture Functional Chemicals from CO2 (i)- Development of manufacturing technology for functional plastic materials using CO 2 as a raw material
Project objectives and overview
a. Development of manufacturing technology for polyurethane raw materials We will develop manufacturing technology for isocyanates, a
raw material for polyurethane, and PCD using CO2 as a raw material, utilizing CO2 directly from exhaust gas of factories, etc., instead of theconventional raw material phosgene. With these CO2 derivatives, we aim to realize eco-friendly, high-performance polyurethane.
b. Development of new intermediates synthesis technology for polycarbonate production and of a high-performance process for nonphosgene polycarbonate We will develop a new synthesis technology for the production of DPC precursors using CO 2 as a raw material
instead of phosgene. We aim to realize a process to enhance the functionality of polycarbonate using the DPC obtained by this technology.

Implementation structure

Project scale

Tosoh Corporation [the contact company]
Mitsubishi Gas Chemical Company, Inc.

□ Project scale (a+b) :□ Support scale (a+b) :Approx. ¥30.69 billion
Approx. ¥19.80 billion**Includes incentives. Subject to change.

Project period□ Subsidy ratea, b : 2/3 subsidy→1/2 subsidy (incentive rate: 10%)

From FY2021 to FY2028 (eight years)
Project concept
a. Development of
manufacturing technology forpolyurethane raw materials

•

•
•
•

Synthesis functional
chemicals, which are used asplastic raw materials fromCO2 raw materials.
Fix CO2 as plastics.
Enhance energy efficiency ofprocesses.
Reduce CO2 emissions
compared with conventional
manufacturing method.

Source: Tosoh Corporation and
Mitsubishi Gas Chemical Company, Inc.

Carbon dioxide (CO2)
Low-concentration
CO2

Isocyanates[Intermediate]
Dialkyl carbonate (DRC)[Intermediate]
Carbamic acid ester
Pyrolysis

Polyols[Raw materials for PU]
Methylene diphenyl diisocyanate (MDI)
Hexamethylene diisocyanate (HDI)

Polyols
PCD

b. Development of new intermediates
synthesis technology for PC production
and of a high-performance process for
non-phosgene PC[Raw materials for PU]
Polycarbonate diol (PCD)

Isocyanates

Carbonate
raw materials

Phenol[Raw material for
melt-polymerized PC]
Diphenyl carbonate (DPC)

Bisphenol A

Polyurethane (PU)

Polycarbonate (PC)Fixation of CO2 in PU

Fixation of CO2 in PC©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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Topic: Conclusion of Agreement for DBJ Sustainability Linked Loan withEngagement Dialogue with Development Bank of Japan
February 10, 2022 News Release

Mitsubishi Gas Chemical Company, Inc. (MGC; Head office: Chiyoda-ku, Tokyo;
President: Masashi Fujii) today announced that it has concluded a loan
agreement (agreement period: 10 years; ¥10 billion) with the Development Bankof Japan (DBJ; Head office: Chiyoda-ku, Tokyo; President: Hajime Watanabe) on
a DBJ Sustainability Linked Loan with Engagement Dialogue (SLL withEngagement Dialogue).
SLL with Engagement Dialogue is a financial instrument designed to encouragesustainable growth for both borrowers and society as a whole. Based on theGreen Loan and Sustainability Linked Loan Guidelines drafted by Japan’s
Ministry of the Environment, SLL with Engagement Dialogue works throughdialogue between DBJ by establishing the borrower key performance indicators(KPIs) appropriate for helping the borrower raise the level of sophistication of theirsustainability management, and sustainability performance targets (SPTs) alignedwith sustainability strategy. Loan terms and conditions are linked to SPT
achievement.

