HIGHLIGHTS

1

Financial and Operating Highlights
As of or years ended March 31
Please refer to p. 97 for notes of major indices.

2007

2008

2009

2 010

Results of Operations (Millions of yen / Thousands of U.S. dollars)¥

Net sales
Gross proﬁt

969,713¥ 1,202,965

625,918

812,411¥

1,076,165
757,127¥

840,427542,259

Operating income

559,077

714,211663,267

461,668

Net income

165,092

173,246

145,063

107,210EBIDAX

321,790382,654

275,871242,543¥ 1,608,107¥ 1,807,901¥ 1,768,045(Earnings before interest, depreciation and amortization, and exploration)

Financial Position (Millions of yen / Thousands of U.S. dollars)
Total assets¥

2,013,778

Net assets excluding minority interests

1,028,895

1,157,371

1,271,123

1,387,500

Net debt(169,667)(328,353)(324,109)(349,211)

Cash Flows (Millions of yen / Thousands of U.S. dollars)¥

Cash ﬂows from operating activities

231,982¥363,995¥

230,352¥

241,373

Cash ﬂows from investing activities(209,243)(261,767)(240,168)

Cash ﬂows from ﬁnancing activities

13,794(45,228)(46,090)(251,812)
68,937

Cash and cash equivalents at end of the year

189,417

222,270

162,845

216,395

Earnings per share (EPS)¥ 70,423.45¥ 73,510.14¥ 61,601.60¥ 45,553.56

Net assets per share

436,467.92

491,168.09

540,100.10

589,548.88

7,000.00

7,500.00

8,000.00

5,500.00

9.9%

10.2%

13.0%

12.1%

(18.6)%
64.0%
17.7%
20.4%

(36.1)%
64.0 %
15.8 %
21.4 %(31.2)%
71.9%
11.9%
14.6%

(30.6)%
68.9%
8.1%
10.5%

¥ 1,020,000¥ 1,110,000

2,405.6

2,617.8

1,610.8

1,617.9

Price earnings ratio (PER) (Times)

14.5

15.1

11.1

15.1

Price book-value ratio (PBR) (Times)

2.3

2.3

1.3

1.2

Net proved reserves (Million boe)

1,770

1,645

1,598

1,475

Net production (Thousand boed)

418

423

405

405

217,646

315,684

294,364

235,721

Per Share Data (Yen / U.S. dollars)

Cash dividends per share
Payout ratio (%)

Financial Indices (%)
Net debt / Net total capital employed
Equity ratio
Return on equity (ROE)Net return on average capital employed (Net ROACE)

Stock Indices
Stock price (Yen / U.S. dollars)Market capitalization (Billions of yen / Millions of U.S. dollars)¥

683,000¥

686,000

Operating Data

Exploration and development expenditures(Millions of yen / Thousands of U.S. dollars)

Oil price / Exchange rate / INPEX share price
Oil price (U.S.$/bbl)
150¥118.09¥117.47¥1,110,000

120$100.30¥98.26¥1,020,000

90¥100.2060$68.10$65.91¥93.04 $8¥683,000¥686,000$49.2330
Jan. 2006

014

Apr. 2006

Jan. 2007

INPEX CORPORATION Annual Report 2013

Apr. 2007

Jan. 2008

Apr. 2008

Jan. 2009

Apr. 2009

Jan. 2010 Apr. 2010

1
Highlights

2 0 112 0 122 0 13¥¥

1,186,732¥ 1,216,533$ 12,943,217

791,289

790,2078,407,352

529,743

709,358

693,448

7,377,891

128,699

194,001

182,962

1,946,611

943,080
608,247

2 013 (U.S. dollars)*

274,931362,597

350,905

3,733,429¥ 2,680,380¥ 3,066,398¥ 3,616,159$ 38,473,870

1,996,890

2,179,252

2,481,293

26,399,543(688,807)(874,116)(815,308)(8,674,412)

Net Income
for the year ended March 31, 2013

183.0

¥

Net Income Analysis(¥ billion)(For the year ended
March 31, 2012)¥194.0¥274,094¥

320,692¥

252,347$

2,684,828(844,511)(280,864)(489,870)(5,211,937)

