Consolidated Financial Results for the year ended March 31, 2018 [Japanese GAAP]May 10, 2018
Note: The following report is an English translation of the Japanese-language original.
Company name
Code number
Representative
Contact person: INPEX CORPORATION
Stock Exchange on which the Company is listed : Tokyo Stock Exchange: 1605
URL http://www.inpex.co.jp: Toshiaki Kitamura, President: Munehiro Hosono, General Manager, Corporate Communications Unit
TEL+81-3-5572-0233
Scheduled date of ordinary general meeting of shareholders : June 26, 2018
Scheduled date of filing Financial Report: June 27, 2018
Scheduled date of payment of cash dividends: June 27, 2018
Preparation of supplementary explanatory materials: Yes
Meeting of financial results presentation: Yes (for institutional investors and analysts)(Amounts less than one million yen are rounded off)
1. Consolidated Financial Results for the year ended March 31, 2018 (April 1, 2017 - March 31, 2018)(1) Consolidated operating results(Figures in % represent the changes from the previous fiscal year)

Net sales
For the year ended
March 31, 2018

Millions of yen

March 31, 2017

Operating income

Net income attributableto owners of parent

Ordinary income%

Millions of yen%

Millions of yen

933,701

6.8

357,3636.2

387,269

874,423(13.4)

336,452(13.8)

333,891%

Millions of yen

%

16.0

40,362(12.6)(10.9)

46,168175.2(Note): Consolidated comprehensive income: for the year ended March 31, 2018, ¥(42,266) million; ( %)for the year ended March 31, 2017, ¥43,905 million; ( %)Net income pershare—basic

Net income pershare—diluted

Net income
as a percentage of net
assets excluding noncontrolling interests

Ordinary income
as a percentage of
total assets

Operating income
as a percentage ofnet sales

Yen

Yen

%

%

%

For the year ended
March 31, 2018

27.64

1.4

9.0

38.3

March 31, 2017

31.61

1.6

7.7

38.5

(Reference): Equity in earnings (losses) of affiliates: for the year ended March 31, 2018, ¥ 4,192 million
for the year ended March 31, 2017, ¥ 2,175 million(2) Consolidated financial position
Total assets

Net assets

Net assets excluding
Net assets excluding
non-controlling interests
non-controlling interests
as a percentage of total
per share
assetsMillions of yen

Millions of yen%

Yen

As of March 31, 2018

4,255,565

3,158,868

68.5

1,997.24

As of March 31, 2017

4,312,174

3,207,542

68.3

2,015.38(Reference): Net assets excluding non-controlling interests: as of March 31, 2018, ¥ 2,916,680 million
as of March 31, 2017, ¥ 2,943,169 million(3) Consolidated cash flows
Cash flows fromoperating activities

Cash flows frominvesting activities

Cash flows fromfinancing activities

Cash and cash equivalents
at end of the year

For the year ended
March 31, 2018

Millions of yen

Millions of yen

Millions of yen

Millions of yen

278,539(351,908)

34,742

276,079

March 31, 2017

275,81053,483(65,428)

316,790

2. Dividends
Cash dividends per share
At 1st
At 2ndAt 3rdAt fiscal
quarter end quarter end quarter end year end
For the year ended
March 31, 2017
March 31, 2018
For the year ending
March 31, 2019
(forecast)(Note):

Yen

Yen

Yen

Total cash
dividends(Annual)

Total

Cash dividends as apercentage of net
assets(Consolidated)

Payout ratio(Consolidated)

Yen

Yen

Millions of yen

%

%

9.00
9.00

9.00
9.00

18.00
18.00

26,286
26,286

56.9
65.1

0.9
0.9

9.00

9.00

18.00

54.8

As of the beginning of the fiscal year, the Company expects an ¥18 dividend per common stock in total for the year ending March 31, 2019, andadditionally plans to issue a commemorative dividend of ¥6 per share following the Ichthys LNG Project s start-up and shipment of cargo. For
Class A stock dividends, please refer to the exhibit Dividends of Class A stock.

3. Forecasted Consolidated Operating Results for the year ending March 31, 2019 (April 1, 2018 - March 31, 2019)(Figures in % represent the changes from the corresponding period of the previous fiscal year)

Net sales

Operating income

Millions of yen

For the six months ending
September 30, 2018
For the year ending
March 31, 2019%

Millions of yen

384,000 (14.3)
860,000% Millions of yen

165,000 (11.2)(7.9)

377,000

5.5

Net income
attributable toowners of parent

Ordinary income%

Yen

12,000 (60.2)

8.22

18.9

32.87

% Millions of yen

165,000 (15.6)(4.2)

371,000

Net income
per share

48,000*Notes(1) Significant changes in scope of consolidation: Yes(Changes in the specified subsidiaries during the period due to change in scope of consolidation)

Newly included:INPEX Financial Services Singapore PTE. LTD., JODCO Lower Zakum Limited(Two companies)(2) Changes in accounting policies, accounting estimates and restatement of corrections
1. Changes in accounting policies resulting from the revision of the accounting standards and other regulations
2. Other changes in accounting policies
3. Changes in accounting estimates
4. Restatement of corrections(3) Number of shares issued (Common stock)
1. Number of shares issued at the end of the period(including treasury stock):
2. Number of treasury stock at the end of the period:
3. Average number of shares:: None: None: None: None1,462,323,600 shares as of March 31, 2018
1,462,323,600 shares as of March 31, 2017
1,966,500 shares as of March 31, 2018
1,966,500 shares as of March 31, 2017
1,460,357,100 shares for the year ended March 31, 2018
1,460,357,146 shares for the year ended March 31, 2017

(Reference) Non-Consolidated Financial Results
1. Financial results for the year ended March 31, 2018 (April 1, 2017 - March 31, 2018)(1) Operating results(Figures in % represent the changes from the previous fiscal year)

Operating income

Net sales
For the year ended
March 31, 2018
March 31, 2017

For the year ended
March 31, 2018
March 31, 2017

Ordinary income

Net income

Millions of yen%

Millions of yen%

Millions of yen%

Millions of yen%

233,574
258,160(9.5)(20.6)

46,39064,792(28.4)(24.1)

30,136
122,317(75.4)
118.0

1,764
88,920(98.0)
949.4

Net income pershare—basic
Yen
1.21
60.89

Net income pershare—dilutedYen(2) Financial position
Total assets
As of March 31, 2018
As of March 31, 2017

Net assets

Net assets as apercentage of total assets

Net assets per share

Millions of yen

Millions of yen%

Yen

2,918,963
3,137,704

2,383,265
2,404,076

81.6
76.6

1,631.97
1,646.22(Reference): Net assets: as of March 31, 2018, ¥ 2,383,265 million
as of March 31, 2017, ¥ 2,404,076 million*This financial report is not subject to audit by certified public accountants or audit firms.
*Explanation regarding the appropriate use of estimated consolidated financial results
The aforementioned forecasts "3. Forecasted Consolidated Operating Results for the year ending March 31, 2019" are based on thecurrently available information and contain many uncertainties. The final results might be significantly different from theaforementioned forecasts due to changes in business conditions including oil and natural gas price levels, production and sales plans,
project development schedules, government regulations and financial and tax schemes. Please refer to "1. (4) Outlook for the Next
Period" on page 4.

Exhibit:
Dividends of Class A stock
Cash dividends per share
At 1st quarter end At 2nd quarter end At 3rd quarter end At fiscal year end
Total
Yen
Yen
Yen
Yen
Yen
For the year ended
March 31, 2017
3,600.00
3,600.00
7,200.00
March 31, 2018
3,600.00
3,600.00
7,200.00
For the year ending
3,600.00
March 31, 2019
3,600.00
7,200.00(forecast)(Note): The Company conducted a stock split at a ratio of 1:400 of common stock effective October 1, 2013. However, for Class A
stock (unlisted), no stock split was implemented. The article, which shows that dividends of Class A stock are equivalent to dividends
of a common stock prior to the stock split, is specified in the Articles of Incorporation. As of the beginning of the fiscal year, theCompany expects a ¥7,200 dividend per Class A stock for the year ending March 31, 2019, and additionally plans to issue acommemorative dividend per Class A stock similarly to the common stock, following the Ichthys LNG Project s start-up andshipment of cargo.

Index of the Attachments
1. Summary of Operating Results and other2(1) Summary of Consolidated Operating Results

2(2) Summary of Consolidated Financial Position

3(3) Summary of Cash Flows

4(4) Outlook for the Next Period

4(5) Dividends for the year ended March 31, 2018 and for the year ending March 31, 20194

2. Basic Rationale for Selection of Accounting Standards

5

3. Consolidated Financial Statements and Principal Notes

6(1) Consolidated Balance Sheet

6(2) Consolidated Statement of Income and Consolidated Statement of Comprehensive Income

8

Consolidated Statement of Income

8

Consolidated Statement of Comprehensive Income

9(3) Consolidated Statement of Changes in Net Assets

10(4) Consolidated Statement of Cash Flows

12(5) Notes to Consolidated Financial Statements

14(Conditions or events that indicate there could be substantial doubt about
the Company's ability to continue as a going concern)

14(Basis of Presenting Consolidated Financial Statements)

14(Changes in the Presentation)

18(Consolidated Balance Sheet)

19(Consolidated Statement of Income)21(Consolidated Statement of Comprehensive Income)23(Consolidated Statement of Changes in Net Assets)

24(Consolidated Statement of Cash Flows)26(Segment Information and Others)

27(Financial Instruments)

31(Securities)

35(Derivative Transactions)

37(Per Share Information)

38(Significant Subsequent Events)

38(Omissions of Disclosure)38

4. Non-Consolidated Financial Statements

39(1) Non-Consolidated Balance Sheet

39(2) Non-Consolidated Statement of Income42(3) Non-Consolidated Statement of Changes in Net Assets

