Equity

Cash Flow

Bank Loans

Proceeds from public offering(approx. ¥520 billion)(in August 2010)

Operating cash flow
Cash and cash
equivalents on hand

Lending from JBIC
Guarantee from JOGMEC
Project finance

Maintain strong
financial position● Maintain financial strength even at the peak in borrowing
Maintain funding capability to ensure necessary investments● Long–term financial target
Equity ratio : 50% or higher
Net debt/Net total capital employed: 20% or lessApprox.

(¥ billion)

Investment Plan

¥1.8 trillion

788.0

800

From the year ended March 31, 2011
to the year ending March 31, 2017.

630.0

600

Approx. ¥4 trillion

April 2011- March 2014:
400

737.0

366.0
240.7

275.0

200

Development expenditures
Exploration expenditures
Other expenditures*

187.0
54.0
37.0

32.5
21.2

0

2011

2012

36.0
26.0
2013

24.0
27.0

Project Overview
3.1

Reserves, Production and Investment Plan

036

3.2

Project Overview

038

3.3

Special Report 1: Ichthys LNG Project

040

3.4

Special Report 2: Abadi LNG Project

044

3.5

Project Overview by Region

046

Asia & Oceania / Eurasia / Middle East & Africa / Americas / Japan* Mainly for the Naoetsu LNG Receiving Terminal
and domestic pipeline and related facilities

2014

ActualEquity ratio

Net debt /Net total capital employed
Equity ratio

120 (%)Net debt/Net total capital employed
30 (%)

Long-term target:
20% or less

15
90

71.9%
64.0% 64.0%

74.5%

0

68.9%

60

-15

Long-term target:
50% or higher

Corporate Responsibility
and Management(Years to
March 31)

Approx. ¥1.8 trillion

568.0

Crew at ADMA Block, UAE

Business Overview

3

Investment plan and funding sources of approx. ¥4 trillion▲▲

Our company’s objective for corporate
growth is to raise production to 800,000–
1 million boed by 2020. To achieve thisgoal, it is necessary to invest in existing
projects such as the Ichthys and Abadi
Projects, as well as new projects which
will increase our reserves in the future.
In our investment plan,
approximately ¥4 trillion will be requiredfor development and exploration
activities including the Ichthys Project
during the seven-year period from theyear ended March 31, 2011 to the year
ending March 31, 2017.
It is important for us to maintaina strong balance sheet and achieve
ﬁnancial stability in order to makecontinuous investments in potential
projects while also maintaining thefunding capability to ensure necessary
investments for our major LNG projects.
To achieve ﬁnancial stability, we set along-term target for ﬁnancial leverage,that is, an equity ratio of 50% or higher
and a net debt to net total capital
employed ratio of 20% or less.
To implement our ¥4 trillion
investment plan, while considering
the ﬁnancial target, we envisage thefollowing three funding sources:
1) proceeds from a public offering,2) cash and other liquid investments on
hand and3) bank loans including project ﬁnancing.
We completed a public offering inAugust 2010 and succeeded in raising
approximately ¥520 billion. Now weplan to procure funding through bankloans including project ﬁnance taking
into account our ﬁnancial target, ona ﬁnancial base that has been further
strengthened by the public offering.

Project Overview

To ensure further growth, we plan to invest approximately ¥4 trillion over seven years
from the year ended March 31, 2011, to the year ending March 31, 2017. While achieving
ﬁnancial stability, we will make appropriate investments through optimal funding sources.

Performance / Message

Investment Plans and Financial Strategies-18.6%-31.2% -30.6%-30-36.1%-45-48.9%
-60

0

2007

2008

2009

2010

2011

2007

2008

(Years ended March 31)

2009

2010

2011

(Years ended March 31)

Credit rating information (As of June 30, 2011)
Long-term credit ratings
Short-term credit ratings

034

INPEX CORPORATION Annual Report 2011

Standard & Poor’s

A (negative)

Rating and Investment Information

AA- (stable)

Standard & Poor’s

A-1

Financial /Corporate Information30

Reserves, Production and Investment Plan
Reserves

Production Volume

Our reserves as of March 31, 2011, consistedof approximately 1.3 billion barrels ofoil equivalent (boe) of proved reserves,approximately 2.8 billion boe of probablereserves and approximately 600 million boe ofpossible reserves. These proved reserves give
us a reserve to production ratio (R/P ratio) of 8.5
years. Adding the probable reserves increases
the R/P ratio to 26.7 years.
We also have an abundance of contingent
resources. We also expect to continue
increasing proved and probable reserves overthe medium to long term through new projects
and by raising the recoverability rate on
existing oil and gas ﬁelds.

Our net production volume for the year ended
March 31, 2011, was 239 thousand barrels per
day of crude oil and 1,102 million cubic feetper day of natural gas. Combining crude oil andnatural gas gives us production of 423 thousandbarrels of oil equivalent per day (boed).
Regarding medium- to long-term
forecasts for our net production volume, theexisting projects, including Ichthys and Abadi,
will support the production volume of ourassets contributing to a rise in production
to approximately 700 thousand boed.
Furthermore, we expect our production toincrease to 800,000–1 million boed by 2020
through aggressive exploration together withacquisitions of new oil and gas ﬁelds.

Expansion of reserves(Million boe)

■ Japan■ Asia & Oceania■ Eurasia■ Middle East & Africa■ Americas

117
367
210
583
30

(%)

9
28
16
45
2

Reserves are a source ofcorporate value. The probable/possible reserves andcontingent resources will be
upgraded to proved reserves
through development. Throughproduction activities, theseproved reserves will become theearnings source of our company.

Our Reserves(Thousand boed)■ Japan■ Asia & Oceania■ Eurasia■ Middle East & Africa■ Americas■Japan ■Asia & Oceania ■Eurasia ■Middle East & Africa ■Americas
1,000 (Thousand boed)

Major projects:

Ichthys, Kashagan

Ichthys, ACG

Major projects:

Abadi,ADMA Block◀ New

projects

700

3,176
2,929

2,818

Expansion of
production volu
ume

2011

585
2011

Production volume is directly
linked to sales that result inincome for our company. That
income serves as an investment
resource for subsequentdevelopment.

3,000(R/P ratio)

2,000

1,598

1,475

26.7 years

30.5 years

1,308

8.5 years
0

2009

2010

500
400

423

417

440

450

446

435
◀ Existing300

projects

200
100
0

Actual

2012

2013

2014

2015

2016

2020

(Years to March 31)
Notes: The forecasts for net production for the years ending March 31, 2012 to 2016, are premised on the same oil price (Brent crude at $95/ barrel) as that used in forecasting the results for that year.
The production volume of crude oil and natural gas under the production sharing contracts entered into by the INPEX Group corresponds tothe net economic take of our group.

Classiﬁcation of reserves (image)High

Commercial

Production

Proved *1

Probable *2

Contingent resources

Undiscovered
PIIP

Prospective resources

Chance of commerciality

Reserves

Not confirmed /not commercially
viableDiscovered PIIP

600

2011

2011

Years ended March 31

Total petroleum initially-in-place (PIIP)

800,0001 million boedUÊV Ì ÞÃÊ Ê*ÀiVÌUÊL>`Ê Ê*ÀiVÌ]ÊiÌV°

800

5,000

Possible *3

Low
High

Certainty

Low*1 Proved reserves: The amount of oil from known reservoirs for which commercial recovery from a certain date forward is judged
as being possible with reasonable certainty. When probabilistic methods are used, there should be at least a 90% probability
that the quantities actually recovered will meet or exceed the estimated amount of proved reserves.
*2 Probable reserves: Additional reserves which have a lower certainty than proved reserves and a higher possibility of recovery
than possible reserves. When probabilistic methods are used, there should be at least a 50% probability that the quantities
actually recovered will meet or exceed the sum of estimated proved reserves and probable reserves.
*3 Possible reserves: Additional reserves which have a lower certainty than probable reserves. When probabilistic methods areused, there should be at least a 10% probability that the quantities actually recovered will meet or exceed the total sum of
estimated proved reserves, probable reserves and possible reserves.
Note: Prepared by INPEX based on material provided the by Japan Oil, Gas and Metals National Corporation (JOGMEC)

036

Long-term production outlook

900

Project Overview

Major projects:(Million boe)

1,000

6
50
7
32
5

Long-term production outlook■Proved reserves ■Probable reserves ■Possible reserves ■Contingent resources

4,000

(%)

25
214
28
135
21

INPEX CORPORATION Annual Report 2011

Investment Plan
Expan
ansionon of iinvestment for
explorati
ation and development
We continuously invest in
exploration and development tomaintain and expand reserves.

