PROJECTOVERVIEW

5

Project (Segment) Overview

Asia &p.60
Oceania

Eurasia
p.64

8

4

`

1,551

`

1,296
1,296

Number of countries

1

Number of projects

1
12
2

42

20

6

2
4

In production

2

1

5

Under development
Discovered /Preparation for development

Project Summary

Upside Potential

058

INPEX CORPORATION Annual Report 2013

190

188

210

207

211

207
2008

25

2013

25

2012

28

2011

27

2010

25

2009

54

195

2008

201

185

■Net production (thousand boed)

177■Proved reserves (million boe)

214

Production / Reserves

179

367

466

523

530

Other project

Substantial increase in net proved reserves owing to the booking of
Ichthys reserves as a result of development transfer.

Under exploration

2009

2010

2011

2012

2013

In the core Asia and Oceania region, INPEX isengaged in activities in the Offshore Mahakam
Block, which is contributing signiﬁcantly to earnings, and the large-scale Ichthys and Abadi
LNG projects, where development as well as
preparation for development are ongoing. At
the same time, the Company is actively advancing multiple small and medium-sized production
projects.

The Companyʼs activities in this region revolve
mainly around the ACG Projects in Azerbaijan and
the Kashagan Project in Kazakhstan, a large-scale
oil project. With the commencement of production
at the Kashagan Project, production volumes inthe Eurasia region are expected to increase going
forward.

Exploration prospects number up to a maximumof 20 in this region. Of this total, 10 projects are
in close proximity to the Ichthys gas and condensate fields. In addition, interests are maintained in exploration blocks near the Offshore
Mahakam Block and in the frontier areas of the
Bay of Bengal in India.

Two exploration potentials were added to theportfolio during the year ended March 31, 2013.
INPEX was awarded offshore exploration blocks
located northwest of Shetland Island in the
United Kingdom in October 2012. The Company
also concluded a Cooperation Agreement with
Rosneft regarding the exploration blocks in the
Sea of Okhotsk, Russia in May 2013.

Middle East&
Africap.66

Americas
p.68

Japan
p.70

8

8

1

`

`

Minami-Nagaoka
Gas Field

5

12

4

`

19

6
2

Naoetsu LNG
Terminal

11

Natural gas pipeline(Approx. 1,400 km)
etc.

1

505

518

583

636

682

739

2

130

138

126

137

117

2013

25

28

29

2013

30

17

36

2012

32

2011

18

30

40

2010

21

21

38

2009

32

2008

17

26

68
2012

15
2011

158

2010

155

135

146
2009

132

145
2008

Project Overview

151

5

2008

2009

2010

2011

2012

2013

The Middle East and Africa region accounts formore than 60% of INPEXʼs net oil production volume. From both the Companyʼs reserves and net
production volume perspectives, the mainstay
ADMA Block in Abu Dhabi in the United ArabEmirates contributes substantially. In Africa, theacquisition of a project in Angola Block 14 during
the year ended March 31, 2013 is also expected
to bolster reserves and production volumes.

The Companyʼs track record as a development
operator in Venezuela spans more than 20 years.
In addition to its development and preparation
for development activities in the Joslyn oil sandsand shale gas projects in Canada, INPEX participates in such projects as the Lucius oil ﬁeld in
the deepwater Gulf of Mexico in August 2012.

INPEX is active in the Minami-Nagaoka Gas
Field in Niigata Prefecture, one of the largest of
its kind in Japan. At the same time, the Company
operates a domestic trunk pipeline of approximately 1,400 km. With the Naoetsu LNG Terminal scheduled to come online from 2014, INPEX
is positioned to put in place a comprehensive gas
supply chain.

Building its portfolio in the Middle East, INPEX
was awarded an onshore exploration block in
Iraq in May 2012. Plans are in place to commence
exploration activities going forward. In April
2013, the Company took steps to participate inan exploration block in offshore Mozambique,
East Africa. Moreover, exploration potential
exists within Angola Block 14.

Additional exploration and development projects
with potential include the shale gas project inCanada and the offshore exploration projectin the frontier area of Uruguay, South America.
Moreover, considerable interest is being directed
toward the succession of pre-salt (deepwater oil
ﬁelds) discoveries in offshore locations in Brazil.

INPEX has placed considerable weight on surveying new oil and natural gas resources both onand offshore Japan for many years. The Company
has conducted comprehensive evaluation workover the past two years. In addition to identifying
promising areas, INPEX has also established an
exploration policy going forward. Looking ahead,
the Company will engage in specific exploration
work based on its past ﬁndings and policy.

INPEX CORPORATION Annual Report 2013059

Project (Segment) Overview by Region

Asia & Oceania
Regarding the performance in Asia and Oceania for the year ended March 31, 2013, net
sales increased by 0.4% to ¥485.3 billion. Despite decreases in sales volume and pricesof natural gas, this result was largely attributable to an increase in crude oil sales volume
and yen depreciation. From a proﬁt perspective, operating income decreased by 6.0%
to ¥281.6 billion owing mainly to an increase in depreciation.