43(4) Notes to Non-Consolidated Financial Statements

47(Conditions or events that indicate there could be substantial doubt about47

the Company's ability to continue as a going concern)
5. Other48
48(1) Production, Orders Received and Sales Performance11. Summary of Operating Results and other(1) Summary of Consolidated Operating Results
In the fiscal year ended March 31, 2018, the global economy overall continued to gradually recover thanks to steady economies in
Europe and the United States and economic recovery in China and other Asian markets despite uncertainty caused by geopoliticalrisks. The Japanese economy continued on its trajectory of moderate recovery as consumption per capita and capital expenditures
showed signs of recovery as corporate earnings, employment rates and the income environment continued to improve.
Of the international crude oil price indices, which significantly influence the financial performance of the INPEX Group, Brent
crude, commonly considered a benchmark index, started the fiscal year at US$53.12 per barrel on April 1, 2017 and continued ona downward trend, eventually falling to US$44.82 per barrel in late June over concerns of crude oversupply following reports on
the recovery of crude oil production in Libya and Nigeria in addition to (observations of) high U.S. crude inventory figures andgrowing U.S. shale oil production.
Thereafter, in July the index rebounded with the easing of oversupply concerns as Nigeria voluntarily capped its production
capacity and Saudi Arabia announced cuts in its August export shipments at the Joint OPEC-Non-OPEC Ministerial Monitoring
Committee. The index continued to climb to a record high of US$70.53 in late January.
Although Brent crude then fell temporarily to US$62.59 over renewed concerns of excess supply following Iran's production
output increase and U.S. shale oil production hitting a record high in February, the index rose again in March driven bybullish factors such as Saudi Arabia and others conveying their intention to continue their collective production reduction into
2019 while achieving an all-time record in February in terms of the production cut compliance rate. Brent crude ultimately closed
out the fiscal year at US$70.27 per barrel on March 31, 2018.
Meanwhile, in Japan, crude oil and petroleum product prices shifted in correlation with international oil prices. The INPEXGroup's average crude oil sales price for the fiscal year ended March 31, 2018 reflected this shift and rose to US$56.30 per barrel,
up US$9.89 from the previous fiscal year.
The foreign exchange market, another important factor that affects the business of our Group, began to trade at ¥111 level against
the U.S. dollar. After that, Current Employment Statistics (CES) in early-April was lower than the market forecast andgeopolitical risk in Middle East and East Asia was getting higher, the yen appreciated to ¥108 level against the U.S. dollar.
However, because Emmanuel Macron won French Presidential election in May and the concern about political situation in Europe
pulled back, the yen depreciated to ¥114 level against the U.S. dollar.
In summer, the yen has remained in steadiness roughly lower ¥109 to lower ¥114 level against the U.S. dollar. After that,
European Central Bank (ECB) showed the possibility to change an easy-money policy and the Euro appreciated against the U.S.
dollar. At the beginning of September, because of Hurricane in the U.S. and geopolitical risk in Asia, the yen appreciated to ¥107
level against the U.S. dollar. At the end of 2017, the yen picked up to ¥112 level against the U.S. dollar through the balance-sheet
shrinking by Federal Reserve Board (FRB) in September and the rise in interest-rate in December.
However, in 2018, through Treasury Secretary Steven Mnuchin s statement that a weaker dollar is good for U.S. trade, increase involatility and the stock price crash by the result of CES in February and concern about trade protectionism, the yen appreciate tomid ¥104 level. TTM closed at ¥106.27 to the U.S. dollar which turned out to be ¥5.93 higher than that of the fiscal year end of
March 31, 2017.
Reflecting these situations, the average sales exchange rate for our Group for this fiscal year was ¥111.27 against the U.S. dollar,
which is ¥2.67 lower than that of the previous fiscal year.
Consolidated net sales for the year ended March 31, 2018 increased by ¥59.2 billion, or 6.8%, to ¥933.7 billion from the previous
fiscal year due to an increase in crude oil price.
Net sales of crude oil increased by ¥93.0 billion, or 15.1%, to ¥710.2 billion, and net sales of natural gas decreased by ¥34.4
billion, or 14.2%, to ¥208.1 billion.
Sales volume of crude oil decreased by 9,325 thousand barrels, or 7.6%, to 112,882 thousand barrels. Sales volume of natural gas
decreased by 78,178 million cf, or 22.8%, to 264,816 million cf. Sales volume of overseas natural gas decreased by 86,126 million
cf, or 31.7%, to 185,573 million cf, and sales volume of domestic natural gas increased by 213 million ㎥, or 11.1%, to 2,123
million ㎥ (79,243 million cf).
The average sales price of overseas crude oil increased by US$9.89, or 21.3%, to US$56.30 per barrel. Meanwhile, the averagesales price of overseas natural gas decreased by US$0.15, or 2.9%, to US$5.04 per thousand cf. In addition, the average sales priceof domestic natural gas increased by ¥3.00, or 6.9%, to ¥46.36 per ㎥. The average exchange rate of the Japanese yen against the
U.S. dollar on consolidated net sales depreciated by ¥2.67, or 2.5%, to ¥111.27 per U.S. dollar from the corresponding period of
the previous fiscal year.
The increase of ¥59.2 billion in net sales was mainly derived from the following factors: regarding net sales of crude oil andnatural gas, a decrease in sales volume pushing sales down of ¥88.7 billion, an increase in unit sales price contributing ¥127.9
billion to the increase, the depreciation of the Japanese yen against the U.S. dollar contributing ¥19.3 billion to the increase, and2

an increase in net sales excluding crude oil and natural gas of ¥0.6 billion.
Cost of sales for the year ended March 31, 2018 increased by ¥44.1 billion, or 9.7%, to ¥498.0 billion due to an increase in royalty
and others. Exploration expenses decreased by ¥5.4 billion, or 80.3%, to ¥1.3 billion. Selling, general and administrative expenses
decreased by ¥0.4 billion, or 0.5% , to ¥76.9 billion. As a result, operating income increased by ¥20.9 billion, or 6.2% , to¥357.3 billion.
Other income (expenses) improved by ¥32.4 billion, due mainly to posting gain on reversal of allowance for recoverable accounts
under production sharing, meanwhile, posting provision for allowance for recoverable accounts under production sharing for theprevious fiscal year. As a result, ordinary income increased by ¥53.3 billion, or 16.0%, to ¥387.2 billion.
Extraordinary loss was ¥79.9 billion as a result of posting impairment loss for certain projects due to a drop in future outlook ofnatural gas prices in Americas.
Total amount of current income taxes and deferred income taxes increased by ¥38.0 billion, or 14.0%, to ¥309.3 billion, and net
loss attributable to non-controlling interests was ¥42.4 billion. As a result of the above effects, net income attributable to ownersof parent for the year ended March 31, 2018 decreased by ¥5.8 billion, or 12.6%, to ¥40.3 billion.
Financial results by segment are as follows:
1) JapanNet sales increased by ¥17.3 billion, or 16.9%, to ¥120.0 billion due to increases in sales volume and sales prices of crude oiland natural gas. Operating income increased by ¥7.2 billion, or 40.0%, to ¥25.2 billion.
2) Asia & Oceania
Net sales decreased by ¥69.2 billion, or 31.8%, to ¥148.8 billion due to a decrease in sales volume, despite an increase in sales
prices of crude oil and natural gas, and the depreciation of the Japanese yen against the U.S. dollar. Operating income
decreased by ¥23.1 billion, or 44.9%, to ¥28.4 billion.
3) Eurasia (Europe & NIS)
Net sales increased by ¥28.4 billion, or 47.2%, to ¥88.5 billion due to increases in sales volume and sales price of crude oil,and the depreciation of the Japanese yen against the U.S. dollar. Operating income increased by ¥9.2 billion, or 76.6%, to¥21.3 billion.
4) Middle East & Africa
Net sales increased by ¥83.0 billion, or 17.2% , to ¥565.2 billion due to an increase in sales price of crude oil and thedepreciation of the Japanese yen against the U.S. dollar, despite a decrease in sales volume. Operating income increased by¥28.1 billion, or 10.2%, to ¥305.0 billion.
5) Americas
Net sales decreased by ¥0.3 billion, or 2.9%, to ¥10.9 billion due to a decrease in sales volume of crude oil, despite thedepreciation of the Japanese yen against the U.S. dollar. Operating loss increased by ¥1.2 billion, or 13.8%, to ¥10.6 billion.
(2) Summary of Consolidated Financial Position
Consolidated total assets as of March 31, 2018 decreased by ¥56.6 billion to ¥4,255.5 billion from ¥4,312.1 billion as of March
31, 2017. Current assets decreased by ¥473.3 billion to ¥469.5 billion due to a decrease in cash and deposits and others. Fixed
assets increased by ¥416.7 billion to ¥3,785.9 billion due to increases in tangible fixed assets, investments and other assets andothers.
Meanwhile, total liabilities decreased by ¥7.9 billion to ¥1,096.6 billion from ¥1,104.6 billion as of March 31, 2017. Current
liabilities increased by ¥11.7 billion to ¥309.1 billion and long-term liabilities decreased by ¥19.6 billion to ¥787.5 billion.
Net assets decreased by ¥48.6 billion, to ¥3,158.8 billion. Total shareholders' equity increased by ¥11.3 billion, to ¥2,568.2
billion. Total accumulated other comprehensive income decreased by ¥37.8 billion to ¥348.4 billion and non-controlling interests
in net assets decreased by ¥22.1 billion to ¥242.1 billion.

3(3) Summary of Cash Flows
As for cash flows for the year ended March 31, 2018, net cash provided by operating activities increased by ¥2.7 billion to ¥278.5
billion from the previous fiscal year due mainly to an increase in impairment loss (non-cash), despite a decrease in income before
income taxes and an increase in income taxes paid.
Net cash used in investing activities was ¥351.9 billion due to a decrease in proceeds from time deposits, and an increase inpayments for purchases of mining rights and others, meanwhile, net cash provided by investing activities was ¥53.4 billion for theprevious fiscal year.
Net cash provided by financing activities was ¥34.7 billion due to increases in proceeds from long-term debt and proceeds from
non-controlling interests for additional shares and others, meanwhile, net cash used in financing activities was ¥65.4 billion for theprevious fiscal year.
After totaling ¥2.0 billion of the effect of exchange rate changes on cash and cash equivalents, the decrease in cash and cash
equivalents for the year ended March 31, 2018 amounted to ¥40.7 billion. Cash and cash equivalents as of March 31, 2018 totaled¥276.0 billion reflecting the above net decrease of ¥40.7 billion, from ¥316.7 billion at the end of the previous fiscal year.
(4) Outlook for the Next Period
As for the company s financial outlook, consolidated net sales for the six months ending September 30, 2018 are expected todecrease 14.3% year-on-year to ¥384.0 billion, and net sales for the year ending March 31, 2019 are expected to decrease 7.9%
year-on-year to ¥860.0 billion.
Operating income for the six months ending September 30, 2018 is expected to decrease 11.2% year-on-year to ¥165.0 billion,
while operating income for the year ending March 31, 2019 is expected to increase 5.5% year-on-year to ¥377.0 billion.
Ordinary income for the six months ending September 30, 2018 is expected to decrease 15.6% year-on-year to ¥165.0 billion, andordinary income for the year ending March 31, 2019 is expected to decrease 4.2% year-on-year to ¥371.0 billion. Net income
attributable to INPEX CORPORATION for the six months ending September 30, 2018 is expected to decrease 60.2% year-onyear to ¥12.0 billion, while net income attributable to INPEX CORPORATION for the year ending March 31, 2019 is expected toincrease 18.9% year-on-year to ¥48.0 billion.
Net sales for the year ending March 31, 2019 are expected to fall due to an expected drop in crude oil sales volume. While
operating income for the year ending March 31, 2019 is expected to rise on the back of a lower cost of sales ratio, ordinary income
for the year ending March 31, 2019 is expected to drop due mainly to the absence of temporary profit as posted in the year ended
March 31, 2018. Net income attributable to INPEX CORPORATION for the year ending March 31, 2019 is expected to increaseyear-on-year, due in part to the absence of impairment loss.
The above estimates are based on a crude oil price assumption of US$65.0 per barrel (Brent) at an exchange rate of ¥105 to the
U.S. dollar through the fiscal year ending March 31, 2019.
(5) Dividends for the year ended March 31, 2018 and for the year ending March 31, 2019
The INPEX CORPORATION Group has set the year-end dividend at ¥9 per common stock for the year ended March 31, 2018.
Combined with the mid-term dividend of ¥9 per common stock, the total dividend for the year ended March 31, 2018 is ¥18 percommon stock. Also in accordance with its dividend policy, the Group has set the year-end dividend of ¥3,600 per Class A stock
for the year ended 31, 2018. Combined with the mid-term dividend of ¥3,600 per Class A stock (unlisted), the total dividend forthe year ended March 31, 2018 is ¥7,200 per Class A stock.
For the year ending March 31, 2019, the Group expects mid-term and year-end dividends each of ¥9, bringing the total dividend to¥18 per common stock and additionally plans to issue a commemorative dividend of ¥6 per common stock following the Ichthys
LNG Project s start-up and shipment of cargo. The Group expects mid-term and year-end dividends of ¥3,600 each, bringing thetotal dividend to ¥7,200 per Class A stock, and additionally plans to issue a commemorative dividend per Class A stock similarly
to the common stock, following the Ichthys LNG Project s start-up and shipment of cargo.
The Group conducted a stock split at a ratio of 1:400 of common stock effective October 1, 2013. However, for Class A stock, nostock split was implemented. The article, which shows that dividends of Class A stock are equivalent to dividends of a common
stock prior to the stock split, is specified in the Articles of Incorporation.

