Note: The following report is an English translation of the Japanese-language original.

Financial Results
for the fiscal year ended March 31, 2019

May 10 , 2019Japan Petroleum Exploration Co .,Ltd.
Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

AgendaⅠ. Financial Highlights,
Progress of Mid-term Business Plan
Hideichi Okada
Representative Director and President

Ⅱ.

FY3/19 Financial Results

Michiro Yamashita
Director, Managing Executive Officer

Ⅲ. FY3/20 Forecasts

Michiro Yamashita
Director, Managing Executive Officer

Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

2

Ⅰ. Financial Highlights,
Progress of Mid-term Business Plan
Hideichi Okada
Representative Director and President

Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

3

Summary
Financial Results for FY3/19

Operating profit 2.3bn. yen（YoY -6.4bn. yen ）Profit attributable to owners of parent 14.7bn. yen（YoY +45.7bn. yen）

 Increase in OPEX in association with full-year operation of Soma LNG Terminal, Declined
in profit from diluted bitumen sales
 Improvement in equity in gains of affiliates, Dissipation of temporary loss recorded in
FY3/18

Forecasts for FY3/20

Operating profit 5.6bn. yen (YoY +3.2bn. yen）
Profit attributable to owners of parent 11.4bn. yen (YoY -3.3bn. yen）

 Improvement in profit from diluted bitumen sales
 Decrease in equity in gains of affiliates, Increase in tax expenses

Progress of Mid-term Business Plan Steadily implementing each business to achieve Mid-term Target（ROE=>5％)

Return to Shareholders

FY3/19 annual dividend of 40 yen per share （YoY +20 yen ）FY3/20 (Forecast) annual dividend of 40 yen per share （Interim 20 yen, Year-end 20 yen)

 Maintain the policy of stable dividends to shareholders, and aim for the increase of ourcorporate value and the shareholders return in mid-to-long term, by the improvement offinancial structure and the promotion of growth investment
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Trends in Crude Oil Price and Foreign Exchange Rate
USD/bblYen/USD

$100

¥115

$90
$80

¥110

$70
$60

¥105

JCC Price USD/bbl
Exchange Rate JPY/USD

Average rate for FY3/19
USD 71.94/bbl ¥110.35/USD
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5

2019-012018-10

2018-072018-04

2018-012017-10

2017-07$40

2017-04$50¥100

Financial Highlights - FY3/19 Results and FY3/20 Forecasts■ FY3/19 Results (YoY)
Billions of Yen

Billions of Yen

FY3/18 (a)FY3/19 (a)

230.6

267.9

+37.3

+16%

Operating profit

8.7

2.3

-6.4

-73%

Ordinary profit

3.8

12.5

+8.6

+227%

Profit (loss) attributableto owners of parent

-30.9

14.7

+45.7

-%

JCC (USD/bbl)

56.20

71.94

+15.74+28%

Exchange rate
(Yen/USD)

111.67110.35-1.32-1%Net sales

Billions of Yen

25.0
250

3,500
350.0

ChangeNet Sales (Left Axis)

3,000
300.0

250.0
2,500

2,000

1,500

267.9

FY3/19 (a)FY3/20 (f)

267.9

308.6

+40.6

+15%

Operating profit

2.3

5.6

+3.2

+142%

Ordinary profit

12.5

12.6

+0.1

+1%

Net sales

Change14.7

JCC (USD/bbl)

71.94

65.00

-6.94

-9%

Exchange rate
(Yen/USD)

110.35110.00

-0.35

-0%

11.4

-3.3

Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

-22%

15.0
150
12.6
11.4

8.7

10.0
100

3.8

5.6
5.0
50

2.3

-

500

-50

-30.9
FY3/18 (a)FY3/19 (a)FY3/20 (f)Right Axis
Operating profit
Ordinary profit
Profit (loss) attributable to owners of parent

6

200
20.0

1,000

-

Profit (loss)
attributable to ownersof parent

14.7
12.5

230.6

■ FY3/20 Forecasts (YoY)
Billions of Yen

308.6

-100

Long-term Vision and Mid-term Business Plan
Long-term Vision 2030

Corporate profit*1 composition

2030 Ratio“Growth to the Integrated Energy
Company Utilizing Our Oil and Gas
E&P and Its Supply Basis”
The profit composition JAPEX aims for in 2030
E&P Business : Non-E&P Business = 6：4