To maintain and expand our reserves, we are
actively conducting exploration investment, as
well as investment in development to produce
crude oil and natural gas from reserves inour possession. We have invested more than¥800 billion during the past three years. Basedon our investment plan of approximately ¥4trillion over seven years period from the year
ended March 31, 2011 to the year ending
March 31, 2017, we will continue to actively
invest in exploration and development. The
investment amount over the next three years
will be approximately ¥1.8 trillion or less. In
particular, we predict increased investment fordevelopment of the Ichthys Project and otherprojects that will contribute to the dramatic
growth of our company.

Investment (Results and plan)■Development expenditures■Exploration expenditures ■Other expenditures*
800 (¥ billion)

788
737

700
630
600

568

500
400
366
275

300
240.7
200

187.0

100
54

0

32.5
21.2

37

36
26

24
27

2011

2012

2013

2014

Actual(Years to March 31)* Mainly for the Naoetsu LNG Receiving Terminal
and domestic pipeline and related facilities

INPEX CORPORATION Annual Report 2011037

Project Overview
We seek to achieve a well-balanced portfolio through a combination of different
projects, by resource (crude oil and natural gas), by stage (exploration, development andproduction), by contract, etc.

Projects

Eurasia
Number of countries
Number of projects
Producing
Development
Exploration
Other

London OfficeAmericas
Number of countries

Countries

Number of projects(As of June 30, 2011)

Producing
Preparation for development

4
5

Exploration

7
18
11
1
6
P. 57

2
1
1
1

Tehran Office

Project Overview

P. 51

Tokyo Head Office

Tripoli Office
Cairo
OfficeHouston OfficeAtlantic Ocean
Abu Dhabi Office

Japan
P. 60

Caracas OfficeParamaribo Office

Pacific Ocean

Jakarta OfficeDarwin Office

Middle East
& Africa
Number of countries
Number of projects
Producing
Undeveloped
Exploration

Perth Office

Indian Ocean

7
13
8
1
4
P. 54

038

INPEX CORPORATION Annual Report 2011

Asia
& Oceania
Number of countries
Number of projects
Producing
Development
Preparation for development
Exploration
Other

Rio de Janeiro Office

7
34
11
2
3
17
1
P. 46

Producing

Exploration, Preparation for development and Development, etc.

INPEX CORPORATION Annual Report 2011039

Ichthysgas-condensate
field

Special Report 1: Ichthys LNG Project

WA-285-P
WA-37-R

INPEX participated in an open bid
conducted by the Australian Federal
Government for the WA- 285-P block,which is located off the coast of Western
Australia about 200 km from the Kimberleyregion. In August 1998 we acquired the
exploration permit for this block. In the ﬁrst
drilling campaign, three exploratory wells
were drilled and discovered the presenceof gas and condensate from March 2000.
We then conducted a 3-D seismic survey.
A second drilling campaign began in
2003, and three exploratory wells were
drilled that resulted in conﬁrmation of theextent of gas and condensate. Further
wells were drilled beginning in 2007.
Through these endeavors, we conﬁrmed
sufﬁcient recoverable reserves of gas andcondensate for commercial development.

The Ichthys LNG Project is the ﬁrst large-scale
LNG project undertaken by a Japanese company
as an operator. The target for FID is Q4 2011,
and the production start target is Q4 2016.

10km

We are currently proceeding withfront-end engineering and design (FEED)
activity, securing government approval,
LNG marketing activities and ﬁnanceactivities, with an FID target of Q4 2011.
After FID, we will begin with detailed
engineering work on both the onshore andoffshore facilities, followed by equipment
procurement and the construction of the
LNG plant and other facilities. The target
date for production startup is Q4 2016.
In August 2006, INPEX was granted
Major Project Facilitation status for the
Ichthys Project by the Federal Minister
for Industry, Tourism and Resources.
This status recognizes the fact that thisproject would contribute to the long-term
economic development of Australia.

Environmental Impact Survey andContribution to Regional Communities
INPEX is working closely with theAustralian Federal and Northern Territory
Governments and other Australian
stakeholders, as well as people associatedwith the project, to ensure that the Ichthys
Project proceeds as planned.

About the Environmental
Impact Survey

One of two large-scale LNG projects in which INPEX iscurrently engaged, Ichthys is an enormous gas and condensate
ﬁeld discovered in 2000 by us about 200 km offshore from
Western Australia. We will build offshore production facilities,
an 889-km subsea gas export pipeline and an onshore LNG
plant, with production targeted for Q4 2016.
Production volume(expected):

LNG 8.4 million tons/year
LPG 1.6 million tons/year
Condensate approx. 100,000 bbl/d (peak rate)

FID target:

Q4 2011

Production start target: Q4 2016

040

Interest owned:

INPEX 76%, TOTAL 24%

Project status:

Preparation for development

INPEX CORPORATION Annual Report 2011

At the offshore rig

INPEX is conducting an environmental
impact survey in accordance with guidelines
established by the Australian Federal
and Northern Territory Governments toassess the impact of aspects of the Ichthys
Project. These included the environmental
impacts of the offshore processing andproduction facilities, the subsea pipeline
and the planned LNG plant (near Darwin
in Australia’s Northern Territory). We
submitted a draft Environmental Impact
Statement (EIS) summarizing these
activities to both governments in April
2010. This report was submitted for public
review during the period July–September
2010, and the opinions of a variety of
stakeholders were taken, focusing on thosein the Darwin area where the LNG plant will
be built. By June 2011, INPEX had been
granted environmental approval for the
Ichthys Project from the ministers of theAustralian Federal and Northern Territory
environmental agencies based on the EIS.

Darwin Ofﬁce

Ichthys LNG Project
AUSTRALIA

Perth Ofﬁce

The name “Ichthys,” which means“ﬁsh” in ancient Greek, is derived
from the many fossilized ﬁsh thatwere discovered in onshore areas inclose proximity to the block.

Project Overview

Ichthys
LNG Project

Project History

Support for Local Communities
In proceeding with the Ichthys Project,
INPEX places great importance oncommunications with local communities
and building a relationship of mutual
understanding with the indigenous
people of the project area. INPEX seeks
to be considered as a trusted corporate
citizen, and therefore we do our utmost
to deepen communications with people
in local communities.
In the case of the Ichthys Project,
our efforts include providing vocational
training opportunities for young people,
such as local indigenous peoples, throughthe donation of approximately AUD2
million for the construction of the Larrakia
Trade Training Centre. The goal of theschool, which opened in April 2011, is toenable students to earn qualiﬁcations
that will help them develop their careers,and currently 300 students are enrolled
to learn professional skills. In addition,
INPEX donated to those affected by the
Queensland ﬂoods.

Environmental Assessment Report
Please refer details on : http://www.inpex.com.au/

Larrakia Trade Training Centre

Students and INPEX Chairman Kuroda at the Larrakia
Trade Training Centre

INPEX CORPORATION Annual Report 2011041

Special Report 1: Ichthys LNG Project
Project Development Concept
Onshore Facilities

Offshore Production Facilities
FPSO

These are composed of a central processing facility(CPF) for the separation of natural gas and condensate
and a ﬂoating production storage and ofﬂoading (FPSO)
vessel for the storage and ofﬂoading of condensate.

The FPSO receives condensate from the
CPF and handles storage (storage capacity
1.2 million barrels) and shipments (85,000
bbl/d peak). Some of the natural gas is repressurized and sent back to the CPF.

■Condensate: 85 thousand bbl/d (peak rate)

These are composed of the LNG plant andonshore storage facilities. The planned site forthese facilities is Blaydin Point, which is acrossthe harbour from Darwin.
■LNG: 8.4 million tons/year■LPG: 1.6 million tons/year■Condensate: 15 thousand bbl/d (peak rate)

Outline of Development Concept
LNG: 8.4 million tons/year
Production volume:

Condensate: 100 thousand bbl/d (peak rate)
LPG: 1.6 million tons/year

Subsea development wells:

30 wells at Brewster, 20 wells at Plover

Reservoir depth:

Approx. 3,900 m - 4,600 m

Subsea production facility:

Flowline, ﬂexible riser, etc.

Offshore production facility: CPF + FPSO
Gas export pipeline:

42” subsea pipeline (approx. 889 km)

Darwin onshore facilities:

Produce, store and ship LNG, LPG andcondensate

CPF
Processes the product received via the
ﬂexible risers from the development wells,
separating it into gas and condensate.

Onshore storage tankcapacity:
Natural gas

C3 Tank: 1 × 85,000 m³

C4 Tank: 1 × 60,000 m³

100km

200km

Gas Liquefaction Plant
The gas liquefaction plant will extract
condensate and LPG from the natural
gas pumped via the pipeline. Using
two trains, the liquefaction plant willthen cool the remaining natural gas
to –162°C to form LNG. It will handle
shipments of approximately 8.4 million
tons/year of LNG, 1.6 million tons/yearof LPG and 15,000 bpd of condensate.