In production

M YA N M A R

Under development
Discovered /Preparation for development

VIETNAM
KG-DWN2004/6

Offshore Martaban

Under exploration
Other project
Blocks 05-1b & 05-1c

2 South Natuna

OP Operator project

Block S OP
Block R
Block SK-10
Block SK-8

Sea Block B p. 61
Kuala Lumpur Oﬃce

M A L AY S I ATangguh LNG Project (Berau Block)

East Kalimantan Block

1 Offshore Mahakam Blockand Attaka Unitp. 61

PA P U A
NEW GUINEA

Tengah BlockSouth East Mahakam BlockWest Sebuku Block

Sebuku Block

Semai II Block

INDONESIA

Jakarta Office

4 Bayu-Undan Project (JPDA03-12 Block) p. 62
Kitan Oil Field (JPDA06-105 Block)

Ichthys LNG Project

5 Abadi LNG Project OP p. 63
Darwin Office

AC/P36 OP
WA-410-P

JPDA11-106
WA-343-P OP
WA-341-P OP
WA-344-P OP

WA-411-P
WA-274-P
WA-281-Ppp. 48–55（Special Report）OP

Babar Selaru Block OP

PDL3 & PDL4
Unitization
PRL14

6 Prelude FLNG Project (WA-44-L Block)p. 63

WA-35-L & WA-55-L Unitization(Coniston Unit)

WA-285-P OP
WA-494-P OP

WA-35-L (Van Gogh Oil Field)
WA-43-L (Ravensworth Oil Field)

WA-155-P (Part II)
WA-35-L
WA-155-P (Part I）

3 Van Gogh Oil Field,

Ravensworth Oil Field
and othersp. 62

AUSTRALIA
Perth OfficeQ.

Please tell us
about production
trends at
the Offshore
Mahakam Block.

A.

Asia & Oceania Q&A

060

INPEX CORPORATION Annual Report 2013

In addition to the natural decline in production, volumes contracted due to production
impediments caused by such factors as sandat production wells. In response, steps weretaken to drill new production wells and to
implement various initiatives including measures to counteract sand problems. Thanks
to these countermeasures the drop in production bottomed out around autumn 2012
and is currently showing signs of recovery.

Offshore Mahakam Block production facility

1. Offshore Mahakam Block and Attaka Unit
INPEX entered into a production sharing contract (PSC) with the Indonesian
Government in October 1966, at thattime acquiring a 100% participating interest in the Offshore Mahakam Block. The
Attaka Unit was established in April 1970
through the unitization of part of the adjacent blocks owned by INPEX and Unocal(now Chevron), with each company taking a 50% interest. Production of crude
oil and natural gas began in 1972. INPEX
farmed out a 50% participating interest in
the Offshore Mahakam Block to CFP (nowTOTAL) in July 1970. This venture subsequently made a series of discoveries in
the Bekapai (oil), Handil (oil), Tambora (oiland gas), Tunu (gas), Peciko (gas), Sisi andNubi (gas), as well as the South Mahakam(gas) ﬁelds, each of which has continued
to produce crude oil and natural gas.
The crude oil and condensate produced
from these ﬁelds are shipped mainly to oil
reﬁneries and power companies in Japanby tanker from the Santan and Senipah

Shipping terminal

terminals. Most of the natural gas is supplied to the Bontang LNG Plant, thenshipped as LNG to Japan and elsewhere.
The Offshore Mahakam Block willcontinue to be a key proﬁt center for
INPEX. In addition, together with TOTAL(the operator), we have been engaged
in negotiations with the Indonesianauthorities to secure a contract extension
beyond 2018 with respect to the Offshore
Mahakam Block.

Project status
Contract area
(production on the basis of all ﬁelds and(block)average rate of FY2012)
Offshore
MahakamAttaka Unit

Crude oil: 72 Mbbld
In production Natural gas: 1,393 MMcf/d
LPG: 12 Mbbld

Venture company(established)

Interest owned(*Operator)

INPEX
CORPORATION(February 21, 1966)

INPEX 50% TOTAL* 50%

Bontang LNG Plant

Attaka Unit
Santan Terminal

Attaka Field

Badak Field
Nilam Field

Tunu Field

Tambora Field
Sisi Field

Handil Field

Nubi Field

Senipah Terminal

Bekapai Field

Balikpapan

Peciko Field

Offshore
Mahakam BlockSouth Mahakam Field

Gas field

Oil field

Oil and gas field

INPEX 50% Chevron* 50%

5Project Overview

2. South Natuna Sea Block B
In July 1977, INPEX acquired a 17.5%
participating interest in the South NatunaSea Block B. Later, in January 1994,
INPEX increased its total participatinginterest in the block to 35% with thepurchase of an additional 17.5% interest. Crude oil production began in 1979,and supplies of natural gas to Singapore
via Indonesiaʼs ﬁrst international pipelinecommenced in 2001. Additional deliveries of natural gas from this pipeline to
Malaysia started in 2002. These supply
milestones contributed to the extensionof the PSC covering the block until 2028.

FPSO vessel

Project status
Contract area
(production on the basis of all ﬁelds and(block)average rate of FY2012)
South Natuna
Sea B

In production

Crude oil: 40 Mbbld
Natural gas: 374 MMcf/d
LPG: 15 Mbbld

Production operations in the Belanak oil and gas ﬁeld, which is part ofSouth Natuna, utilize a world-class ﬂoating production, storage and ofﬂoading(FPSO) system. Production of crude oiland condensate began in December
2004, with LPG production commencing in April 2007. At this same block,production began at the Hiu Gas, Kerisi
Oil and Gas, and North Belut Gas ﬁelds
from 2006 as well as the Bawal Gas
Field in July 2012. In addition, a numberof development projects are currently
under way to maintain and expand output. This includes preparation for development at the South Belut Gas Field.
Natuna Sea

North Belut South Natuna Sea

BelidaKerisi

Bawal

Venture company(established)

Interest owned(*Operator)

INPEX Natuna, Ltd.
(September 1, 1978)

