Consolidated Financial Results for the year ended March 31, 2016 [Japanese GAAP]May 12, 2016
Note: The following report is an English translation of the Japanese-language original.
: INPEX CORPORATION
Stock Exchange on which the Company is listed : Tokyo Stock Exchange: 1605
URL http://www.inpex.co.jp: Toshiaki Kitamura, President: Kimihisa Kittaka, General Manager, Corporate Communications Unit
TEL+81-3-5572-0233
Scheduled date of ordinary general meeting of shareholders : June 28, 2016
Scheduled date of filing Financial Report: June 29, 2016
Scheduled date of payment of cash dividends: June 29, 2016
Preparation of supplementary explanatory materials: Yes
Meeting of financial results presentation: Yes (for institutional investors and analysts)
Company name
Code number
Representative
Contact person(Amounts less than one million yen are rounded off)
1. Consolidated Financial Results for the year ended March 31, 2016 (April 1, 2015 - March 31, 2016)(1) Consolidated operating results(Figures in % represent the changes from the previous fiscal year)

Net sales

Operating income

Net income attributableto owners of parent

Ordinary income

For the year ended
March 31, 2016

Millions of yen%

Millions of yen%

Millions of yen%

Millions of yen%

1,009,564(13.8)

390,139(27.1)

374,771(34.8)

16,777(78.4)March 31, 2015

1,171,226(12.2)

534,886(27.1)

575,155(23.3)

77,820(57.6)(Note): Consolidated comprehensive income: for the year ended March 31, 2016, ¥ (166,368) million; ( %)for the year ended March 31, 2015, ¥ 306,979 million; ((11.2)%)

Net income pershare—basic

Net income pershare—diluted

Yen

Yen

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

For the year ended
March 31, 2016

%

%

%

11.49

0.6

8.5

38.6

March 31, 2015

53.29

2.7

13.5

45.7

(Reference): Equity in earnings (losses) of affiliates:for the year ended March 31, 2016, ¥ (20,696) million
for the year ended March 31, 2015, ¥ (13,443) 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, 2016

4,369,841

3,178,803

67.1

2,008.34

As of March 31, 2015

4,499,153

3,288,703

68.2

2,099.95(Reference): Net assets excluding non-controlling interests: as of March 31, 2016, ¥ 2,932,892 million
as of March 31, 2015, ¥ 3,066,680 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, 2016

Millions of yen

Millions of yen

Millions of yen

Millions of yen

183,707(543,534)

156,726

53,813

March 31, 2015

216,749(81,086)(4,177)

260,9781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, 2015
March 31, 2016
For the year ending
March 31, 2017
(forecast)

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

33.8
156.7

0.9
0.9

9.00

9.00

18.00

154.6

(Note): Above information of "Dividends" is regarding common stock. For information regarding Class A stock (which is not listed), please refer to
Exhibit "Dividends of Class A stock ".

3. Forecasted Consolidated Operating Results for the year ending March 31, 2017 (April 1, 2016 - March 31, 2017)(Figures in % represent the changes from the corresponding period of the previous fiscal year)

Net sales
Millions of yen

For the six months ending
September 30, 2016
For the year ending
March 31, 2017

Operating income% Millions of yen

Net income
attributable toowners of parent

Ordinary income% Millions of yen% Millions of yen

Net income
per share%Yen

389,000 (31.4)

118,000 (52.2)

118,000 (54.4)

8,000 (82.4)

5.48

808,000 (20.0)

238,000 (39.0)

237,000 (36.8)

17,00011.64

1.3*Notes(1) Significant changes in scope of consolidation: None(Changes in the specified subsidiaries during the period due to change in scope of consolidation)(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:: Yes: None: None: None1,462,323,600 shares as of March 31, 2016
1,462,323,600 shares as of March 31, 2015
1,966,400 shares as of March 31, 2016
1,966,400 shares as of March 31, 2015
1,460,357,200 shares for the year ended March 31, 2016
1,460,357,200 shares for the year ended March 31, 2015

(Reference) Non-Consolidated Financial Results
1. Financial results for the year ended March 31, 2016 (April 1, 2015 - March 31, 2016)(1) Operating results(Figures in % represent the changes from the previous fiscal year)

Operating income

Net sales
For the year ended
March 31, 2016
March 31, 2015

For the year ended
March 31, 2016
March 31, 2015

Ordinary income

Net income

Millions of yen%

Millions of yen%

Millions of yen%

Millions of yen%

324,969
417,670(22.2)(8.5)

85,394
139,754(38.9)(33.4)

56,102
246,881(77.3)(19.0)

8,473
149,110(94.3)(23.3)Net income pershare—basic
Yen
5.80
102.11

Net income pershare—dilutedYen2

(2) Financial position
Total assets
As of March 31, 2016
As of March 31, 2015

Net assets

Net assets as apercentage of total assets

Net assets per share

Millions of yen

Millions of yen%

Yen

3,328,919
3,516,098

2,339,920
2,398,664

70.3
68.2

1,602.29
1,642.52(Reference): Net assets: as of March 31, 2016, ¥ 2,339,920 million
as of March 31, 2015, ¥ 2,398,664 million*Indication of audit procedure implementation status
This earnings report is exempt from audit procedure under the Financial Instruments and Exchange Act. The audit procedure forfinancial statements under the Financial Instruments and Exchange Act has not been completed at the time of disclosure of this report.
*Explanation regarding the appropriate use of estimated consolidated financial results
The aforementioned forecasts "3. Forecasted Consolidated Operating Results for the year ending March 31, 2017" 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. (1) Analysis on
Consolidated Operating Results" on page 7.

3

Exhibit:
Dividends of Class A stock
Cash dividends per share
At 1st quarter end At 2nd quarter end At 3rd quarter end
For the year ended
March 31, 2015
March 31, 2016
For the year ending
March 31, 2017
(forecast)

Yen

Yen

At fiscal year end

Total

Yen

Yen

3,600.00
3,600.00

3,600.00
3,600.00

7,200.00
7,200.00

3,600.00

3,600.00

7,200.00

4

YenIndex of the Attachments
1. Results of Operations and Financial Position

6(1) Analysis on Consolidated Operating Results

6(2) Analysis on Consolidated Financial Position

8(3) Dividend policy and Dividends for the year ended March 31, 2016 and for the year ending March 31, 20178

2. Overview of the INPEX CORPORATION Group9

3. Management Policy

10(1) Basic Management Strategy

10(2) Medium- to Long-Term Management Strategy, Management Indices and Challenges

10

4. Basic Rationale for Selection of Accounting Standards

13

5. Consolidated Financial Statements

14(1) Consolidated Balance Sheet

14(2) Consolidated Statement of Income and Consolidated Statement of Comprehensive Income

16

Consolidated Statement of Income

16

Consolidated Statement of Comprehensive Income17(3) Consolidated Statement of Changes in Net Assets

18(4) Consolidated Statement of Cash Flows

20(5) Notes to Consolidated Financial Statements

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

22(Basis of Presenting Consolidated Financial Statements)

22(Changes in Accounting Policies)

26(Changes in the Presentation)

26(Consolidated Balance Sheet)

27(Consolidated Statement of Income)30(Consolidated Statement of Comprehensive Income)32(Consolidated Statement of Changes in Net Assets)

33(Consolidated Statement of Cash Flows)

35(Segment Information and Others)

36(Financial Instruments)

40(Securities)

44(Derivative Transactions)46(Per Share Information)

47(Significant Subsequent Events)