KPI
Circular Carbon Methanol Concept Realization

SPT (1)

Conclude demonstration operation of Circular Carbon
Methanol pilot plant by FY2023

SPT (2)Complete construction of Circular Carbon Methanol mass
production plant with annual production volume of 10,000
tons or more by FY2029

Conclusion of this loan agreement was the result of evaluation of KPIs and SPTs(listed on the right) pertaining to the Circular Carbon Methanol Concept, a
concrete action plan for addressing energy and climate change issues by using
CO2 and waste plastic as raw materials to produce methanol, found in MGC’s
Medium-Term Management Plan Grow UP 2023.

©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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Topic: Participation in Initiative to Study Japan’s Energy Transition [ETI-CGC]
November 8, 2021 News Release

Mitsubishi Gas Chemical Company, Inc. (MGC; Head office: Chiyoda-ku, Tokyo;
President: Masashi Fujii) today announced its participation in “ETI-CGC (Energy
Transition Initiative-Center for Global Commons,” a voluntary initiative launched by the
University of Tokyo’s Center for Global Commons and Japanese enterprises. ETI-CGC
will conduct studies concerning Japan’s energy transition based on the five principles
highlighted below.
1. We will safeguard the sustainability of our environment, the Global Commons.
To this end, we will chart pathways to reduce Japan’s greenhouse gas
emissions to net zero by 2050.
2. Capitalizing on findings and scientific insights across the world and in Japan,
we will study pathways compatible with local circumstances in order to achieve

Energy Transition Initiative - Center for Global Commons

What is ETI-CGC?
• ETI-CGC is a platform for linking industry and academia in voluntary cooperation
between business leaders and the academic world to imagine Japan’s pathway to
net zero• Secretariat: The University of Tokyo’s Center for Global Commons• Member List
AGC

Mitsui & Co.

JERA

Hitachi

Sumitomo ChemicalTokyo Electric Power Company Holdings

Toyota Motor

Sumitomo Mitsui Financial GroupSoftBank

Mitsubishi Gas Chemical

Daikin Industries

Mitsubishi Chemical

Mitsubishi UFJ Financial GroupThe University of Tokyo Institute for Future Initiatives

carbon neutrality, while safeguarding well-being and wealth.
3. With these pathways, we aim to become an international model case forcountries with unique local circumstances and subsequently
contributions to the carbon neutrality of the entire world.

make

4. We will consider the implementation of the pathways an opportunity totransform Japan’s industrial structure and economic/social system as well as
our behavioral pattern towards the future. We will also discuss how we can takeadvantage of this opportunity.

5. We will make policy proposals and take a leadership role in stimulating
discussions on a broader basis in Japan.

©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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Topic: Initiative for Resourcification Business Targeting Used Plastic
November 9, 2020 News Release

Initiative for resourcification business targeting used plastic
Capital participation in new company R Plus Japan Ltd.

Initiatives under the joint venture

R Plus Japan Members

R Plus Japan Ltd. will join forces with U.S.-based biochemical venture Anellotech
Inc. to promote development of technology with low environmental impact for theefficient resourcification of used plastic.
This move should contribute to solving common issues worldwide regarding
plastic through cross-industry collaboration encompassing recovered plastic
sorting and treatment, monomer and polymer production, packaging andcontainer manufacturing, trading companies, beverage and food productmanufacturers and other entities, with sights on practical applications in 2027.

Crude
oil

Raw
material

Material

Container / packaging

Consumergoods

Sorting /preprocessing©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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History of Resource Development at Mitsubishi Gas Chemical (1)1951Japan Gas Chemical Co., Inc. established1953

Successfully developed water-dissolved natural gas in a mining area in Yamanoshita District of Niigata City
with forerunner to Water&Geo-Tech Engineers, Nissaku

1955

Began development of water-dissolved natural gas following excavation of “Kajikawa R-1 Well,” a test well in
the Higashi-Niigata region

1959

Discovered “Higashi-Niigata Oil and Gas Field” (Higashi-Niigata SK-1 Well), a deep non-associated gas field in
the Higashi-Niigata region in cooperation with Japan Petroleum Exploration Co., Ltd.