INPEX Natuna 35%
ConocoPhillips* 40%
Chevron 25%

Block B

South Belut
Gas Field Natuna Island
Hiu

Sembilang

BelanakGas field

Oil field

Oil and gas field

INPEX CORPORATION Annual Report 2013061

3. Van Gogh Oil Field, Ravensworth Oil Field and others
INPEX acquired participating interests
in WA-155-P (Part I) in July 1999, after
which the Van Gogh and Ravensworth
oil ﬁelds were discovered. The Australian Government granted production
licenses (WA-35-L and WA-43-L) for
those two blocks, in which oil productioncommenced in February and August of
2010, respectively.
The decision to develop the Coniston Unit, which saddles WA-35-L andWA-55-L, was made in December 2011,
and work targeting the commencement of
production in 2014 is under way. Average
crude oil production for the ﬁrst year ofoperation of the Coniston Unit is expected
to be 21.5 thousand barrels per day.
WA-35-L & WA-55-L
Unitization(Coniston Unit)

Barrow Island

Van Gogh Oil Field

WA-35-L
Indian Ocean

WA-155-P（Part II）

Ravensworth Oil Field

WA-43-L
Exmouth

WA-155-P（Part I）
Onslow

AUSTRALIA

Oil field
Van Gogh FPSO

Contract area
(block)Project status(production on the basis of all
ﬁelds and average rate of FY2012)

Venture company(established)

Interest owned(*Operator)

WA-35-L (Van Gogh Oil Field)

In production (Crude oil: 16 Mbbld)

INPEX Alpha 47.499% Apache* 52.501%

WA-43-L (Ravensworth Oil Field)

In production (Crude oil: 16 Mbbld)

INPEX Alpha 28.5% BHPBP* 39.999% Apache 31.501%

WA-35-L & WA-55-L
Unitization area(Coniston Unit)

Under development

WA-35-L(excluding Van Gogh Oil Field)
WA-155-P (Part Ⅱ)

INPEX Alpha, Ltd.
(February 17, 1989)

Under exploration

INPEX Alpha 47.499% Apache* 52.501%
INPEX Alpha 47.499% Apache* 52.501%
INPEX Alpha 18.670% Apache* 40.665% OMV 27.110% Tap 13.555%

WA-155-P (Part Ⅰ)

INPEX Alpha 28.5% BHPBP* 39.999% Apache 31.501%

4. Bayu-Undan Project (JPDA03-12 Block) and Kitan Oil Field (JPDA06-105 Block)
In April 1993, INPEX acquired a participating interest in JPDA03-12, a contract
area located in the Timor Sea JPDA.
Exploration within this contract area
resulted in the discovery of oil and gas
ﬁelds. Of these, studies revealed that
the Undan structure and the Bayu structure in the adjacent JPDA03-13 contract
area were a single structure. The interest holders unitized both contract areas
in 1999, allowing joint development of
the Bayu-Undan Gas-Condensate Field
to proceed. The commercial production and shipment of condensate and
LPG started in 2004, and LNG in February 2006.
INDONESIAEAST TIMOR

Abadi Gas Field

JPDA06-105 (Kitan Oil Field)
Timor Sea
Joint Petroleum Development Area

The presence of oil was conﬁrmed
through exploration drilling of the Kitan-1
and Kitan-2 wells in March 2008 in the
JPDA06-105 contract area, which INPEX
acquired in January 1992. Thereafter, we

Darwin LNG

Project status
Contract area
(production on the basis of all(block)ﬁelds and average rate of FY2012)

Bayu-Undan
Unit

In production
Crude oil: 48 Mbbld
Natural gas: 501 MMcf/d
LPG: 29 Mbbld

DarwinAUSTRALIA

Gas field

062

Oil field

INPEX CORPORATION Annual Report 2013

Venture company(established)

JPDA06-105
In production (Crude oil: 32 Mbbld)(Kitan Oil Field)

Interest owned(*Operator)
INPEX Sahul 19.2458049%
ConocoPhillips* 61.3114766%
Santos 19.4427185%

JPDA03-12

Darwin Gas Pipeline

Bayu-Undan Gas-Condensate Field

obtained approval for the ﬁnal development plan from the Timor Sea JPDA
authorities in April 2010. After development works, the production at the Kitan
Oil Field commenced in October 2011.

INPEX Sahul, Ltd.
(March 30, 1993)

INPEX Sahul 11.378120%
ConocoPhillips* 56.943372%
Eni 10.985973%
Santos 11.494535%
Tokyo Timor Sea Resources(TEPCO/Tokyo Gas) 9.198000%

INPEX Timor Sea, Ltd. INPEX Timor Sea 35%(November 25, 1991) Eni* 40% Talisman 25%

5. Abadi LNG Project
INPEX acquired a 100% participatinginterest in the Masela Block in November
1998 through an open bid conducted by
the Indonesian Government. INPEX proceeded with exploratory activity as theoperator, and an exploratory well drilledin 2000 discovered the Abadi Gas Field.
Subsequently, six appraisal wells were
drilled (two in 2002 and four in 2007–2008), all of which conﬁrmed the presence of gas and condensate column.
The Indonesian Government granted
its approval to the plan of development
for Stage-I (POD-1) for a “ﬂoating LNG”
with a capacity of 2.5 million tons per

year of LNG in December 2010. INPEX
is currently conducting FEED works. We
are studying the possibilities for further
development exploiting its reserves andare currently undertaking the continuous
drilling of three appraisal wells and one
exploration well.

Tanimbar Island
Drilling rig

INDONESIA

Abadi Gas Field

Arafura Sea

AUSTRALIA
Timor Sea

DarwinContract area (block)
MaselaGas field

Floating LNG

Project status

Venture company (established)

Interest owned (*Operator)

Preparation for development

INPEX Masela, Ltd.
(December 2, 1998)

INPEX Masela* 65% Shell 35％

5

In June 2012, we acquired from Shell a
17.5% participating interest in the Prelude FLNG Project, which is under development in offshore Western Australia.
The Prelude FLNG Project consists of
the Prelude and Concerto gas ﬁelds andwill produce 3.6 million tons per year of
LNG, 400 thousand tons per year of LPG
at peak and approximately 36 Mbbld ofcondensate at peak. Shell made the FID
on the Prelude FLNG Project, which willbe the worldʼs ﬁrst FLNG project, in May

2011. Development of the Prelude FLNG
Project is currently under way, with thestart of production targeted at around 10
years from when the Prelude Gas Field
was ﬁrst discovered in early 2007.

