TOKYO -- Toshiba has begun talks with several suitors to sell its U.S. liquefied natural gas business, marking the last stage of offloading the loss-making assets the troubled conglomerate was carrying.

The Japanese company recently invited tenders, garnering responses from 10 companies, a source familiar with the matter told Nikkei. There is speculation that Jera, a joint venture between utilities Tokyo Electric Power Co. Holdings and Chubu Electric Power, may be among the bidders. American gas producer Tellurian and Chinese state-affiliated energy company PetroChina are also thought to have raised their hands.

Now that Toshiba has seen the worst of its financial crisis, the LNG project is considered its largest risk factor. In 2017, the company had said the business could produce losses as deep as 1 trillion yen ($9 billion).

Toshiba holds concessions to process 2.2 million tons of U.S.-produced shale gas into LNG annually at Freeport LNG's facility in Texas for 20 years, starting in 2019.

Toshiba's foray into natural gas, an unusual move for a company known mainly for electronics and machinery, began in 2013 as a way to salvage a nuclear power generation station, the South Texas Project. Toshiba had won orders to build the reactors there, but the project became a burden after the 2011 meltdowns at Japan's Fukushima plant triggered the need for additional safety measures, ballooning the costs and causing major delays.

To keep the project profitable, Toshiba signed an agreement to sell electricity generated by the new reactors to Freeport. In exchange, Toshiba agreed to the LNG arrangement at Freeport's facility. But with little experience handling gas, Toshiba struggled to find customers for the LNG.

Those in the know say that the Toshiba board meetings at the time had a bizarre feel. "I don't want to explain publicly that we are doing this for the nuclear plant," then-CEO Hisao Tanaka barked at his colleagues.

The Freeport LNG project in Texas processes U.S.-produced shale gas into LNG. A recent rise in prices has improved its viability, and therefore its attractiveness to potential buyers. © Reuters

"Come up with a different argument for it," he instructed them.

When Toshiba announced the LNG deal, the company promoted it as a way to "bundle" the sale of both gas power plants and the fuel that would run them.

Tanaka also was encouraged by the Japanese government, which wanted stronger energy ties with the U.S. The Ministry of Economy, Trade and Industry contacted several companies, including Toshiba, to gauge their interest in the Texas LNG industry.

"We can't disappoint the government," Tanaka insisted at the board meetings. Nobody could oppose it, sources said.

In 2017, the orders for the South Texas Project's reactors were in effect canceled. That left Toshiba with nothing to show for it except the 20-year obligation.

Tanaka stepped down in 2015 over Toshiba's accounting scandal.

Uncertainties remain. Toshiba's contract was set to take effect in September 2019. But Freeport's facility suffered hurricane damage last summer that likely will cause a roughly six-month delay.

Toshiba also has not finalized buyers for the gas. "We unofficially have about 80% of them down, but we still have to sign formal contracts," a source familiar with the matter said. In the latest explanation, Toshiba still expects to be unable to sell all of the planned gas and might chalk up 200 billion yen in losses.

Toshiba announces a medium-term plan in November. The company logged net profit of more than 1 trillion yen for the April-June quarter thanks to the sale of semiconductor unit Toshiba Memory, yet operating profit -- showing how its actual businesses are performing -- came to just 700 million yen.

Negotiations have stalled with Korea Electric Power to sell a U.K. nuclear project to the state-run South Korean utility. The Japanese company also needs to reform a corporate culture that led to the 2015 scandals. It remains unclear how Toshiba plans to chart a way for the future and handle the various risks.