47(Omissions of Disclosure)47

6. Non-Consolidated Financial Statements

48(1) Non-Consolidated Balance Sheet

48(2) Non-Consolidated Statement of Income

51(3) Non-Consolidated Statement of Changes in Net Assets

52(4) Notes to Non-Consolidated Financial Statements

56(Conditions or events that indicate there could be substantial doubt about
56

the Company's ability to continue as a going concern)
7. Other

57
57(1) Production, Orders Received and Sales Performance51. Results of Operations and Financial Position(1) Analysis on Consolidated Operating Results
In the fiscal year ended March 31, 2016, the Japanese economy continued on a path of gradual recovery driven by improvements
in corporate earnings and the employment rate, although there were weaknesses in certain segments of the economy including
exports and consumer spending.
Of the international crude oil prices, which significantly influence the financial performance of the INPEX Group, Brent crude,considered a common benchmark index, started at US$57.10 per barrel on April 1, 2015, and reached a high of US$67.77 perbarrel in early May due to factors including decreased shale oil production forecasts in the U.S., and an upward revision in crude
oil demand forecasts by the International Energy Agency (IEA). The index then took on a downward trajectory, dropping to
US$42.69 per barrel in early August due to sluggish crude demand in China amid concerns of an economic slowdown there.
Thereafter, the index rose to US$53.05 per barrel due to heightened geopolitical risk brought on by Russia s military intervention
in Syria. The index then began dropping again in early December as OPEC deferred a decision on reducing production, anddropped to US$27.88 per barrel in mid-January marking its lowest point in twelve years as a result of sluggish crude demand
worldwide and concerns of crude oil oversupply associated with the lifting of sanctions against Iran and observations of an
expansion in crude oil exports there.
However, the index then bounced back and finished at US$39.60 per barrel on March 31, 2016, owing to growing expectations ofcrude oil output adjustments by OPEC and non-OPEC countries triggered by the consensus among four oil producing countries
including Saudi Arabia and Russia to freeze crude oil output.
Meanwhile, in Japan, the prices of crude oil and petroleum products shifted in correlation with international oil prices. The INPEXGroup s average crude oil sales price for the fiscal year ended March 31, 2016 reflected this shift and fell to US$47.95 per barrel,
down US$36.05 from the previous fiscal year.
The foreign exchange market, another important factor that affects the business of our Group, began to trade at the ¥120 level to
the U.S. dollar. Beginning of the period, the yen has remained in steadiness roughly ¥118 to ¥120 level to the U.S. dollar. In lateMay, the director of European Central Bank remarked that he would accelerate the quantitative monetary easing before the off
period in summer. In addition to that, the suggestion by Chairman of Federal Reserve Board Yellen, which showed a possibility tomove the rise in interest-rate forward, also brought the dollar buying to the higher ¥125 level for a while.
However, the depreciation in the Chinese stock market in August, and the decline in the rate of Chinese Yuan increased theconcern over the Chinese economy. Furthermore, the movement of the risk aversion in the market brought the yen buying
dominant and the yen appreciated to the lower ¥116 for a while. Afterward, on the situation where the interest-rate appreciation of
25 basis point by FRB in December and the additional monetary easing (partly introduction of the negative interest rate) by Bankof Japan were determined, the dollar appreciated to the lower ¥120. However, the concern over the world economy and thedecline of the expectation of the additional rise in interest-rate depreciated the dollar across the board. TTM closed at ¥112.69 to
the U.S. dollar which turned out to be ¥7.58 higher than that of the fiscal year end of March 31, 2015.
Reflecting these situations, the average sales exchange rate for our Group for this fiscal year was ¥120.55 to the U.S. dollar, whichis ¥12.62 lower than that of the previous fiscal year.
Consolidated net sales for the year ended March 31, 2016 decreased by ¥161.6 billion, or 13.8%, to ¥1,009.5 billion from theprevious fiscal year due to a decrease in sales price of crude oil and natural gas.
Net sales of crude oil decreased by ¥51.1 billion, or 7.0%, to ¥679.2 billion, and net sales of natural gas decreased by ¥105.0
billion, or 24.9%, to ¥316.7 billion.
Sales volume of crude oil increased by 36,669 thousand barrels, or 45.5%, to 117,227 thousand barrels. Sales volume of natural
gas increased by 27,731 million cf, or 9.0%, to 337,216 million cf. Sales volume of overseas natural gas increased by 29,105
million cf, or 12.0%, to 271,912 million cf, and sales volume of domestic natural gas decreased by 37 million ㎥, or 2.1%, to1,750 million ㎥ (65,304 million cf).
The average sales price of overseas crude oil decreased by US$36.05, or 42.9%, to US$47.95 per barrel. Meanwhile, the averagesales price of overseas natural gas decreased by US$4.78, or 42.1%, to US$6.58 per thousand cf. In addition, the average sales
price of domestic natural gas decreased by ¥5.27, or 9.2%, to ¥52.29 per ㎥.
The decrease of ¥161.6 billion in net sales was mainly derived from the following factors: regarding net sales of crude oil andnatural gas, an increase in sales volume contributing ¥362.1 billion to the increase, a decrease in unit sales price pushing sales
down of ¥612.8 billion, the depreciation of the Japanese yen against the U.S. dollar contributing ¥94.4 billion to the increase, anda decrease in net sales excluding crude oil and natural gas of ¥5.3 billion.
Cost of sales for the year ended March 31, 2016 increased by ¥1.3 billion, or 0.3% , to ¥526.7 billion due mainly to thedepreciation of the Japanese yen against the U.S. dollar. Exploration expenses decreased by ¥17.0 billion, or 73.5% , to¥6.1 billion due mainly to a decrease in exploration activities in the Americas region. Selling, general and administrative expenses
decreased by ¥1.1 billion, or 1.3%, to ¥86.5 billion. As a result, operating income decreased by ¥144.7 billion, or 27.1%, to6¥390.1 billion.
Other income decreased by ¥31.8 billion, or 31.3%, to ¥69.9 billion due to a decrease in foreign exchange gain and others, despite
increases in gain on sales of marketable securities and dividend income. Other expenses increased by ¥23.8 billion, or 38.7%, to¥85.3 billion due to increases in equity in losses of affiliates and loss on disposal of fixed assets. As a result, ordinary income
decreased by ¥200.3 billion, or 34.8%, to ¥374.7 billion.
Extraordinary loss was ¥45.8 billion as a result of posting impairment loss for certain projects due to a drop in oil prices andothers.
Total amount of current income taxes and deferred income taxes decreased by ¥110.0 billion, or 23.7%, to ¥354.3 billion, and net
loss attributable to non-controlling interests was ¥42.2 billion. As a result of the above effects, net income attributable to ownersof parent for the year ended March 31, 2016 decreased by ¥61.0 billion, or 78.4%, to ¥16.7 billion.
Financial results by segment are as follows:
1) JapanNet sales decreased by ¥19.9 billion, or 15.4%, to ¥109.6 billion due to decreases in sales volume and sales prices of crude oiland natural gas. Operating income decreased by ¥4.5 billion, or 27.5%, to ¥12.0 billion.
2) Asia & Oceania
Net sales decreased by ¥106.9 billion, or 26.1%, to ¥302.8 billion due to a decrease in sales prices of crude oil and natural gas,
despite an increase in sales volume of crude oil and natural gas and the depreciation of the Japanese yen against the U.S.
dollar. Operating income decreased by ¥81.0 billion, or 45.5%, to ¥97.2 billion.
3) Eurasia (Europe & NIS)
Net sales decreased by ¥27.1 billion, or 28.9%, to ¥66.8 billion due to a decrease in sales price of crude oil, despite an increasein sales volume of crude oil and the depreciation of the Japanese yen against the U.S. dollar. Operating income decreased by¥18.3 billion, or 57.1%, to ¥13.8 billion.
4) Middle East & Africa
Net sales decreased by ¥8.0 billion, or 1.5%, to ¥516.5 billion due to a decrease in sales price of crude oil, despite an increasein sales volume of crude oil and the depreciation of the Japanese yen against the U.S. dollar. Operating income decreased by¥42.3 billion, or 12.7%, to ¥290.8 billion.
5) Americas
Net sales increased by ¥0.3 billion, or 2.8% , to ¥13.7 billion due to an increase in sales volume of crude oil and thedepreciation of the Japanese yen against the U.S. dollar, despite a decrease in sales prices of crude oil and natural gas.
Meanwhile, operating loss decreased by ¥1.3 billion, or 8.5%, to ¥14.0 billion due to a decrease in exploration expenses andothers.
As for the outlook, consolidated net sales for the six months ending September 30, 2016 are expected to be ¥389.0 billion, todecrease by 31.4% compared with the six months ended September 30, 2015, and net sales for the year ending March 31, 2017 are
expected to be ¥808.0 billion, to decrease by 20.0% compared with the year ended March 31, 2016.
Operating income for the six months ending September 30, 2016 is expected to be ¥118.0 billion, to decrease by 52.2% comparedwith the six months ended September 30, 2015, and operating income for the year ending March 31, 2017 is expected to be ¥238.0
billion, to decrease by 39.0% compared with the year ended March 31, 2016.
Ordinary income for the six months ending September 30, 2016 is expected to be ¥118.0 billion, to decrease by 54.4% comparedwith the six months ended September 30, 2015, and ordinary income for the year ending March 31, 2017 is expected to be ¥237.0
billion, to decrease by 36.8% compared with the year ended March 31, 2016. Net income attributable to owners of parent for thesix months ending September 30, 2016 is expected to be ¥8.0 billion, to decrease by 82.4% compared with the six months ended
September 30, 2015, and net income attributable to owners of parent for the year ending March 31, 2017 is expected to be ¥17.0
billion, to increase by 1.3% compared with the year ended March 31, 2016.
Net sales for the year ending March 31, 2017 are expected to decrease due to the forecasted decline in the crude oil price andappreciation of Japanese yen against the U.S. dollar compared with the previous fiscal year, and operating income and ordinary
income for the year ending March 31, 2017 are also expected to decrease as well. Net income attributable to owners of parent for
the year ending March 31, 2017 is expected to increase slightly year on year, due in part to the lack of impairment loss.
In these estimates, the crude oil price is assumed to be US$45.0 per barrel (for Brent crude oil) with the exchange rate of theJapanese yen against the U.S. dollar at ¥110.0 through the year ending March 31, 2017.

7

(2) Analysis on Consolidated Financial Position
Consolidated total assets as of March 31, 2016 decreased by ¥129.3 billion to ¥4,369.8 billion from ¥4,499.1 billion as of March
31, 2015. Current assets decreased by ¥358.0 billion to ¥984.3 billion due to a decrease in marketable securities and others. Fixed
assets increased by ¥228.7 billion to ¥3,385.4 billion due to increases in tangible fixed assets and intangible assets and others.
Meanwhile, total liabilities decreased by ¥19.4 billion to ¥1,191.0 billion from ¥1,210.4 billion as of March 31, 2015. Current
liabilities decreased by ¥46.0 billion to ¥319.1 billion and long-term liabilities increased by ¥26.6 billion to ¥871.9 billion.
Net assets decreased by ¥109.9 billion, to ¥3,178.8 billion. Total shareholders' equity decreased by ¥12.5 billion, to¥2,536.9 billion. Total accumulated other comprehensive income decreased by ¥121.2 billion to ¥395.9 billion and noncontrolling interests increased by ¥23.8 billion to ¥245.9 billion.
As for cash flows for the year ended March 31, 2016, net cash provided by operating activities decreased by ¥33.0 billion to¥183.7 billion from the previous fiscal year due to a decrease in income before income taxes owing to a decrease in sales prices ofcrude oil and natural gas and others. Meanwhile, net cash used in investing activities increased by ¥462.4 billion to¥543.5 billion due to increases in payments for long-term time deposits and payments for purchases of mining rights and others.
Net cash provided by financing activities was ¥156.7 billion due to increases in proceeds from long-term debt and proceeds from
non-controlling interests for additional shares, meanwhile, net cash used in financing activities was ¥4.1 billion for the previous
fiscal year.
After totaling ¥4.0 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, 2016 amounted to ¥207.1 billion. Cash and cash equivalents as of March 31, 2016
totaled ¥53.8 billion reflecting the above net decrease of ¥207.1 billion, from ¥260.9 billion at the end of the previous fiscal year.
(3) Dividend policy and dividends for the year ended March 31, 2016 and for the year ending March 31, 2017
In order to secure a stable and efficient supply of oil and gas resources, the INPEX CORPORATION Group aims to expand its
operating base, and will make the required investments to undertake exploration and development activities in Japan and overseas
as well as maintain and expand its supply infrastructure. The robust financial standing of the INPEX CORPORATION Group is
crucial for maintaining this level of investment. Therefore, our basic policy is to find a suitable balance between maximizing
corporate value through investing in the sustenance and expansion of our reserves as well as oil and gas production, and driving
direct shareholder returns via cash dividends, taking into account the Group's medium- to long-term perspectives.
In accordance with the policy outlined above, the Group has set the year-end dividend at ¥9 per common stock for the year ended
March 31, 2016. Combined with the mid-term dividend of ¥9 per common stock, the total dividend for the year is ¥18 percommon stock. Also in accordance with the policy, the Group has set the year-end dividend of ¥3,600 per Class A stock for theyear ended 31, 2016. Combined with the mid-term dividend of ¥3,600 per Class A stock, the total dividend for the year is ¥7,200
per Class A stock.
For the year ending March 31, 2017, the Group expects mid-term and year-end dividends each of ¥9 per common stock and¥3,600 per Class A stock, bringing total dividends to ¥18 per common stock and ¥7,200 per Class A stock.
The Group plans to allocate retained earnings to investments for the sustenance and expansion of its reserves as well as oil and gas
production, among other initiatives.