Project Overview

6. Prelude FLNG Project (WA-44-L Block)

Timor Sea

Concerto Gas Field
Prelude Gas Field

WA-44-L

Ichthys Gas-Condensate Field

AUSTRALIA

Gas field

FLNG vessel

Contract area(block)WA-44-L

Project status

Venture company (established)

Interest owned (*Operator)

Under development

INPEX Oil & Gas Australia Pty Ltd(February 28, 2012)

INPEX Oil & Gas Australia 17.5%
Shell* 67.5% KOGAS 10.0% CPC 5.0%

INPEX CORPORATION Annual Report 2013063

Eurasia
Regarding the performance in Eurasia for the year ended March 31, 2013, net sales increasedby 1.4% to ¥85.5 billion due to yen depreciation despite a decrease in the sales price of
crude oil. Operating income decreased by 11.3% to ¥41.8 billion mainly due to an increasein administrative expenses.
214/28Southeast Area,
214/29South Area,214/30b
Sakhalin I Project
P799

UNITED
KINGDOMRUSSIA

BELARUSRUSSIA

London Office

JA PA NFRANCEUKRAINE
AUSTRIAK A Z A K H S TA N
HUNGARY

1 Offshore Norrth

ROMANIA

Caspian Sea Contract
ontract AreaA(Kashagan Oil Field and others)p. 65

I TA LYUZBEK IS TANBULGARIAGEORGIAIn
n prproduction

TURKEYGREECEAZERBAIJAN

2 AC
ACG Oil Fieldsp. 65
TURK MENIS TAN

Under development
opment
Under
Und
U
Un
n er exexpeploration

p 65
3 BTC
BTC P
Pipe
Pi
peli
line
ne
e Pro
Proje
Proje
jject
ctp.

Other prO
projecj t

Q.

What do you see
as the potential
for new oil and gas
ﬁelds in Russia?

Eurasia Q&A

064

INPEX CORPORATION Annual Report 2013

A.

In May 2013, INPEX signed a Cooperation
Agreement with Rosneft in connection withthe exploration and development of blocks ina frontier area to the north of the Okhotsk Sea.
INPEX has accordingly secured the exclusive
right to negotiate ﬁnal agreements with regard
to exploration and development activities inthe blocks. Recognizing the vast reserves ofoil and gas in and around Russia, this initiative
is expected to help develop the Companyʼsbusiness over the medium to long term.

Agreement signing ceremony

1. Offshore North Caspian Sea Contract Area (Kashagan Oil Field and others)
Phase 1 experimental program currently
under way. Production is scheduled tocommence in the third quarter of 2013(as of June 30, 2013).
Besides the Kashagan ﬁe ld, hydrocarbon reserves were also conﬁrmed infour other structures: Kalamkas, Aktote,

In September 1998, INPEX acquired aparticipating interest in the Offshore
North Caspian Sea Contract Area in
Kazakhstan ʼs territorial waters and now
holds a 7.56% interest.
Phased development of the
Kashagan Oil Field is planned, with the

Kairan, Kashagan Southwest. Appraisalof these structures is continuing in parallel with the development of the main
Kashagan ﬁeld with a view to expanding the total production of the contractarea.

AtyrauKAZAKHSTAN

Kashagan Oil Field

KairanCaspian Sea

KalamkasKashagan Southwest

AktoteOffshore
North Caspian Sea
Contract Area

Onshore facility

Contract area (block)

Project status

Venture company (established)

Interest owned

Offshore
North Caspian Sea

Under development

INPEX North Caspian Sea, Ltd.
(August 6, 1998)

INPEX North Caspian Sea 7.56% Eni 16.81% ExxonMobil 16.81%
KMG 16.81% Shell 16.81% TOTAL 16.81% ConocoPhillips 8.40%

2. ACG Oil Fields
AZERBAIJANBaku

ACG Oil Fields

Sangachal

Deepwater Gunashli Field
Chirag Field
Caspian Sea

Azeri Field

Oil field

Azeri Field, the West Azeri Field, the East
Azeri Field, and the Deepwater Gunashli
Field. In March 2010, the decision wasmade to transition the Chirag Oil Project
to a development phase. Operations
are currently in progress with the commencement of production planned at
the end of 2013.

Contract area
(block)Project status(production on the basis of all ﬁelds
and average rate of FY2012)

Venture company(established)

Interest owned(*Operator)

ACG(Azeri, Chirag, Gunashli)

In production(Crude oil: 652 Mbbld)

INPEX Southwest
Caspian Sea, Ltd.
(January 29, 1999)

INPEX Southwest Caspian Sea 10.96% BP* 35.78%
Chevron 11.27% SOCAR 11.65% Statoil 8.56%
ExxonMobil 8.00% TPAO 6.75% Itochu 4.30% ONGC 2.72%

5
Project Overview

Oil Pipeline

INPEX acquired a participating interestof the Azeri-Chirag-Gunashli (ACG) Oil
Fields in a region of the south CaspianSea in Azerbaijan in April 2003. The
Companyʼs current participating interest
has increased to 10.9644%.
At the ACG Oil Fields, oil is being
produced at the Chirag Field, the Central

3. BTC Pipeline Project
The 1,770-km BTC pipeline stretchesfrom Baku in Azerbaijan to Ceyhan on
Turkeyʼs Mediterranean coast throughTbilisi, Georgia. Full-scale operationcommenced in June 2006. Total transportation capacity stands at 1.2 million

barrels per day. While mainly transporting crude oil produced in the ACG
Oil Fields in Azerbaijan, the pipeline
also transports crude oil produced inother areas including Turkmenistan andKazakhstan.