42. Basic Rationale for Selection of Accounting Standards

The INPEX Group has been analyzing the differences between International Financial Reporting Standards (IFRS)
and accounting principles generally accepted in Japan. The Group will take into consideration the domestic andinternational situations for appropriate adoption of the IFRS in the future.

5

3. Consolidated Financial Statements and Principal Notes(1) Consolidated Balance Sheet(Millions of yen)Accounts

As of March 31, 2017

As of March 31, 2018

(Assets)
Current assets
Cash and deposits

652,6144

Accounts receivable-trade72,364Marketable securities

5,503

Inventories

1,

4

276,1024

66,90030,7201,

432,321

Deferred tax assets

7,264

3,231

Accounts receivable-other
Recoverable accounts under production
sharingOther83,291

71,01447,263
4

Less allowance for doubtful accounts
Less allowance for recoverable accounts under
production sharing
Total current assets

68,403

4(20,763)

40,997(20,984)(3,701)
942,960

469,582

Buildings and structures, net

214,575

201,045

Wells, net

44,98038,323

Machinery, equipment and vehicles, net

120,71399,472

Land

19,18919,098

1,511,660

1,678,743

17,478

7,936

Fixed assets
Tangible fixed assets

Construction in progress
Other, net
Total tangible fixed assets

2,

4,

1,928,597

5

2,

4,

2,044,619

5

Intangible assets
Goodwill

60,79854,037

Exploration and development rights

154,556

153,168

Mining rights

298,370

328,086

7,528

6,210

521,253

541,502

Other
Total intangible assets
Investments and other assets
Investment securities

3,Long-term loans receivable
Recoverable accounts under production
sharing
Deferred tax assets
Other

4

246,0854

134,235

4

Less allowance for doubtful accounts
Less allowance for recoverable accounts under
production sharing

3,

4

367,4174

295,861

611,937

589,098

25,75020,26329,2484

11,359(8,282)(849)(116,842)(81,625)

Less allowance for investments in exploration(2,769)(1,664)

Total investments and other assets

919,362

1,199,860

3,369,213

3,785,982

4,312,174

4,255,565

Total fixed assets
Total assets

6

(Millions of yen)Accounts

As of March 31, 2017

As of March 31, 2018

(Liabilities)
Current liabilities
Accounts payable-trade51,10545,675

Short-term loans

44,252

71,250

Income taxes payable

45,21917,234

Accounts payable-other73,721

94,360

Provision for loss on business

2,920

9,887

Provision for exploration projects

4,478

4,005

Accrued bonuses to officers

62

62

Asset retirement obligations

4,301

407

Other

71,403

66,310Total current liabilities

297,465

309,194

Long-term debt

643,432

627,326

Deferred tax liabilities

45,61535,619331

380

Liability for retirement benefits

5,952

5,937

Asset retirement obligations

104,845

111,128

6,989

7,110

807,166

787,502

1,104,631

1,096,696

Common stock

290,809290,809

Capital surplus

676,273673,574Retained earnings

1,595,018

1,609,094

Treasury stock(5,248)(5,248)2,556,852

2,568,230

6,479

10,217717

25,724

Translation adjustments

379,119

312,507

Total accumulated other comprehensive income

386,316

348,449

264,372

242,188

Total net assets

3,207,542

3,158,868

Total liabilities and net assets

4,312,174

4,255,565

Long-term liabilities

Accrued special repair and maintenance

Other
Total long-term liabilities
Total liabilities(Net assets)
Shareholders' equity

Total shareholders' equity
Accumulated other comprehensive income
Unrealized holding gain (loss) on securities
Unrealized gain (loss) from hedging instruments

Non-controlling interests7(2) Consolidated Statement of Income and Consolidated Statement of Comprehensive Income
Consolidated Statement of Income(Millions of yen)
For the year ended
March 31, 2018

For the year ended
March 31, 2017

Accounts
Net sales

874,423

Cost of sales

453,8462

Gross profit
Exploration expenses
Selling, general and administrative expenses

1,

933,701

420,576435,662

6,734

1,327

77,3892

Operating income

498,0392

1,

2

76,971

336,452

357,363Interest income

10,4606,477

Dividend income

2,802

4,778

Gain on sales of investment securities

4,999

Equity in earnings of affiliates

2,175

Other income

4,192

Gain on reversal of allowance for recoverable accounts
under production sharing

17,528Compensation income

12,625

Other

18,652

9,664

Total other income

39,09055,266

Interest expense

5,228

7,075

Provision of allowance for doubtful accounts

8,308

Provision for allowance for recoverable accounts under
production sharing

14,374

Other expenses

Provision for loss on business

3,264

Foreign exchange loss

3,759

10,472

Other

9,980

4,547

Total other expenses

41,651

25,360333,891

387,269

Ordinary income
Extraordinary loss
Impairment loss

3

6,366

3

79,970Total extraordinary loss

6,366

79,970

Income before income taxes

327,525

307,299

Income taxes-current

304,620

308,351

Income taxes-deferred(33,227)

1,048

Total income taxes

271,393309,399

Net income (loss)

56,131(2,100)Net income (loss) attributable to non-controlling interests

9,963(42,462)

Net income attributable to owners of parent

46,16840,3628

Consolidated Statement of Comprehensive Income(Millions of yen)
For the year ended
March 31, 2018

For the year ended
March 31, 2017

Accounts

Net income (loss)

56,131(2,100)

1,522

3,711

(19,867)(68,317)

6,119

24,439Other comprehensive income
Unrealized holding gain on securities
Translation adjustments
Share of other comprehensive income of affiliates
accounted for by the equity method
Total other comprehensive income1

Comprehensive income(12,225)1(40,166)

43,905(42,266)

Owners of parent

36,564

2,495

Non-controlling interests

7,341(44,762)

Total comprehensive income attributable to9(3) Consolidated Statement of Changes in Net Assets
For the year ended March 31, 2017
(Millions of yen)
Shareholders' equity
Common stock Capital surplus
Balance at the beginning of the period

290,809676,273

Retainedearnings

Treasury stock

Total
Shareholders'equity(5,248)2,536,971

1,575,136

Changes during the period
Change in ownership interest of parent
arising from transactions with
non-controlling shareholders
Cash dividends paid

(26,286)(26,286)

Net income attributable to owners ofparent46,16846,168Purchase of treasury stock

(0)

(0)

19,881(0)

19,881

1,595,018(5,248)2,556,852

Net changes in items other than those inshareholders' equity
Total changes during the period
Balance at the end of the period

290,809676,273

Accumulated other comprehensive income
Total
NonUnrealized Unrealized
accumulated controllingholding gain gain (loss) Translation
otherinterests(loss) on from hedging adjustments
comprehensive
securities
instruments
incomeBalance at the beginning of the period

4,958(6,660)397,622395,921245,910Total
net assets

3,178,803

Changes during the period
Change in ownership interest of parent
arising from transactions with
non-controlling shareholders
Cash dividends paid

(26,286)

Net income attributable to owners ofparent46,168Purchase of treasury stock
Net changes in items other than those inshareholders' equity

(0)
1,521

7,377

(18,503)(9,604)

18,462

8,857

Total changes during the period

1,521

7,377

(18,503)(9,604)

18,462

28,739Balance at the end of the period

6,479

717

379,119

386,316

264,372

3,207,542

10

For the year ended March 31, 2018
(Millions of yen)
Shareholders' equity
Common stock Capital surplus
Balance at the beginning of the period

290,809676,273

Retainedearnings

Treasury stock

Total
Shareholders'equity(5,248)2,556,852

1,595,018

Changes during the period
Change in ownership interest of parent
arising from transactions with
non-controlling shareholders(2,699)(2,699)Cash dividends paid

(26,286)(26,286)

Net income attributable to owners ofparent40,36240,362(2,699)14,076

11,377

673,574

1,609,094

Purchase of treasury stock
Net changes in items other than those inshareholders' equity
Total changes during the period
Balance at the end of the period

290,809(5,248)2,568,230

Accumulated other comprehensive income
Total
NonUnrealized Unrealized
accumulated controllingholding gain gain (loss) Translation
otherinterests(loss) on from hedging adjustments
comprehensive
securities
instruments
incomeBalance at the beginning of the period

6,479

717

379,119

386,316

264,372

Total
net assets

3,207,542

Changes during the period
Change in ownership interest of parent
arising from transactions with
non-controlling shareholders(2,699)Cash dividends paid

(26,286)

Net income attributable to owners ofparent40,362

Purchase of treasury stock
Net changes in items other than those inshareholders' equity

3,737

25,007(66,612)(37,866)(22,184)(60,051)

Total changes during the period

3,737

25,007(66,612)(37,866)(22,184)(48,674)

Balance at the end of the period

10,21725,724

312,507348,449

242,188

3,158,86811

(4) Consolidated Statement of Cash Flows(Millions of yen)
For the year ended
March 31, 2017

Accounts

For the year ended
March 31, 2018

Cash flows from operating activities
Income before income taxes

327,525

307,299

Depreciation and amortization

91,15992,805

Impairment loss

6,366

79,970

Amortization of goodwill

6,760

6,760

Provision for allowance for recoverable accounts
under production sharing

15,934(21,190)

Provision for exploration projects

(240)

(458)

Other provisions

7,144

6,810

Liability for retirement benefits(1,483)19

Interest and dividend income(13,262)(11,255)

Interest expense

5,228

7,075

Foreign exchange loss (gain)

4,896

11,048Equity in losses (earnings) of affiliates(2,175)(4,192)

Loss (gain) on sales of investment securities(4,999)Recovery of recoverable accounts under
production sharing (capital expenditures)

79,87353,465

Recoverable accounts under production
sharing (operating expenditures)(2,823)

9,632

Accounts receivable-trade(16,350)

2,846

Inventories

5,592(2,097)

Accounts payable-trade

4,299

20,604

Accounts receivable-other

11,569(287)

Accounts payable-other

4,181

12,221

280

4,848

Other

23,311

12,467

Subtotal

552,790

588,395

Interest and dividends received

18,77324,459Interest paid

(2,911)(5,077)

Income taxes paid

(292,840)(329,238)

Net cash provided by (used in) operating activities

275,810

278,539

Advances received

12

(Millions of yen)
For the year ended
March 31, 2017

Accounts

For the year ended
March 31, 2018

Cash flows from investing activities
Payments for time deposits(355,238)(259,990)

Proceeds from time deposits

921,781593,900

Payments for purchases of tangible fixed assets(278,359)(271,324)

Proceeds from sales of tangible fixed assets

4,610

236

Payments for purchases of intangible assets(21,953)(1,364)

Payments for purchases of investment securities(80,224)(127,785)

Proceeds from sales and redemptions of investment securities

10,600Investment in recoverable accounts under
production sharing (capital expenditures)(37,325)(24,135)

Decrease (increase) in short-term loans receivable(1,322)50(133,478)(172,533)

275

273

Long-term loans madeCollection of long-term loans receivable
Payments for purchases of mining rights(100,906)

Other

24,118

11,671

Net cash provided by (used in) investing activities

53,483(351,908)

(96)

392

Proceeds from long-term debt

11,76077,612

Repayments of long-term debt

(62,903)(39,250)

Proceeds from non-controlling interests for additional shares

16,10927,570Cash dividends paid

(26,286)(26,291)

Cash dividends paid to non-controlling interests(3,939)(2,523)(72)(2,766)(65,428)

34,742(887)(2,083)

Net increase (decrease) in cash and cash equivalents

262,977(40,711)

Cash and cash equivalents at beginning of the period

53,813

316,790

Cash flows from financing activities
Increase (decrease) in short-term loans

Other
Net cash provided by (used in) financing activities
Effect of exchange rate changes on cash and cash equivalents