82. Overview of the INPEX CORPORATION GroupThe INPEX CORPORATION Group consists of INPEX CORPORATION, 73 subsidiaries (including 65 consolidated
subsidiaries), 26 affiliates (including 20 equity method affiliates) and their 3 subsidiaries (as of March 31, 2016). The Group
primarily engages in exploration, development, production and sales of crude oil and natural gas in Japan as well as in "Asia &Oceania", "Eurasia (Europe & NIS)", "Middle East & Africa" and "Americas".
The following diagram shows our Group's business flow.

93. Management Policy(1) Basic Management Strategy
The INPEX Group aims to become a top class international oil and gas exploration and production company by sustainably
growing its oil and gas development business. With natural gas as our core business, we will grow into an integrated energy
company by contributing to a stable energy supply to broader communities. We will continue to play a significant role inboosting the supply of energy to Japan while contributing to global economic growth and social development. Through these
efforts, we intend to further advance our reputation among our shareholders and more broadly our stakeholders as a company
that plays an essential role in the global community.
(2) Medium- to Long-Term Management Strategy, Management Indices and Challenges
Based on the Basic Management Strategy above, we carry out our business operations in accordance with the following three
growth measures:- Continuous enhancement of E&P activities to become a top class international oil & gas E&P company- Strengthening of gas supply chain to further globalize gas business- Reinforcement of renewable energy initiatives to become an integrated energy company contributing to the global
community
Our challenges are as follows:
The INPEX Group's upstream oil and gas business involves developing new oil and gas fields discovered through conducting
geophysical surveys and drilling exploratory wells, and delivering shareholder returns from profits generated by producing andselling the oil and natural gas, as well as reinvesting in new exploration and development in order to maintain and expand
reserves.
In carrying out exploration, development and production activities, the INPEX Group gives the highest priority in ensuringsafety and minimizing environmental impact. To this end, the Group's business operations are based on systems and frameworks
that meet global standards in safety, environmental sustainability, etc.
There are numerous risks inherent to the upstream oil and gas industry, such as the risk of insufficient discovery of oil and gas
through exploration, the risk of development and production schedule delays, the risk of accidents and cost overruns, the risk
associated with the logistics of transporting oil and natural gas on tankers and through pipelines, and country risks involving
potential changes in the legal and tax systems in producing countries. Taking such risks into account, the INPEX Group pursues
a financially sound mix between operations with high growth potential through the expansion of reserves and operations
providing stable revenue to improve the quality of its asset portfolio. At the same time, the Group aims to further enhance its
corporate value by fully leveraging its overseas assets as well as its domestic infrastructure including its LNG terminal andnatural gas trunk pipeline network.
In May 2012, we set targets to achieve sustainable growth over the medium- to long-term, and laid out the MEDIUM- TO
LONG-TERM VISION OF INPEX—Ichthys and our growth beyond—to clarify key initiatives over the five years leading up to
the startup of the Ichthys LNG Project. The three growth targets outlined in the vision are: 1) Continuous Enhancement of our
E&P Activities; 2) Strengthening our Gas Supply Chain; and 3) Reinforcement of our Renewable Energy Initiatives. Our threemanagement policies designed to support these growth targets are: 1) Securing / Developing Human Resources and Building an
Efficient Organizational Structure; 2) Investment for Growth and Return for Shareholders; and 3) Responsible Management as a
Global Company. Through realizing its vision, the Group intends to further enhance its corporate value as well as its reputation
among its shareholders and more broadly its stakeholders, as a company that plays an essential role in the global community.
The INPEX Group is now faced with the immediate challenge of responding to the drop in oil prices since the second half of2014. To this end, we will continuously evaluate individual project investments and reduce operating expenditures as well as
selling, general and administrative expenses, and build a resilience that will allow us to ensure the continuity of efficientbusiness operations even with oil prices remaining at relatively low levels for a sustained period of time.
Meanwhile, business operations geared towards our medium to long-term growth must proceed continuously and steadily.
First, as for the continuous enhancement of our E&P activities, we will work diligently toward our target of commencing
production at the Ichthys LNG Project in Australia in the third quarter of 2017, as per the production schedule update announced
in September 2015. With regard to the Abadi LNG Project in Indonesia, in September 2015 we submitted to the Indonesian
government authorities a revised plan of development (POD) that envisions the adoption of a floating LNG with an annual LNG
processing capacity of 7.5 million tons. In April 2016, we received a notification from the Indonesian government authorities
instructing to re-propose a plan of development based on onshore LNG development. We intend to work closely with theIndonesian government authorities aiming for the early start-up of development. Elsewhere, we acquired a 5% participatinginterest in the ADCO Onshore Concession in Abu Dhabi in April 2015, and will continue our efforts to secure stable production
at our existing projects including the Offshore Mahakam Block in Indonesia, the ADMA Block offshore Abu Dhabi and the
ACG oil fields in Azerbaijan, undertake exploration activities aimed at the acquisition of new oil and gas reserves and pursue

10

opportunities to join viable projects. Next, with regard to strengthening our gas supply chain, we have been working on theconstruction of the Toyama Line extension of our trunk pipeline network in Japan with the aim of commencing operations in
mid-2016 to respond to the growing demand for natural gas supplies. INPEX and Chubu Electric Co., Inc. also entered a joint
power supply business agreement with nine city gas companies under the circumstance of the liberalization of the retailelectricity and gas markets in Japan and will proceed to establish a framework to flexibly respond to the energy needs ofcustomers. Lastly, as for the reinforcement of renewable energy initiatives, we are advancing our efforts as an integrated energy
company that contributes to the global community through various initiatives including our participation since June 2015 in the
Sarulla Geothermal Independent Power Producer Project in Indonesia.
The Group's fundamental business operation policies and initiatives to the address the challenges are as follows:
Continuous Enhancement of E&P Activitiesi) Balanced Asset Portfolio- Regional Diversification
The Group's operations have diversified beyond Japan, Asia, Oceania and the Middle East, where we have a wealth ofoperational experience, to include locations around the world such as the Caspian Sea region, Central and South America andAfrica. We will continue to pursue a portfolio of assets taking geographical mix into consideration.
- Crude Oil and Natural Gas Product Ratio
The INPEX Group's ratio of crude oil products versus natural gas products is approximately 66/34.
Crude oil, which has diverse applications and is considered a convenient fuel source that can be easily handled, transported
and stored, is widely used all over the world. As crude oil is a sensitive commodity, its sales prices are often influenced bymarket conditions. While crude oil customers are not bound to long-term sales contracts, capital investments in crude oil
production and transportation are relatively small in comparison to natural gas including LNG. Furthermore, the timerequired for crude oil development is comparatively short, enabling quick returns on investment once oil fields are
discovered.
Natural gas has the lowest environmental impact among fossil fuels, and demand for natural gas as a quick and effective
measure against global warming is expected to increase. Commercial production of natural gas requires substantial
investment and a long lead-time for the preparation of infrastructure such as liquefaction plants or pipelines. Since gas buyers
are also required to make large investments in LNG receiving facilities, stable and long-term sales and purchase contracts are
essential. Such LNG contracts, while influenced to an extent by oil price fluctuations, enable long-term profit stability.
When acquiring interests in new projects, it is important to achieve a sound balance between crude oil and natural gas
production to ensure efficient investment with a view to securing long-term cash flow.
- Balancing Project Stages (Exploration, Development and Production)
Because oil and gas reserves become depleted as production advances, the INPEX Group must constantly seek to acquire
fresh reserves to ensure stable profitability. For this, it is important to reinvest production revenue in exploration and create an
operational cycle of discovering, developing and producing at new oil and gas fields to generate revenue, ensuring the stability
and continuity of projects at every stage.
To maintain this cyclical balance, we will continue to focus on stable production at key assets including the Offshore
Mahakam Block and the ADMA Block as well as the diligent development of the Ichthys LNG Project, while investing in
new exploration opportunities.
ii) Implementation of Operator Projects
As Operator, we require significant management resources in terms of organization, human resources and financing.
However, being Operator also presents us with significant opportunities to acquire new participating interests throughimproved technological capabilities and greater recognition from oil and gas producing countries as well as international oil
companies. The group is committed to pursuing and implementing projects as Operator, starting with the Ichthys LNG
Project, by further enhancing its technological capabilities, ensuring safety in all operations and integrating with local
communities.
iii) Strengthening Relationships with Leading Oil and Gas Companies Globally
Developing oil and gas involves considerable risks. Large-scale projects in particular require investments too large for any
one company to shoulder individually. Companies therefore typically form consortiums to share the risks and jointly
undertake business operations. The INPEX Group is committed to increasing its chances of participating in viable projects,
expanding its business and dispersing risks through enhanced cooperation with major international oil companies and nationaloil companies in oil and gas producing countries as well as leading private oil resource developers, Japanese trading

11

companies and other energy-related enterprises.
Strengthening Gas Supply Chain
The INPEX Group aims to build a solid network of operations in the Japanese natural gas market, which represents a stablesource of revenue. As well as sustaining a natural gas trunk pipeline network to supply the promising markets in the KantoKoshinetsu and Hokuriku regions, we plan to increase production at the Minami-Nagaoka gas field, one of the largest gas
fields in Japan. We also own numerous promising natural gas assets primarily in Australia and Indonesia. To ensure our longterm growth, we will actively pursue the strengthening of our gas supply chain by organically linking such international assets
and our infrastructure in Japan, with our Naoetsu LNG Terminal serving as the gateway.
Reinforcement of Renewable Energy Initiatives
As an E&P company, one of our most important challenges is to reduce environmental impact through greenhouse gas
reduction initiatives, etc. We are pursuing the development of renewable energy resources such as photovoltaic andgeothermal power generation and biomass fuels, as well as next-generation energy solution technologies based on hydrogen,fuel cells and high performance batteries in cooperation with Japanese and international companies, universities andorganizations. Through these activities, we seek to locate new business opportunities while helping reduce environmental
impact.
Securing / Developing Human Resources and Building an Efficient Organizational Structure
We introduced INPEX Values, a set of core values designed to be shared by all INPEX directors and employees, and areworking on creating foundations to establish a global HR management system. In the fiscal year ended March 31, 2016, we
took steps to instill group-wide adherence to INPEX Values, established a defined practice of accepting diversity andinclusion at the workplace and developed the INPEX Action Plan in conjunction with the Japanese government s introductionof the Act of Promotion of Women s Participation and Advancement in the Workplace. Going forward, we will continue todevelop an efficient organizational structure and secure experienced global talent.
Investment for Growth and Return for shareholders
To ensure growth for the Group, we will progressively carry out investment activities in the medium- to long-term while
maintaining sound financial standing. With an eye on the Ichthys production startup schedule, we will look to deliver
appropriate shareholder returns that meet the standards of top-class international oil and gas E&P companies.
Responsible Management as a Global Companyi) CSR Management Promotion, Enhanced Stakeholder Communications and Corporate Governance
As a global entity, the INPEX Group has strived to develop a responsible management system. We are engaged in various
ways to progressively strengthen our CSR management under the guidance of the CSR Committee chaired by the President &CEO. We will continue to promote active disclosure practices so as to reach out to our stakeholders based in many locations
around the world. We have already implemented measures through the INPEX Advisory Committee to reinforce our corporate
governance from a global perspective, and will continue to strengthen internal management with the implementation of the
Corporate Governance Code on June 1, 2015.
ii) Strengthening Health, Safety and Environment (HSE) Initiatives
We have organized our HSE management system based on global standards, and through the implementation of HSE
activities, we have strived to ensure the safety and health of stakeholders involved in our business and to protect theenvironment. As for safety and health, we are implementing occupational safety control at drilling, construction andoperational sites, instilling process safety management practices essential for preventing major incidents and disaster andmanaging the health of employees. We are also actively working on enhancing HSE competency through HSE training andpersonnel development, as well as the preparing emergency response manuals and strengthening corporate preparedness
through emergency response drills. In the area of environmental protection, we are making every effort to minimize the impactof our activities on the environment particularly in terms of global warming by means of greenhouse gas emissions control,
prevention of air pollution and water contamination, chemical substance control, effective utilization of water resources,
prevention of soil pollution, waste management and biodiversity conservation. Through our global initiatives, we willcontinue to suitably address and evaluate health and security risks in every country and area in which we operate, andimplement measures to mitigate risks.
Based on its mission of contributing to the advancement of society through the stable and efficient supply of energy andthrough the implementation of activities outlined in its Vision, the INPEX Group will improve its corporate value over thelong term with a view to securing sustainable growth.