Black Sea

TURKEYGEORGIARUSSIA
CaspianSea
AZERBAIJAN
ARMENIA

TbilisiBaku

BTC Pipeline
Ceyhan
SYRIA

IRAQ

IRAN

Contract area
(block)Venture company(established)

Interest owned(*Operator)

BTC Pipeline

INPEX BTC Pipeline, Ltd.
(October 16, 2002)

INPEX BTC Pipeline 2.5% BP* 30.1% Azerbaijan (BTC) Limited 25%
Chevron 8.9% Statoil 8.71% TPAO 6.53% Eni 5% TOTAL 5% Itochu 3.4%
ConocoPhillips 2.5% ONGC 2.36%

INPEX CORPORATION Annual Report 2013065

Middle East & Africa
Regarding the performance in the Middle East and Africa for the year ended March 31,
2013, it was impacted by a decrease in the sales price of crude oil, an increase in the sales
volume of crude oil, and yen depreciation. As a result, net sales increased by 4.2% to ¥520.8
billion and operating income increased by 0.9% to ¥357.3 billion.
TURKEYGREECE

SPAIN

SYRIA
MOROCCO

IRAN

IRAQ

Block 10JORDANEl Ouar I/II Blocks

South October Area

ALGERIAL I BYA

Soroosh & Nowrooz Fields

Abu Al Bukhoosh Block

EGYPTADMA Block 1
p. 67SAUDI
ARABIA
MALI

NIGER
CHAD

NIGERIACAMEROON

2 Offshore Angola Block 14p. 67

Abu Dhabi
Office

OMAN

YEMEN

SUDAN

CENTRAL SOUTH
AFRICAN SUDAN
REPUBLIC

D EM O CR ATI CREPUBLIC
OF THE CONGO

Onshore Cabinda North Block

U.A
U
.A
A .E.
E.

S O M A In
L Iproduction
A
ETHIOPIA

Discovered /Preparation for development
Under exploration
OP Operator project

K EN YATA NZ A NIA

Nganzi Block3/05 Block

3 Offshore D.R. Congo Blockp. 67

Area 2&5

ANGOLAZAMBIANAMIBIAQ.

Which exploration
project is attracting
your attention in
the Middle East andAfrica region?

A.

Middle East & Africa Q&A

MOZAMBIQUE

ZIMBABWE

We are particularly excited by thepotential of exploration projects in Iraq.
In May 2012, INPEX put forward thesuccessful bid for the onshore Exploration Block 10 in Iraq with a partner. In
addition, we participated in an exploration project in an area in Mozambique in
April 2013, where large-scale reserves ofnatural gas have been discovered.
A view of the Block 10 surface in Iraq

066

INPEX CORPORATION Annual Report 2013

1. ADMA Block

The ADMA Block (Upper Zakum Oil Field)

Contract area (block)

Project status

In May 2004, INPEX made Japan Oil
Development Co., Ltd. (JODCO), a wholly
owned subsidiary by acquiring all of the
JODCO shares held by Japan National Oil
Corporation through a share exchange.
JODCO owns an interest in the ADMA
Block located offshore Abu Dhabi in the
United Arab Emirates. Oil production currently spans ﬁve ﬁelds in the block.
In addition, a number of development projects are currently under way tomaintain and expand oil output, such asredevelopment of the Upper Zakum Field
Venture company (established)

involving the use of artiﬁcial islands, as well
as phase 1 development and other workwith the aim of engaging in early production at the Umm Lulu and Nasr ﬁelds.
Satah Field Das Island

Nasr Field
Umm Shaif Field
Upper Zakum/
Lower Zakum
Field

Zirku Island

Umm Al-Dalkh Field
Umm Lulu Field

U.A.E.

Abu Dhabi

Oil field
Undeveloped oil field

Subsea pipeline

Interest owned
JODCO 12% ADNOC 60% BP 14.67% TOTAL 13.33%

Umm Shaif, Lower Zakum Field
Upper Zakum Field

In production

Umm Al-Dalkh Field
Satah Field
Nasr Field

JODCO 12% ADNOC 60% ExxonMobil 28%
Japan Oil Development Co., Ltd.
(JODCO) (February 22, 1973)

Under
development

Umm Lulu Field

JODCO 12% ADNOC 88%
JODCO 40% ADNOC 60%
JODCO 12% ADNOC 60% BP 14.67% TOTAL 13.33%

2. Offshore Angola Block 14
CONGO

Atlantic Ocean

Offshore Angola
Block 14The State ofCabindaCONGO

Contract area
(block)Project status(production on the basis of all ﬁelds and average rate of FY2012)

Offshore Angola Block 14

In production (Crude oil: 148 Mbbld)

5

Production facility

Venture company(established)

Interest owned(*Operator)

Angola Block 14 B.V.
(April 19, 2012)

Project Overview

AngolaParticipating through a joint venture company with TOTAL S.A., INPEX acquired a
9.99% indirect interest in the oil producing Angola Block 14 in February 2013.
Block 14 is located approximately 100
km offshore from Cabinda, Angola. It isan oil-producing block that includes discovered undeveloped ﬁelds. Crude oil
is currently being produced from threedevelopment areas. Through exploration
activities as well as the development of
discovered undeveloped ﬁelds, this blockis expected to help boost overall value.