These are pipes for transporting
product from the seabed to the CPF.

Product

Ichthys
WA-37-R / WA-285-P

approx. 889km

Darwin City

Timor Sea

Ichthys gas-condensate ﬁeld location

Development
Well

Project Overview

Natural gas

Product

Condensate

Water depth:
approx. 250m

: 2 × 165,000 m³

Condensate Tank : 2 × 60,000 m³(re-pressurized and sent back to the CPF)

Flexible Risers

LNG Tank

Northern Territory• Browse Sedimentary Basin of theWestern Australia continental shelf• Approximately 200 km offshore Western
Australia

Flowline

Gas Export Pipeline

City of Darwin

Block area

(INPEX Darwin Office)2

Drill Center
This equipment is placed on the seabedfor direct connection to a number ofdevelopment wells.

• WA-37-R: 913 km• WA-285-P: 1,161 km2This is a 42” wide pipeline connecting
the CPF with the onshore LNG plant. The
pipeline route takes it as deep as 250 m,
and to a length of approximately 889 km.

Wickham Point（Darwin LNG）

Water depth

Timor Sea

• Block water depth: 170 m–340 m• Offshore production facility depth:
approx. 250 m(Planned construction site)

Blaydin Point
Middle Arm Peninsula

Project History
1998
Participated in an open
bid, permit acquired▶ Submitted a bid for WA285-P in an open bid process
conducted by the AustralianFederal Government; a permit
was acquired042

2000 – 2001

2003– 2004

2007– 2008

First drilling campaign

Second drilling campaign▶ Conﬁrmed the presence of gas
and condensate in all three
exploratory wells▶ Drilled three exploratory wells
to verify reserves; conﬁrmed theareal extension of the reservoir
and the presence of gas andcondensate

Appraisal of recoverable
reserves▶ Acquired, processed andinterpreted 3-D seismic data

INPEX CORPORATION Annual Report 2011

▶ Conﬁrmed the extension of theIchthys gas-condensate poolthrough further drilling of two
wells

2009-2011

Future Milestone

Preparation for development

Government approvals▶ Started FEED
activities forthe onshore
LNG plant,
the offshore
production
facilities and thepipeline in 2009

▶ Public review of EIS during the period
July–September 2010

▶ Invitation to tender (ITT) for the CPF issued in
November 2010
▶ Preparatory work for the EPC procurement phaseof the onshore LNG plant began in December
2010▶ Engineering work for the LNG plant completed in
March 2011 / Preparatory work underway / Major
engineering work in process at off-shore facilities▶ Field development
plan andproduction license▶ EIS supplement taking public review into
applicationconsideration submitted to government in April 2011
submitted to the▶ Environmental approval received from thegovernment ingovernment of the Northern Territories in May 2011
April 2011
and from the Australian Federal Government in June2011

▶ Q4 2011: Final
investment
decision (FID)▶ Q4 2016:
Production start

INPEX CORPORATION Annual Report 2011043

Special Report 2: Abadi LNG Project

Masela Block

Abadi production test

Abadi gas fieldAbadi
LNG Project

Development of the Abadi Gas Field
Production of the Abadi Project

LNG project employing
the world's ﬁrst ﬂoating LNG technology
Full-scale progress through a strategic partnership

Planned production at Abadi is 2.5 million
tons/year of LNG and 8,400 bbl/d ofcondensate.
This scale of production wasapproved for Phase 1 development by
the Indonesian Government in December
2010. Phase 1 development is planned
for the Northern area of the block where
reserves are concentrated. A feasibility
study for further development is
continuously being conducted based ongas reserves.

Floating LNG Technology
The Abadi gas ﬁeld is located in the Arafura Sea in Indonesian
territorial waters, approximately 2,600 km east of Jakarta, thecapital of Indonesia. The ﬁeld is classiﬁed as a giant gas ﬁeld
with an area of more than 1,000 km2. Development basedon the “ﬂoating LNG” concept is being studied, and we are
currently preparing for Front-End Engineering and Design(FEED) and related preparatory development work.

30km

ofﬂoaded) concept. A ﬂoating LNG is
created by installing an LNG plant ona large vessel. This new method allows
for natural gas to be processed into
liquid at that plant and then directlyofﬂoaded to an LNG carrier. A numberof oil companies, notably the oil majors,
are looking into commercial use of such
FLNGs or are preparing to constructthem.
A ﬂoating LNG eliminates the needfor some conventional equipment, suchas pipelines, and therefore requires
less initial investment and minimizes
environmental impact.

Jakarta Ofﬁce

Abadi
LNG Project

INDONESIA

The plan of development for the Abadi
Project is based on the “ﬂoating LNG”
(a ﬂoating offshore facility where natural
gas is processed, liqueﬁed, stored andProject Overview“Abadi” means “eternal” in Bahasa
Indonesia. The name was assignedin the hopes of “burning forever.”Floating LNG at Abadi

Production volume LNG 2.5 million tons/year (First phase development)(expected):
Condensate approx. 8,400 bbl/dInterest owned*:

INPEX 60% Shell 30% PT Energi Mega Persada 10%

Project status:

Preparation for development

LNG Tanker*In July 2011, INPEX signed an agreement with Shell for transfer of a 30% participating interest. The transaction
is subject to the satisfaction of certain conditions such as the approval of the Indonesian Government.

Image of Abadi FLNG

Project History
INPEX acquired a 100% participatinginterest in the Masela block in November
1998 through a public tender conductedby the Indonesian Government. INPEX
proceeded with the exploratory activity
as the operator, and an exploratory welldrilled in 2000 discovered the Abadi gas
ﬁeld. This marked the ﬁrst discovery ofoil and natural gas in the Arafura Sea,
Indonesia. Subsequently, six appraisal
wells were drilled (two in 2002 and four
more in 2007-2008) so as to gain a moreaccurate estimate of the reserves. All of
the wells conﬁrmed the presence of a
sufﬁcient gas and condensate column.
In parallel with these activities,
concept selection studies of development
options were carried out. We submitted
a plan of development (POD) basedon our studies in September 2008,
and subsequently received approvalin principle for it from the Indonesian
Government. Afterward, taking into

044

INPEX CORPORATION Annual Report 2011

Structure of the Abadi gas field

Contribution to Regional Community
consideration a third-party evaluationof the POD implemented by theGovernment, it was determined thatphased development of the Abadi gas
ﬁeld would be appropriate, with the ﬁrst
phase consisting of development as a“ﬂoating LNG” with a capacity of 2.5
million tons/year of LNG. The Indonesian
Government granted its approval tothe plan of development (POD-1) inDecember 2010. INPEX is currently
conducting preparations for FEEDand Environmental and Social Impact
Assessment (AMDAL) procedures, and weare continuing to make preparations fordevelopment.
In the course of moving toward fullscale development, we had been looking
into forming a strategic partnership witha company with experience and provenresults in the LNG business and largescale offshore development, which could
contribute to the success of this project.

As a result, INPEX chose to invite RoyalDutch Shell onboard as our strategic
partner in the Abadi Project, and signed
an agreement with the subsidiary of
Shell to transfer part of our participatinginterest (30%) in July 2011.

Project History

As part of our efforts to contribute to
local communities, INPEX donated 2,000
books, etc., to a local library in Saumlaki
city in Maluku, one of the candidate
locations for the Abadi Project logistics
base, in 2010, at the local community's
request. From April 2011, INPEX andPattimura University are carrying out anempowerment program for the seaweed
farmers in Selaru Island in Maluku.

Our other activities in Indonesia
include donations to relief efforts after theWest Sumatra Earthquake and our ongoingsupport of exchange students through the
INPEX Scholarship Foundation. In addition,
we work to improve the understanding of
the contributions of the Abadi Project toIndonesia by participating in conferencesand exhibitions throughout the country.

Donation to local library in Saumlaki City

1997– 2000

2001– 2002

2003– 2007

2007– 20082010

Future Milestone

Participated in an open bid,permit acquired

Drilled appraisal
wells

Reserves conﬁrmation

Studies of ﬂoating LNG▶ Submitted a bid for the Masela block at a
public tender conducted by the Indonesian
Government; A production-sharing contract(PSC) for the block was concluded▶ Drilled the Abadi-2
and Abadi-3 appraisal
wells over a period of
about seven months
beginning in March
2002 to appraise theextent of the structure▶ Conducted a reserves evaluationand concept selection studies ofdevelopment options▶ Conducted pre-FEED work
for a ﬂoating LNG

Government approvalof the POD-1▶ FEED▶ AMDAL(Environmental
and Social Impact
Assessment)▶ Conducted a seismic survey; Conﬁrmed thepresence of gas and condensate by drillingan exploratory well

▶ Drilled four additional appraisal
wells from May 2007. Conﬁrmed
the extension of gas andcondensate pools▶ Submitted a POD to theIndonesian Government in
September 2008

▶ Transfer of a 10%
participating interest to
PT Energi Mega Persada▶ Approval of POD-1
was granted by theIndonesian Government▶ FID▶ Production start

INPEX CORPORATION Annual Report 2011045

Project Overview by Region

Asia & Oceania
Net sales increased 15.5% to ¥406.9 billion, and operating income increased 23.4% to ¥235.8 billion, due
to increases in sales prices of crude oil and gas, and a rise in the sales volume of crude oil, despite yen
appreciation.