12

4. Basic Rationale for Selection of Accounting Standards
The INPEX Group has been analyzing the differences between International Financial Reporting Standards (IFRS) andaccounting principles generally accepted in Japan. The Group will take into consideration the domestic and internationalsituations for appropriate adoption of the IFRS in the future.

13

5. Consolidated Financial Statements(1) Consolidated Balance Sheet(Millions of yen)Accounts

As of March 31, 2015

As of March 31, 2016

(Assets)
Current assets
Cash and deposits

922,683

772,528

Accounts receivable-trade77,20956,462Marketable securities

162,289

Inventories

1

Deferred tax assets

31,652

1

35,915

4,955

2,852

Accounts receivable-other

110,31484,650Other

46,21145,012Less allowance for doubtful accounts(12,905)(13,076)

Total current assets

1,342,409

984,345

Buildings and structures, net

138,010

124,900

Wells, net

36,391

51,257

Machinery, equipment and vehicles, net

109,686

130,796

Land

19,86919,673

1,173,409

1,407,490

20,254

18,495

Fixed assets
Tangible fixed assets

Construction in progress
Other, net
Total tangible fixed assets

2,

4,

5

1,497,621

2,

1,752,614

5

Intangible assets
Goodwill

74,31967,558

Exploration and development rights

134,809146,262

Mining rights

238,316

318,438

Other

11,324

9,212

Total intangible assets

458,769

541,471

Investments and other assets
Investment securities

284,090

3, 4

3,

4

213,730

Long-term loans receivable

126,516

4,230

Long-term time deposits
Recoverable accounts under production
sharing

120,270

202,842703,291

727,771

22,848

13,10576,16871,357(8,398)(7,814)

Less allowance for recoverable accounts under
production sharing(121,707)(131,765)

Less allowance for investments in exploration(2,727)(2,046)

1,200,352

1,091,410

3,156,743

3,385,496

4,499,153

4,369,841

Deferred tax assets
Other

3, 4

Less allowance for doubtful accounts

Total investments and other assets
Total fixed assets
Total assets

14

(Millions of yen)Accounts

As of March 31, 2015

As of March 31, 2016

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

4

Income taxes payable
Accounts payable-other53,47447,351

33,206

68,46860,18542,845

113,567

4

Provision for exploration projects

479,621

9,492

4,781

Accrued bonuses to officers

70

55

Asset retirement obligations

1,093

2,233

Other

94,12273,769Total current liabilities

365,212319,127

643,951

673,098

Deferred tax liabilities

77,91756,044

Provision for loss on business

9,080

4,737

227

293

Liability for retirement benefits

6,700

7,461

Asset retirement obligations

105,234

100,8292,126

29,445845,238

871,911

1,210,450

1,191,038

Common stock

290,809290,809

Capital surplus

679,287

676,273

Retained earnings

1,584,645

1,575,136

Treasury stock(5,248)(5,248)2,549,494

2,536,971

Unrealized holding gain on securities

46,0494,958

Unrealized loss from hedging instruments(36,423)(6,660)Translation adjustments

507,560

397,622

Total accumulated other comprehensive income

517,185395,921

222,023

245,910

Total net assets

3,288,703

3,178,803

Total liabilities and net assets

4,499,153

4,369,841

Long-term liabilities
Long-term debt

4

Accrued special repair and maintenance

Other

4

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

Total shareholders' equity
Accumulated other comprehensive income

Non-controlling interests15(2) Consolidated Statement of Income and Consolidated Statement of Comprehensive Income
Consolidated Statement of Income(Millions of yen)
For the year ended
March 31, 2016

For the year ended
March 31, 2015

Accounts
Net sales

1,171,226

Cost of sales

1,009,564

525,4432

526,757

2

Gross profit

645,782

482,806

Exploration expenses

23,238

6,166

Selling, general and administrative expenses

1,

2Operating income

87,6571,

2

86,500534,886

390,139

Interest income

11,226

10,751Dividend income

6,669

10,825Gain on sales of marketable securities

18,14625,986

Foreign exchange gain

19,562

2,964

Other

46,15919,406

Total other income

101,763

69,934

Interest expense

2,946

4,198

Equity in losses of affiliates

13,443

20,696

Provision for allowance for recoverable accounts under
production sharing

19,44925,026

Provision for exploration projects

835

335

Loss on disposal of fixed assets

6,258

13,288Other

18,561

21,756

Total other expenses

61,49485,301

575,155

374,771

Other income

Other expenses

Ordinary income
Extraordinary loss
Impairment loss

3

35,132

3

45,884

Total extraordinary loss

35,13245,884

Income before income taxes

540,022

328,887

Income taxes-current

448,658

356,585

Income taxes-deferred

15,767(2,192)

Total income taxes

464,425354,393

Net income (loss)

75,597(25,505)

Net loss attributable to non-controlling interests(2,222)(42,282)

Net income attributable to owners of parent

77,82016,77716

Consolidated Statement of Comprehensive Income(Millions of yen)
For the year ended
March 31, 2016

For the year ended
March 31, 2015

Accounts

Net income (loss)

75,597(25,505)

1,315(41,094)

Translation adjustments

244,018(129,078)

Share of other comprehensive income of affiliates
accounted for by the equity method(13,951)

29,310

Other comprehensive income
Unrealized holding gain (loss) on securities

Total other comprehensive income1

Comprehensive income

231,3821(140,862)

306,979(166,368)

301,622(104,487)

5,356(61,881)

Total comprehensive income attributable to
Owners of parent
Non-controlling interests17(3) Consolidated Statement of Changes in Net Assets
For the year ended March 31, 2015
(Millions of yen)
Shareholders' equity
Common stock Capital surplus
Balance at the beginning of the period

290,809679,287

Retainedearnings

Total
Shareholders'equity(5,248)2,497,725

1,532,876

Cumulative effects of changes inaccounting policies
Restated balance

Treasury stock

235
290,809679,287

1,533,111

235(5,248)2,497,961

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

(26,286)(26,286)

Net income attributable to owners ofparent77,82077,82051,53351,533

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

290,809679,287

1,584,645(5,248)2,549,494

Accumulated other comprehensive income

Balance at the beginning of the period

Unrealized
holding gain
on securities

Unrealized
loss fromhedging
instruments

44,737(17,578)

Total
Nonaccumulated controlling
Translation
otherinterests
adjustments
comprehensive
income266,224

293,382

204,928

Cumulative effects of changes inaccounting policies
Restated balance

Total
net assets

2,996,036
235

44,737(17,578)

266,224

293,382

204,928

2,996,272

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

(26,286)

Net income attributable to owners ofparent77,820Net changes in items other than those inshareholders' equity

1,311(18,845)

241,335

223,802

17,094

240,897

Total changes during the period

1,311(18,845)

241,335

223,802

17,094292,431

Balance at the end of the period

46,049(36,423)

507,560

517,185

222,023

3,288,703

18

For the year ended March 31, 2016
(Millions of yen)
Shareholders' equity
Common stock Capital surplus
Balance at the beginning of the period

Retainedearnings

Treasury stock

Total
Shareholders'equity290,809679,287

1,584,645(5,248)2,549,494

290,809679,287

1,584,645(5,248)2,549,494

Cumulative effects of changes inaccounting policies
Restated balance
Changes during the period
Change in treasury shares of parent
arising from transactions with
non-controlling shareholders(3,014)(3,014)

Cash dividends paid

(26,286)(26,286)

Net income attributable to owners ofparent16,777

16,777(3,014)(9,509)(12,523)

676,273

1,575,136

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)2,536,971

Accumulated other comprehensive income

Balance at the beginning of the period

Total
Nonaccumulated controlling
otherinterests
comprehensive
incomeUnrealized
holding gain
on securities

Unrealized
loss fromhedging
instruments

Translation
adjustments

46,049(36,423)

507,560

517,185

222,023

3,288,703

46,049(36,423)

507,560

517,185

222,023

3,288,703

Total
net assets

Cumulative effects of changes inaccounting policies
Restated balance
Changes during the period
Change in treasury shares of parent
arising from transactions with
non-controlling shareholders(3,014)

Cash dividends paid

(26,286)

Net income attributable to owners ofparent16,777

Net changes in items other than those inshareholders' equity(41,090)

29,763(109,937)(121,264)

23,887(97,376)

Total changes during the period(41,090)

29,763(109,937)(121,264)

23,887(109,900)

Balance at the end of the period

4,958(6,660)397,622395,921245,910

3,178,803

19

(4) Consolidated Statement of Cash Flows(Millions of yen)
For the year ended
March 31, 2015

Accounts

For the year ended
March 31, 2016

Cash flows from operating activities
Income before income taxes

540,022

328,887

Depreciation and amortization

52,52086,791

Impairment loss

35,13245,884

Amortization of goodwill

6,760

6,760

Provision for allowance for recoverable accounts
under production sharing

20,307

29,843

Provision for exploration projects(600)(4,399)Other provisions

3,419(4,352)

Liability for retirement benefits

(873)

