INPEX CORPORATION

Semiannual Financial Results
for the six months ended September 30, 2005

Tokyo ・ 16th November 2005

1Agenda

1. Overview of the FY2006 Semiannual
Consolidated Financial Results
Mutsuhisa Fujii
Executive Senior Vice President

2. Overview of the FY2006 Semiannual
Corporate Activities Results
Naoki Kuroda
President

2Cautionary Statement
This presentation includes forward-looking information that reflects the plan andexpectations of INPEX CORPORATION (the “Company”). Such forward-looking
information is based on the current assumptions and judgments of the Company in light ofthe information currently available to it, and involves known and unknown risk,uncertainties, and other factors. Such risks, uncertainties and other factors may cause theCompany’s performance, achievements or financial position to be materially different fromany future results, performance, achievements or financial position expressed or impliedby such forward-looking information. Such risks, uncertainties and other factors include,
without limitation:
 Price volatility and change in demand in crude oil and natural gas
 Foreign exchange rate volatility
 Change in costs and other expenses pertaining to the exploration, development andproduction
The Company undertakes no obligation to publicly update or revise the disclosure of
information in this presentation (including forward-looking information) after the date ofthis presentation

3

Overview of the FY2006 Semiannual
Consolidated Financial Results

4Subsidiaries and Affiliates
25 consolidated
subsidiaries

One exploration subsidiary liquidated since March, 2005

Major subsidiaries

Country/region

OwnershipStage

INPEX Natuna

Indonesia

100%

Production

INPEX Masela

Indonesia

50%

Under discussion for development

INPEX Sahul

Timor Sea Joint Petroleum Development Area

100%

Production

INPEX Browse

Australia

100%

Under discussion for development

JODCOUAE

100%

Production

Azadegan Petroleum Development

Iran

100%

Development

INPEX Southwest Caspian Sea

Azerbaijan

51%

Production

INPEX North Caspian Sea

Kazakhstan

45%

Development

11 affiliates accounted forequity method

No change since March, 2005

Major affiliates

Country/region

Ownership

Stage

MI Berau B.V.

Indonesia

44%

Development

Angola Japan Oil

Angola19.6%

Production

5Highlights of the FY2006 Semiannual Consolidated Financial Results(Billions of yen)

1H of FY2005

1H of FY2006

Change% change

213.9310.696.7

45.2%

116.5
110.3
33.0
17,596.54

186.5
180.5
51.6
26,908.15

70.0
70.2
18.6
9,311.61

60.1%
63.7%
56.5%

Net sales
Operating income
Ordinary income
Net income
Net income per share (¥)*

52.9%

*Based on averaged shares outstanding (1H of FY2006: 1,919,832 shares, 1H of FY2005: 1,876,337shares). Due to increase in shares outstanding during the term (May17, 2005) caused by stock exchange for acquisition of JODCO, averaged shares outstanding has increased from 1H of FY2005 to 1H of FY2006

Net sales

Ordinary income(Billions of yen)(Billions of yen)

400200(Billions of yen)

Net income

60

310.6300
213.9
20010010086.0
127.940114.1

110.3

196.50180.5

Crude oil

1Hof FY2006
05年度中間33.000
1H of FY200504年度中間2051.6

1H of FY200504年度中間1H of FY2006
05年度中間1Hof FY200504年度中間1Hof FY2006
05年度中間Natural gas

6Crude Oil Sales
Background reasons for the sales increase in crude oil
9 Sales volume increased 7.3% year-over-year from increase in production at JODCO (ADMA Block), INPEXSouthwest Caspian Sea (ACG oil field), and INPEX Natuna (Belanak oil and gas Field)
9 Average unit price rose sharply by 45.3% year-over-year
9 The yen slightly appreciated against the U.S. dollar on average

Crude oil sales*(Billions of yen)
Crude oil sales volume(Mbbl)
Average unit price($/bbl)
Average exchange rate(¥/$)

1H of FY2005

1H of FY2006

Change% change

127.8

196.5

68.6

53.7%

30,91033,156

2,245

7.3%

37.17

54.00

16.83

45.3%

110.15109.59(0.56)(0.5%)*Includes domestic supply obligations with Indonesia

7Natural Gas Sales
Background reasons for the sales increase in natural gas
9 Sales volume slightly decreased year-over-year
9 Average unit price rose sharply by 33.5% year-over-year along with higher oil prices
9 The yen stayed at the same level against the U.S. dollar on average

Natural gas sales*(Billions of yen)
Natural gas sales
volume (MMcf)
Average unit price($/Mcf)
Average exchange rate(¥/$)

1H of FY2005

1H of FY2006

Change% change

86.0

114.0

28.0

32.6%

146,211

144,654(1,557)(1.1%)

5.10

6.81

1.71

33.5%

109.84109.69(0.15)(0.1%)*Includes LPG

8Statements of Income
1H of FY2005

1H of FY2006

Change% change

Net sales

213.9

310.6

96.7

45.2%

Cost of sales

91.4

116.7

25.3

27.7%

Exploration expenses

0.9

2.5

1.5

156.4%

Selling, general andadministrative expenses

4.9

4.7(0.1)(3.4%)