Net production by region

Proved reserves by region

50%

44%

28%

214

¥406.9367

thousand boedbillion7
Number of projects 34
Number of countries

million boe

P.

Attaka Unit

Preparation for development

3

Exploration

17

Other

1

1 Offshore Mahakam Block

Tengah BlockSouth East Mahakam Block47

Semai II Block

Sebuku Block

WA-410-P
WA-411-P
WA-281-P
WA-274-P

8 JPDA03-12 – Bayu-Undan Project
Darwin Office
WA-343-P OP
WA-341-P OP
WA-344-P OP

5 WA-285-P / WA-37-R (Ichthys) OP
P.

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

P. 48
WA-43-L (Ravensworth Oil Field) and others

3 WA-35-L (Van Gogh Oil Field),

AUSTRALIA

Perth Office

OP Operator project
Exploration

Preparation for development

INPEX CORPORATION Annual Report 2011

Crude oil: 91 thousand bbl/dNatural gas: 2,026 million cf/d

INPEX entered into a production sharing
contract (PSC) with the Indonesian
Government in October 1966, at that timeacquiring a 100% working interest in the
Offshore Mahakam Block. The Attaka Unit
was established in April 1970 throughthe unitization of part of the adjacent
blocks owned by INPEX and Unocal (nowChevron), with each company taking
a 50% interest. The Attaka ﬁeld was
subsequently discovered, and productionof crude oil and natural gas began in
1972. INPEX farmed out a 50% working
interest in the Offshore Mahakam Blockto CFP (now TOTAL) in July 1970. Thisventure subsequently made a series of
discoveries in the Bekapai (oil), Handil (oil),
Tambora (oil and gas), Tunu (gas), Peciko(gas), Sisi and Nubi (gas) ﬁelds, all of

INPEX CORPORATION(February 21, 1966)

INPEX 50% TOTAL* 50%
INPEX 50% Chevron* 50%

which have continued to produce crude
oil and natural gas. The crude oil andcondensate produced from these ﬁelds
are shipped mainly to oil reﬁneries andpower companies in Japan by tanker fromthe Santan and Senipah terminals. Mostof the natural gas is supplied to Bontang,
one of the largest liquefaction plants inthe world before being shipped as LNG
to Japan and elsewhere.
An extension through the endof 2017 for each of these two blocks
underpins the overall Mahakam block’s
role as a key proﬁt center for INPEX. In
addition, negotiations are under way
with the Indonesian authorities to securea contract extension beyond 2018 withrespect to the Offshore Mahakam Block.

Development

2. South Natuna Sea Block B
Contract area (block)

Project status

Venture company(production on the basis of all ﬁelds and average rate of FY2010)(established)

South Natuna Sea B

Producing

PPL19050 7 JPDA06-105 (Kitan Oil Field)

WA-357-P
Coniston Unit
WA-255-P Block 1081
WA-35-L (Van Gogh Oil Field)
WA-43-L (Ravensworth Oil Field)

046

PDL3 & PDL4
Unitization

49 P. 44 Special Report 6 Masela Block (Abadi) OP
P.

48

PAPUA
NEW GUINEAINDONESIA

Jakarta OfficeP.

P.

Producing

Interest owned (*operator)

East Kalimantan Block

Attaka UnitP.

(established)

Offshore Mahakam

4 Berau Block – Tangguh LNG Project

Block SK-10
Block SK-8

Block B

47

Venture company(production on the basis of all ﬁelds and average rate of FY2010)

2

Blocks 05-1b & 05-1c

M A L AY S I A

Project status(block)11

VIETNAM

2 South Natuna Sea

Contract area

Development

Offshore Martaban

Mahakam Delta

1. Offshore Mahakam Block and Attaka Unit

Producing

M YA N M A R

Geological survey (in Indonesia)

Project Overview

Net sales by region

Mahakam, Indonesia

ProducingOther

49 P. 40 Special Report

P.

50

Crude oil: 56 thousand bbl/dNatural gas: 376 million cf/d
LPG: 12 thousand bbl/d

In July 1977, INPEX acquired a 17.5%
working interest in the South Natuna Sea
Block B. Later, in January 1994, INPEX
increased its total working interest in theblock to 35% with the purchase of anadditional 17.5% interest. The following
ﬁelds were subsequently discovered
within the block: Belanak (oil and gas),
Hiu (gas), North Belut (gas), Belida (oil),
Sembilang (oil) and Kerisi (oil and gas).
Crude oil production has continued
since 1979. A sales agreement to deliver
natural gas to Singapore via Indonesia’s
ﬁrst international pipeline was concludedin January 1999. The pipeline started
supplying gas from the block, as well

INPEX Natuna, Ltd.
(September 1, 1978)

Interest owned (*operator)

INPEX Natuna 35%
ConocoPhillips* 40% Chevron 25%

as the two adjacent blocks of NatunaSea Block A and Kakap Block, in 2001.
Additional deliveries of natural gas fromthis pipeline to Malaysia started in 2002.
These supply milestones have contributed
to the extension of the PSC covering theblock until 2028.
Production operations in the
Belanak ﬁeld utilize a world-class FPSO
system. Production of crude oil andcondensate began in December 2004
and of LPG in April 2007. The Hiu andKerisi ﬁelds came on stream in 2006
and 2007, respectively. Gas productioncommenced at the North Belut ﬁeld in
November 2009.

INPEX CORPORATION Annual Report 2011047

3. WA-35-L (Van Gogh Oil Field), WA-43-L (Ravensworth Oil Field) and others
Contract area (block)

Project status (production on the basis of
all ﬁelds and average rate of FY2010)

WA-35-L(Van Gogh oil ﬁeld)

Producing(Crude oil: 30 thousand bbl/d)

WA-43-L(Ravensworth oil ﬁeld)
Coniston Unit
(WA-35-L, WA-255-P unitization area)

Venture company

Interest owned(established)(*operator)

Contract area (block)

Project status

INPEX Alpha 47.499% Apache* 52.501%

WA-37-R

Preparation fordevelopment

Producing(Crude oil: 16 thousand bbl/d)

INPEX Alpha 28.5% BHPBP* 39.999%
Apache 31.501%

WA-285-P

Preparation for development
INPEX Alpha, Ltd.
(February 17, 1989)

WA-255-P Block 1081
WA-35-L(excluding Van Gogh oil ﬁeld)

Venture company

Interest owned(established)(*operator)

INPEX Ichthys Pty Ltd(April 5, 2011)

INPEX Ichthys Pty Ltd* 76% TOTAL 24%
INPEX Browse* 76% TOTAL 24%

WA-274-P

INPEX Browse 20% Chevron 50% Santos* 30%

INPEX Alpha 41.32913%
Apache* 45.67587% Woodside 13.0000%

WA-281-P

INPEX Browse 20.0000% Santos* 47.8306%
Chevron 24.8300% Beach 7.3394%

INPEX Alpha 23.7495% Apache* 26.2505%
Woodside 50.0000%

WA-341-P

INPEX Alpha 47.499% Apache* 52.501%

Exploration

WA-357-P

p. 40 Special Report

5. WA-37-R (Ichthys) and its Surrounding Blocks

INPEX Browse, Ltd.
(September 1, 1998)

Exploration

WA-343-P

INPEX Browse* 60% TOTAL 40%

WA-344-P

INPEX Alpha 35% Apache* 65%

WA-410-P

INPEX Browse 20% Santos* 30% Chevron 50%

WA-155-P (PartⅡ)

INPEX Alpha 18.67% Apache* 81.33%

WA-411-P

INPEX Browse 26.6064% Santos* 63.6299% Beach 9.7637%

WA-155-P (PartⅠ)

INPEX Alpha 28.5% BHPBP* 39.999%
Apache 31.50%(Part I). Production licenses were thenobtained for WA-35-L and WA-43-L, andoil production commenced in Februaryand August 2010, respectively.
Preparation for development
work is also under way at the Coniston/Novara, which spans WA-35-L and WA255-P.

on offshore production facilities atthat time. The EPC tender for the CPF
was issued in November 2010, withpreparatory work for the procurement
phase of the LNG plant beginning in
December of the same year. In addition,
work concerning production licenses
and ﬁnancing is ongoing with the target
for FID scheduled in Q4 2011, and forcommercial production in Q4 2016.
INPEX also retains interests in eightblocks surrounding Ichthys. Exploration
activities are ongoing. Any discoveries ofmajor oil or gas reserves in these blocks
could considerably increase the potentialof the Ichthys ﬁeld beneﬁtting fromsynergistic effects.