548,057

29,294137,069

1,458,336

182,025

249,233

199,859

2,126,386¥ 40,832.40¥$

53,137.93¥ 50,114.22

546,958.90

596,908.99

7,230.98

6,000.00

7,000.00

679,639.63
7,000.00

14.7%

13.2%

14.0%

14.0%

Increase in net sales

29.8
Increase in cost of sales

30.9
Increase in exploration expenses andallowance for exploration

533.19

20.6
Others

74.48

10.7(For the year ended
March 31, 2013)¥183.0(48.9)%
74.5%
7.6%
10.8%
¥

631,000(60.7)%
71.1%
9.3%
16.0%
¥

559,000(43.9)%
68.6%
7.9%
11.2%
¥

500,000(43.9)%
68.6%
7.9%
11.2%
$

0

2,043.6

1,827.9

19,448

15.5

10.5

10.0

10.0

1.2

0.9

0.7

0.7

1,308

2,432

2,188

2,188

423

426

408

408

248,005

243,531807,9888,596,532

50

INPEX share price (Yen)

808.0

800

177.3

130

600

82.70
¥93.99

400

243.5

100

200

¥559,000¥83.15Jan. 2011

Apr. 2011¥500,00085

Apr. 2012

0.6
32.8

576.7

210.1
0

¥82.14Jan. 2012

54.0

115

$110.02¥631,000

billion■Development ■Exploration■Acquisition costs

Exchange rate (Yen/U.S.$)$122.88

200

Exploration and development expenditures
increased substantially compared with theprevious ﬁscal year due mainly to the increase in development expenditures in connection with the transition to the Ichthys development phase for the year under review,and the acquisition of interests in such largescale projects as shale gas projects in Canada and Prelude FLNG Project in Australia.

(¥ billion)$117.36

150

808.0

¥

* The translation of yen amounts into U.S. dollar amounts is included solely for convenience, as a matter of arithmetic
computation only, at ¥93.99 = U.S.$1.00, the approximate rate of exchange in effect as of March 31, 2013.

Exchange rate (Yen/U.S.$)

100

Exploration and Development
Expenditures for the year ended
March 31, 2013

5,320

2,306.8

Oil price (ICE Brent)

billionNet sales increased by ¥29.8 billion compared with the previous ﬁscal year. In addition, the gain on transfer of the Ichthys LNG
Project equity interest was recognized.

Jan. 201370
Apr. 2013

2012

2013

INPEX CORPORATION Annual Report 2013015

Financial and Operating Highlights (Graphs)
As of or years ended March 31
Please refer to p. 97 for notes of major indices.

Proﬁtability Indices` See p. 8 of Fact Book 2013 for more about proﬁtability indices.

Net Income, EBIDAXNet Sales (by product)(Earnings before interest, depreciation and amortization, and exploration)(¥ billion)■Crude oil ■Natural gas ■Other

1,500
1,200

400

1,203.0

1,186.7

1,076.2

28.4

27.5

900

650.4

397.8

200

788.1

726.2

194.0

183.0

128.7

107.2

0
2008

2009

2010

2011

2012

2013

2008

Despite the impact of yen appreciation, net sales experienced a sound increase owing mainly to ﬁrm trends in crude oil prices between the period fromthe year ended March 31, 2010, to the year ended March 31, 2012.

Efﬁciency Indices` See p. 9 of Fact Book 2013 for more

2009

2010

ROE

Net ROACE

25(¥ billion)

21.4

Equity ratio ■Net debt （%）
Net debt / Net total capital employed 100

1,000

11.9

10

1,500

16.0

14.6

11.2

10.8

8.1

5

7.6

9.3

0

2009

2010

2011

2012

2013

■Cash dividends per share (Fiscal year end)
4,000

5,500

13.0
%

6,000

3,000

4,000
10.2
% 3,500

Payout ratio （%）

8,000

6,000

4,000

7,000

4,000

3,500

1,271.1-328.4-324.120

2010-349.2-688.8-874.1-815.30-40-36.1%-31.2%-30.6%

2008

2009

2010

-48.9%
2011-60.7%
2012-43.9%-80

2013

The Companyʼs net debt is negative because the sum of cash and cash
equivalents and public bonds is greater than the sum of interest-bearing
debt. INPEX continues to maintain ﬁnancial strengths.