Angola Block 14 B.V. 20% (including 9.99% of
INPEXʼs interest) Chevron* 31%
Sonangol 20% Eni 20% Galp 9%

3. Offshore D.R. Congo Block
MibaleMotobaLukamiMoko

MwambeMisatoLibwa
CONGO

MuandaBananaTshialaGCO

Contract
area (block)
Soyo

Atlantic Ocean

INPEX has participated in oil explorationand development projects offshore the
Democratic Republic of the Congo (DRC)
since July 1970. Oil production commenced
in 1975 from the GCO Oil Field, which was

discovered in 1971. Including GCO, 11 oil
ﬁelds have been discovered. The contract
covering this block was extended until
2023 in May 1995, and production levels
from existing ﬁelds remain stable.

Project status
Venture company(production on the basis of all(established)ﬁelds and average rate of FY2012)

Offshore D.R. In production
Congo Block (Crude oil: 14 Mbbld)

Teikoku Oil (D.R. Congo)
Co., Ltd. (August 1, 1970)

Interest owned(*Operator)
Teikoku Oil (D.R. Congo) 32.28%
Perenco* 50% Chevron 17.72%

INPEX CORPORATION Annual Report 2013067

Americas
Regarding the performance in the Americas for the year ended March 31, 2013, net sales
increased by 7.6% to ¥5.9 billion due to an increase in the sales volume of natural gas.
On the earnings front, however, INPEX recognized an operating loss of ¥6.1 billion (10.4%
higher than the previous year).
2 Shale Gas Project in Canadap. 69

In production

1 Joslyn Oil Sands Projectp. 69

Under development

Hangingstone Block

Under exploration

Discovered /Preparation for development

CANADA
Calgary Oﬃce

Q.

Please tell us about theCompanyʼs participation in
the development project in
the U.S. Gulf of Mexico inAugust 2012.

OP Operator project

U N I T ED S TAT E S
OF AMERICA

Americas Q&A

Houston Office
Louisiana Block SL20183
West Cameron Blocks
401/402
Block Cuervito
Block FronterizoA.

We acquired a 7.2% participatinginterest in the Lucius project in the
deepwater of the U.S. Gulf of Mexico from Anadarko Petroleum Corporation. Currently, development
operations are being undertakenwith an eye toward commencing
production of crude oil and natural
gas from the latter half of 2014.
The Lucius project is expected tocontribute to the Companyʼs net
production volume prior to thecommencement of production at
the Ichthys Project. At the sametime, we anticipate gaining considerable experience and knowledge in deepwater development
through the participation.

Main Pass Block 118
Ship Shoal Block 72
Walker Ridge 95/96/139/140
Keathley Canyon Blocks 874/875/918/919 (Lucius)

MEXICO
Caracas Office

3 Copa Macoya OP /Carabobo Block,
Project 3

Guarico Oriental Blocksp. 69

Block 31 OP
Paramaribo Office

VENEZUELA
COLOMBIASURINAME

Block 117PERU

BRAZIL

BOLIVIABM-ES-23

Frade Project

PA R AGUAY
Rio de Janeiro Office

URUGUAY
Area15

Lucius Oil Field

068

INPEX CORPORATION Annual Report 2013

1. Joslyn Oil Sands Project
In November 2007, INPEX acquired a 10%
interest in the Joslyn Oil Sands Upstream
Project in Alberta, Canada. The Joslyn
project plans to conduct a multiphase mining development, with a production planof 100 thousand barrels per day by thelate 2010s as part of the Stage I develop-

ment. Currently, we are taking preliminary
steps to consider a development plan.
Despite the decision by TOTAL to suspend the oil sand upgrader (synthetic crude
oil manufacturing) project in which we areparticipating, measures going forward are
currently under consideration.

Contract area (block)

Project status

Venture company (established) Interest owned (*Operator)

OSL 7280060T24

Discovered /Preparation fordevelopment

INPEX Canada, Ltd.
(November 28, 2006)

OSL 7405070799
OSL 7404110452

OSL
7405070799
OSL
7404110452

OSL 7280060T24

Joslyn Oil Sands
Lease Block

INPEX Canada 10%
TOTAL* 38.25％
Suncor 36.75% Occidental 15%

Athabasca
River

Province of Alberta
Fort McMurray

2. Shale Gas Project in Canada
In August 2012, INPEX acquired a 40%
participating interest in the shale gas
projects in the Horn River, Cordova andLiard basins from Nexen Inc.
The shale gas projects in the Horn
River, Cordova and Liard basins containdiscovered and undeveloped shale gas.
Yukon Territories

We will proceed with full-scale development and are aiming for combined production at the Horn River and Cordova
projects of a maximum of 1,250 millionsof cubic feet per day (approximately 200
thousand boed). The shale gas that is
produced will be converted into LNG

with studies currently under way to consider commercialization through exports
from the Canadian west coast.

Northwest Territories

Acquired area
British Columbia

Highway
Major pipelines

Cordova Area

5
Horn River Area
Onsite drilling

Contract area
(block)Project status

Venture company(established)

Interest owned(*Operator)

Horn River,
Cordova and Liard areas

In production (partly)

INPEX Gas British Columbia Ltd.
(November 28, 2011)

INPEX Gas British Columbia 40%
NEXEN* 60%

Project Overview

Liard Area

3. Copa Macoya and Guarico Oriental Blocks
INPEX was awarded a 100% participating interest in a central onshore area, theEast Guarico Block in Venezuela, in July
1992. INPEX participated in oil and natural gas ﬁeld rehabilitation, exploration anddevelopment activities as an operator.
Thereafter, the existing operational service
agreements were changed to joint ventureagreements in 2006. Around the sametime, the East Guarico Block was newly
reconﬁgured into a gas business in the
Copa Macoya Block and a crude oil business in the Guarico Oriental Block. In addition, the agreement period of both agreements was extended to 2026 as a result of
the change to joint venture agreements.