945

Interest and dividend income(17,895)(21,579)

Interest expense

2,946

3,464

Foreign exchange loss (gain)

3,973

15,085Equity in (earnings) losses of affiliates

13,443

20,696

Loss (gain) on sales of marketable securities(18,146)(25,986)

Recovery of recoverable accounts under
production sharing (capital expenditures)

75,58564,199Recoverable accounts under production
sharing (operating expenditures)(60,763)(45,833)

Accounts receivable-trade25,201

15,193Inventories(797)(2,551)

Accounts payable-trade

6,309(4,389)Accounts receivable-other(1,440)41,632

Accounts payable-other(11,246)(13,746)

(125)

2,882

Other

(3,940)9,625

Subtotal

669,795

549,053

Interest and dividends received

28,194

31,446

Interest paid

(2,376)(3,205)

Income taxes paid

(478,863)(393,586)

Net cash provided by (used in) operating activities

216,749

183,707

Advances received20

(Millions of yen)
For the year ended
March 31, 2015

Accounts

For the year ended
March 31, 2016

Cash flows from investing activities
Payments for time deposits(326,025)(544,330)

Proceeds from time deposits

698,139790,267

Payments for long-term time deposits(112,181)(439,989)

Payments for purchases of tangible fixed assets(448,381)(476,788)

Proceeds from sales of tangible fixed assets

245

1,131

Payments for purchases of intangible assets(15,445)(26,897)

Proceeds from sales and redemptions of marketable securities

214,527

175,584

Payments for purchases of investment securities(26,767)(6,876)

Proceeds from sales and redemptions of investment securities

68,937

27,700Investment in recoverable accounts under
production sharing (capital expenditures)(70,430)(60,442)

Decrease (increase) in short-term loans receivable(3,824)(4,120)(111,387)(215,709)

Collection of long-term loans receivable

259

384,759

Payments for purchases of mining rights(18,424)(134,516)

Other

69,672(13,305)

Net cash provided by (used in) investing activities(81,086)(543,534)

Increase (decrease) in short-term loans

1,489

92

Proceeds from long-term debt

27,712

127,120

Repayments of long-term debt

(18,683)(26,868)

Proceeds from non-controlling interests for additional shares

16,73087,279Cash dividends paid

(26,287)(26,297)

Cash dividends paid to non-controlling interests(4,991)(4,524)

(147)

(74)

(4,177)

156,726

Effect of exchange rate changes on cash and cash equivalents

11,962(4,064)

Net increase (decrease) in cash and cash equivalents

143,447(207,164)

Cash and cash equivalents at beginning of the period

117,530

260,978

Long-term loans madeCash flows from financing activities

Other
Net cash provided by (used in) financing activities

Cash and cash equivalents at end of the period

121

260,978

1

53,813

(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: 65
Names of major subsidiaries;
Japan Oil Development Co., Ltd., INPEX Alpha, Ltd., INPEX Natuna, Ltd., INPEX Sahul, Ltd., INPEX Southwest
Caspian Sea, Ltd., INPEX Gas British Columbia Ltd., JODCO Onshore Limited, INPEX North Caspian Sea, Ltd.,INPEX Browse, Ltd., INPEX Holdings Australia Pty Ltd, INPEX Ichthys Pty Ltd, INPEX Oil & Gas Australia Pty Ltd
and INPEX Masela, Ltd.
During this period:
Number of companies newly included in the scope of consolidation: 2
Number of companies excluded from the scope of consolidation: 2
Details for the above changes:
1) JODCO Onshore Limited has been newly included due to establishment of the company.
2) INPEX Geothermal Sarulla, Ltd. has been newly included due to an increase in materiality of the company.
3) INPEX West of Shetland Limited and INPEX Nganzi DRC S.P.R.L.. have been excluded due to completion of liquidation.
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.
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
LtdDuring this period:
Number of companies newly included as affiliates accounted for by the equity method: 2
Number of companies excluded from affiliates accounted for by the equity method: 1
Details for the above changes:
1) PT Medco Geopower Sarulla and Sarulla Operations Ltd. have been newly included due to acquisition of shares.
2) ALBACORA JAPAO PETROLEO LTDA has been excluded due to completion of liquidation.
Names 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.
22

(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 49 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 10 companies including, but not limited to, Japan Oil Development, Co., Ltd., INPEX Southwest Caspian Sea, Ltd., and
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.
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

23(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.
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 which are 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, 2016. 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.

24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.
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.

25

(Changes in Accounting Policies)
Effective from the year ended March 31, 2016, the Company has applied the "Revised Accounting Standard for Business
Combinations" (Accounting Standards Board of Japan Statement No.21, issued on September 13, 2013), "Revised AccountingStandard for Consolidated Financial Statements" (ASBJ Statement No.22, issued on September 13, 2013), "Revised AccountingStandard for Business Divestitures" (ASBJ Statement No.7, issued on September 13, 2013), and other standards.
Accordingly, any difference arising from changes in the Company's ownership interest in a subsidiary when the Company retains
control over the subsidiary is recognized in capital surplus, and acquisition-related costs are expensed in the fiscal year in which
the costs are incurred.
As for business combinations executed at or after the beginning of the year ended March 31, 2016, adjustments to the allocationof acquisition costs after the confirmation of the provisional accounting treatment are reflected in the consolidated financial
statements for the fiscal year which includes the acquisition date.
In addition, the presentation method of net income was amended and "minority interests" was renamed "non-controllinginterests".
To reflect these changes in presentation, consolidated financial statements for the year ended March 31, 2015 have been
reclassified.
The Company has applied these standards from the beginning of the year ended March 31, 2016 in accordance with transitional
treatments as stated in Section 58-2(4) of the "Revised Accounting Standard for Business Combinations", Section 44-5(4) of the"Revised Accounting Standard for Consolidated Financial Statements", and Section 57-4(4) of the "Revised Accounting Standard
for Business Divestitures".
As a result, capital surplus decreased by ¥3,014 million as of March 31, 2016. The impact on the profit and loss for the year ended
March 31, 2016 was immaterial.
(Changes in the Presentation)(Consolidated Statement of Income)"Gain on transfer of mining rights", previously presented separately in other income, is included in "Other" since it has becomeless significant.
As a result, ¥27,520 million which was recorded as "Gain on transfer of mining rights" in other income on the consolidated
statement of income in the previous fiscal year is reclassified as "Other".
(Consolidated Statement of Cash Flows)"Gain on transfer of mining rights", previously presented separately in cash flows from operating activities, is included in"Other" since it has become less significant. "Proceeds from transfer of mining rights", previously presented separately in cash
flows from investing activities, is included in "Other" since it has become less significant.
As a result, ¥(27,520) million which was recorded as "Gain on transfer of mining rights" in cash flows from operating activities
on the consolidated statement of cash flows in the previous fiscal year is reclassified as "Other". ¥59,405 million which wasrecorded as "Proceeds from transfer of mining rights" in cash flows from investing activities is reclassified as "Other".

26

(Consolidated Balance Sheet)*1 Major accounts included in inventories
As of March 31, 2015

As of March 31, 2016

Millions of yen

Millions of yen

9,162

7,910

344

643

22,14527,361

Merchandise and finished goods
Work in process
Raw materials and supplies*2 Accumulated depreciation of tangible fixed assets
As of March 31, 2015
Accumulated depreciation of tangible fixed assets

As of March 31, 2016

¥ 683,230 million¥ 700,783 million*3 The Company has the following investments in subsidiaries and affiliates.
As of March 31, 2015

As of March 31, 2016

Millions of yen

Millions of yen

132,377

120,068(of which investment in jointly controlled entities)(84)(7,124)

Other (investments and other assets)

74

Investment securities (equities)*4 Assets provided as collateral and collateral-backed debt are as follows:Collateralized Assets
As of March 31, 2015

As of March 31, 2016

Millions of yen
Buildings and structures
Wells
Machinery, equipment and vehicles
Other (tangible fixed assets)
Investment securities
Other (investments and other assets)
Total

27

Millions of yen

1,975(1,975)

(

)

48

(48)

(

)

6,968

(6,968)

(

)

11

(11)

(

)

1,020

(

)

(

)

217

(

)

(

)

10,241(9,004)

(

)

7,744

7,744

Secured debt
As of March 31, 2016

As of March 31, 2015
Millions of yen
Short-term loans

490

(474)

Accounts payable-other

509

(

)

Long-term debt

1(

Others (long-term liabilities)

16

(

1,018

(474)

Total

Millions of yen
(

)

(

)

)

(

)

)

(

)

(

)

531

531

Amounts in parentheses () above represent foundation collateral and liabilities.

In addition, the followings are pledged as collateral for the Ichthys LNG project financing and the BTC pipeline project financing.
The Ichthys LNG project financing
As of March 31, 2015

As of March 31, 2016

Millions of yen

Millions of yen

Cash and deposits

3,875

1,507

Inventories

4,729

8,861

Other (current assets)

2,462

15,113160

150

Construction in progress

752,019945,517Long-term loans receivable

9,680

Land

Total

772,926

971,150

The BTC pipeline project financing
As of March 31, 2015
Investment securities

As of March 31, 2016

¥ 7,294 million¥ 7,294 million*5 Accumulated advanced depreciation deducted from acquisition costs of fixed assets related to contribution and others
As of March 31, 2015

As of March 31, 2016

Millions of yen

Millions of yen

1,393

1,393

Machinery, equipment and vehicles

226

221

Land

84

84

Buildings and structures28

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, 2015

As of March 31, 2016
Millions of yen

Millions of yen

Tangguh Trustee*2

16,168Ichthys LNG Pty Ltd*1

470,635

Fujian Tranche*2

5,731

Tangguh Trustee*2

13,125

Sakhalin Oil and Gas Development Co.,
Ltd.

1,914

Fujian Tranche*2

4,653

INPEX Offshore North Campos, Ltd.

1,260

Sakhalin Oil and Gas Development Co.,
Ltd.

1,924

Japan Canada Oil Sands Limited

676

INPEX Offshore North Campos, Ltd.

Oceanic Breeze LNG Transport S.A.

125

Japan Canada Oil Sands Limited

Employees (housing loans)

92

Oceanic Breeze LNG Transport S.A.