116.5

186.5

70.0

60.1%

Other income

2.6

5.0

2.3

88.1%

Other expenses

8.9

11.0

2.1

23.6%

Ordinary income

110.3

180.5

70.2

63.7%

Income taxes

78.1

128.9

50.7

64.9%

Minority interests

(0.8)

(0.0)

0.8(96.9%)

Net income

33.051.6

18.656.5%(Billions of yen)

Operating income

9Other Income / Expenses
1H of FY2005

1H of FY2006

Change% change

Other income

2.6

5.0

2.3

88.1%

Interest income

1.6

3.3

1.7

108.0%

Equity in earnings of affiliates

−

1.0

1.0

−

Reversal of allowance for investments in exploration

0.7−(0.7)(100.0%)

Other

0.3

0.7

0.3

101.7%

Other expenses

8.9

11.0

2.1

23.6%

Interest expenses

1.1

2.7

1.5

131.1%

Equity in losses of affiliates

0.4−(0.4)(100.0%)

Provision for allowance forrecoverable accounts under production sharing

0.1

0.3

0.1

71.3%

Amortization of exploration and development rights

0.8

0.0(0.8)(94.8%)

Foreign exchange loss

5.2

7.4

2.1

41.1%

Other

0.9

0.5

(0.4)

(43.5%)(Billions of yen)

10Balance Sheets(Billions of yen)

1H ofFY2005

FY2005

1H of Change fromFY2006
FY2005Current assets

203.1

238.4

251.0

12.5

5.3%

Tangible fixed assets

68.9

68.2

67.8

(0.4)

(0.6%)

Intangible assets

142.2

138.6

139.7

1.00.8%Recoverable accounts underproduction sharing

225.9

239.6

269.1

29.512.3%

Investment securities

103.4

118.3

181.8

63.4

53.6%

Other investments

19.3

17.4

17.9

0.4

2.6%

Less allowance for recoverable
accounts under production sharing(44.9)(41.5)(41.2)

0.2(0.6%)

Total assets

718.1

779.2

886.1

106.9

13.7%

Current liabilities

101.3

122.9

163.6

40.7

33.2%

Long-term liabilities

216.1

209.7

231.2

21.4

10.2%

Minority interests in consolidated
subsidiaries

33.1

35.2

35.6

0.3

1.1%

Total shareholders’ equity

367.5

411.2

455.6

44.3

10.8%

Total liabilities, minority interests andshareholders’ equity

718.1

779.2

886.1

106.9

13.7%

% change11

Statements of Cash Flows(Billions of yen)

1H of FY2005

1H of FY2006

Change% change

110.3

180.5

70.2

63.7%

5.5

6.6

1.0

18.3%

Recovery of recoverable accounts under production
sharing (capital expenditures)

16.7

22.6

5.9

35.6%

Recoverable accounts under production sharing(operating expenditures)

(3.0)

(0.9)

2.1

(69.7%)(75.0)(110.4)(35.3)

47.1%

9.0

2.9

(6.0)

(67.6%)

63.5

101.4

37.9

59.7%

Purchases of investment securities(33.4)(75.0)(41.5)

124.1%

Investment in recoverable accounts under production
sharing (capital expenditures)(30.8)(48.4)(17.6)

57.1%

7.7(0.4)(8.2)−(56.5)(123.9)(67.4)

119.2%

4.9

0.4

(4.5)

(91.5%)

121.1

109.8

(11.3)(9.3%)

Income before income taxes and minority interests
Depreciation and amortization

Income taxes paid
Other
Net cash provided by operating activities

Other
Net cash used in investing activities
Net cash provided by financing activities
Cash and cash equivalents at end of the year

12Financial Index
Net Debt / Total Capital Employed*

Equity Ratio**

12.0%
52.9%

52.8%
51.4%

(13.3%)(19.2%)
FY2004

Notes:***FY2005

1H of FY2006

FY2004

FY2005

1H of FY2006

Net Debt/Total Capital Employed = (Debt - Cash and Deposits – Government Bonds, Local government Bonds and Companies’ Bonds (withdeterminable value)) / (Shareholders’ Equity + Minority Interest + Debt - Cash and Deposits - Government Bonds, Local Government Bonds andCompanies’ Bonds (with determinable value))
Equity Ratio = Shareholders’ Equity/Total Assets

13Overview of the FY2006 Semiannual
Corporate Activities Results

14

Business Strategy
Active implementation of strategic and effective oil and gas exploration and development projects

Regional Diversification

Well-balanced Assets Portfolio
9 Balance by stage (exploration, development and production)

 Core area
¾ Indonesia, Australia
 Target area

9 Balance by resource (crude oil and natural gas)
9 Balance by contract (PSC, Concession and Service Contract)¾ The Caspian Sea¾ The Middle East

9 Balance as an operator and a non-operator

Diversification of NaturalGas Business Natural gas shipments via
LNG and pipeline
 Supply of natural gas to theproducing countries
 New technology (GTL, etc.)¾ Others (Africa, SouthAmerica, Russia, etc.)