Copa Macoya andGuarico Oriental Blocks
Georgetown
CaracasGUYANAVENEZUELA
BogotaCOLOMBIA

Contract area
(block)Project status(production on the basis of all ﬁelds and average rate of FY2012)

Venture company(established)

Interest owned(*Operator)

Copa Macoya

In production
Crude oil: 1 Mbbld
Natural gas: 64 MMcf/dTeikoku Oiland Gas Venezuela,
C.A. (June 7, 2006)

Teikoku Oil and Gas Venezuela* 70% PDVSA Gas 30%

Guarico Oriental

Teikoku Oil and Gas Venezuela 30% PDVSA CVP* 70%

INPEX CORPORATION Annual Report 2013069

JapanRegarding the performance in Japan for the year ended March 31, 2013, net sales increased
by 4.6% to ¥118.9 billion due to an increase in the sales price of natural gas. Operating
income increased by 16.1% to ¥28.6 billion.

Yabase Oil Field
Akita
District Office

Akita Prefecture

2 Naoetsu LNG Terminal
p. 71(Under construction)

Higashi-Kashiwazaki Gas Field
Sekihara Gas Field (underground storage)
ityy
Niigata City

Niigata Marketing
OfficeNiigata District Office(Under construction)［建設中］
Toyama Lineン

Minami-Aga Oil Field
Kashiwazaki
City

Itoigawa
City
C
Ci
Cit
ty

Toyama City
Toyam
Toy
y

Minami-Kuwayama Oil Field
Nag
gaok
aoka
a CitytyyToyamaPrefecture

Joe
oe
etsu
ts Ciityty

Shin Oumi Line

Niigata
Prefecture
Domestic Natural Gas

Na
N
Nag
Nagano
agano
o Ci
City
ty

1 Minami-Nagaoka Gas Fieldp. 71

Tokyo Lineン
Tomi BSS※

Ma sum
Mat
su
umoto
um
oC
Ciity
ty

Gunma
Prefecture

Fujioka BS*

Shin Tokyo Line

Matsumoto Line

Isesaki Power Control Center

Karu
Kar
K
uiz
uiz
izaw
awa
wa
a
Town

Tochigi PrefectureChChihino Cit
Citty
Tom
To
om
miio
ioka Cityy

NaganoPrefecture

Kofu Line

Ryomo Line

Hon
H
Honjo
on
njjo
o Cit
City
City

Sho
h
ho
owa
owa
wa Tow
To n
Second Suruga Trunk Line S

Iruma LineKo
ofu Ci
City
ittyy
it

Ome
me
e Ci
C ty

Sodeshi LNG Terminal
Shizuoka Line

[Shizuoka Gas]

Shizuoka Shi
Shhizzuoka
hi
zuoka
zuo
a
Prefecture
City
Cit
y

Sa o CitySan
it

Yamanashi
Prefecture

Got
Go
G
ot
otemba
otem
em
emb
mb
ba
CiityyCit
Fuji City

K osu CKon
City

Oil and gas fields

SaitamaPrefecture

Other project

Natural gas
pipeline network

Adachi-ku,
d
Toky
kyo
o

Metropolitan
Tokyo

Head Office (Akasaka, Minato-ku)

Regasified
LNG

* BS・
・
・Booster station

Chiba City

Major office or
district office

Technical Research Center

Minamifuji Line
(INPEX, Shizuoka Gas, Tokyo Gas)

(Kitakarasuyama, Setagaya-ku)

Itazuma Power Control Center

Sammu
City

Chiba
Prefecture

Naruto Gas Field
Chiba District Office0

Q.

What progress
have you made inyour ongoinggeothermal power
development
endeavors in Japan?

Japan Q&A

070

INPEX CORPORATION Annual Report 2013

A.

100km

We continue to carry out joint studies forthe development of geothermal power
Hokkaido
in Hokkaido and Akita prefectures, which
Amemasudake
began in 2011. Geological ground surveys
have already been completed in both prefectures conﬁrming the presence of underground temperatures of 200ºC and above,a necessary requirement for geothermal
Akita
Oyasu
power generation. Plans are in place to drill
exploration wells during 2013 and to push
Geothermal power generation research areas
forward studies in earnest.

1. Minami-Nagaoka Gas Field and the domestic natural gas business
Discovered in 1979 and in production
since 1984, Minami-Nagaoka is one of
the largest gas ﬁelds in Japan. After processing, the natural gas is transported
through a 1,400-km trunk pipeline network stretching across the Kanto andKoshinetsu regions that surround thegreater Tokyo metropolitan area anddelivered to city gas companies andindustrial customers along this network.
INPEX has experienced substantial
sales growth in recent years due to sharp
rises in the prices of competing fuels, aswell as the highly environmentally friendly
attributes of natural gas. The target is for
medium- to long-term annual sales of 2.5
billion m3 by the early 2020s and in the
3.0 billion m3 range over the long term,
reﬂecting further capacity increases forour core Shin Tokyo Line and develop-

ment of the Toyama Line (extending from
Itoigawa City, Niigata Prefecture, to Toyama City, Toyama Prefecture), construction of which began in April 2012.
In order to support this growth, supply capacity and reliability have beenenhanced through the introduction of
LNG from Shizuoka Gas Co., Ltd., in2010. INPEX decided to build an LNG
terminal at Naoetsu, Joetsu City, in Niigata Prefecture, which is slated to start in
the beginning of 2014.
At the Naruto Gas Field in Chiba
Prefecture, natural gas dissolved in water
is being produced. Natural gas dissolvedin water is contained in underground“brine water.” We pump up the brinewater, extract natural gas and supply
the gas to surrounding areas. The brinewater also contains high levels of iodine.