215

Employees (housing loans)

63

Total

590
1,690

25,969492,898*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.
(2) Guarantee for derivatives
As of March 31, 2015
¥ (36,433) million

Ichthys LNG Pty Ltd

As of March 31, 2016
¥ (7,643) 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, 2015
Completion guarantee (the Company's portion)¥ 958,502 million

29

As of March 31, 2016
¥ 901,540 million

(Consolidated Statement of Income)*1 Major accounts included in selling, general and administrative expenses are as follows:
For the year ended
March 31, 2015

For the year ended
March 31, 2016

Millions of yen

Millions of yen

22,324

22,64119

1,386)

Personnel expenses(Including provision for accrued retirement benefits to employees

77

53)

Taxes

5,691

4,109

Freight expenses

9,801

11,176

Depreciation expenses

24,51825,113

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, 2015
March 31, 2016
¥ 85 million¥ 754 million*3 Impairment loss
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.
For the year ended March 31, 2015
Use
Assets related to Joslyn Oil
Sands Lease Block

Assets related to JPDA06-105
Block (Kitan Oil Field)

Location

Alberta, Canada

Timor Sea Joint Petroleum
Development Area (JPDA),
the Commonwealth ofAustralia / the Democratic
Republic of Timor-LesteClassification

Impairment loss
(Millions of yen)

Other (Tangible fixed assets)

13,359Mining rights

14,231

Subtotal

27,590Wells

348

Machinery, equipment and vehicles

629

Construction in progress
Other (Investments and other assets)
Subtotal

6,111
452
7,541
35,132Total

The recoverable amount of the assets related to JPDA06-105 Block (Kitan Oil Field) is reasonably estimated by discounting thefuture cash flows at a rate of 7%. The recoverable amount of the assets related to Joslyn Oil Sands Lease Block is estimated at
zero.

30

For the year ended March 31, 2016
Use

Location

Assets related to Keathley
Canyon Blocks
874/875/918/919 (Lucius Oil
Field)

U.S. Gulf of Mexico

Assets related to JPDA06-105
Block (Kitan Oil Field)

Timor Sea Joint Petroleum
Development Area (JPDA),
the Commonwealth ofAustralia / the Democratic
Republic of Timor-LesteClassification
Wells

2,335

Machinery, equipment and vehicles

4,378

Mining rights

19,735

Subtotal

26,450

Wells

2,701

Machinery, equipment and vehicles

2,517

Construction in progress

2,184

Subtotal

7,403

Buildings and structures
Wells
Assets related to the shale gas
project in the Horn River area

Assets related to Copa
Macoya Block

British Columbia, Canada

Bolivarian Republic ofVenezuela

2,858
744

Mining rights

471

Other

104

Subtotal

4,570

Buildings and structures

73

Wells

945

Machinery, equipment and vehicles

76

Construction in progress
Other
Buildings and structures

UAE

392

Machinery, equipment and vehicles

Subtotal

Assets related to Abu Al
Bukhoosh Block

Impairment loss
(Millions of yen)

2,587
2
3,685
75

Wells

1,201

Machinery, equipment and vehicles

1,294

Construction in progress

576

Other

42

Subtotal

3,191

Other

583

Total

45,884

The recoverable amount of the assets related to Keathley Canyon Blocks 874/875/918/919 (Lucius Oil Field), the shale gas
project in the Horn River area and Abu Al Bukhoosh Block is reasonably estimated by discounting the future cash flows at a rateof 6.5%. The recoverable amount of the assets related to JPDA06-105 Block (Kitan Oil Field) and Copa Macoya Block isestimated at zero.

31

(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, 2015
March 31, 2016
Millions of yen

Millions of yen

Amount recognized during the period

26,405(15,819)

Amount of reclassification adjustment

Unrealized holding gain (loss) on securities(24,355)(27,567)

Before income tax effect

2,049(43,387)

Amount of income tax effect

(734)

2,293

Unrealized holding gain (loss) on securities

1,315(41,094)

244,018(128,941)

Translation adjustments
Amount recognized during the period(137)

Amount of reclassification adjustment
Translation adjustments

244,018(129,078)(28,436)

8,667

Amount of reclassification adjustment

2,238

(153)

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

12,246

20,796(13,951)

29,310231,382(140,862)

Share of other comprehensive income of affiliates accounted for by theequity method
Amount recognized during the period

32

(Consolidated Statement of Changes in Net Assets)
For the year ended March 31, 2015
1. Type and number of shares issued and treasury stock(Shares)

Balance as ofApril 1, 2014

Increase

Decrease

Balance as ofMarch 31, 2015

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

1,966,400

1,966,400

Total

1,966,400

1,966,400

Total
Treasury stock

2. Share subscription rights
None
3. Dividends(1) Cash dividends paid
Resolution
Ordinary general
meeting of shareholders
June 25, 2014
Board of directors'
meetingNovember 7, 2014

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, 2014

June 26, 2014

0

3,600

March 31, 2014

June 26, 2014

13,143

9 September 30, 2014

December 1, 2014

03,600 September 30, 2014

December 1, 2014

(2) Dividends, whose record date was in the year ended March 31, 2015, and whose effective date will be in the next fiscal year
Resolution

Type ofshare

Source ofdividends

Ordinary general
meeting of shareholders
June 24, 2015

Commonstock
Class Astock

Retainedearnings
Retainedearnings

Cash dividends
paid(Millions of yen)

33

Dividends
per share(Yen)

Record date

Effective date

13,143

9March 31, 2015

June 25, 2015

0

3,600

March 31, 2015

June 25, 2015

For the year ended March 31, 2016
(Shares)

1. Type and number of shares issued and treasury stock
Balance as ofApril 1, 2015

Decrease

Increase

Balance as ofMarch 31, 2016

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

1,966,400

1,966,400

Total

1,966,400

1,966,400

Total
Treasury stock

2. Share subscription rights
None
3. Dividends(1) Cash dividends paid
Resolution
Ordinary general
meeting of shareholders
June 24, 2015
Board of directors'
meetingNovember 10, 2015

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, 2015

June 25, 2015

0

3,600

March 31, 2015

June 25, 2015

13,143

9 September 30, 2015

December 1, 2015

03,600 September 30, 2015

December 1, 2015

(2) Dividends, whose record date was in the year ended March 31, 2016, and whose effective date will be in the next fiscal year
Resolution

Type ofshare

Source ofdividends

Ordinary general
meeting of shareholders
June 28, 2016

Commonstock
Class Astock

Retainedearnings
Retainedearnings

Cash dividends
paid(Millions of yen)

34

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

(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, 2015

For the year ended
March 31, 2016

Millions of yen

Millions of yen

Cash and deposits

922,683

772,528

Time deposits for more than three months and others(661,705)(718,715)

Cash and cash equivalents

260,978

53,8132 Significant non-cash transactions
For the year ended March 31, 2015 (April 1, 2014 through March 31, 2015)
Significant asset retirement obligations newly recorded were ¥69,253 million.
For the year ended March 31, 2016 (April 1, 2015 through March 31, 2016)
None

35

(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), "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, 2015 (April 1, 2014 through March 31, 2015)(Millions of yen)
Reportable segments
Eurasia
Middle East
(Europe
Americas& Africa& NIS)

Adjustments Consolidated
*1
*2

Japan

Asia &
Oceania

129,521409,775

94,049524,528

13,351

1,171,226

1,171,226

Total

129,521409,775

94,049524,528

13,351

1,171,226

1,171,226

Segment income (loss)

16,692

178,225

32,227333,213(15,302)545,056(10,169)

534,886

Segment assets

292,960

1,677,806

557,563

253,120305,996

3,087,447

1,411,706

4,499,153

Total

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

Other items
Depreciation and
20,651
6,366
9,899
9,900
4,334
51,153
1,366
52,520amortization
Amortization of goodwill
(192)
(192)
6,952
6,760
Investment to affiliates
accounted for by the
1,596
61,16054,096
1,197
118,050
118,050
equity method
Increase of tangible fixed
assets and intangible
26,985405,230
12,412
46,37846,490537,498
418
537,917
assetsNote: 1. (1) Adjustments of segment income of ¥(10,169) million include elimination of inter-segment transactions of ¥209 million
and corporate expenses of ¥(10,379) 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 ¥1,411,706 million include elimination of inter-segment transactions of ¥(2,164)
million and corporate assets of ¥1,413,871 million. Corporate assets are mainly goodwill, cash and deposits, marketablesecurities, investment securities and assets concerned with the administrative divisions that are not allocated to areportable segment.
(3) Adjustments of depreciation and amortization of ¥1,366 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 increase of tangible fixed assets and intangible assets of ¥418 million consist mainly of capital
expenditure to corporate assets.
2. Segment income is reconciled with operating income on the consolidated statement of income.

36

For the year ended March 31, 2016 (April 1, 2015 through March 31, 2016)(Millions of yen)
Reportable segments
Eurasia
Middle East
(Europe
Americas& Africa& NIS)

Adjustments Consolidated
*1
*2

Japan

Asia &
Oceania

109,601

302,871

66,851

516,513

13,726

1,009,564

1,009,564

Total

109,601

302,871

66,851

516,513

13,726

1,009,564

1,009,564

Segment income (loss)

12,096

97,204

13,831

290,865(14,001)

399,996(9,856)

390,139

Segment assets

338,026

1,729,119

576,842

412,576

165,633

3,222,199

1,147,642

4,369,841

Total

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

Other items
Depreciation and23,17010,142
14,755
16,43985,151
1,639
86,791
20,642amortization
(192)
(192)
6,952
6,760
Amortization of goodwill
Investment to affiliates
accounted for by the
1,683
73,32735,535110,546
110,546
equity method
Increase of tangible fixed
assets and intangible
59,368308,433
24,156
210,659
4,798
607,415
1,651
609,067
assetsNote: 1. (1) Adjustments of segment income of ¥(9,856) million include elimination of inter-segment transactions of ¥202 million
and corporate expenses of ¥(10,059) 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 ¥1,147,642 million include elimination of inter-segment transactions of ¥(1,971)
million and corporate assets of ¥1,149,614 million. Corporate assets are mainly goodwill, cash and deposits, investment
securities and assets concerned with the administrative divisions that are not allocated to a reportable segment.
(3) Adjustments of depreciation and amortization of ¥1,639 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 increase of tangible fixed assets and intangible assets of ¥1,651 million consist mainly of capital
expenditure to corporate assets.
2. Segment income is reconciled with operating income on the consolidated statement of income.