 Maintain and expand natural gas production from offshore Mahakam block in Indonesia, the existing
profit center Promote development of the two major oil field projects in the Caspian Sea (ACG, Kashagan) Progress three operator projects in Azadegan Iran, Ichthys Australia, and Abadi Indonesia
 Maintain and expand reserves by acquiring promising exploration blocks and purchasing high-grade oiland gas field assets
 Contribute to an efficient and stable supply of energy to Japan as the national flag company

Mid- and Long-term sustainable strategies to grow corporate value
15

Progress of Major Projects
Existing Profit Center: Offshore Mahakam, Indonesia

 1H of FY2006 results and Plan for thefuture¾ Continuous gas field development to support
stable LNG supply from the Bontang LNG Plant(Maintaining existing amount of LNG shipped)(Staged development at the Tunu and Peciko fields,
further development of the Tambora field, developmentof phase 1 aiming for production to start in September
2007 at the Sisi/Nubi gas fields)

 Mid-to Long-Term Targets¾ Continuation of stable supply of natural gas tothe Bontang LNG Plant
Bontang LNG Plant¾ Renewal of the LNG sales contracts to be expiredin 2010 or late16

Progress of Major Projects
New Profit Center: ACG, Kashagan in the Caspian Sea
 ACG（Azeri-Chirag-Gunashili) Oil Fields, Azerbaijan¾ Phase 1 (Central Azeri) start-up in February 2005
¾ Phase 2 (West and East Azeri) are under development, and are planned to start-up inQ1 and Q4 of 2006
¾ Phase 3 (Gunashili Deepwater and West Chirag) are scheduled to start-up in Q1 2008
¾ BTC pipeline is scheduled to begin full shipment by the end of 2005
¾ The level of production is expected to reach 1 million barrels per day in 2009 Kashagan Oil Field, Kazakhstan¾ Kashagan Oil Field is the first discovery in the Kazakhstan territorial waters of theCaspian Sea and is one of the largest oil field in the world. In addition to Kashagan,
there are four other structures such as Kalamkas, Aktote, Kashagan Southwest andof Kairan structures in the area and hydrocarbon reserves have been confirmed in allthe structures¾ In Phase 1, Tranche 1 and Tranche 2 developments at Kashagan Oil Field are underway, and production is planned to start-up in 2008
¾ The level of production is expected to plateau at 1.2 million barrels per day in 2016
after the completion of Phase 3 development
17

Progress of Major Projects
Projects Operated by INPEX: Ichthys / Abadi / Azadegan Ichthys Gas-Condensate Field, Australia（WA-285-P Block）¾ Proactively conducting feasibility studies to determine the development plan(LNG, GTL) and gas marketing¾ Pursue commencement of gas production targeting at early period from 2010, as amajor project following ACG and Kashagan Abadi Gas Field, Indonesia (Masera Block)¾ Drilling of four appraisal wells are scheduled in order to evaluate reserves in
midyear of 2006
¾ After appraisal activities, we plan to conduct feasibility studies for development
plan and gas marketing Azadegan Oil Field, Iran
¾ Since March 2004, we have been establishing operating organization, have been
implementing several bidding procedures necessary for the development of thefield, and have been conducting appraisal work for the reserve evaluation basedon the appropriate working process along with contracted development schedule18

New Projects
42-2&4 BlockTunisia

 Successfully bid for 42-2&4 block innorthern part of Libya jointly with TOTAL,a French company, in October 2, 2005

Mediterranean
Toripoli

Algeria

INPEX Libya, Ltd.

Banghazi42-2&4(3,419km2 )

Egypt

Libya

 Established as 100% subsidiary of INPEXin October 17, 2005
 Currently pursuing signing a contract
 Our Working Interest：40%(Operator TOTAL: 60%)ChadSudan

Exploration and Production Sharing
Agreement :EPSA

 Scheduled to start exploration activities
after 2006

19Business Integration Process with Teikoku Oil・Company name・Schedule
05/11/2005
Signing of Stock Transfer Agreement
31/01/2006 (Plan) Extraordinary Shareholders’ Meeting
28/03/2006 (Plan) Delisting of both companies
03/04/2006 (Plan) Establishment and listing of jointholding Company
June 2008 (Plan) To become an operating holding
company

Kokusai Sekiyu Kaihatsu Teiseki Holdings
Kabushiki Kaisha(English name: INPEX Holdings Inc.)
・Stock transfer ratio
INPEX ： Teikoku ＝ 1 ： 0.00144Current

Phase 2 (2008/6)

HoldingCompany

OperatingHolding Company

INPEX

MergerOverseas
Operations

Teikoku

Share Transfer

INPEX

Phase 1 (2006/4)

INPEX

Teikoku

Teikoku

Overseas
Domestic
Operations Operations

Overseas
Operations

Overseas
Operations

Domestic
Operations

Further reorganization to realize growth strategy

Overseas
Operations

Domestic
Operations

NewOperations

20