(Times)

20

20

15

15

10

10

5

5

0

0

PER

15.1

2.3
0
2009

40

2011

2012

2013

The Company, which is currently in a growth investment phase, is placing theemphasis on balancing the needs to expand medium- to long-term earnings
with ensuring appropriate returns to shareholders.

INPEX CORPORATION Annual Report 2013

15.1

PBR

15.5

10.5

10.0

3,500
3,000

2,500

2008

1,387.5

11.1

14.0
%

3,000
3,000

2,000

7,000

13.2
%

14.7
%

12.1
%

1,157.4

Price Earnings Ratio (PER), Price Book-Value Ratio (PBR)■Cash dividends per share (2nd quarter end)

4,000

68.6% 60

74.5%

` See p. 12 of Fact Book 2013 for more about performance indices.

Cash Dividends per Share, Payout Ratio

7,500

80

71.1%

-500

Net ROACE is an indicator that is commonly used by resource development
companies. Net ROACE is a proﬁt ratio which includes net debt with the sumof net assets. With the Companyʼs negative net debt position, net ROACE ishigher than ROE.

Performance Indices64.0%

2,481.3

2,179.3

1,996.9

7.9-1,000

2008

68.9%

500

0

(Yen)

71.9%

2,000

20

10.5

2013

■Net assets excluding minority interests

2,500

15.8

2012

Net Assets Excluding Minority Interests, Equity Ratio,
Net Debt, Net Debt / Net Total Capital Employed

（%）

15

2011

EBIDAX is an index that is commonly used by resource development companies. It is a measure of proﬁt before interest payments, depreciation andamortization as well as exploration expenses. EBIDAX provides an indicationof the level of proﬁt generated without the impact of accounting treatment
applied by individual companies.
p. 11 of Fact Book 2013 for more
Stability Indices ` See
about stability indices.

about efﬁciency indices.

Return on Equity (ROE), Net ROACE

016

350.9

274.9

173.2

100

0

8,000

275.9

145.1

558.0

486.9

300

300

30.6

429.1

356.2

326.4

362.6

242.5

28.9

27.1

398.3

783.5

■Net income ■EBIDAX

382.7

1,216.5

31.4

943.1

840.4

391.1

600

(¥ billion)

2008

1.3

1.2

1.2

0.9

0.7

2009

2010

2011

2012

2013

Despite the Company ʼ s steady performance and stable cash dividend
payment record, PER and PBR remained entrenched at a low level. This
trend can be seen in other mining- and oil-related stocks listed in Japan.

1Highlights

Reserve/Production Indices` See p. 13 of Fact Book 2013 for more about reserve/production indices.

Net Proved and Probable Reserves, Reserves-to-Production Ratio

Net Proved Reserves (by product),
Reserve Replacement Ratio (3-year average)(Million boe)

■Crude oil ■Natural gas

2,500
2,000

1,645
1,500
1,000

1,598

1,475

558
550

122
%

61
% 1,048500
0Reserve replacement ratio (3-year average)（％）
300
2,432
282
2,188
%
255 240
%

495

35
%

180

1,308
409

980

899

1,451

1,259

981

929

120
60

25
%
2010

4,774
4,366

4,000

2012

4,256

4,126

2,929

4,095

1,823

2,818

40

1,907

30

3,000
29.8

32.3

27.5

26.7

27.4

2,000

20
10

1,000
10.8

10.7
2011

4,404

3,176

2,721

14.7

0
2009

5,000

28.2

1,087

2008

■Proved reserves ■Probable reserves
Reserves (proved + probable) -to-production ratio (Years)
Proved reserves-to-production ratio
50(Million boe)

0

2013

10.0

15.6

8.5

1,645

1,598

1,475

1,308

2,432

2,188

2008

2009

2010

2011

2012

2013

0

Reserve replacement ratio (3-year average) =Proved reserves increase including acquisition / Production

Reserves to production ratio (Years) =Reserves as of the end of the year / Production in the year

The Final Investment Decision (FID) for the Ichthys LNG Project was made inJanuary 2012 and the reserve evaluation at 1.18 billion boe was upgraded to
net proved reserves.