Project Overview

INPEX has acquired working interests inoffshore Western Australia, such as WA155-P (Part II) and WA-12-L (deep) in July
1994, WA-155--P (Part I) in July 1999,
WA-357-P in July 2006, and one block in
WA-255-P in March 2009.
The Van Gogh and Ravensworth
oil ﬁelds were discovered in WA-155-P

INPEX acquired a working interest in
WA-285-P offshore Western Australia
after winning an open bid in August
1998. In 2000, after pursuing exploration
activities as an operator, INPEX
discovered the Ichthys gas-condensate
ﬁeld.
Eight exploratory wells drilled
by INPEX conﬁrmed the presence of
sufﬁcient reserves for a large-scale
project in the Ichthys gas-condensate
ﬁeld. Later, in September 2008, a site in
Darwin was selected for construction of
an LNG plant. FEED work on this plantbegan in January 2009. In April of thesame year, an ofﬁce was established in
Darwin and FEED work also commenced

4. Berau Block, Tangguh LNG ProjectContract area
(block)Berau

Tangguh Unit

Project status (production on the basis of
all ﬁelds and average rate of FY2010)

Producing
Crude oil: 5 thousand bbl/dNatural gas: 799 million cf/d

MI Berau B.V., a joint venture establishedby INPEX (44%) and Mitsubishi
Corporation (56%), acquired an interestof around 22.9% in the Berau Block, a
hub within the Tangguh LNG Project, in
October 2001. MI Berau owns a 16.3%
working interest (including an actualinterest held by INPEX of about 7.17%)in the Tangguh Unit, which is a unitizedarea spanning the Berau Block and the
adjoining Wiriagar and Muturi blocks. MI
Berau Japan Ltd., a second joint venture
between INPEX (44%) and Mitsubishi
Corporation (56%), also acquired 16.5%of the issued and outstanding shares

048

INPEX CORPORATION Annual Report 2011

Venture company

Interest owned(established)(*operator)

MI Berau B.V.
(August 14, 2001)

Ml Berau 22.856% BP* 48.0%
Nippon Oil Exploration (Berau) 17.144% KG Breau 12.0%
MI Berau 16.3% BP* 37.16% CNOOC 13.9%
Nippon Oil Exploration (Berau) 12.23%
KG Berau, KG Wiriagar 10.0% LNG Japan 7.35% Talisman 3.06%

of KG Berau Petroleum Ltd. in October
2007, bringing INPEX’s total interest in
the project to 7.79%.
In March 2005, the Indonesian
Government approved a development
plan for the Tangguh LNG Project andan extension of the PSC until 2035.
Subsequently, development work
such as the drilling of production wells
and construction of an LNG plant was
conducted over a period of four years.
The ﬁrst cargo of LNG was shipped inJuly 2009.

p. 44 Special Report

6. Masela Block (Abadi)
Contract area
(block)MaselaProject status

Preparation fordevelopment

Venture company(established)

INPEX Masela, Ltd.
(December 2, 1998)

INPEX acquired a 100% participatinginterest in the Masela Block in November
1998 through a public tender conductedby the Indonesian Government. The
Abadi-1 exploratory well was drilled in2000 and conﬁrmed the presence of gas
and condensate. This marked the ﬁrst
discovery of crude oil and natural gas in
the Arafura Sea, Indonesia. Subsequently
six appraisal wells were drilled by 2008
(two in 2002 and four more in 20072008), and gas and condensate weresuccessfully conﬁrmed in all of thewells. In September 2008, based on theInterest owned (*operator)**

INPEX Masela* 60% Shell 30% PT Energi Mega Persada 10%*In July 2011, INPEX signed an agreement with Shell for transfer of a 30% participating interest. The
transaction is subject to the satisfaction of certain conditions such as the approval of the Indonesian
Government.

results of Pre-FEED of a ﬂoating LNG, adevelopment plan was submitted to theIndonesian Government and approvalin principle was granted. After a thirdparty evaluation, approval for the planof development (POD-1) was granted in
December 2010 for commencement of
LNG production of 2.5 million tons/year.
Currently, various preparatory measures,
including Front-End Engineering and
Design (FEED) and Environmental andSocial Impact Assessment (AMDAL), areunderway in the lead-up to developmentof the Abadi gas ﬁeld.

INPEX CORPORATION Annual Report 2011049

Eurasia
Ichthys LNG Project, Australia

Blaydin Point in Northern Territory, Australia

JPDA (Kitan Oil Field)

7. JPDA06-105 (Kitan Oil Field)

Net sales decreased 7.1% to ¥68.3 billion, and operating income fell 8.3% to ¥36.4 billion, due to adecrease in the sales volume of crude oil and yen appreciation, despite an increase in the sales price of
crude oil.

Net sales by region

Net production by region

Proved reserves by region

Number of projects

45

Producing2

Development

1

Exploration

1

Other

1

Number of countries

JPDA06-105

Project status

Venture company (established)

Interest owned (*operator)

Development

INPEX Timor Sea, Ltd.
(November 25, 1991)

INPEX Timor Sea 35% Eni* 40%
Talisman 25%

7%

7%

16%

billionthousand boed

million boe

28

¥68.3
INPEX acquired an interest in JPDA06105 in January 1992, a contract area
located within the Timor Sea Joint
Petroleum Development Area (JPDA). Oilin the Jahal structure and the Kuda Tasi
structure was discovered in 1996 and2001, respectively, through exploration
works.
Oil was found in March 2008by the Kitan-1 exploratory well,and the presence of a commercial
oil accumulation was conﬁrmed by

the Kitan-2 appraisal well drilled
subsequently. In line with the provisionsof the PSC, INPEX made a declaration in
April 2008 to the authorities that an oil
ﬁeld of commercial scale had been foundat Kitan. Thereafter, INPEX acquired
approval for the ﬁnal development planfrom the relevant authority in April 2010.
Currently, development work is under
way at the Kitan Oil Field with a target
production startup in the second half of
2011.

210

P799
Sakhalin Project

RUSSIA

UNITED
KINGDOMRUSSIA

London Office

8. JPDA03-12 – Bayu-Undan ProjectContract area
(block)

JPDA03-12
Bayu-Undan
Unit

Project status (production on the basis of
all ﬁelds and average rate of FY2010)

Producing
Crude oil: 54 thousand bbl/d
LPG: 32 thousand bbl/dNatural gas: 502 million cf/d

In April 1993, INPEX acquired a working
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 in
the Elang, Kakatua, Kakatua North andUndan structures.
Oil production in the Elang,
Kakatua and Kakatua North oil ﬁelds
began in 1998 but ceased in 2007 due
to natural depletion. Geological studies
revealed that the Undan structure andthe Bayu structure in the adjacent
JPDA03-13 contract area were a single
body. Final agreement on unitization
was reached in 1999 between interest

FRANCE

Venture company

Interest owned(established)(*operator)

INPEX Sahul, Ltd.
(March 30, 1993)

CZECH
R E P.

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

holders of both contract areas, allowing
joint development of the BayuUndan gas and condensate ﬁeld toproceed. The commercial production ofcondensate and LPG from the projectcommenced in 2004. An LNG sales
agreement was concluded with Tokyo
Electric Power Co., Inc., and Tokyo Gas
Co., Ltd., in August 2005 stipulating a
total annual supply of 3 million tons.
The gas is transported through a 500km undersea pipeline to an LNG plantbuilt in Darwin in Australia’s Northern
Territory. LNG shipments from the plantcommenced in February 2006.

INPEX CORPORATION Annual Report 2011UKRAINEK A Z AK HS TAN

AUSTRIAHUNGARY

ROMANIAP.

52 1 Offshore North

Caspian Sea Contract Area
(Kashagan Oil Field and others)

I TA LY

BULGARIAGREECEP.

Exploration

050

JAPAN

BELARUSPOLANDGERMANYINPEX Sahul 19.2458049% ConocoPhillips* 61.3114766%
Santos 19.4427185%

Project Overview

Contract area (block)

Development

TURKEYUZBEKISTANGEORGIAAZERBAIJAN

2 ACG Oil Fields
TURKMENISTAN

P.