Cash and cash equivalents at end of the period

113316,7901

276,079

(5) Notes to Consolidated Financial Statements(Conditions or events that indicate there could be substantial doubt about the Company's ability to continue as a going concern)
None(Basis of Presenting Consolidated Financial Statements)
1. Scope of consolidation
Number of consolidated subsidiaries: 64
Names of major subsidiaries;
Japan Oil Development Co., Ltd., INPEX Alpha, Ltd., INPEX Sahul, Ltd., INPEX Southwest Caspian Sea, Ltd., INPEX Gas
British Columbia Ltd., JODCO Onshore Limited, JODCO Lower Zakum Limited, INPEX North Caspian Sea, Ltd.,INPEX Browse, Ltd., INPEX Holdings Australia Pty Ltd, INPEX Ichthys Pty Ltd, INPEX Oil & Gas Australia Pty Ltd,INPEX Masela, Ltd and INPEX Financial Services Singapore PTE. LTD.
During this period:
Number of companies newly included in the scope of consolidation: 3
Number of companies excluded from the scope of consolidation: 3
Details for the above changes:
1) JODCO Lower Zakum Limited has been newly included due to establishment of the company.
2) INPEX Financial Services Singapore PTE. LTD. and INPEX E&P Mexico, S.A. de C.V. have been newly included due toan increase in materiality of the companies.
3) INPEX West Congo Petroleum, Ltd. and INPEX UK Ltd. have been excluded due to completion of liquidation.
4) INPEX Natuna Ltd. has been excluded due to execution of share transfer.
Names of major non-consolidated subsidiaries:
Sakata Natural Gas, Co., Ltd., Teikoku Oil de Burgos, S.A. de C.V. and TELNITE CO., LTD.
(Reason for exclusion from the scope of consolidation)
Those companies are not consolidated because their total assets, total net sales, total net income (the equity portion) and total
retained earnings (the equity portion) do not have significant impact on the consolidated financial statements.
Name of an entity that is not accounted for as our subsidiary even though the Company owns the majority vote:
Ichthys LNG Pty Ltd(Reason for not accounted for as our subsidiary)
The Company owns the majority vote of Ichthys LNG Pty Ltd through INPEX Holdings Australia Pty Ltd. However, sinceboth parties' affirmative votes are required for important resolutions based on the shareholders agreement between INPEX
Holdings Australia Pty Ltd and TOTAL E&P Holding Ichthys, Ichthys LNG Pty Ltd is considered to be an affiliate accounted
for by the equity method.

14

2. Application of equity method
Number of non-consolidated subsidiaries accounted for by the equity method: None
Number of affiliates accounted for by the equity method: 20
Names of major affiliates:
Angola Block 14 B.V., MI Berau B.V., Angola Japan Oil Co., Ltd., INPEX Offshore North Campos, Ltd. and Ichthys LNG Pty
LtdNames of major non-consolidated subsidiaries and affiliates not accounted for by the equity method:
Sakata Natural Gas, Co., Ltd., Teikoku Oil de Burgos, S.A. de C.V., TELNITE CO., LTD. and Tangguh project management
Co., Ltd.
(Reason for not applying the equity method)
These subsidiaries and affiliates are not accounted for by the equity method because their total net income (the equity portion)and total retained earnings (the equity portion) do not have significant impact on the consolidated financial statements.
Procedures for application of the equity method:
Regarding affiliates accounted for by the equity method having a different closing date from the consolidated closing date, theCompany used the financial statements of each affiliate prepared as of its closing date. For certain affiliates, however, theCompany used financial statements prepared for consolidation purposes as of the consolidated closing date.
3. Closing dates for the fiscal year of consolidated subsidiaries
For the 48 companies for which the closing dates differ from the consolidated closing date, including, but not limited to,
INPEX Sahul, Ltd. and INPEX Masela, Ltd., the Company uses the financial statements for the year ended December 31.
However, the necessary adjustments have been made to the financial statements of those companies to reflect any significant
transactions made between the Company's closing date and those of the consolidated subsidiaries.
For the 11 companies including, but not limited to, Japan Oil Development, Co., Ltd., INPEX Southwest Caspian Sea, Ltd.,INPEX North Caspian Sea, Ltd., INPEX Holdings Australia Pty Ltd and INPEX Ichthys Pty Ltd, we use their financial
statements for the year ended on the consolidated closing date even though their closing date is December 31.

15

4. Accounting policies
1) Valuation method for significant assets(a) Securities
Other securities
With a determinable market value
Other securities with a determinable market value are stated at fair value with any changes in unrealized holding gain or
loss, net of the applicable income taxes, included directly in net assets. Cost of securities sold is determined by themoving-average method.
Without a determinable market value
Other securities without a determinable market value are stated at cost determined by the moving-average method.
(b) Derivatives
Fair value(c) Inventories
Overseas inventories
Carried mainly at cost, determined by the average cost method (balance sheet value is carried at the lower of cost or
market)Domestic inventories
Carried mainly at cost, determined by the moving-average method (balance sheet value is carried at the lower of cost or
market)2) Depreciation method of significant depreciable assets(a) Tangible fixed assets (except leased assets)
Depreciation of overseas mining facilities is mainly computed by the unit-of-production method. For other tangible fixed
assets, straight-line method of depreciation is applied.
Useful lives of significant fixed assets are as follows:
Buildings and structures: 2-60 years
Wells: 3 years
Machinery, equipment and vehicles: 2-22 years(b) Intangible assets (except leased assets)
Exploration and development rights
Exploration and development rights at the exploration stage are fully amortized in the consolidated fiscal year. Such rights
which are at the production stage are amortized by the unit-of-production method.
Mining rights
Mining rights are mainly amortized by the unit-of-production method.
Other
Other intangible assets are mainly amortized by the straight-line method.
Software for internal use is amortized by the straight-line method over 5 years.
(c) Leased assets
Leased assets for financing lease transactions whose ownership are not to be transferred:
Depreciation of these assets is calculated based on the straight-line method over the lease period assuming no residual
value.

16

3) Basis for significant allowances(a) Allowance for doubtful accounts
Allowance for doubtful accounts is provided at an amount determined based on the historical experience of bad debt withrespect to ordinary receivables, plus an estimate of uncollectible amounts determined by reference to specific doubtfulreceivables from customers experiencing financial difficulties.
(b) Allowance for recoverable accounts under production sharing
Allowance for recoverable accounts under production sharing is provided for probable losses on specific investments
made under production sharing contracts.
(c) Allowance for investments in exploration
Allowance for investments in exploration is provided for future potential losses on investments in exploration companies
at an estimated amount based on the net assets of the investees.
(d) Provision for exploration projects
Provision for exploration projects is provided for future expenditures of consolidated subsidiaries at the exploration stage
based on a schedule of investments in exploration.
(e) Accrued bonuses to officers
Accrued bonuses to officers are provided at the expected payment amount for the fiscal year.
(f) Provision for loss on business
Provision for loss on business is provided for future potential losses on crude oil and natural gas development, production
and sales business individually estimated for each project.
(g) Accrued special repair and maintenanceAccrued special repair and maintenance are provided for planned major repair and maintenance activities on tanks incertain subsidiaries at the amounts accumulated through the next activity.
4) Accounting for retirement benefits(a) Method of attributing expected retirement benefits to proper periods
When calculating retirement benefit obligations, the benefit formula method is used for attributing expected retirement
benefits to periods through March 31, 2018. Because certain subsidiaries are classified as small enterprises, a simplified
method (the amount which would be required to be paid if all active employees voluntarily terminated their employment
as of the balance sheet date) is applied for the calculation of the retirement benefit obligation for those subsidiaries.
(b) Method of recognizing for actuarial differences
Actuarial gains and losses are charged or credited to income as incurred.
5) Translation of consolidated subsidiaries' significant assets and liabilities denominated in foreign currencies into yen in
preparation of the consolidated financial statements
Monetary assets and liabilities denominated in foreign currencies are translated into yen at the exchange rates prevailing at
the balance sheet date. The resulting exchange gain or loss is credited or charged to income.
The revenue and expense accounts of the overseas subsidiaries are translated into yen at the average rates of exchange
during the period. The balance sheet accounts are translated into yen at the rates of exchange in effect at the balance sheet
date. Translation differences are presented as a component of translation adjustments and non-controlling interests.

176) Accounting for major hedge transactions(a) Hedge accounting
The special treatment is applied to the interest rate swaps that meet certain criteria. For certain equity-method affiliates, thedeferred hedge accounting method is adopted.
(b) Hedging instruments and hedged items
Hedging instruments: Interest rate swap transactions
Hedged items: Interest payments on borrowings(c) Hedging policy
Derivative transactions are limited to the scope of actual demand, and the Company does not engage in speculative
derivative transactions.
(d) Hedge effectiveness assessment method
The Company does not perform hedge effectiveness assessment of interest rate swap transactions since the special
treatment is applied.
7) Amortization of Goodwill
Goodwill is amortized by the straight-line method over 20 years.
8) Scope of cash and cash equivalents in consolidated statement of cash flows
Cash (cash and cash equivalents) in the consolidated statement of cash flows consisted of cash on hand, cash in banks
which can be withdrawn on demand, and short-term investments with a maturity of three months or less when purchased
which can easily be converted to cash and are subject to little risk of change in value.
9) Other items important to the preparation of the consolidated financial statements(a) Consumption tax
Transactions subject to the consumption tax are recorded at amounts exclusive of the consumption tax.
(b) Recoverable accounts under production sharing
Cash investments made by the Company during exploration, development and production phases under a production
sharing contract are recorded as "Recoverable accounts under production sharing" so long as they are recoverable under
the terms of the relevant contract. When the Company receives crude oil and natural gas in accordance with the contract,
an amount corresponding to the purchase costs of the products (i.e., a cost recovery portion of the investments) is released
from this account.

(Changes in the Presentation)(Consolidated Statement of Income)"Loss on disposal of fixed assets", previously presented separately in other expenses, is included in "Other" since it has becomeless significant.
As a result, ¥4,786 million which was recorded as "Loss on disposal of fixed assets" in other expenses on the consolidated
statement of income in the previous fiscal year is reclassified as "Other".

18

(Consolidated Balance Sheet)*1 Major accounts included in inventories
As of March 31, 2017
Millions of yen

Millions of yen

6,861

8,095

99

291

23,75923,934Merchandise and finished goods
Work in process
Raw materials and supplies

As of March 31, 2018

*2 Accumulated depreciation of tangible fixed assets
As of March 31, 2017
Accumulated depreciation of tangible fixed assets

As of March 31, 2018

¥ 762,321 million¥ 825,311 million*3 The Company has the following investments in subsidiaries and affiliates.
As of March 31, 2017

As of March 31, 2018

Millions of yen

Millions of yen

Investment securities (equities)

163,526

282,432(of which investment in jointly controlled entities)(62,417)(181,935)*4 Assets provided as collateral and collateral-backed debt are as follows:Collateralized Assets
As of March 31, 2017

As of March 31, 2018

Millions of yen

Millions of yen

222

3,763

8,533

7,910

149

141

Construction in progress

1,119,049

1,245,155

Investment securities

62,492

182,049

Long-term loans receivable

131,261

293,788

Other

10,147

4,101

Total

1,331,855

1,736,911

Cash and deposits
Inventories
Land

The above is mainly related to Ichthys LNG Project Finance, and the others which pledged as collateral for liabilities of affiliates
excluding the Ichthys LNG Project Finance.

*5 Accumulated advanced depreciation deducted from acquisition costs of fixed assets related to contribution and others
As of March 31, 2017

As of March 31, 2018

Millions of yen

Millions of yen

1,393

1,393

Machinery, equipment and vehicles

207

193

Land

84

84

Buildings and structures

19

6 Contingent liabilities(1) The Company and its consolidated subsidiaries are contingently liable as guarantors of indebtedness of the following
companies:
As of March 31, 2017

As of March 31, 2018
Millions of yen

Millions of yen

Ichthys LNG Pty Ltd*1

562,236

Ichthys LNG Pty Ltd*1

533,241

Tangguh Trustee*2

18,997

Tangguh Trustee*2

19,982

Sakhalin Oil and Gas Development Co.,
Ltd.