The reserves-to-production ratio measures the current number of production
volume years of reserve volumes held. As of March 31, 2013, the Companyʼsreserves-to-production ratio was 14.7 years for net proved reserves and 27.5
years on the basis of proved and possible reserves.

Net Production (by product)

Average Expenses per BOE Produced,
Finding and Development Cost per BOE (3-year average)(Thousand boed)

450■Crude oil ■Natural gas

423
181

360

405

405

182

187

423

426

184

175

Average expenses per boe produced
Finding and development cost per boe (3-year average)(U.S.$/boe)

80

408

78.6

162

60

55.4

270
180

242
223

239

251

40

246

218

28.3
20

90

17.5

16.4

17.9

11.4

0

0

2008

2009

2010

2011

2012

2013

10.2

12.4

11.2

2008

2009

2010

6.3
2011

11.2

2012

2013

For the year ended March 31, 2013, crude oil production volume in the Middle
East and Africa regions increased, mainly in the ADMA Block. On the other
hand, there were signs of a decrease in natural gas production volume for thesame period owing mainly to natural decline at the Offshore Mahakam Block.

Finding and development cost per boe (3-year average) = The sum of total costs incurred for
exploration and development of oil and gas ﬁelds and total costs incurred for acquisitions
divided by the sum of proved reserve extensions, acquisitions and revisions.

Exploration Success Ratio (3-year average),
Number of Exploratory Wells Exploration success ratio (3-year average)

LTIF, TRIR

■Number of exploratory wells（Number）
40

（％）

80

Finding and development cost per boe is improving signiﬁcantly following
the upgrade of the Ichthys net probable reserves to net proved reserves.

57.9%

5.26

56.3%

30

50.6%
19

17

3.86
20

46.8%
13

20

2

7

9

10

0.96
0

0
2008

2009

2010

2011

4.05

4

45.0%

24
40

TRIR

6

64.5%
60

LTIF

(Incidents)

2012

2013

Exploration success ratio (3-year average) = The number of net productive exploratory wells drilled /The number of net exploratory wells drilled. (An exploratory well is a well drilled to ﬁnd a new ﬁeld,
to ﬁnd a new reservoir in a ﬁeld previously found to be productive of oil or gas in another reservoir or
to extend the limits of a known reservoir.) The number of wells represents the completion of drilling
operations for the subject year. However, data for the year ended March 31, 2013 included operations
currently in progress.

1.20

1.16
0.64

0
2009

2010

2011

1.86
0.72

0.77

2012

2013

LTIF: Rate of injuries resulting in fatalities or lost time per million hours worked
TRIR: Rate of recordable injuries (fatalities, lost time, restricted workdays, and medical treatment)
per million hours worked

The number of exploratory wells is expected to increase from the year ending
March 31, 2014 on the back of vigorous exploration investment.

INPEX CORPORATION Annual Report 2013017

Business Topics

1

Acquisition of Production and Development Assets
August 2012 Participation in Offshore Angola Block 14

INPEX reached an agreement with TOTAL S.A. to acquire a 9.99%
interest in Block 14 offshore the Republic of Angola. Locatedapproximately 100 kilometers offshore, Block 14 is currently producing crude oil in three development areas, and there are otherdiscovered undeveloped areas. Further exploration and development of the discovered undeveloped areas of the block will be
conducted.
August 2012 Acquisition of interest in

the Lucius Oil Field in the U.S. Gulf of Mexico
INPEX agreed to acquire a 7.2% participating interest in the
Lucius project, which includes portions of Keathley Canyon
Blocks 874, 875, 918 and 919 in the U.S. Gulf of Mexico.
The Lucius project has been in the development phase since
December 2011, and the ﬁrst production of crude oil and natural gas is expected to start in the latter half of 2014.
Texas