We export the iodine to Europe, theUnited States and elsewhere.

The natural gas pipeline that crosses Shibumi river in Niigata

Echigo Line

Sekihara Gas Field

Sea ofJapan(underground storage)

Producing: Total oil and gas ﬁelds (FY2012 average)

Natural gas: Approx. 134 MMcf
Crude oil and condensate: Approx. 4 Mbbld

Natural gas sales (FY2012)

Approx. 1.75 billion m³

JoetsuShinkansen
Line

KashiwazakiCity

Gas field

Shinetsu
HonsenNagaokaCity

Higashi-Kashiwazaki
Gas Field

Production and Sales of Domestic Natural Gas

MitsukeCity

Minami-Nagaoka
Gas Field

Minami-Nagaoka andnearby gas ﬁelds

Ojiya City

JoetsuLine

2. Construction of the Naoetsu LNG Terminalby combining that supply with existing
domestic supplies from Minami-Nagaoka and other ﬁelds we will be able toenhance the capacity and stability of our
supply structure.

5
Project Overview

We expect domestic demand for natural
gas to rise steadily and continue to beﬁrm due to factors such as the shift to natural gas from oil as consciousness about
the environment and energy conservation increases, as well as rising oil prices.
To ensure stable supply to the domestic
natural gas market over the long term,
INPEX has been engaged in constructing
an LNG terminal in Joetsu City (the portof Naoetsu) in Niigata Prefecture since2009. The operational startup is planned
for the beginning of 2014. Afterward, weplan to receive LNG from our overseas
projects at the Naoetsu terminal, andNaoetsu LNG Receiving Terminal Overview
Location

12 Yachiho, Joetsu City,
Niigata Prefecture

Lot area

Approx. 25 ha

Gas production
capacity

7.5 MM m³/d
(LNG 240 tons/hour)

LNG tank

180 thousand kl 2
(upgrade possible)

LNG receiving capacity

Approx.
1.5 million tons/year

Operational start target

Beginning of 2014

The Naoetsu LNG Terminal currently underconstruction (April 2013)

Gas Supply Chain
We will establish a gas supply chain byorganically connecting overseas LNG
with the domestic natural gas infrastructure to meet the natural gas demand inJapan, which is expected to remain ﬁrm.
By ﬂexibly combining the three gas
supply chain sources of
1 domestic natural gas,
2 regasiﬁed LNG from Shizuoka Gas
Co., Ltd., and3 regasiﬁed LNG from Naoetsu,

we are conﬁdent in our ability to improve
supply capacity and enhance supply stability, allowing us to meet future demand
increases.
Building a total gas supply chain
covering upstream and downstream
processes will be our base of support instrengthening emergency backup measures for the supply of gas by enhancing
cooperation with gas and electric powercompanies and expanding the pipeline

network, as well as building the global
LNG portfolio. Through these activities, we will work toward developing anenergy business that uses natural gas.

INPEX CORPORATION Annual Report 2013071

What it means to take on the challenge of a project operator
In the crude oil and natural gas business, it is common for several companies to form a partnership, instead of one company
taking sole responsibility, for the purpose of splitting up themassive amount of operating capital required and distributing
risk in the event no discoveries of crude oil or natural gas are
made. Among the partner companies that form the coalition,
the one company that acts as the lead representative of the
project is called the operator. Being the operator entails leading
the other partners, negotiating with the oil-producing country,■ Operator■ Non-operator■ Affiliate

and closely managing contractors and other afﬁliates in order tosuccessfully develop the crude oil and natural gas project intoa business. For this reason, the operator is viewed as the truedeveloper of the crude oil and natural gas project. Contrary to a
non-operator, which mainly provides funding, an operator that
leads a project to success is often presented with opportunities to participate in many other high-quality projects; in otherwords, it sees more opportunities to acquire new interests.

Electric powercompanies

ajor

Oil m

Consumers
Oilcompanies

Trad
compinganyGascompanies

Operator

Chemicalsmakers(project propeller)

Insurance companies

E&P c

ompa

Steelmakers

Oil-producing country

ny

Crude oil and natural gas
development project

Government-affiliated financial institutions and banks
Consulting companies, etc.
Plant engineering companies

What is 1 ton of LNG?
In Japan, liqueﬁed natural gas (LNG) is primarily used two ways:
as a fuel to generate electricity and as city gas. The energy produced by one ton of LNG differs based on assumptions used,
but as a fuel burned to generate electricity, one ton of LNG
can produce 6,000 kWh in a conventional power generation
turbine. This is equivalent to the amount of electricity used byabout two households in one year. In terms of city gas, one tonof LNG can produce 1,200 cubic meters of city gas, which isenough to supply two to three households for a year.

Electricity

1 ton of
LNG

two
= Approximately= about
households annually
6,000 kWhCity gas3

covered. Accordingly, this ﬁgure tends tobe higher than the success rate for wells
drilled in so-called wildcat territory̶
unproven, unexplored geographical formations. Prior to drilling a well, a surveyof geological features is conducted, as isa seismic survey for minerals, based uponwhich drilling sites are screened for themost promising geological structures toimprove the odds of making a discovery.

Drill bit072

INPEX CORPORATION Annual Report 2013

City gas

two to three= Approximately= about
households annually
1,200 mWhat are the chances of ﬁnding crude oil and natural gas?
Generally speaking, the odds of discovering sufﬁcient quantities of crude oiland natural gas after drilling a well are
low. In the test wells it drilled between
the ﬁscal years ended March 2011 andMarch 2013, INPEXʼs success rate was
45.0% (3-year average). However, thisﬁgure includes additionally drilled wells
in geographical formations where crude
oil and natural gas had already been dis-Electricity