53

53 3 BTC Pipeline

Producing

INPEX CORPORATION Annual Report 2011051

Kashagan Oil Field (site crew)

Kashagan Oil Field (offshore facility)

1. Offshore North Caspian Sea Contract Area (Kashagan Oil Field and others)
Contract area (block)

Offshore North Caspian Sea

Project status

Development

The Offshore North Caspian Sea
Contract Area consists of two blocks,
the eastern block (4,300 km²) and thewestern block (around 1,275 km²), witha combined total area of around 5,575
km². Of these, the Kashagan Oil Fieldlies in the eastern block, approximately
75 km southeast of the Kazakhstan cityof Atyrau, at 3–5 meters deep in the
Caspian Sea.
In September 1998, INPEX
acquired a working interest in the
Offshore North Caspian Sea Contract
Area inside Kazakhstan’s territorial
waters. Today, INPEX holds a 7.56%
interest.
The Kashagan Oil Field was
discovered during the ﬁrst exploratory
drillings in the block in September 1999.
The ﬁrst discovery in the Kazakhstancontrolled part of the Caspian Sea, theKashagan ﬁeld is among the largest ﬁnds
in the history of oil exploration.
A phased development of thisﬁeld is planned, with the Phase 1
experimental program now under way.
The co-ventures agreed in October
2008 with the Kazakhstan authority todevelop the Kashagan ﬁeld, upon which
the co-ventures established a new joint
operating company, North CaspianOperating Company, which assumed therole of the former operator, Agip KCO,
in January 2009. The production startis targeted for the end of 2012, with
development under way currently.

052

INPEX CORPORATION Annual Report 2011

Venture company (established)

Interest owned

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%

Besides the Kashagan ﬁeld,
hydrocarbon reserves have also been
conﬁrmed in the four other structuresof Kalamkas, Kashagan Southwest,
Aktote and Kairan. Appraisal of thesestructures is continuing in parallel withthe development of the main Kashaganﬁeld with a view to expanding the total
production of the Contract Area.
Development of the Kashaganﬁeld is subject to strict environmental
conditions. The international consortiumof developers represents the highest
level of technology and know-how,
and work is being carried out withclose consideration of the surrounding
environment, and it is hoped that thedevelopment will lead to increased oil
export revenues for Kazakhstan, thecreation of employment opportunities inthat country and the improvement of theeconomic situation for its people.

BTC Pipeline (Ceyhan Terminal)

ACG Oil Field

2. ACG Oil Fields
Contract area (block)

Project status (production on the basis of
all ﬁelds and average rate of FY2010)

ACG(Azeri, Chirag, Gunashli)

Producing(Crude oil: 821 thousand bbl/d)

INPEX acquired a 10% working interestin the Azeri-Chirag-Gunashli (ACG)
oil ﬁelds in April 2003. The ﬁelds
are located in a region of the South
Caspian Sea controlled by the Republicof Azerbaijan. In August 2010, INPEX
purchased an additional interest(0.9644%) that increased its working
interest to 10.9644%.
Oil production started in the Chiragﬁeld and has since expanded to include
the Central Azeri ﬁeld (February 2005),
the West Azeri ﬁeld (December 2005)
and the East Azeri ﬁeld (October 2006).
The Deep Water Gunashli ﬁeld came onstream in April 2008. The New Chirag

Venture company

Interest owned(established)(*operator)

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

INPEX Southwest Caspian Sea 10.96%
BP* 37.43% Chevron 11.27% SOCAR 10.00%
Statoil 8.56% ExxonMobil 8.00% TPAO 6.75%
Itochu 4.30% Hess 2.72%

Oil Project (COP) was sanctioned in
March 2010. The COP is the additional
investment for the development of
Chirag and the deep-water portion,
including the shallow layer, of the
Gunashli ﬁelds. Operations are under
way so as to increase oil output from theACG ﬁelds.
Most of the crude oil producedby the ACG ﬁelds is being transported
from Baku, Azerbaijan, to Ceyhan,
Turkey via Georgia for shipment from
the Mediterranean coast using the BTC
pipeline, a major oil transportation
system that began full-scale operations
in June 2006.

Project Overview

Kashagan Oil Field(onshore production facility)

3. BTC Pipeline
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% SOCAR 25% Chevron 8.9%
Statoil 8.71% TPAO 6.53% Eni 5% TOTAL 5% Itochu 3.4%
ConocoPhillips 2.5% Hess 2.36%

INPEX acquired a 2.5% interest in the
BTC pipeline project in October 2002.
The 1,770-km BTC pipeline
stretches from the Baku, Azerbaijan to
Ceyhan on Turkey’s Mediterranean coast
through Tbilisi, Georgia. Commencing
full-scale operation in June 2006, thepipeline was originally built to transport
crude oil produced in the ACG oil ﬁelds
in Azerbaijan. The pipeline’s capacity
was expanded up to 1.2 million bbl/d sothat it can also accommodate future oil
output from the Kashagan Oil Field in
Kazakhstan.

INPEX CORPORATION Annual Report 2011053

Middle East & Africa
Net sales increased 15.4% to ¥350.7 billion, and operating income rose 18.3% to ¥243.1 billion, due to anincrease in sales volume and the sales price of crude oil, despite yen appreciation.
ADMA Block, Zirku Island, UAE

Net production by region

32%

45%

billionthousand boed

million boe

135¥350.7

1. ADMA Block

Proved reserves by region

37%

Number of countries

7

Number of projects

13

Producing

8

Preparation for development

1

Exploration

4

Contract area (block)

Upper Zakum Field

583

TURKEYSYRIA

3 El Ouar I and II Blocks

MOROCCOP.

JORDAN

Cairo OfficeSouth October Area

Block 113-3&4 OP

ALGERIAP.

55 ADMA Block 1

SAUDI
ARABIAMALI

Soroosh &Nowrooz Fields

West Bakr Area OP
Abu Al Bukhoosh BlockEGYPT

L I B YA

IRAN

IRAQ

Tripoli Office

Ohanet Block

Tehran Office

56

NIGER

U.A
U
A .E
E

YEMEN

CHAD

SUDAN
SOMALIA

NIGERIACAMEROONCENTRAL
AFRICANREPUBLICETHIOPIADEMOCR ATICREPUBLIC
OF CONGO

Onshore Cabinda North Block

Nganzi Block3/05 A BlockK E N YA

Abu Dhabi
Office

OMAN

Venture company (established)

Interest owned

JODCO 12% ADNOC 60%
BP 14.67% TOTAL 13.33%
JODCO 12% ADNOC 60% ExxonMobil 28%

Producing
Japan Oil Development Co., Ltd.
(JODCO) (February 22, 1973)

Umm Al-Dalkh Field
Satah Field

Umm lulu Field

GREECE

Project status

Umm Shaif,
Lower Zakum Field

Nasr Field

SPAIN

Tea ceremony in Abu Dhabi

Preparation fordevelopment

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 shareexchange. Established in 1973, JODCO
owns an interest in the ADMA Blocklocated offshore Abu Dhabi in the United
Arab Emirates. Oil production currently
spans ﬁve ﬁelds in the block. Production
started from the Upper Zakum (UZ) Oil
Field (the largest in the block) in 1982,
followed by the Umm Al-Dalkh (UA) Oil
Field in 1985 and the Satah (ST) Oil Field
in 1987. JODCO has been involved in
the development of these ﬁelds. The
Umm Shaif (US) and the Lower Zakum(LZ) oil ﬁelds have also been producing
crude oil steadily since 1962 and 1967,
respectively. The oil produced fromthese ﬁelds is transported by subsea
pipelines to the islands of Das (from US
and LZ) and Zirku (from UZ, UA and ST)
for shipment.

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

A number of development projects
are currently under way to maintain andexpand oil output from the ADMA Block,including plans to develop promising
untapped structures in the block,the construction of new gas injection
facilities for the Umm Shaif ﬁeld andredevelopment plans for the Upper
Zakum ﬁeld that involve the use ofartiﬁcial islands.
The operation and developmentof these ﬁelds is undertaken by ADMAOPCO and ZADCO, the two local
operating companies for which theshares are owned by JODCO, Abu
Dhabi National Oil Company (ADNOC)
and other participating oil companies.
Through JODCO, INPEX continues todispatch engineers and other personnel
to both of these operating companies.

Project Overview

Net sales by region

ADMA Block, Upper Zakum Field

TANZ ANIA

3/91 Block

2 Offshore D.R.

Congo Block

P.

054

Producing

MOZAMBIQUEZAMBIANAMIBIAOP Operator project
Exploration

ANGOLA

56

ZIMBABWE

MADAGASCAR

Undeveloped

INPEX CORPORATION Annual Report 2011

INPEX CORPORATION Annual Report 2011055

Americas
Offshore Congo Block

Offshore Congo Block

Offshore Congo Block

Net sales decreased 24.1% to ¥12.7 billion, due to a decrease in the sales volume of crude oil, and theoperating loss was ¥3.0 billion (compared with operating income of ¥1.0 billion in the previous year), due tohigher exploration expenses.