Marine production facilities at
Angola Block 14

Louisiana
New Orleans

Houston

KC874

KC875

KC918

KC919

Keathley Canyon Blocks
874/875/918/919
Lucius Oil Field

Geographic areas subject to participation

Construction work on production facilities for the Lucius project2

Acquisition of New Exploration Projects
From April 1, 2012, through June 30, 2013,
INPEX acquired a total of nine new exploration projects.

October 2012: United Kingdom

INPEX was awarded new exploration blocks
in the 27th Seaward Licensing RoundMay 2013: Uruguay, South America

INPEX was successful in the 27th Seaward
Licensing Round in the United Kingdom, andwas awarded offshore exploration blocks jointlywith Centrica (U.K.) and Statoil (Norway). Exploration work will be conducted.

Acquisition of interest in offshore
exploration block
INPEX agreed to acquire a partial interest in
exploration Area 15 offshore Uruguay from
Tullow Oil (U.K.), an independent E&P company. Exploration activities including 3D seismic data acquisition work have been ongoing in the block since December 2012.

018

INPEX CORPORATION Annual Report 2013

April 2013: Mozambique, Africa

Participation in offshore exploration project
INPEX agreed to acquire a partial interest in the
exploration block Area 2 & 5 offshore Mozambiquefrom Statoil (Norway). Two exploratory wells areplanned during 2013.

3

Highlights

7

1

FINANCIAL /CORPORATE INFORMATION

Progress on Development Work for the Ichthys LNG Project in Australia
December 2012 Project ﬁnance arrangements signed

June 2013 Construction begins on FPSO facility

INPEX finalized arrangements for US$20 billion in projectﬁnance loans for the Ichthys LNG Project, including those witheight export credit agencies and 24 commercial banks fromJapan and abroad.

A ceremony was held for the ﬁrst steel cutting for the hull ofa Floating Production, Storage and Ofﬂoading (FPSO) facility
in Okpo, South Korea. With fabrication of the hull under way,
construction work on all of the Ichthys LNG Projectʼs major offshore facilities has been commenced.

January 2013 First steel cutting ceremony foroffshore CPF
The first steel cutting ceremony was held at Geoje in South
Korea for the construction of the offshore central processing
facility (CPF) for the Ichthys LNG Project.
February 2013 Completion of insurance arrangements forconstruction of facilities
INPEX completed insurance arrangements providing coveragefor project facilities related to the Ichthys LNG Project during
the construction period (through the end of 2016).

Ribbon-cutting and ﬁrst steel-cutting ceremony for the FPSO facility

See the Special Feature on pp. 48–55 for more details aboutprogress being made on the Ichthys LNG Project.

4

Progress on the Abadi LNG Project in Indonesia
November 2012 Start of FEED work for

January 2013 Start of FEED work for FLNG facilities

subsea production facilities
Front-End Engineering and Design (FEED) work for subsea
production facilities was commenced that will transport natural
gas and condensate from the Abadi gas ﬁeld to the Floating
LNG (FLNG) plant.

FEED work for Floating LNG (FLNG) facilities was commenced
that reﬁne, liquefy, store and ofﬂoad natural gas and condensate produced from the Abadi gas ﬁeld.

May 2012: Iraq

March 2013: Indonesia

INPEX was awarded onshore exploration Block 10

INPEX was awarded West Sebuku Block inSouth Makassar

INPEX was successful in the fourth Petroleum Licensing
Round in Iraq, and was awarded the onshore exploration
Block 10 jointly with LUKOIL (Russia). In November 2012, a
service agreement related to the block was signed. Exploration work will be conducted accordingly.

April 2013:
Timor Sea Joint Petroleum
Development Area

INPEX was successful with Mubadala Petroleum(United Arab Emirates) in the 2012 Petroleum
Licensing Round in Indonesia and was awarded
the West Sebuku Block in South Makassar. Exploration work will be conducted.