1960

Began solo development of shallow layer non-associated gas at depths of up to 1,000m in the Higashi-Niigata
region (Higashi-Niigata R-11 Well). 10 sites excavated by 1965

1967

Discovered “Shin-Tainai Gas Field” (Shin-Tainai NS-2 Well), located near the mouth of the Tainai River in the
Kitakambara region in collaboration with Japan Petroleum Exploration Co., Ltd.

1971

Japan Gas Chemical Co., Inc. and Mitsubishi Edogawa Chemical Co., Ltd. merged to become Mitsubishi Gas
Chemical Company, Inc.

Water-dissolved natural gas well excavation
during initial development

Launched first attempt at commercialization (experimented on balanced extraction method by calendar date
for water-dissolved natural gas)
Water-dissolved natural gas production facility
during initial development©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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History of Resource Development at Mitsubishi Gas Chemical (2)1981

Reopened solo developed shallow layer non-associated gas at depths up to 1,000m in the Niigata region(Higashi-Niigata MG-21 Well). 13 sites excavated by 1985
Began surveying aimed at building a geothermal power station in the Hachimantai-Sumikawa region of Akita
Pref. in collaboration with Mitsubishi Metal Corporation [today: Mitsubishi Materials Corporation]

1983

Discovered “Iwafune-oki Oil and Gas Field” (Iwafune-oki SIM-1 Well) through four-way collaboration withJapan Petroleum Exploration Co., Ltd., Japex Offshore Ltd. and Niigata Petroleum Development Co., Ltd.

1990

Launched Iwafune-oki Oil and Gas Field production
Established MGCRA to conduct coal-seam gas exploration in Queensland, Australia

1994

Joined forces with Mitsubishi Materials to establish Hachimantai Geothermal Co., Ltd. [today: Hachimantai
Green Energy Co., Ltd.] in Kazuno City, Akita Pref., to supply steam to the Tohoku Electric Power Sumikawa
Geothermal Power Station

1995

Started three-way operation of Sumikawa Geothermal Power Station in conjunction with Tohoku Electric Power
Co., Inc. and Mitsubishi Materials Corporation

1996

Reopened solo developed medium-depth non-associated gas at depths up to 1,450m in the Higashi-Niigata
region (Higashi-Niigata MG-34 Well excavation)

Test production at non-associated natural
gas well in Higashi-Niigata

Withdrew from coal-seam gas exploration business in Queensland, Australia

Steam releasing at Sumikawa Geothermal
Power Station©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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History of Resource Development at Mitsubishi Gas Chemical (3)2002

Excavated reinjection wells “K1-5” and “K2-5” for groundwater from water-dissolved natural gas in the
Higashi-Niigata region (new water-dissolved well excavation for first time in approx. 40 years)

2004

Launched joint surveying in the Akinomiya region with Mitsubishi Materials

2006

Participated in natural gas exploration in the Zitong mining zone, Sichuan Province, China

2008

Together with Japan Petroleum Exploration Co., Ltd. and Japex Offshore Ltd., excavated three test wells in the
Sea of Japan - “Seiro-oki MS-1 Well,” “Tainai-oki MS-1 Well” and “Aganogawa-oki MS-1 Well” - using excavation
barge HAKURYU-5.
Established Japan CCS Co., Ltd., with MGC and eight partners as the originating companies

2010

Established Yuzawa Geothermal Power Corporation with Electric Power Development Co., Ltd. and Mitsubishi
Materials Corporation to build a geothermal power plant in Yuzawa City, Akita Pref.

2012

MGC, with nine other companies, inaugurated the Fukushima Geothermal Project in the Azuma and Adatara
regions of Fukushima Pref.

