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Points of Interest in Japanese Onshore Prospecting Right Due Diligence: Managing the Risk of Post-Investment Invalidation

Would be investors in mining companies should be aware of certain risks that may not be apparent in cursory level due diligence. This newsletter will help investors identify two such risks concerning Prospecting Rights (Shi-ku-tsu-ken): potential early termination based on breach by the holder of the requirement to commence drill work within the statutory period and issues surrounding the extension process. Accordingly, when investing in a company which holds a Prospecting Right it is important to check the deadline for the commencement of drill work, and whether the holder of the Prospecting Right will be able to commence drill work within the statutory deadline or potential extensions thereof.

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Natural Resources and Energy Newsletter (June 8, 2020) (913 KB / 4 pages) Download PDF [914 KB]

Authors

紺野 博靖

Hiroyasu Konno specializes in the energy and natural resources sector, mainly in the upstream and middle-stream sectors, such as projects and transactions regarding LNG, biomass fuels, coal, rare metals, copper ore, petroleum, and other minerals in the world, as well as the down-stream sectors such as transactions regarding electricity and gas in Japan. He has a breadth of knowledge about industrial practices and policy trends, through his experience working as a secondee, or temporary worker, at Nippon Oil (currently ENEOS), JOGMEC (Japan Oil, Gas and Metals National Corporation (currently Japan Organization for Metals and Energy Security)),and JERA, in addition to an energy and natural resources team in a foreign law firm, as well as experience from being a committee member of relevant governmental panels. He always endeavors to provide clients with legal services with additional value, including managerial perspectives. He handles all kinds of legal issues related to the energy and natural resources sector, by closely working together with N&A’s experts in each sector. He also actively works on legal issues with regard to “carbon”, such as CCS (Carbon Capture and Storage), transactions of carbon credits, and others.