2,046

Sakhalin Oil and Gas Development Co.,
Ltd.

1,938

Japan Canada Oil Sands Limited

1,683

Japan Canada Oil Sands Limited

1,594

Oceanic Breeze LNG Transport S.A.

216

Oceanic Breeze LNG Transport S.A.

209

Employees (housing loans)

51

Employees (housing loans)

33

Total

585,233

556,998*1 Debt for investment funds of the Ichthys LNG project.
*2 Debt for investment funds of Tangguh LNG project through MI Berau B.V. and MI Berau Japan Ltd.
(The aforementioned Debt for the year ended March 31, 2018 includes the amount (¥9,154 million) for the construction of Train-3,
based on the Company's participating interest as the guarantor of indebtedness.)(2) Guarantee for derivatives
As of March 31, 2017
Ichthys LNG Pty Ltd¥ (212) million

As of March 31, 2018¥

million

The aforementioned derivative transactions are utilized to hedge exchange rate fluctuation risk regarding payments ofdevelopment costs for the Ichthys LNG project. The amount is valuation gain (loss) on the derivatives.
(3) Completion guarantee
In connection with the Ichthys LNG project financing, the Company and other project participants provide lenders with a guaranteeof liabilities during the construction phase based on each participating interest in addition to collateralizing its assets.
The portion guaranteed by the Company is as follows:
As of March 31, 2017
Completion guarantee (the Company's portion)¥ 903,862 million

20

As of March 31, 2018
¥ 857,530 million

(Consolidated Statement of Income)*1 Major accounts included in selling, general and administrative expenses are as follows:
For the year ended
March 31, 2017
Personnel expenses(Including provision for accrued retirement benefits to employees

For the year ended
March 31, 2018

Millions of yen

Millions of yen

21,73723,427671

1,160)

62

62)

Taxes

3,078

4,506

Freight expenses

9,862

11,117

Depreciation expenses

20,12418,606

Amortization of goodwill

6,760

6,760

(Including provision for accrued bonuses to officers*2 Research and development expenses included in general and administrative expenses and production cost:
For the year ended
For the year ended
March 31, 2017
March 31, 2018
¥ 1,983 million

21¥ 978 million

*3 Impairment loss
For the year ended March 31, 2017
The Company groups mining area and other assets as a basic unit that generates cash inflows independently of other groups ofassets. Due to impact from deteriorating business environments based on such factors as the drop in oil prices, the Company
reduced the respective carrying amounts of the assets listed below to recoverable amounts, posting the reductions as impairment
loss.

Use

Location

Classification
Buildings and structures
Wells

Assets related to the shale gas
project in Canada

Assets related to Yabase Oil
Field

Assets related toSouth Natuna Sea Block B
Other

British Columbia, Canada

Akita City, Akita, etc.

Republic of Indonesia

Impairment loss
(Millions of yen)
225
1,689

Machinery, equipment and vehicles

421

Mining rights

268

Other

27

Subtotal

2,630

Buildings and structures

650

Wells

11

Machinery, equipment and vehicles

906

Land

442

Other

17

Subtotal

2,027

Exploration and development rights

1,702
6
6,366

Total

The recoverable amount of the assets related to the shale gas project in the Horn River area is reasonably estimated bydiscounting the future cash flows at a rate of 8.3%. The recoverable amount of the assets related to South Natuna Sea Block B isestimated at zero. The recoverable assets of the land related to Yabase Oil Field is estimated by the net realized value of theassets (of which based on reasonably adjusted the valuation amount for real estate tax purposes), and the others are estimated atzero.
For the year ended March 31, 2018
The Company groups mining area and other assets as a basic unit that generates cash inflows independently of other groups ofassets. In light of the decline in forecasted natural gas prices in the Americas, the recoverble amount of these groups of assets
expected to decrease, the Company reduced the respective carrying amounts of the assets listed below to recoverable amounts,
posting the reductions as impairment loss.

Use

Location

Classification
Buildings and structures

Assets related to the shale gas
project in Canada

British Columbia, Canada

Impairment loss
(Millions of yen)
2,677

Wells

4,020

Machinery, equipment and vehicles

11,391Mining rights

48,428

Other

9,725

Subtotal

76,243

Other

3,726

Total

79,970

The recoverable amount of the assets related to the shale gas project in the Horn River, Cordova and Liard areas is reasonably
estimated by discounting the future cash flows at rates ranging from 9.9% to 16.2%.

22

(Consolidated Statement of Comprehensive Income)*1 Reclassification adjustments and income tax effects allocated to each component of other comprehensive income
For the year ended
For the year ended
March 31, 2017
March 31, 2018
Millions of yen

Millions of yen

Amount recognized during the period

8,327

4,951

Amount of reclassification adjustment

Unrealized holding gain (loss) on securities(5,029)(0)

Before income tax effect

3,297

4,951

Amount of income tax effect(1,775)(1,240)

Unrealized holding gain (loss) on securities

1,522

3,711

Amount recognized during the period(19,877)(68,261)

Amount of reclassification adjustment

9

(55)

(19,867)(68,317)(2,837)

23,906

Amount of reclassification adjustment

(553)

391

Adjustment for acquisition cost of assets
Share of other comprehensive income of affiliates accounted for by
the equity method
Total other comprehensive income

9,510

141

6,119

24,439(12,225)(40,166)

Translation adjustments

Translation adjustments
Share of other comprehensive income of affiliates accounted for by theequity method
Amount recognized during the period23

(Consolidated Statement of Changes in Net Assets)
For the year ended March 31, 2017
1. Type and number of shares issued and treasury stock(Shares)

Balance as ofApril 1, 2016

Increase

Decrease

Balance as ofMarch 31, 2017

Number of shares
Common stock

1,462,323,600

1,462,323,600

Class A stock1

1

1,462,323,601

1,462,323,601

Total
Treasury stock
Common stock

1,966,400

100

1,966,500

Total

1,966,400

100

1,966,500(Note):The increase of 100 shares in treasury stock of common stock was due to purchase of less-than-one -voting-unit shares.
2. Share subscription rights
None
3. Dividends(1) Cash dividends paid
Resolution
Ordinary general
meeting of shareholders
June 28, 2016
Board of directors'
meetingNovember 11, 2016

Type of share

Cash dividends paid
(Millions of yen)

Commonstock
Class Astock
Commonstock
Class Astock

Dividends
per share(Yen)

Record date

Effective date

13,143

9March 31, 2016

June 29, 2016

0

3,600

March 31, 2016

June 29, 2016

13,143

9 September 30, 2016

December 1, 2016

03,600 September 30, 2016

December 1, 2016

(2) Dividends, whose record date was in the year ended March 31, 2017, and whose effective date will be in the next fiscal year
Resolution

Type ofshare

Source ofdividends

Ordinary general
meeting of shareholders
June 27, 2017

Commonstock
Class Astock

Retainedearnings
Retainedearnings

Cash dividends
paid(Millions of yen)

24

Dividends
per share(Yen)

Record date

Effective date

13,143

9March 31, 2017

June 28, 2017

0

3,600

March 31, 2017

June 28, 2017

For the year ended March 31, 2018
(Shares)

1. Type and number of shares issued and treasury stock
Balance as ofApril 1, 2017

Balance as ofMarch 31, 2018

Decrease

Increase

Number of shares
Common stock

1,462,323,600

1,462,323,600

Class A stock1

1

1,462,323,601

1,462,323,601

Common stock

1,966,500

1,966,500

Total

1,966,500

1,966,500

Total
Treasury stock

2. Share subscription rights
None
3. Dividends(1) Cash dividends paid
Resolution
Ordinary general
meeting of shareholders
June 27, 2017
Board of directors'
meetingNovember 8, 2017

Type of share

Cash dividends paid
(Millions of yen)

Commonstock
Class Astock
Commonstock
Class Astock

Dividends
per share(Yen)

Record date

Effective date

13,143

9March 31, 2017

June 28, 2017

0

3,600

March 31, 2017

June 28, 201713,143

9 September 30, 2017

December 1, 2017

03,600 September 30, 2017

December 1, 2017

(2) Dividends, whose record date was in the year ended March 31, 2018, and whose effective date will be in the next fiscal year
Resolution

Type ofshare

Source ofdividends

Ordinary general
meeting of shareholders
June 26, 2018

Commonstock
Class Astock

Retainedearnings
Retainedearnings

Cash dividends
paid(Millions of yen)

25

Dividends
per share(Yen)

Record date

Effective date

13,143

9March 31, 2018

June 27, 2018

0

3,600

March 31, 2018

June 27, 2018

(Consolidated Statement of Cash Flows)*1 Cash and cash equivalents at the end of the period are reconciled to the account reported in the consolidated balance sheet as
follows:
For the year ended
March 31, 2017

For the year ended
March 31, 2018

Millions of yen

Millions of yen

Cash and deposits

652,614276,102

Time deposits for more than three months and others(335,823)(22)

Cash and cash equivalents

316,790276,079

26

(Segment Information and Others)(Segment information)
1. Overview of reportable segments
The reportable segments for the Group's oil and natural gas development activities are composed of individual mining area andothers for which separate financial information is available in order for the Board of Directors to make Group management
decisions.
Since the Group operates oil and natural gas businesses globally, the Group's reportable segments are the mining areas and others
by geographical region, categorized in "Japan", "Asia & Oceania" (mainly Indonesia, Australia and East Timor), "Eurasia (Europe& NIS)" (mainly Azerbaijan and Kazakhstan), "Middle East & Africa" (mainly UAE) and "Americas."
The Company produces oil and natural gas in each segment. In addition, the Company conducts marketing activities for
petroleum products and others in "Japan" segment.
2. Basis of measurement of sales and income (loss), assets, and other items by reportable segment
Accounting policies for the reportable segments are substantially the same as those described in "Basis of Presenting Consolidated
Financial Statements."
3. Information on sales and income (loss), assets, and other items by reportable segment
For the year ended March 31, 2017 (April 1, 2016 through March 31, 2017)(Millions of yen)
Reportable segments
Eurasia
Middle East
(Europe
Americas& Africa& NIS)

Adjustments Consolidated
*1
*2

Japan

Asia &
Oceania

102,659

218,099

60,191

482,182

11,290874,423

874,423

Total

102,659

218,099

60,191

482,182

11,290874,423

874,423

Segment income (loss)

18,03351,565

12,112276,870(9,360)349,221(12,769)

336,452

Segment assets

320,852

1,997,494

600,854446,791

137,119

3,503,111

809,062

4,312,174

Total

Net sales(1) Sales to third parties(2) Intercompany sales
and transfers between
segments

Other items
Depreciation and
16,991
21,622
10,32729,297
11,40589,645
1,513
91,159amortization
(192)
(192)
6,952
6,760
Amortization of goodwill
Investment to affiliates
accounted for by the
1,965
116,619
252
34,772
153,611280
153,892
equity method
Increase of tangible fixed
assets and intangible
15,082
197,957
19,87042,9673,329
279,207573
279,780
assetsNote: 1. (1) Adjustments of segment income of ¥(12,769) million include elimination of inter-segment transactions of ¥13 million
and corporate expenses of ¥(12,782) million. Corporate expenses are mainly amortization of goodwill and generaladministrative expenses that are not allocated to a reportable segment.
(2) Adjustments of segment assets of ¥809,062 million include elimination of inter-segment transactions of ¥(2) million andcorporate assets of ¥809,064 million. Corporate assets are mainly goodwill, cash and deposits, investment securities andassets concerned with the administrative divisions that are not allocated to a reportable segment.
(3) Adjustments of depreciation and amortization of ¥1,513 million consist mainly of depreciation of corporate assets.
(4) Adjustments of amortization of goodwill of ¥6,952 million consist of amortization of goodwill not attributable to areportable segment.
(5) Adjustments of investment to affiliates accounted for by the equity method of ¥280 million consist of investment toaffiliates accounted for by the equity method not attributable to a reportable segment.
(6) Adjustments of increase of tangible fixed assets and intangible assets of ¥573 million consist mainly of capital
expenditure to corporate assets.
2. Segment income is reconciled with operating income on the consolidated statement of income.