37

(Relative information)
For the year ended March 31, 2015 (April 1, 2014 through March 31, 2015)
1. Products and service information(Millions of yen)
Natural gas(excluding LPG)

Crude oil
Sales to third parties

730,422

LPG

401,337

Total

Other

20,522

18,944

1,171,226

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

Asia & Oceania
627,068

UAE

Total

Other

514,863

29,294

1,171,226

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

Australia
252,746

Total

Other
985,770259,104

1,497,621

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

Sales

Relative reportable segment
Middle East & Africa

ADNOC
For the year ended March 31, 2016 (April 1, 2015 through March 31, 2016)
1. Products and service information(Millions of yen)
Natural gas(excluding LPG)

Crude oil
Sales to third parties

679,241

LPG

306,205

Total

Other

10,555

13,561

1,009,564

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

Asia & Oceania
491,204

UAE

378,393

Other
102,493

Total
37,472

1,009,564

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

Australia
291,248

Total

Other
1,209,074

252,29138

1,752,614

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

Sales

Relative reportable segment
102,493

ADNOC

Middle East & Africa(Information on impairment loss from fixed assets by reportable segment)
For the year ended March 31, 2015 (April 1, 2014 through March 31, 2015)(Millions of yen)
Reportable segments
Japan
Impairment loss

Asia &
Oceania

Eurasia(Europe& NIS)

Middle East
Americas& Africa

7,541

27,590Total

Eliminations
and other

35,132

Total

35,132For the year ended March 31, 2016 (April 1, 2015 through March 31, 2016)(Millions of yen)
Reportable segments
Japan
Impairment loss

Asia &
Oceania

Eurasia(Europe& NIS)

7,403

Middle East
Americas& Africa
3,191

35,289Total

Eliminations
and other

45,884

Total

45,884(Information on amortization of goodwill and unamortized balance by reportable segment)
For the year ended March 31, 2015 (April 1, 2014 through March 31, 2015)(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(2,162)(2,162)
76,482
74,319March 31, 2015
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, 2016 (April 1, 2015 through March 31, 2016)(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(1,970)(1,970)69,52967,558March 31, 2016
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

39

(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 of 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 have been
providing long-term loans for the construction or expansion of domestic gas infrastructure. The Company generally borrows
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 are considered to be of
low-risk and high-liquidity. The Company limits the use of derivative transactions for managing risks of forecasted
transactions and portfolio assets, and does not engage in speculative derivative transactions.
(2) Details of financial instruments, associated risk and risk management(Credit risks 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. As for bonds, the Company mainly holds bonds with short-term
maturities by considering medium- to long-term cash outflow forecast and market price fluctuation risk.
(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. As a result of fiscal year-end conversion, yen appreciation causes a foreign exchange loss
on assets and foreign exchange gain on liabilities while yen depreciation causes foreign exchange loss on assets and foreignexchange gain on liabilities. 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 for
the Ichthys Project and others, 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 derivative transactions management outline. For derivativetransactions exposed to market price fluctuation, 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 forthe 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 be prepared 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.

40

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).
(Millions of yen)

As of March 31, 2015
Carrying value

Fair value

Difference(1) Cash and deposits

922,683

928,304(2) Accounts receivable-trade77,20977,209(3) Marketable securities and investment
securities

280,592

280,592

1,280,485

1,286,106

5,620(1) Short-term loans

33,20632,937(268)(2) Long-term debt

643,951

633,603(10,347)

677,157

666,541(10,616)

179

179

Total assets

Total liabilities
Derivatives (*)5,620(*) 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, 2016

(Millions of yen)
Carrying value

Fair value

Difference(1) Cash and deposits

772,528

777,134(2) Accounts receivable-trade56,462

56,462(3) Marketable securities and investment
securities

61,423

61,423

890,413895,020

4,606(1) Short-term loans

68,46868,361(107)(2) Long-term debt

673,098

663,984(9,113)

741,567

732,346(9,221)

(270)

(270)

Total assets

Total liabilities
Derivatives (*)4,606(*) 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.
Note 1: Methods of calculating of 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.
(2) Accounts receivable-trade
Since the item is settled in a short period of time and the 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.

41

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, 2016

As of March 31, 2015
Unlisted securities
Stocks of subsidiaries and affiliates

33,409132,377

32,239120,068

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.
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, 2015
(Millions of yen)More than 1 year
More than 5More than 10
1 year or lessbut less than 5
years but less
years
years
than 10 years
922,683
Cash and deposits
Accounts receivable-trade77,209Marketable securities and investment
securities
Other securities:
17,00014,000Public bonds
Corporate bonds
35,80021,100
Other bonds
18,040Other
66,096Long-term time deposits
120,270
Total
1,136,829
155,370
As of March 31, 2016

(Millions of yen)
1 year or less

Cash and deposits
Accounts receivable-trade
Investment securities
Other securities:
Public bonds
Corporate bonds
Other bonds
Other
Long-term time deposits
Total

More than 1 year
but less than 5
years

772,528
56,4625,500

828,99042

202,842
208,342More than 5
years but lessthan 10 years

More than 10years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, 2015

(Millions of yen)
1 year or less

Short-term loans
Long-term debt
Lease obligations
Total

6,763
26,442
68
33,274More than 1 year
but less than 5
years
276,228145
276,373

More than 5
years but lessthan 10 years
265,9691
265,971

As of March 31, 2016

Total

101,753
101,753(Millions of yen)

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

More than 10
years

5,181
63,28755
68,52443

More than 1 year
but less than 5
years
329,726105
329,831More than 5
years but lessthan 10 years
252,2621
252,263

More than 10
years
91,10991,109(Securities)
1. Other securities
As of March 31, 2015

(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(2) Bonds
Public bonds
Corporate bonds
Other(3) Other
Subtotal
Total

Carrying value

Unrealized gain
(loss)

34,62352,081

17,45831,17839,30012,54973,49531,24339,313
18,243
106,737

65
13
5,693
33,242

191,147

247,61956,472

17,765

15,374(2,390)17,60017,598(1)

35,365
226,51232,973
280,592(2,392)54,080

As of March 31, 2016

(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)

14,582

22,888

8,306

5,500

5,508

8

2,461

4,970

2,509

22,54333,368

10,82433,67628,054(5,621)

33,67656,22028,054
61,423(5,621)5,202(2) Bonds
Public bonds
Corporate bonds
Other(3) Other
Subtotal
Total

44

2. Other securities sold for the fiscal years
For the year ended March 31, 2015
Type of securities(Millions of yen)
Proceeds from sales(1) Stock(2) Bonds
Public bonds
Corporate bonds
Other(3) Other
Total

Gain on sales

Loss on sales

91,741357

984,071
175,813

18,053
18,411

9

For the year ended March 31, 2016
Type of securities(Millions of yen)
Proceeds from sales(1) Stock(2) Bonds
Public bonds
Corporate bonds
Other(3) Other
Total

45

Gain on sales

Loss on sales

31,20530,90659
8

2102,666
164,777

31,632
31,7002

(Derivative Transactions)
1. Derivatives not subject to hedge accounting(1) Derivatives related to foreign currency
As of March 31, 2015

(Millions of yen)Type of derivatives

Contract
amounts

Due after one
year

Foreign exchange
forwards
35,264
Sell CAD
Buy USD(*) Fair value is the price obtained from the counterparty financial institutions.
Over-the-countertransactions

Fair value
179

As of March 31, 2016

Valuation gain
(loss)
179(Millions of yen)Type of derivatives

Contract
amounts

Due after one
year

Foreign exchange
forwards
37,451
Sell CAD
Buy USD(*) Fair value is the price obtained from the counterparty financial institutions.
Over-the-countertransactions

Fair value(270)

Valuation gain
(loss)(270)

2. Derivatives subject to hedge accounting(1) Derivatives related to interest rate
As of March 31, 2015
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, 2016
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

46

(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, 2015
March 31, 2016
(1) Net assets excluding non-controlling interests per share¥ 2,099.95
For the year ended
March 31, 2015

(2) Net income per share¥ 2,008.34
For the year ended
March 31, 2016

¥ 53.29¥ 11.49

77,82016,777

0

0

(0)

(0)

77,81916,7771,460,357,200

1,460,357,200(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.

47

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

As of March 31, 2015

As of March 31, 2016

(Assets)
Current assets
Cash and deposits

884,704

753,729

Accounts receivable-trade26,196

16,962Marketable securities

162,289

Finished goods

2,655

2,588

166

377

Raw materials and supplies

9,498

12,833

Advance payments-trade

25

108

Prepaid expenses

637

2,796

Work in process and partly-finished construction

Deferred tax assets
Short-term loans receivable from subsidiaries andaffiliates
Other

295
156,170

195,708

58,83946,415

Allowance for doubtful accounts(6,533)(10,191)

Allowance for investments in exploration(13,099)(14,961)

Total current assets

1,281,550

1,006,661

Buildings, net

15,946

15,564Structures, net

111,393

100,628213

581

63,12460,51137

31

Tools, furniture and fixtures, net

3,379

3,029

Land

17,051

17,467164

111

Construction in progress

42,75594,887

Total tangible fixed assets

254,066

292,81376,482

69,5292

2

Software

2,468

2,428

Other

4,555

4,270

Total intangible assets

83,50876,230

Fixed assets
Tangible fixed assets

Wells, net
Machinery and equipment, net
Vehicles, net

Leased assets, net

Intangible assets
Goodwill
Mining right48

(Millions of yen)Accounts

As of March 31, 2015

As of March 31, 2016

Investments and other assets
Investment securities

134,565

78,118Investments in stock of subsidiaries and affiliates

1,465,761

1,493,189

Investments in capital of subsidiaries and affiliates

0Long-term loans receivable from employees
Long-term loans receivable from subsidiaries
and affiliates
Long-term prepaid expenses

29

21

197,470

222,426

347

131

Long-term time deposits

120,270

202,842

Recoverable accounts under production sharing

101,564

95,827

Other

12,0798,187

Allowance for doubtful accounts
Allowance for recoverable accounts under
production sharing
Allowance for investments in exploration(104)(11,298)(805)(5,027)(134,202)(131,204)

Total investments and other assets

1,896,974

1,953,214

2,234,548

2,322,258

3,516,098

3,328,919

Accounts payable-trade

3,378

2,543

Current portion of long-term debt

7,760

9,096

53

44

Accounts payable-other

15,764

11,457

Accrued expenses

3,269

3,398

Income taxes payable

22,752

8,529

Deferred tax liabilities

832

Advances received

65

2,396

Deposits payable

323

308

796,573593,474

Accrued bonuses to officers

68

55

Asset retirement obligations

890

158

Other

12

406

851,746

631,868

Total fixed assets
Total assets(Liabilities)
Current liabilities

Lease obligations

Deposits received from subsidiaries and affiliates

Total current liabilities

49

(Millions of yen)Accounts

As of March 31, 2015

As of March 31, 2016

Long-term liabilities
Long-term debt

224,872

332,921

120

76

Deferred tax liabilities

5,982

2,877

Accrued retirement benefits to employees

6,106

7,043

Provision for loss on business
Provision for loss on business of subsidiaries
and affiliates
Asset retirement obligations