2. Offshore D.R. Congo Block

Offshore D.R. Congo
Block

Project status (production on the basis of all

Venture company

Interest owned

ﬁelds and average rate of FY2010)(established)(*operator)

Producing(Crude oil: 14 thousand bbl/d)

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

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

INPEX acquired a 17.03% working
interest in July 1970 in an offshore
area in the country now known as the
Democratic Republic of the Congo(DRC) and has been participating in
oil exploration and development inthis region. An additional interest was
acquired in July 1972, increasing its
participating interest to the current shareof 32.28%.

Net production by region

1%

5%

2%

billionthousand boed

million boe

21

¥12.7

Oil production commenced in1975 from the GCO Oil Field, which
was discovered in 1971. Including GCO,
11 oil ﬁelds have been discovered in
the Offshore DRC Block. The contract
covering this block was extended until
2023 in May 1995, and production levels
from existing ﬁelds remain stable.

Proved reserves by region30

1 Joslyn Oil Sands ProjectP.

Number of countries

7

Number of projects

18

Producing

11

Preparation for development

1

Exploration

6

Project Overview

Net sales by region
Contract area (block)58

Hangingstone Block

CANADA

UNITED S TATESOF AMERICA

3. El Ouar I /II Blocks
Contract area (block)El Ouar I and II Blocks

Project status

Venture company (established)

Interest owned (*operator)

Undeveloped

Teikoku Oil Algeria Co., Ltd.
(December 21, 2001)

Teikoku Oil Algeria 10.29%
Sonatrach 67.33% Eni* 22.38%

In November 2001, INPEX acquired a
10.29% working interest in the El Ouar I
and II onshore blocks located in eastern
Algeria. Exploratory drilling in 1997 andthe subsequent drilling of appraisal wells
conﬁrmed the presence of natural gas,condensate and crude oil in the El Ouar

I Block. Natural gas and condensate
were also found in the El Ouar II Blockin exploratory drilling in 2001. Joint
development studies of these blocks andsurrounding ﬁelds are currently ongoing.

Houston OfficeWest Cameron Blocks 401 and 402

Louisiana Block SL19372/SL20183
Main Pass Blocks 118
Ship Shoal Block 72
Walker Ridge 95/96/139/140

Block Cuervito
Block Fronterizo

4 Gulf of Mexico

Projects(U.S. and Mexico)P.

59

MEXICOP.

Caracas Office
Copa Macoya Block
Guarico Oriental Block
Carabobo Block, Project 3
Block 31 OP
Paramaribo Office

58 Copa Macoya / Guarico Oriental Blocks 2
VENEZUELA
COLOMBIASURINAME

Block 117BRAZILPERU
P.

59 Brazil (Frade Project and others) 3
BOLIVIAPA R AGUAY

OP Operator project
Exploration

056

INPEX CORPORATION Annual Report 2011

Preparation for development

BM-ES-23
BM-C-31
Frade Project
Rio de Janeiro Office

Producing

INPEX CORPORATION Annual Report 2011057

Copa Macoya Block, Venezuela

Copa Macoya Block, Venezuela

1. Joslyn Oil Sands ProjectContract area (block)

Project status

Venture company (established)

Interest owned (*operator)

Contract area
(block)Preparation fordevelopment

INPEX Canada, Ltd.
(November 28, 2006)

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

Frade Project
BM-C-31

OSL 7404110452

BM-ES-23

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 plan of 100,000 bbl/
d by the second half of 2010 as Phase
1 development. The development
framework is currently underinvestigation.

Mexico (Cuervito)

3. Brazil (Frade Block and others)

OSL 7280060T24
OSL 7405070799

Brazil (Frade Block)

In regard to the oil sand upgrader(synthetic crude oil manufacturing)project in which we participate,
alternatives to the plant planned
by TOTAL in Edmonton are underconsideration.

Project status (production on the basis of all
ﬁelds and average rate of FY2010)

Venture company

Interest owned(established)(*operator)

Producing Crude oil: 62 thousand bbl/dNatural gas: 12 million cf/d

Frade Japão Petróleo
Limitada (FJPL) (July 5, 1999)

Frade Japão Petróleo 18.2609%
Chevron* 51.7391% Petrobras 30%

Exploration

INPEX Petróleo Santos Ltda.
(January 19, 2007)

INPEX Petróleo Santos 20% Petrobras* 60% Shell 20%

Frade Japão Petróleo Limitada (FJPL), a
joint venture established by INPEX andSojitz Corporation, acquired a 12.75%
working interest in the Frade Block in
Brazil’s offshore Northern Campos basin
in July 1999, and acquired an additional
2.25% in July 2001. As a result of thechange in interest ownership due toarrangements determined under contract,
FJPL’s working interest amounted to
18.3% in June 2006.

INPEX Petróleo Santos 15% Petrobras* 65% Shell 20%

After its initial discovery in 1986,
the reserves of the Frade Oil Field wereﬁrst estimated in 2001 with the drilling of
two appraisal wells after FJPL acquired aparticipating interest in the block. A ﬁnal
investment decision to develop Frade
was made in June 2006 after subsequentfeasibility studies. Commercial production
started in June 2009, marking the ﬁrst
crude oil to be produced in Brazil by anenterprise with a signiﬁcant Japaneseequity interest.

Project Overview

Joslyn Block, Canada

4. Gulf of Mexico Projects (U.S. and Mexico)
2. Copa Macoya and Guarico Oriental Blocks
Contract area (block)Contract area

Project status (production on the basis of

Venture company(block)all ﬁelds and average rate of FY2010)(established)

Copa Macoya

Producing
Crude oil: 1 thousand bbl/dNatural gas: 78 million cf/d

Teikoku Oil and Gas
Venezuela, C.A. (June 7, 2006)

Guarico Oriental

Interest owned

Ship Shoal Block 72

Teikoku Oil and Gas Venezuela 70% PDVSA 30%

West Cameron Blocks
401/402

Teikoku Oil and Gas Venezuela 30% PDVSA 70%

Main Pass Block 118

Project status (production on the basisof all ﬁelds and average rate of FY2010)

Venture company

Interest owned(established)(*operator)

Teikoku Oil (North America) 25% PetroQuest* 42.5% Other 32.5%
Producing
Crude oil: 1 thousand bbl/dNatural gas: 19 million cf/d

Teikoku Oil(North America)
Co., Ltd.
(May 30, 2003)

Louisiana Block SL19372

INPEX was awarded a 100% working
interest in a central onshore area, theEast Guarico Block in Venezuela in
July 1992. INPEX participated in oil
and natural gas ﬁeld rehabilitation andexploration and development activities
as an operator under the operating
service agreement (OSA) terms.
The existing OSAs were changed
to joint venture agreements in 2006 after
a change of policy by the Venezuelan

058

INPEX CORPORATION Annual Report 2011

Government. Based on the new policy,
INPEX established gas and crude
oil venture companies jointly withPetroleos de Venezuela, S.A. (PDVSA),
the Venezuelan national petroleum
company, and from April 2006 continued
the gas business in the Copa Macoya
Block and the crude oil business in the
Guarico Oriental Block. The new joint
venture agreement also features contract
extensions until 2026 for both blocks.

Teikoku Oil (North America) 16.66667% XTO* 50%
Other 33.33333%
Teikoku Oil (North America) 17.5% PetroQuest* 38.5% Other 44%

Louisiana Block SL20183
Walker Ridge
95/96/139/140

Teikoku Oil (North America) 25% PetroQuest* 38% Other 37%

Teikoku Oil (North America) 25％ PetroQuest* 55% Other 20％
Exploration

INPEX has participated in oil and gas
development projects in the shallow
waters of the U.S. Gulf of Mexico sinceApril 2006. Following production startup
from Ship Shoal 72 in July 2006, Main
Pass 118, West Cameron 401/402,
Louisiana SL19372 and SL20183 started
production.
We participated in deepwater
exploration blocks of Walker Ridge
95/96/139/140 in the Gulf of Mexico in

INPEX Gulf of
Mexico Co., Ltd.
(April 28, 2010)

INPEX Gulf of Mexico 15% Shell* 70% Other 15%

February 2011.
INPEX’s afﬁliate, Teikoku Oil de
Burgos S.A. de C.V., has participatedin gas development and production
operations in the Cuervito and Fronterizo
blocks located in the Burgos basin of
Mexico since 2004. This project has been
conducted under the multiple service
contract with PEMEX, and INPEX’s
afﬁliate holds a 40% working share ofthis project.