2013

Excavated the geothermal survey well “Musadake SMMG-1 Well” in the Musadake region of Hokkaido Pref.
with Japan Petroleum Exploration Co., Ltd. and Mitsubishi Materials Corporation

Semisubmersible ocean excavation rig“HAKURYU-5”

Began a joint survey of geothermal resources in the Bandai, Azuma and Adatara regions of Fukushima Pref.
2014

In British Columbia, Canada, participated in shale gas development in North Montney and LNG business in
Prince Rupert

2015

Established Appi Geothermal Energy Corporation through a joint venture with Mitsubishi Materials Corporation
to advance study of geothermal power commercialization in the Appi region of Hachimantai City, Iwate Pref.
Oil and natural gas excavationin Sichuan Province, China©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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History of Resource Development at Mitsubishi Gas Chemical (4)2016Entered the LNG-fired power generation business through investment in Fukushima Gas Power Co., Ltd.
Started injection of CO2 in CCS demonstration project in Tomakomai City, Hokkaido Pref.

2018

Established MGC Energy Co., Ltd. to consolidate electric power procurement, supply and sales functions forthe entire Mitsubishi Gas Chemical GroupElectric Power Development Co., Ltd. participated in Appi Geothermal Energy Corporation

2019

Halted geothermal survey in the Bandai region of Fukushima Pref.
Commercial operations launched at Wasabizawa Geothermal Power Station in Yuzawa City, Akita Pref.
Started construction of Appi Geothermal Power Station

Tomakomai CCS Demonstration Project Center
Photo credit: Japan CCS Co., Ltd.

Achieved cumulative insertion of 300,000 tons of CO2 in the Tomakomai CCS Demonstration Project

2020

Withdrew from shale gas and LNG business in Canada
Commercial operations launched at Fukushima Natural Gas Power Plant
Withdrew from geothermal project in the Musadake region of Hokkaido Pref.

2021

TOHO EARTHTECH, INC. (MGC consolidated subsidiary) launched production of newly developed waterdissolved natural gas in the Nishikambara region of Niigata Pref.

Current water-dissolved natural gas
production facility©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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Turning Ancient Underground Water into Niigata’s Strength-Water-dissolved Natural Gas, IodineGas dissolved in brine

A precious element, and one essential to human health

Water-dissolved natural gas

IodineThe main component is methane.
Collected from drawn brine where dissolved.
Abundant reserves verified in Niigata Pref. and Chiba Pref.
Chemical Products Made from Natural Gas[Broad Applications for Natural Gas]

This element is critical for the creation of thyroid hormones necessary for body
growth, and can be consumed through various types of seaweed. In somelandlocked countries, the addition of iodine to table salt and other foods is
mandated by law. Collected mainly from minerals and brine, iodine’s
antibacterial and chemical properties are leveraged for use in a wide range ofapplications from pharmaceuticals to industrial products.

In addition to use in general households,
natural gas is also used as fuel for thermal
power generation. It is also widely utilized asa raw material for methanol, ammonia andother chemicals.

Vinyl

Dry ice

Paint

Adhesives

Herbicides
2%

Others include products found in synthetic fabrics, artificial leather, etc.

Others

X-ray contrast
agents15%

Salt additive

22%

4%
Pet food additives[Water-dissolved Natural Gas andNon-associated Natural Gas]

Water-dissolved natural gas

Water-dissolved natural gas in Niigata Pref. isprimarily located 500 to 1,000 m underground,with non-associated natural gas also present
at lower depths.

Non-associated natural gas

Applications

Anti-bacterial/
6%
for iodine
anti-fungal
Stabilizers
agents6%
12%
PharmaLiquid
crystalceuticals
related10% Industrial
11%
catalysts
11%

Water-dissolved natural gas and iodine are extremely important resourcesthat hold the potential to become strengths for Niigata.
Turning Ancient Underground Water into Niigata’s Strength https://www.gas-youso.com/©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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Disclaimer
This document has been translated from the Japanese original forreference purpose only. In the event of any discrepancy between thistranslated document and the Japanese original, the original shallprevail.
This document contains performance forecasts and other statements
concerning the future. These forward-looking statements are based on
information available at the time. These materials were prepared andon certain premises judged to be reasonable. None of these forwardlooking statements are intended to be guarantees of future
performance. Various factors may cause actual performance to differ
significantly from forecasts.

©MITSUBISHI GAS CHEMICAL COMPANY, INC.

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