27

For the year ended March 31, 2018 (April 1, 2017 through March 31, 2018)(Millions of yen)
Reportable segments
Eurasia
Middle East
(Europe
Americas& Africa& NIS)

Adjustments Consolidated
*1
*2

Japan

Asia &
Oceania

120,059

148,836

88,597565,243

10,964

933,701

933,701

Total

120,059

148,836

88,597565,243

10,964

933,701

933,701

Segment income (loss)

25,25628,405

21,395305,055(10,656)

369,456(12,093)357,363

Segment assets

303,133

2,343,012

622,221511,194

57,186

3,836,747

418,818

4,255,565

Total

Net sales(1) Sales to third parties(2) Intercompany sales
and transfers between
segments

Other items
Depreciation and
17,941
14,0539,691
36,892
12,90091,4801,325
92,805amortization
Amortization of goodwill
(192)
(192)
6,952
6,760
Investment to affiliates
accounted for by the
1,980
237,959915
31,712
272,567298
272,866
equity method
Increase of tangible fixed
assets and intangible
2,975
228,823
7,040
149,217
1,785
389,841
1,065
390,906
assetsNote: 1. (1) Adjustments of segment income of ¥(12,093) million include elimination of inter-segment transactions of ¥17 million
and corporate expenses of ¥(12,110) million. Corporate expenses are mainly amortization of goodwill and generaladministrative expenses that are not allocated to a reportable segment.
(2) Adjustments of segment assets of ¥418,818 million include elimination of inter-segment transactions of ¥(2) million andcorporate assets of ¥418,820 million. Corporate assets are mainly goodwill, cash and deposits, investment securities andassets concerned with the administrative divisions that are not allocated to a reportable segment.
(3) Adjustments of depreciation and amortization of ¥1,325 million consist mainly of depreciation of corporate assets.
(4) Adjustments of amortization of goodwill of ¥6,952 million consist of amortization of goodwill not attributable to areportable segment.
(5) Adjustments of investment to affiliates accounted for by the equity method of ¥298 million consist of investment toaffiliates accounted for by the equity method not attributable to a reportable segment.
(6) Adjustments of increase of tangible fixed assets and intangible assets of ¥1,065 million consist mainly of capital
expenditure to corporate assets.
2. Segment income is reconciled with operating income on the consolidated statement of income.

28

(Relative information)
For the year ended March 31, 2017 (April 1, 2016 through March 31, 2017)
1. Products and service information(Millions of yen)
Natural gas(excluding LPG)

Crude oil
Sales to third parties

617,194

LPG

235,793

Total

Other
6,781

14,653

874,423

2. Geographical information(1) Sales(Millions of yen)Japan

Asia & Oceania
409,945

Total

Other

387,959

76,518874,423

Note: Sales by geographical area is determined based upon the final destination and customer.
(2) Tangible fixed assets(Millions of yen)Japan

Australia
282,442

Total

Other
1,390,187

255,968

1,928,597

3. Information by major customer
None
For the year ended March 31, 2018 (April 1, 2017 through March 31, 2018)
1. Products and service information(Millions of yen)
Natural gas(excluding LPG)

Crude oil
Sales to third parties

710,277

202,054

LPG

Other
6,047

Total

15,322

933,701

2. Geographical information(1) Sales(Millions of yen)Japan

Asia & Oceania
428,652

Total

Other

405,422

99,627

933,701

Note: Sales by geographical area is determined based upon the final destination and customer.
(2) Tangible fixed assets(Millions of yen)Japan

Australia
264,548

Other
1,537,732

Total
242,33829

2,044,619

3. Information by major customer(Millions of yen)
Customer

Sales

Relative reportable segment
107,654

SIETCO

Middle East & Africa(Information on impairment loss from fixed assets by reportable segment)
For the year ended March 31, 2017 (April 1, 2016 through March 31, 2017)(Millions of yen)
Reportable segments

Impairment lossJapan

Asia &
Oceania

2,033

1,702

Eurasia(Europe& NIS)

Middle East
Americas& Africa

Total

2,630

6,366

Eliminations
and other

Total

6,366

For the year ended March 31, 2018 (April 1, 2017 through March 31, 2018)(Millions of yen)
Reportable segments
Japan
Impairment loss

Asia &
Oceania

Eurasia(Europe& NIS)

3,630

Middle East
Americas& Africa

Total

96

79,97076,243Eliminations
and other

Total

79,970(Information on amortization of goodwill and unamortized balance by reportable segment)
For the year ended March 31, 2017 (April 1, 2016 through March 31, 2017)(Millions of yen)
Reportable segments
Japan

Asia &
Oceania

Eurasia(Europe& NIS)

Middle East Americas& Africa*1

Total

Eliminations
and other
*2

Total

Balance as of(1,778)(1,778)62,576
60,798March 31, 2017
Note: 1. This is the unamortized balance of negative goodwill acquired before April 1, 2010 and net amount of goodwill is stated on
the balance sheet.
2. This is the unamortized balance of goodwill not attributable to a reportable segment.
3. Please refer to "Segment information" regarding to the amounts of amortization of goodwill.
For the year ended March 31, 2018 (April 1, 2017 through March 31, 2018)(Millions of yen)
Reportable segments
Japan

Asia &
Oceania

Eurasia(Europe& NIS)

Middle East Americas& Africa*1

Total

Eliminations
and other
*2

Total

Balance as of(1,586)(1,586)55,62354,037
March 31, 2018
Note: 1. This is the unamortized balance of negative goodwill acquired before April 1, 2010 and net amount of goodwill is stated on
the balance sheet.
2. This is the unamortized balance of goodwill not attributable to a reportable segment.
3. Please refer to "Segment information" regarding to the amounts of amortization of goodwill.
(Information on negative goodwill by reportable segment)
None

30

(Financial Instruments)
1. Status of financial instruments(1) Policy regarding financial instruments
The Company raises funds for oil and gas development and production, construction or expansion of gas infrastructure
primarily from cash flow on hand and from bank loans. Oil and gas development projects are primarily funded from long-termloans that the Company has secured from the Japan Bank for International Cooperation, Japanese commercial banks andothers. Japan Oil, Gas and Metals National Corporation has provided guarantees for the principal on certain outstanding
amounts of the Company's long-term loans. The Development Bank of Japan and Japanese commercial banks and others haveprovided long-term loans for the construction or expansion of domestic gas infrastructure. The Company generally borrows
loans with variable interest rates, while some loans are with a fixed interest rate depending on the nature of each project.
Regarding the financing policy, the Company manages funds mainly from deposits and government bonds, which areconsidered to be of low-risk and high-liquidity. The Company limits the use of derivative transactions for managing risks offorecasted transactions and portfolio assets, and does not engage in speculative derivative transactions.
(2) Details of financial instruments, associated risk and risk management(Credit risk related to trade receivables)
Trade receivables such as accounts receivable-trade and accounts receivable-other are comprised mainly from sales of crude
oil and natural gas. Main trading partners are national oil companies, major oil companies and others. In line with criteria for
trading and credit exposure management, the Company properly analyzes the status of trading partners for early detection andreduction of default risks.
(Market price fluctuation risk related to securities)
For marketable securities and investment securities exposed to market price fluctuation risk, analysis of market values isregularly reported to the Executive Committee. For shares of stock, the Company mainly holds shares of trading partners andothers to establish close and smooth relationships for the purpose of maintaining a medium- to long-term stable business. A
part of these shares are held for the purpose of investment.
(Interest rate fluctuation risk related to short-term loans and long-term debt)
Loans are mainly used to fund oil and natural gas development projects and construction or expansion of domestic gas
infrastructure and others. The borrowing period is determined considering the financial prospects of the project and useful
lives of the facilities. Loans with variable interest rates are exposed to interest rate fluctuation risk, however, the Company
analyzes the impact of interest rate fluctuation at the time of borrowing and on an annual basis, and leverages fixed-rate-loans
or interest rate swaps as necessary.
(Exchange rates fluctuation risk related to assets and liabilities in foreign currencies)
As most of the Company's business is conducted overseas, the Company is exposed to exchange rate fluctuation risk due to alarge portion of monetary assets and liabilities held in foreign currencies such as cash and deposits, accounts receivables andloans required in overseas projects. For this reason, the Company endeavors to reduce exchange rate fluctuation risk by
maintaining the position between assets and liabilities in foreign currencies. In addition to planned expenditures in foreign
currencies, the Company manages exchange rate fluctuation risk through derivative transactions such as foreign exchange
forwards and others as necessary.
(Management of derivative transactions)
For the above derivative transactions, the Company follows its internal rules. For market values of these derivatives are
regularly reported to the Executive Committee, and the Company only transacts with financial institutions with high credit
ratings to reduce counterparty risks for the use of derivatives.
(Management of the liquidity risk related to financing)
The finance and accounting division controls cash management based on a monthly financing plan prepared by each project
division and secures sufficient liquidity on hand to prepare for liquidity risk.
(3) Supplementary explanation of items related to the market value of financial instruments
For nominal amounts and others regarding derivative transactions on "Derivatives Transactions", its amounts do not indicate
market risks related to derivative transactions.

31

2. Fair value of financial instruments
Carrying value on the consolidated balance sheets, fair value and the difference between them are as shown below. Items forwhich it is extremely difficult to determine market value are not included in the following table (Please refer to Note 2).
As of March 31, 2017

(Millions of yen)
Carrying value

Fair value

Difference(1) Cash and deposits

652,614652,696(2) Accounts receivable-trade72,36472,364(3) Marketable securities and Investment securities

58,80158,801

Total assets

783,780

783,861

81(1) Short-term loans

44,252

43,967(285)(2) Long-term debt

643,432

635,082(8,349)687,684

679,049(8,635)43

43

Total liabilities
Derivatives (*)81(*) Net claims and debts arising from derivative transactions are presented on a net basis. In case the total amount is a debt
amount, the above figure is negative.
As of March 31, 2018

(Millions of yen)
Carrying value

Fair value

Difference(1) Cash and deposits

276,102276,102(2) Accounts receivable-trade

66,90066,900(3) Investment securities

58,25358,253(4) Long-term loans receivable

295,861

295,861

Total assets

697,117

697,117(1) Short-term loans

71,25069,588(1,661)(2) Long-term debt

627,326

600,954(26,372)698,577

670,543(28,034)

50

50

Total liabilities
Derivatives (*)(*) Net claims and debts arising from derivative transactions are presented on a net basis. In case the total amount is a debt
amount, the above figure is negative.