November 2012: India

June 2012: Australia

Acquisition of interest in exploration block in the Bay of
BengalAcquisition of interest in exploration
Block AC/P36

INPEX agreed to acquire a partial interest in the offshore exploration block KG-DWN-2004/6 from Oil and Natural Gas Corporation Limited, Indiaʼs national E&P company. Exploration work
has already begun in the block, and exploratory wells are currently being drilled.

INPEX acquired an interest in the exploration Block AC/P36 offshore Western
Australia. As an operator, INPEX willconduct exploration work, including
drilling of exploratory wells.

INPEX signed a contract
for the JPDA 11-106 Block
A new production sharing
contract was signed withthe relevant authorities
upon expiry of the exploratory phase under the contract for the JPDA 11-106
contract area in the exploration area around the Kitan
Oil Field in the Timor Sea
Joint Petroleum Development Area. INPEX will continue with exploration anddevelopment of the area.

June 2013: Australia

INPEX was awarded exploration Block WA-494-P offshore Western Australia
As an operator, INPEX was awarded a 100% interest in exploration Block WA-494-P offshore Western Australia. Large-scale gas-condensate ﬁelds have been discovered and areunder development, such as the Ichthys and Prelude gas ﬁelds adjacent to the block.

INPEX CORPORATION Annual Report 2013

019

5

Major Corporate Topics
October 2012 Establishment of

the INPEX Advisory Committee
The INPEX Advisory Committee was established as a part ofmeasures to enhance corporate governance. INPEX plans
to hold INPEX Advisory Committee meetings twice a year,
attended by four Japanese and international experts who willoffer their advice on various issues including domestic andinternational politics and economy, the energy situation, andcorporate social responsibility.

May 2013 Acquisition of A1 credit rating from Moodyʼs
INPEX obtained from the U.S. credit rating agency Moodyʼs a
new long-term issuer rating of A1 with a “stable” outlook.
May 2013 Announcement of stock split andreduction in investment unit
INPEX decided to conduct a 1:400 common stock split effective on October 1, 2013, and to adopt a share unit system with
100 shares deﬁned as a single investment unit. As a result of
these initiatives, the investment unit amount of the Companyʼs shares will be one quarter of what it was before the stock
split and adoption of the share unit system, making it easier forindividual investors to acquire shares of the Companyʼs stock.

Effective on October 1, 2013
1 1:400 common stock split
1

The INPEX Advisory Committee

400

2 Adoption of share unit system(trading unit becomes 100 shares)

400

100

100

100

100

April 2013 Construction completed on

INPEX Mega Solar Joetsu
INPEX completed construction on the INPEX Mega Solar Joetsu
solar power generation plant in Joetsu, Niigata. Installed on thesite of our subsidiary, the solar panels began generating powerin March 2013 with a maximum output of two megawatts.

* Trading is allowed in 100-share units (for example, if the price of one share today(400 shares after October 1) is ¥500,000, the price will become ¥125,000 for
a 100-share unit after October 1, 2013).

Electric power conservation and volunteer work

INPEX is working to reduce electricity consumption at its
business sites in Japan. During the summer of 2012, wewere able to cut electricity consumption by as much as
40% compared with the 2010 level. INPEX employees
have volunteered in areas affected by the Great East Japan
Earthquake, with a combined total of 524 employees
volunteering since the natural disaster. For the year ended
March 31, 2013, 214 employees volunteered.
Ceremony to commemorate the completion of
INPEX Mega Solar Joetsu

Reorganizations
In May 2012, INPEX established the New Ventures Division for
the enhancement of planning functions for basic policies andinvestment strategies related to the development of new overseas projects. In June 2013, INPEX established the Gas Supply & Infrastructure Division for the integrated managementof gas supply chain facilities in Japan, including the Naoetsu
LNG Terminal to be completed shortly. INPEX also reorganizedoverseas business divisions and units to promptly deal with theincreasing number of overseas upstream projects.

020

INPEX CORPORATION Annual Report 2013

Volunteer work