Trust Recovery Growth Vitalization - Marubeni

Strategy by Business Segment
Energy Division
✔
Balancing three core businesses
The division optimized its business portfolio by prioritizing the allocation
of management resources to strategic fields. The division’s sharply higher
earnings in the past fiscal year were the cumulative outcome of these
initiatives. The firm fundamentals now in place at the division will play
a key role in the successful completion of the “V” PLAN. At the same
time, in order to keep its status as one of Marubeni’s core divisions over
the next five to ten years, we have positioned natural resource exploration
and production business as our highest priority field, while we will
also strengthen our trading and marketing capabilities. Looking ahead,
we plan to stimulate growth by maintaining an optimal balance among
these three core businesses.
Koichi Mochizuki
Corporate Senior Vice President, COO
Division Strategies and Strengths
The Energy Division operates three core businesses: energy
resource exploration and production, trading, and marketing
and retailing.
In energy resource exploration and production, the division
has continued to broaden its business scope in recent years.
Production was steady at existing oil and gas projects. The
division has already achieved a total production volume of more
than 30,000 boed (barrels of oil equivalent per day). Looking
forward, the division will continue to actively invest in promising
new projects in a drive to further expand its earnings base. In
LNG, the division’s project in Qatar is proceeding favorably. In
Sakhalin, Russia, where the division takes part in the Sakhalin I
Project through investment in Sakhalin Oil and Gas Development
Co., Ltd., good progress is being made on the construction of
related onshore facilities and production well drilling in preparation
for full-scale crude oil production in early 2006.
In trading, which has long been Marubeni’s core field, the
division is primarily engaged in transactions including crude oil,
gasoline, kerosene, diesel fuel and other petroleum products,
mainly through its headquarters in Japan and principal subsidiaries
in the U.S. and Singapore. The division has particularly
distinguished itself in the trade of naphtha, accounting for 25%
of annual imports to Japan. To supply competitive petroleum
products, the division will leverage risk management functions
backed by years of business experience and talented personnel,
utilize futures trading, processing at refineries and various other
techniques, and optimize ties between branches and Group
companies in its worldwide business network.
In the fields of marketing and retailing, the division has a
diverse portfolio of businesses, and delivers distinctive, valueadded
services to each of these business sectors. In particular,
the division is involved in sales of imported LPG in China’s
Guangdong Province, where demand for imported LPG is greatest
in the country, through a joint venture with local partners. In
Japan, the division conducts nationwide retailing operations,
selling petroleum products and LPG via a distribution infrastructure
network comprising storage terminals, filling stations and
other distribution facilities. In terms of critical fuels for power
generation, the division stands apart by handling a diverse lineup
of products, from LNG and nuclear fuel to petroleum products.
Where new business is concerned, the Energy Division conducts
feasibility studies for the commercialization of innovative
fuels with lower environmental load, has launched a business in
trading greenhouse gas emission quotas and takes other creative
initiatives amid a fast-changing business environment.