INPEX CORPORATION Annual Report 2011059

JapanNet income increased 11.2% to ¥104.5 billion, due to higher sales volume and a rise in the sales priceof natural gas. Operating income fell 20.3% to ¥26.0 billion, due to higher net purchases of natural gas.
Natural gas test in JapanNet sales by region

Net production by region

Oyazawa Plant (Nagaoka City, Niigata Prefecture)

Drilling crew in Japan

Yabase Oil Field in Akita Prefecture

Minami-Nagaoka Gas Field and the Domestic Natural Gas Business

Proved reserves by region

11%

6%

9%

billionthousand boed

million boe

25¥104.5

117

61 Naoetsu LNG

Akita Prefecture

Receiving Terminal(Under construction)

Higashi-Kashiwazaki Gas Field
Sekihara Gas Field (Underground storage)
Toyama Line (To be constructed )Niigata Cityy

NiigataMarketing OfficeKasshiwazaki
City

Itoigawa
City
Joet
Joe
Jo
oetsu
su CityittyyNiigata
Prefecture

Shin Oumi Line
Nag
Naga
Na
N
gano City
itt

Tomi BS

Mats
M
Ma
atsu
umot
umo
moto
mot
o CityC ty
yGunma Prefecture

Fujioka BS

Shin Tokyo Line
Matsumoto Line
NaganoPrefecture

Kofu Line
Sh
S
how
h
howa
owa
ow
wa
aT
Town
wn

Sodeshi LNG Terminal

Karuizaw
Ka
Kar
zaw
a a
Tow
To
own
Ch
C
hino Ci
hin
City
ty
y
Tom okaTomi
a City
Cit
oka

Go
ote
otemb
tem
mba
mb
mba
b
City
Cit
ty

Sh
h uokauo
oka
Shizuoka Shiz
City
City
Prefecture

Fuji City

Minamifuji Line

S
Sano
City
Konosuosssu
u CityHead Office (Akasaka, Minato-ku)
C a City
Chib
Ch
Samm
Sa
Sam
ammu City
Chiba
Prefecture

Naruto Gas Field
Chiba District Office

Itadzuma Power Control Center

Technical Research Center(Kitakarasuyama, Setagaya-ku)

Oil and gas fields

060

Natural gas pipeline network

INPEX CORPORATION Annual Report 2011

Minami-Nagaoka and nearby gas ﬁelds

dissolved in water at the Naruto Gas Fieldin Chiba Prefecture. Natural gas dissolvedin water is contained in underground“brine water.” We pump up the brinewater, extract natural gas and supply thegas to surrounding areas. The brine water
also contains high levels of iodine. We
reﬁne and export the iodine to Europe,
the U.S. and elsewhere.

Naoetsu LNG Receiving Terminal Overview

Ryomo Line

SaitamaOme
OOmmee CityPrefecture
Adachi-ku, TokyoA
Metropolitan
Tokyo(INPEX, Shizuoka Gas, Tokyo Gas)

annual demand to the 2.5 to 3.0 billion m3
range, reﬂecting further active expansionof the supply network into new regions
such as Toyama region where we decided
to construct Toyama Line (extending
from Itoigawa City, Niigata Prefecture to
Toyama City, Toyama Prefecture) in May
2011.
Supply capacity and reliability havebeen dramatically enhanced throughdynamic reinforcement of production
facilities, pipeline network expansion andthe introduction of LNG from Shizuoka
Gas Co., Ltd. in 2010. To boost the overall
scale of this business, INPEX has decided
to build an LNG receiving terminal at
Naoetsu, Joetsu City in Niigata Prefectureon the Japan Sea coast. The operational
start target is in 2014.
INPEX also produces natural gas

Isesaki Power Control Center

Honjjo
H
Honjo
oC
City

LNG

Approx. 1.72 billion m3

Construction of Naoetsu LNG Receiving Terminal

JAPAN

Tochigi Prefecture

Yamanashi
Prefecture
Iruma Line
Kofu C
Kofu
City

Shizuoka Line

[Shizuoka Gas]

Natural gas sales (FY 2010)

Minami-Nagaoka
Gas Field
P. 61

Domestic Natural Gas

Tokyo Line

Second Suruga Trunk Line

Niigata District Office
Minami-Aga Oil Field
Minami-Kuwayama Oil Field

Nagao
Naga
oka CityyToyamaPrefecture

Natural gas: Approx. 3.4 million m3/d
Crude oil and condensate: Approx. 4 thousand bbl/dDiscovered in 1979 and in production
since 1984, Minami-Nagaoka is one of
the largest gas ﬁelds in Japan. Even
after more than 25 years of continuous
output, Minami-Nagaoka still accounts
for approximately 40% of Japan‘s total
natural gas production. After being
processed, 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 over recent years, due tosharp rises in the prices of competing
fuels as well as the highly environmentallyfriendly attributes of natural gas. The
medium- to long-term projection is in

Yabase Oil Field
Akita District OfficeP.

Producing: Total oil and gas ﬁelds(FY 2010 average)

Project Overview

Domestic Natural Gas Overview※BS・・
・Booster station

Major office or district office

0

100km

Location:

12 Yachiho, Joetsu City, Niigata Prefecture

Lot area:

Approx. 25 ha

Gas production capacity:

750 million m3/day (LNG 240 tons/hour)

LNG tank:

180 thousand kl × 2 (upgrade possible)

Operational start target:

in 2014

We expect domestic demand for natural
gas to rise steadily and continue to beﬁrm due to factors such as the switch
to natural gas from oil as consciousness
about the environment and energy
conservation increases, higher oil prices.
To ensure stable supply to the domestic
natural gas market over the medium tolong term, INPEX has been engaged inconstructing an LNG receiving terminal
in Joetsu City (the port of Naoetsu) in

Niigata Prefecture on the Japan Sea
coast since 2009. The target operational
start-up date is in 2014. Afterwards, weplan to receive LNG from our overseas
projects at the Naoetsu terminal, andby 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.

Naoetsu LNG Receiving Terminal (Artist's rendering)

INPEX CORPORATION Annual Report 2011061

Gas Supply Chain

Recovery and protection of mangrove forests in Indonesia

We will establish a gas supply chain byorganically connecting the overseas
LNG with the domestic natural gas
infrastructure, so as to meet natural gas
demand in Japan, which is expected tocontinue to be ﬁrm. What this means isthat we will receive supplies of LNG fromoverseas sources, such as Ichthys andAbadi, at our Naoetsu LNG Receiving
Terminal, and employ the pipeline
network to supply natural gas to all of

our customers. This will enable us to
ﬂexibly combine three supply sources– 1)
domestic natural gas, 2) regasiﬁed LNG
from Shizuoka Gas Co., Ltd. (which webegan receiving in January 2010), and 3)
regasiﬁed LNG received at Naoetsu. We
believe that this will result in improved
supply capacity and enhanced supply
stability, allowing us to meet future
demand increases.

Until now, there had been nocompany in Japan equipped with acomplete natural gas infrastructure,from development and production
through liquefaction, transport andregasiﬁcation, and supply. Building a
total gas supply chain covering upstream
and downstream processes is one of the
beneﬁts of business integration, and it
will be our base of support in developing
an energy business suitable to thecoming era of natural gas use.

Corporate Responsibility
and Management
4.1

Corporate Social Responsibility

Corporate Governance

069

Management System / Independence of Outside Directors andDirector Compensation / Internal Control and Compliance System /A Special-Class Share / Disclosure

Three natural gas supply sources
1 Domestic natural gas

4.3

Performance / Message064

HSE (Health, Safety and Environment) Basic Policies /Environmental Impact of Our Business /Environmental Technologies / Operational Safety /Community Support / Development of Human Resources

4.2

Business Overview

4

Inspecting for leaks at a valve station

Project Overview

Construction at the Naoetsu LNG Receiving Terminal

Board of Directors, Auditors and Executive Ofﬁcers 074

2 Regasified LNG from Shizuoka Gas Co., Ltd.
3 Naoetsu LNG Receiving Terminal
Operational start target in 2014

Market Status
Domestic natural gas sales (FY2010)

1.72 billion m

Approx.

3

1 Minami-Nagaoka Gas Field(1.2 million tons/year for LNG equivalents)

Medium-to long-term expected demand:
Approx.

2.5–3.0 billion m

3(1.8-2.2 million tons/year for LNG equivalents)

Natural Gas Pipeline Network(approx. 1,400 km)
Sales to consumers along lines

Overseas
LNG Sources
Ichthys LNG Project
Abadi LNG Project
2 Sodeshi LNG Terminal (Shizuoka Gas)

062

INPEX CORPORATION Annual Report 2011

Corporate Responsibility
and Management

the Naoetsu LNG Receiving Terminal

Financial /Corporate Information

3 Regasified LNG from