9,080

4,737

16,567

6,196

2,331

2,950

627

327

265,687

357,130

1,117,434

988,999

290,809290,809

Legal capital surplus

1,023,802

1,023,802

Total capital surplus

1,023,802

1,023,802

Lease obligations

Other
Total 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

70

225

10,942

7,480

Reserve for overseas investment loss

34,83435,226

Mine prospecting reserve

14,952

20,448Retained earnings brought forward

982,614962,221

1,043,414

1,025,601(5,248)(5,248)2,352,778

2,334,965

Unrealized holding gain on securities

45,885

4,954

Total valuation, translation adjustments and others

45,885

4,954

2,398,664

2,339,920

3,516,098

3,328,919

Total retained earnings
Treasury stock
Total shareholders' equity
Valuation, translation adjustments and others

Total net assets
Total liabilities and net assets

50

(2) Non-Consolidated Statement of Income(Millions of yen)
For the year ended
March 31, 2015

Accounts

For the year ended
March 31, 2016

Net sales

417,670

324,969

Cost of sales

231,791

190,103

Gross profit

185,879

134,866

979

3,059

Selling, general and administrative expenses

45,146

46,412

Operating income

139,754

85,394

Guarantee commission received

9,539

13,106

Gain on sales of marketable securities

18,14625,986

Interest income

13,12816,331Dividend income

42,533

23,690Foreign exchange gain

80,987

Other

3,240

8,774

167,576

87,889Loss on valuation of shares of subsidiaries and affiliates

39,43644,046

Provision of allowance for doubtful accounts

1,484

16,944

73

945

7,377

13,345

Exploration expenses

Other income

Total other income
Other expenses

Provision for allowance for recoverable accounts under
production sharing
Provision of allowance for investment loss
in exploration
Provision for loss on business

2,102

Provision for loss on business of subsidiaries andaffiliates

1,928

Foreign exchange loss

2,939
28,300

Other

8,044

10,659Total other expenses

60,448117,182

Ordinary income

246,881

56,102

Income before income taxes

246,881

56,102

Income taxes-current

98,11649,574

Income taxes-deferred(345)(1,945)

Total income taxes

97,77047,629Net income

149,1108,473

51

(3) Non-Consolidated Statement of Changes in Net Assets
For the year ended March 31, 2015
(Millions of yen)
Shareholders' equity
Capital Surplus

Commonstock

Balance at the beginningof the period
Cumulative effects ofchanges in accounting
policies
Restated balance

Retained earnings

Other retained earnings
Reserve for
specialReserve forReserve forLegal capital Total capital
account for Reserve foradvanced
overseas
surplussurplusadvancedspecialdepreciation
investmentof non-current depreciation depreciation
loss
of non-current
assetsassets

290,809

1,023,802

1,023,802

18

50

13,04438,542

290,809

1,023,802

1,023,802

18

50

13,04438,542

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

52
(0)

(50)

(2,102)(3,708)Cash dividends paid
Net income
Other changes in items
other than those inshareholders' equity(net)Total changes during theperiodBalance at the end of theperiod52
290,809

1,023,802

1,023,802

52

70

(50)

(2,102)(3,708)

10,942

34,834

Valuation, translation
adjustments and others

Shareholders' equity
Retained earnings

Total
Total net
Other retained earnings
Total
Unrealized valuation,assetsTreasury
Total
Shareholders' holding gain translation
RetainedMinestockretainedon securities adjustments
equityearnings
prospecting
and othersbrought earnings
reserveforwardBalance at the beginningof the period
Cumulative effects ofchanges in accounting
policies
Restated balance

8,815

8,815

859,882

920,354235

235

860,118

920,590(5,248)2,229,718

44,59544,595 2,274,314

235(5,248)2,229,954

235
44,59544,595 2,274,549

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

(52)
0

50

2,102

3,708
8,487

(8,487)(2,351)

2,351

Cash dividends paid

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

Net income

149,110

149,110

149,110

149,110

Other changes in items
other than those inshareholders' equity(net)Total changes during theperiodBalance at the end of theperiod6,136

122,496

122,824

14,952

982,614 1,043,414

53(5,248)

1,290

1,290

1,290

122,824

1,290

1,290

124,1142,352,778

45,88545,885 2,398,664

For the year ended March 31, 2016
(Millions of yen)
Shareholders' equity
Capital Surplus

Commonstock

Balance at the beginningof the period
Cumulative effects ofchanges in accounting
policies
Restated balance

Retained earnings

Other retained earnings
Reserve forReserve for
specialReserve forLegal capital Total capital
advancedaccount for Reserve foroverseas
surplussurplusspecialdepreciation
advanced
investmentof non-current depreciation depreciation
loss
assetsof non-current
assets

290,809

1,023,802

1,023,802

70

10,942

34,834

290,809

1,023,802

1,023,802

70

10,942

34,834

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

155

122
(3,584)
392

Cash dividends paid
Net income
Other changes in items
other than those inshareholders' equity(net)Total changes during theperiodBalance at the end of theperiod290,809

1,023,802

1,023,802

54

155(3,462)

392

225

7,480

35,226

Valuation, translation
adjustments and others

Shareholders' equity
Retained earnings

Total
Other retained earnings
Total
Unrealized valuation,
Treasury
Total
Shareholders' holding gain translation
RetainedMinestockretainedon securities adjustments
equityearnings
prospecting
and othersbrought earnings
reserveforwardBalance at the beginningof the period
Cumulative effects ofchanges in accounting
policies
Restated balance

Total net
assets14,952 982,614 1,043,414(5,248)2,352,778

45,88545,8852,398,664

14,952 982,614 1,043,414(5,248)2,352,778

45,88545,8852,398,664

Changes during the period
Provision of reserve foradvanced depreciationof non-current assets
Reversal of reserve foradvanced depreciationof non-current assets
Provision of reserve for
special account foradvanced depreciation of
non-current assets
Reversal of reserve for
special account foradvanced depreciation of
non-current assets
Provision of reserve for
special depreciation
Reversal of reserve for
special depreciation
Provision of reserve foroverseas investment loss
Reversal of reserve foroverseas investment loss
Provision of mineprospecting reserve
Reversal of mineprospecting reserve
Cash dividends paid
Net income
Other changes in items
other than those inshareholders' equity(net)Total changes during theperiodBalance at the end of theperiod

(155)

(122)
3,584
(392)

7,826

(7,826)(2,331)

2,331(26,286)(26,286)(26,286)(26,286)

8,473

8,473

8,473

8,473

5,495 (20,393)(17,813)

20,448 962,221 1,025,601

55(5,248)(40,931)(40,931)(40,931)(17,813)(40,931)(40,931)(58,744)2,334,965

4,954

4,954

2,339,920

(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

56

7. 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, 2015

For the year ended March 31, 2016

1.2 MMbbls(3.2 Mbbls per day)
41.6 Bcf(113.9 MMcf per day)
9.0 MMboe(24.6 Mboe per day)

1.2 MMbbls(3.2 Mbbls per day)
43.8 Bcf(119.7 MMcf per day)
9.4 MMboe(25.7 Mboe per day)482.6 tons

514.0 tons

205.9 million kWh

203.6 million kWh14.9 MMbbls(40.9 Mbbls per day)
241.9 Bcf
(662.6 MMcf per day)60.7 MMboe(166.3 Mboe per day)
9.8 MMbbls(27.0 Mbbls per day)61.7 MMbbls(168.9 Mbbls per day)
1.0 MMbbls(2.7 Mbbls per day)
37.8 Bcf(103.4 MMcf per day)
7.8 MMboe(21.3 Mboe per day)88.6 MMbbls(242.7 Mbbls per day)
321.2 Bcf
(880.0 MMcf per day)
148.9 MMboe(408.1 Mboe per day)17.6 MMbbls(48.0 Mbbls per day)
265.6 Bcf
(725.7 MMcf per day)
67.6 MMboe(184.6 Mboe per day)
11.8 MMbbls(32.3 Mbbls per day)
90.9 MMbbls(248.4 Mbbls per day)
2.7 MMbbls(7.3 Mbbls per day)
32.0 Bcf(87.5 MMcf per day)
8.4 MMboe(22.9 Mboe per day)
124.2 MMbbls(339.2 Mbbls per day)
341.4 Bcf
(932.9 MMcf per day)
188.1 MMboe(513.8 Mboe per day)482.6 tons

514.0 tons

205.9 million kWh

203.6 million kWh

Crude oil
Natural gas
Japan

Subtotal
IodineElectric power generation
Crude oil

Asia & Oceania

Natural gas
Subtotal

Eurasia(Europe & NIS)

Crude oil

Middle East & Africa

Crude oil
Crude oil

AmericasNatural gas
Subtotal
Crude oil
Natural gas

Total

Subtotal
IodineElectric power generation

Note: 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 114.8 MMbbls (314.6 Mbbls per day) of crude oil,408.0 Bcf (1,117.7 MMcf per day) of natural gas, and in total 191.7 MMboe (525.1 Mboe per day) for the year ended March 31, 2015, and 146.1
MMbbls (399.2 Mbbls per day) of crude oil, 432.0 Bcf (1,180.4 MMcf per day) of natural gas, and in total 227.1 MMboe (620.5 Mboe per day) for theyear ended March 31, 2016.
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.

57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, 2015 For the year ended March 31, 2016
Sales volume

Japan

Sales volume

Net sales

Crude oil

791 Mbbls

7,683

741 Mbbls

4,505

Natural gas(excluding LPG)

66,679 MMcf

102,835

65,304 MMcf

91,4927 Mbbls

58

7 Mbbls41

LPG

Asia & Oceania

Net sales

Other

18,944

13,561

Subtotal

129,521

109,601

Crude oil

11,015 Mbbls

103,831

13,505 Mbbls

82,069Natural gas(excluding LPG)

204,231 MMcf

285,480

238,759 MMcf

210,288

LPG

2,844 Mbbls

20,4632,354 Mbbls

10,514

Subtotal

409,775

302,871

Eurasia(Europe & NIS)

Crude oil

9,946 Mbbls

94,04911,666 Mbbls

66,851

Middle East & Africa

Crude oil

58,773 Mbbls

524,528

89,486 Mbbls

516,513

Crude oil

33 Mbbls

329

1,829 Mbbls

9,301

38,575 MMcf

13,021

33,153 MMcf

4,425

Natural gas(excluding LPG)

Americas

Subtotal

Total

13,351

13,726

Crude oil

80,558 Mbbls

730,422

117,227 Mbbls

679,241Natural gas(excluding LPG)

309,485 MMcf

401,337

337,216 MMcf

306,205

LPG

2,851 Mbbls

20,522

2,361 Mbbls

10,555

Other

18,944

13,561

Total

1,171,226

1,009,564

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.

Customer

ADNOC

For the year ended
March 31, 2015
AmountRatio(Millions of yen)
(%)
―

58

For the year ended
March 31, 2016
AmountRatio(Millions of yen)(%)―

102,49310.2