32

Note 1: Methods of calculating the fair value of financial instruments
Assets(1) Cash and deposits
The fair value of current portion of long-term time deposits included in cash and deposits, is calculated by applying a
discount rate to the total of principal and interest. The discount rate is based on the assumed interest rate if a similar new
deposit is entered into. For the other cash and deposits, the relevant carrying value is used since the item is settled in a shortperiod of time and its market value is almost the same as the carrying value.
(2) Accounts receivable-trade
Since the item is settled in a short period of time and its fair value is almost the same as the carrying value, the relevant
carrying value is used.
(3) Marketable securities and investment securities
The fair value of shares is determined by the market prices of exchanges, and the fair value of bonds is determined by market
prices of exchanges or the prices presented by financial institutions. For further information on investment securities of eachholding purpose, please refer to "Securities" section of the notes to consolidated financial statements.
(4) Long-term loans receivable
The fair value of long-term loans receivable is calculated by applying a discount rate to the total of principal and interest. The
discount rate is based on the assumed interest rate if a similar new loan is entered into.
Liabilities(1) Short-term loans
The estimated fair value of current portion of long-term debt included in short-term loans, is calculated by the same method
as (2) Long-term debt. For the other short-term loans, the relevant carrying value is used since the item is settled in a shortperiod of time and its market value is almost the same as the carrying value.
(2) Long-term debt
The estimated fair value of long-term debt is calculated by applying a discount rate to the total of principal and interest. The
discount rate is based on the assumed interest rate if a similar new loan is entered into.
Derivatives
Please refer to "Derivative Transactions" section of the notes to consolidated financial statements.
Note 2: Carrying value of financial instruments for which it is extremely difficult to determine fair value(Millions of yen)
As of March 31, 2018

As of March 31, 2017
Unlisted securities
Stocks of subsidiaries and affiliates

29,260163,526

26,731
282,432

These financial instruments are not included in "Assets (3) Marketable securities and investment securities" as they have noquoted market prices and it is extremely difficult to determine their fair value. For shares of exploration companies, an allowance
for investments in exploration is provided at an estimated amount based on the financial position of the investees.

33

Note 3: Redemption schedules for monetary assets and securities with maturity dates subsequent to the fiscal closing dates are as
follows
As of March 31, 2017

(Millions of yen)
1 year or less

Cash and deposits
Accounts receivable-tradeMarketable securities
Other securities:
Public bonds
Corporate bonds
Other bonds
Other
Total

More than 1 year
but less than 5
years

More than 5
years but lessthan 10 years

More than 1 year
but less than 5
years

More than 5
years but lessthan 10 years

652,61472,3645,500

730,479

As of March 31, 2018

(Millions of yen)
1 year or less

Cash and deposits
Accounts receivable-tradeLong-term loans receivable

More than 10
years

More than 10
years

276,102
66,900343,002784
784

295,076
295,076

Note 4: Maturities for long-term loans payable, leased liabilities and other interest-bearing debt subsequent to the fiscal closing
dates are as follows
As of March 31, 2017

(Millions of yen)
1 year or less

Short-term loans
Long-term debt
Lease obligations
Total

4,947
39,30464
44,317More than 1 year
but less than 5
years
353,524
112
353,636More than 5
years but lessthan 10 years
199,1940
199,194

As of March 31, 2018

Total

90,71390,713(Millions of yen)

1 year or less
Short-term loans
Long-term debt
Lease obligations

More than 10
years

5,109
66,141
56
71,30634

More than 1 year
but less than 5
years
336,89778
336,976

More than 5
years but lessthan 10 years
167,740
0167,741More than 10
years
122,688
122,688

(Securities)
1. Other securities
As of March 31, 2017

(Millions of yen)Type of securities

Acquisition cost

Securities with carrying values exceeding theiracquisition costs(1) Stock(2) Bonds
Public bonds
Corporate bonds
Other(3) Other
Subtotal
Securities with acquisition costs exceeding theircarrying values(1) Stock

Carrying value

Unrealized gain
(loss)

33,90440,368

6,464

5,500

5,503

3

2,178

4,963

2,784

41,58350,835

9,252

8,717

7,965

(751)

8,717
50,3007,965
58,801

(751)
8,500

(2) Bonds
Public bonds
Corporate bonds
Other(3) Other
Subtotal
Total
As of March 31, 2018

(Millions of yen)Type of securities

Acquisition cost

Securities with carrying values exceeding theiracquisition costs(1) Stock(2) Bonds
Public bonds
Corporate bonds
Other(3) Other

26,711

Subtotal
Securities with acquisition costs exceeding theircarrying values(1) Stock(2) Bonds
Public bonds
Corporate bonds
Other(3) Other
Subtotal
Total

35

Carrying value

37,238

Unrealized gain
(loss)
10,527

2,178

5,641

3,462

28,88942,87913,98915,911

15,373(537)

15,91144,80015,37358,253(537)
13,452

2. Other securities sold for the fiscal years
For the year ended March 31, 2017
Type of securities(Millions of yen)
Proceeds from sales(1) Stock(2) Bonds
Public bonds
Corporate bonds
Other(3) Other
Total

Gain on sales

10,6004,999

10,6004,999

For the year ended March 31, 2018
Type of securities

Loss on sales(Millions of yen)
Proceeds from sales(1) Stock(2) Bonds
Public bonds
Corporate bonds
Other(3) Other

0

5,500

Total

5,500

36

Gain on sales

Loss on sales

(Derivative Transactions)
1. Derivatives not subject to hedge accounting(1) Derivatives related to foreign currency
As of March 31, 2017

(Millions of yen)Type of derivatives

Contract
amounts

Due after one
year

Valuation gain
(loss)

Fair value

Foreign exchange
forwards
39,981
Sell CAD
Buy USD(*) Fair value is the price obtained from the counterparty financial institutions.
Over-the-countertransactions

43

As of March 31, 2018

43

(Millions of yen)Type of derivatives

Contract
amounts

Due after one
year

Foreign exchange
forwards
42,494
Sell CAD
Buy USD(*) Fair value is the price obtained from the counterparty financial institutions.
Over-the-countertransactions

Valuation gain
(loss)

Fair value
5050

2. Derivatives subject to hedge accounting(1) Derivatives related to interest rate
As of March 31, 2017
Hedge accounting
method(Millions of yen)Type of derivatives

Principal items
hedgedContract
amounts

Due after one
year

Fair value

Interest rate swaps
payment fixed,
Long-term debt
4,760
4,760
(*)
receipt fluctuated(*) Fair value of derivatives for which special treatment of interest rate swaps is applied is included in the estimated fair valueof the long-term debt since the interest rate swap is treated together with long-term debt subject to hedging.
Special treatment ofinterest rate swaps

As of March 31, 2018
Hedge accounting
method(Millions of yen)Type of derivatives

Principal items
hedgedContract
amounts

Due after one
year

Fair value

Interest rate swaps
payment fixed,
Long-term debt
4,760
4,760
(*)
receipt fluctuated(*) Fair value of derivatives for which special treatment of interest rate swaps is applied is included in the estimated fair valueof the long-term debt since the interest rate swap is treated together with long-term debt subject to hedging.
Special treatment ofinterest rate swaps

37

(Per Share Information)
Net assets excluding non-controlling interests per share, net income per share and the calculation basis are as follows:
For the year ended
For the year ended
March 31, 2017
March 31, 2018
(1) Net assets excluding non-controlling interests per share¥ 2,015.38
For the year ended
March 31, 2017

(2) Net income per share¥ 1,997.24
For the year ended
March 31, 2018

¥ 31.61¥ 27.64

46,16840,362

0

0

(0)

(0)

46,16840,362

1,460,357,146

1,460,357,100(Calculation basis)
Net income attributable to owners of parent(Millions of yen)Amount not attributable to common shareholders(Millions of yen)(of which Net income attributable to owners of parent
related to Class A stock)
Net income attributable to owners of parent related tocommon shareholders (Millions of yen)
Average number of common stock (shares)(Note): Diluted net income per share is not presented because there are no dilutive potential of shares of common stock.

(Significant Subsequent Events)
None(Omissions of Disclosure)With respect to information for standards issued but not effective, leases, related party transactions, tax accounting, asset
retirement obligations and retirement benefits plan respective disclosure has been omitted because it does not have significant
impact on the consolidated financial statements.

38

4. Non-Consolidated Financial Statements(1) Non-Consolidated Balance Sheet(Millions of yen)Accounts

As of March 31, 2017

As of March 31, 2018

(Assets)
Current assets
Cash and deposits

617,554443

Accounts receivable-trade22,403

21,577

Marketable securities

5,503

Finished goods

2,233

2,409

58

203

Raw materials and supplies

9,701

9,825

Advance payments-trade72

49

Prepaid expenses
Short-term loans receivable from subsidiaries andaffiliates
Deposit paid in subsidiaries and affiliates

401

259

420,507

177,881Work in process and partly-finished construction

523,907

Deferred tax assets

5,758

Recoverable accounts under production sharing

47,263

Other

37,24922,341

Allowance for doubtful accounts(23,547)(62,686)

Allowance for investments in exploration
Allowance for recoverable accounts under
production sharing
Total current assets(11,158)(3,701)
1,130,302

696,212

Buildings, net

17,11916,231

Structures, net

176,747

169,047

Wells, net

1,218

642

Machinery and equipment, net

65,711

59,33916

10

Tools, furniture and fixtures, net

2,263

1,574

Land

16,984

16,890120

77Construction in progress

3,047

816

Total tangible fixed assets

283,229

264,62962,57655,623

2

2

Software

2,080

1,550

Other

3,982

3,973

Total intangible assets

68,642

61,150

Fixed assets
Tangible fixed assets

Vehicles, net

Leased assets, net

Intangible assets
Goodwill
Mining right39

(Millions of yen)Accounts

As of March 31, 2017

As of March 31, 2018

Investments and other assets
Investment securities

68,96473,9191,491,638

1,787,811

10

13

210,091

136,241

50

39

7,386

6,235

Allowance for doubtful accounts(17,490)(106)

Allowance for investments in exploration(105,122)(107,183)

Total investments and other assets

1,655,530

1,896,970

2,007,401

2,222,751

3,137,704

2,918,963

2,956

12,361

Investments in stock of subsidiaries and affiliates
Long-term loans receivable from employees
Long-term loans receivable from subsidiaries
and affiliates
Long-term prepaid expenses
Other

Total fixed assets
Total assets(Liabilities)
Current liabilities
Accounts payable-trade
Short-term loans payable

33,515Current portion of long-term debt

10,176

38,5605341

Accounts payable-other

13,86723,863

Accrued expenses

2,781

3,142

Income taxes payable

9,902

3,528

Lease obligations

Deferred tax liabilities

575

Advances received

44

18

Deposits payable

270

257

337,339

1,984

Accrued bonuses to officers

62

62

Provision for loss on business

2,920

9,887

Asset retirement obligations

163

128

Other

129

248

380,666

128,175

Deposits received from subsidiaries and affiliates

Total current liabilities

40

(Millions of yen)Accounts

As of March 31, 2017

As of March 31, 2018

Long-term liabilities
Long-term debt

333,708

361,402

86

44

Deferred tax liabilities

2,919

2,608

Accrued retirement benefits to employees
Provision for loss on business of subsidiaries
and affiliates
Provision for loss on guarantees of subsidiaries
and affiliates
Asset retirement obligations

5,506

5,449

7,568

8,188

Lease obligations

26,693
2,985

2,964

187

169

352,961

407,521733,627535,697

290,809290,809

Legal capital surplus

1,023,802

1,023,802

Total capital surplus

1,023,802

1,023,802

2,108

2,105

4,536

3,404

10,035

13,213

1,071,554

1,044,989

1,088,235

1,063,713(5,248)(5,248)2,397,599

2,373,077

Unrealized holding gain on securities

6,476

10,188

Total valuation, translation adjustments and others

6,476

10,1882,404,076

2,383,265

3,137,704

2,918,963

OtherTotal long-term liabilities
Total liabilities(Net assets)
Shareholders' equity
Common stock
Capital surplus

Retained earnings
Other retained earnings
Reserve for advanced depreciation of
non-current assets
Reserve for special depreciation
Mine prospecting reserve
Retained earnings brought forward
Total retained earnings
Treasury stock
Total shareholders' equity
Valuation, translation adjustments and others

Total net assets
Total liabilities and net assets

41

(2) Non-Consolidated Statement of Income(Millions of yen)
For the year ended
March 31, 2017

Accounts

For the year ended
March 31, 2018

Net sales

258,160

233,574

Cost of sales

148,521

144,627

Gross profit

109,639

88,947

Exploration expenses

3,879

519

Selling, general and administrative expenses

40,96742,036

Operating income

64,792

46,390Interest Income

20,472

14,567

Dividend income

87,27331,650

Guarantee commission received

17,574

17,764

Other

12,715

2,824

Total other income

138,036

66,807

Interest expenses

4,179

9,119

Loss on valuation of shares of subsidiaries and affiliates

42,24618,303

Provision of allowance for doubtful accounts

14,54636,757

Provision of allowance for investment loss
in exploration

4,479

3,546

Other income

Other expenses

Provision for loss on business

3,264

Provision for loss on business of subsidiaries andaffiliates
Provision for loss on guarantees of subsidiaries andaffiliates

2,423

351
2,086

Foreign exchange loss

7,137

6,958

Other

5,497

2,674

Total other expenses

80,511

83,062

122,31730,136

Impairment loss

2,033

3,630

Total extraordinary loss

2,033

3,630

Income before income taxes

120,283

26,506

Income taxes-current

38,55919,958

Income taxes-deferred(7,196)

4,783

Total income taxes

31,362

24,741

Net income

88,9201,764

Ordinary income
Extraordinary loss42

(3) Non-Consolidated Statement of Changes in Net Assets
For the year ended March 31, 2017
(Millions of yen)
Shareholders' equity
Capital Surplus
Commonstock

Balance at the beginningof the period

290,809

Retained earnings

Other retained earnings
Reserve forReserve
Legal capital Total capital
advanced
Reserve forfor
Mine
surplussurplusdepreciation
specialoverseas prospectingof non-current depreciation investment reserve
assetsloss
1,023,802

1,023,802

225

7,480

35,226

20,448Changes during the period
Provision of reserve foradvanced depreciationof non-current assets
Reversal of reserve foradvanced depreciationof non-current assets
Reversal of reserve for
special depreciation
Reversal of reserve foroverseas investment loss
Provision of mineprospecting reserve
Reversal of mineprospecting reserve

1,937
(54)
(2,943)(35,226)
5,322(15,734)

Cash dividends paid
Net income
Purchase of treasury stock
Other changes in items
other than those inshareholders' equity(net)Total changes during theperiodBalance at the end of the period

290,809

1,023,802

1,023,802

43

1,883

(2,943)

2,108

4,536

(35,226)(10,412)
10,035

Valuation, translation
adjustments and others

Shareholders' equity
Retained earnings
Otherretainedearnings
Total
retained
Retainedearnings
earnings
brought
forwardBalance at the beginningof the period

962,2211,025,601

Total
Unrealized valuation,
Total
Treasury
Shareholders' holding gain translationstock
on securities adjustments
equityand others(5,248)2,334,965

4,954

4,954

Total net assets

2,339,920

Changes during the period
Provision of reserve foradvanced depreciationof non-current assets
Reversal of reserve foradvanced depreciationof non-current assets
Reversal of reserve for
special depreciation
Reversal of reserve foroverseas investment loss
Provision of mineprospecting reserve
Reversal of mineprospecting reserve(1,937)54
2,943
35,226(5,322)
15,734

Cash dividends paid

(26,286)(26,286)(26,286)(26,286)

Net income

88,92088,92088,92088,920(0)(0)

Purchase of treasury
stock
Other changes in items
other than those inshareholders' equity(net)Total changes during theperiodBalance at the end of theperiod

(0)

1,522

1,522

1,522

109,333

62,634(0)62,634

1,522

1,522

64,156

1,071,554

1,088,235(5,248)2,397,599

6,476

6,476

2,404,076

44For the year ended March 31, 2018
(Millions of yen)
Shareholders' equity
Capital Surplus
Commonstock

Balance at the beginningof the period

290,809

Retained earnings

Other retained earnings
Reserve forReserve
Legal capital Total capital
advanced
Reserve forfor
Mine
surplussurplusdepreciation
specialoverseas prospectingof non-current depreciation investment reserve
assetsloss
1,023,802

1,023,802

2,108

4,536

10,035

Changes during the period
Provision of reserve foradvanced depreciationof non-current assets
Reversal of reserve foradvanced depreciationof non-current assets
Reversal of reserve for
special depreciation
Reversal of reserve foroverseas investment loss
Provision of mineprospecting reserve
Reversal of mineprospecting reserve(3)(1,132)

6,528(3,350)Cash dividends paid
Net income
Purchase of treasury stock
Other changes in items
other than those inshareholders' equity(net)Total changes during theperiodBalance at the end of the period

290,809

1,023,802

1,023,80245(3)(1,132)

3,177

2,105

3,404

13,213

Valuation, translation
adjustments and others

Shareholders' equity

Balance at the beginningof the period

Retained earnings
Otherretainedearnings
Total
retained
Retainedearnings
earnings
brought
forward

Total
Unrealized valuation,
Total
Treasury
Shareholders' holding gain translationstock
on securities adjustments
equityand others

1,071,554(5,248)1,088,235

2,397,599

6,476

6,476

Total net assets

2,404,076

Changes during the period
Provision of reserve foradvanced depreciationof non-current assets
Reversal of reserve foradvanced depreciationof non-current assets
Reversal of reserve for
special depreciation
Reversal of reserve foroverseas investment loss
Provision of mineprospecting reserve
Reversal of mineprospecting reserve
Cash dividends paid
Net income
Purchase of treasury
stock
Other changes in items
other than those inshareholders' equity(net)Total changes during theperiodBalance at the end of theperiod3
1,132(6,528)3,350(26,286)(26,286)(26,286)(26,286)

1,764

1,764

1,764

1,764

(26,564)(24,522)1,044,989

1,063,713(5,248)

46

3,711

3,711

3,711

(24,522)

3,711

3,711

(20,810)

2,373,077

10,188

10,1882,383,265

(4) Notes to Non-Consolidated Financial Statements(Conditions or events that indicate there could be substantial doubt about the Company's ability to continue as a going concern)
None

47

5. Other(1) Production, Orders Received and Sales Performance1) Actual production
The following table shows actual production by segment:
Segment

Category

For the year ended March 31, 2017

For the year ended March 31, 2018

1.3 MMbbls(3.5 Mbbls per day)48.2 Bcf(132.0 MMcf per day)10.3 MMboe(28.3 Mboe per day)

1.4 MMbbls(3.7 Mbbls per day)
53.1 Bcf(145.6 MMcf per day)11.3 MMboe(31.1 Mboe per day)

565.2 tons

554.5 tons

203.2 million kWh

198.1 million kWh13.1 MMbbls(36.0 Mbbls per day)244.1 Bcf
(668.7 MMcf per day)59.2 MMboe(162.3 Mboe per day)

7.8 MMbbls(21.4 Mbbls per day)
136.8 Bcf
(374.9 MMcf per day)
33.4 MMboe(91.4 Mboe per day)

6.3 million kWh

205.1 million kWh11.6 MMbbls(31.8 Mbbls per day)
1.9 Bcf(5.3 MMcf per day)11.9 MMboe(32.7Mboe per day)

15.1 MMbbls(41.5 Mbbls per day)
7.8 Bcf(21.4 MMcf per day)16.5 MMboe(45.3Mboe per day)

Crude oil
Natural gas
Japan

Subtotal
IodineElectric power generation
Crude oil
Natural gas

Asia & Oceania
Subtotal
Electric power generation
Crude oil
Eurasia(Europe & NIS)

Natural gas
Subtotal
SulfurMiddle East & Africa

23.4 Mtons

Crude oil
Crude oil

AmericasNatural gas
Subtotal
Crude oil
Natural gas

Total

Subtotal
IodineElectric power generation

98.5 MMbbls(269.8 Mbbls per day)
2.7 MMbbls(7.3 Mbbls per day)
42.6 Bcf(116.7 MMcf per day)10.3 MMboe(28.3 Mboe per day)
127.1 MMbbls(348.3 Mbbls per day)
336.8 Bcf
(922.7 MMcf per day)
190.3 MMboe(521.3 Mboe per day)

93.9 MMbbls(257.2 Mbbls per day)
2.0 MMbbls(5.4 Mbbls per day)
39.3 Bcf(107.8 MMcf per day)
9.1 MMboe(24.9 Mboe per day)
120.1 MMbbls(329.1 Mbbls per day)
237.1 Bcf
(649.7 MMcf per day)
164.2 MMboe(449.9 Mboe per day)

565.2 tons

554.5 tons

209.5 million kWh403.3 million kWh
23.4 Mtons

SulfurNote: 1. The volume of LPG produced overseas is included in 'Crude oil'.
2. A portion of crude oil and natural gas production volume is consumed as fuel to generate electricity.
3. The production by the Company's affiliates accounted for by the equity method is included in the figures above.
Also the production volume is a result for the years ended March 31 regardless of a closing date of fiscal periods of its subsidiaries or affiliates.
4. The production volume of crude oil and natural gas under the production sharing contracts entered into by INPEX Group corresponds to the net
economic take of the group.
Figures calculated by multiplying the gross production volume by the Company's interest share are 150.5 MMbbls (412.2 Mbbls per day) of crude oil,
422.9 Bcf (1,158.6 MMcf per day) of natural gas, and in total 229.9 MMboe (629.8 Mboe per day) for the year ended March 31, 2017, and 139.9
MMbbls (383.4 Mbbls per day) of crude oil, 286.7 Bcf (785.3 MMcf per day) of natural gas, and in total 193.2 MMboe (529.4 Mboe per day) for theyear ended March 31, 2018.
5. Boe means barrels of oil equivalent.
6. Iodine is refined by other company on consignment.
7. Figures are rounded to the first decimal place.

482) Orders received
Disclosure on this information is omitted because the amount of orders received is accounted for a minor portion of total sales.
3) Actual sales
The following table shows sales by segment:(Millions of yen)Segment

Category

For the year ended March 31, 2017 For the year ended March 31, 2018
Sales volume

5,148

940 Mbbls

6,299

Natural gas(excluding LPG)

71,295 MMcf

82,82979,243 MMcf

98,4315 Mbbls27

5 Mbbls

38

LPG
Other

14,653

15,290Subtotal

102,659

120,059

Crude oil

12,246 Mbbls

61,2606,554 Mbbls

42,771Natural gas(excluding LPG)

230,183 MMcf

150,084

137,371 MMcf

100,056

LPG

1,855 Mbbls

6,753

1,181 Mbbls

6,009

218,099

148,836

Crude oil

11,336 Mbbls

59,915

13,266 Mbbls

87,226Natural gas(excluding LPG)

1,947 MMcf

275

7,808 MMcf

1,339

Other

31

Subtotal
Middle East & Africa

Americas

Net sales

900 Mbbls

Subtotal

Eurasia(Europe & NIS)

Sales volume

Crude oilJapan

Asia & Oceania

Net sales

60,191

88,597

Crude oil

95,495 Mbbls

482,182

90,412 Mbbls

565,243

Crude oil

2,230 Mbbls

8,686

1,710 Mbbls

8,737

Natural gas(excluding LPG)

39,569 MMcf

2,603

40,394 MMcf

2,227

Subtotal

11,29010,964Crude oil

122,207 Mbbls

617,194

112,882 Mbbls

710,277

Natural gas(excluding LPG)

342,994 MMcf

235,793

264,816 MMcf

202,054

LPG

1,860 Mbbls

6,781

1,186 Mbbls

6,047

Total

Other

14,653

15,322

Total

874,423

933,701

Note: 1. The above amounts do not include the related consumption tax.
2. The Company's subsidiaries of which closing date for fiscal year is December 31 are principally consolidated their operating results for the year ended
December 31 except those subsidiaries prepared their financial statements for consolidation purpose as of the consolidation closing date. However, thesignificant effects of the difference in fiscal periods were properly adjusted in consolidation.
3. Sales volumes are rounded to the nearest whole number.
4. Sales for a major customer and sales as a percentage of total net sales are as follows.

For the year ended
March 31, 2018

Customer

SIETCO

49

Amount(Millions of yen)

Ratio
(%)

107,65411.5