Mid-term Business Plan 2018-2022
Achieve ROE=>5% level with the assumptionof crude oil prices of USD60/bbl
Mid-Term Targets

E&P
Long-Term Targets
Maintain “RRR*2 >1”

Infrastructure &Utility

New Business
Development

Targets to 2022
Business generation by the new
Natural gas transaction volume in Japan business model utilizing our

1.6 million tons (LNG equivalent)Electricity sales volume

2.8 bn. kWh*1 Operating profit + Equity method investment income/loss basis*2 RRR: Reserve Replacement Ratio
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competitive and advanceresources

Progress of Mid-term Business Plan from FY3/19 onward
Develop businesses that make use of our value chain to achieve Mid-term Business Plan
Promotion of Electricity Business

Development Business Opportunities• Start of internal idea sharing and examination• Established New Business Promotion Office• Launch of study group for LNG bunkering at Tomakomai Port• Established Renewable Energy Business Dept. in
Soma Project & Power Business Division (May 2019)• Commissioning of No.1 Power Facilities of the
Fukushima Natural Gas Power Plant (Planned inAutumn,2019)

Strengthen LNG Procurement
Opened Representative Office in Singapore (April 2019)

New Business
Development

Identification of Business Opportunities

CCS, MH,

Next-Generation Technology
for Ocean Resources Exploration

Commercialization

Renewable Energy

Infrastructure& Utility

LNG Procurement

E&P

Acquisition of Interests/
Exploration

Gas Supply Chain

Development /Production

Secure Investment Resources

Maximize Value of Resources in Japan• Start of exploratory drilling at
offshore Hidaka Area of
Hokkaido (April 2019)• Production commencement of
1,900m reservoir at Iwafune-oki Oiland Gas Field• Development of a shallow reservoirof Yufutsu Oil and Gas Field

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Gas Power Generation

LNG Terminal

8

Electric Power Supply

Gas Supply

Crude Oil Supply
Growth Investment in Overseas E&P Business•••

Canada Oil Sands Project: Achievement to stable 20,000
bbl/d level bitumen production
Indonesia Kangean Project: Production commencement at
the Sirasun and Batur Gas Field (TSB Phase2)
U.K. North Sea Offshore Block Project: Final Investment
Decision

Quantitative Targets of Mid-term Business Plan【Long-Term Targets】 Maintain “RRR＞1”*1

E&P

Infrastructure& Utility

In addition to develop existing domestic and overseas projects, strengthen promotion of national
offshore exploration project and efforts toward identification of new business seeds

Proved reserves increased approx. 85 MMBOE by approval of development plan in Garraf Oil Field【Target to 2022】Domestic natural gas transaction volume of 1.6million tons*2 and Electricity
sales volume 2.8 bn. kWh
 Promoting new clients acquisition to expand domestic transaction volume of natural gas
 Promoting electricity sales toward commencement of Fukushima Natural Gas Power Plant*3
 Established Renewable Energy Business Dept. for further promotion of renewable energy development

Production volume (MBOED)

Proved reserves （MMBOE）■Domestic ■Overseas■Domestic ■Overseas

305

313

349

193

203

255

112

110

94

74

387

352
302
277

74

229

73

48
323

72

21

64

FY3/142013年度*1 RRR= Increase in reserves (during certain period)/Production volume*2 LNG equivalent*3 Owned by Fukushima Gas Power Co., Ltd. (JAPEX investment ratio 33%)

9

60

62

42

45

54

52

20

19

19

18

17

FY3/152014年度FY3/16
2015年度FY3/172016年度FY3/182017年度FY3/192018年度27

FY3/19FY3/15
FY3/16
FY3/17
FY3/18
FY3/142013年度末
2014年度末
2015年度末
2016年度末
2017年度末
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54

73

ESG Promotion
Accelerating concrete actions to ESG issues and improvement disclosure
Capital allocation forgrowth investment*2“E&P: Non-E&P = 1:1”

Environment
Established New Business
Promotion OfficeSocial contribution
through sustainablegrowthTarget setting in areas
other than climatechangeSet quantitative target for
GHG emission reduction

Established Renewable
Energy Business Dept.

Promoting diversity atthe board of directors

Building a strong
energy supply systemwith DX*3

Implementation of ICP*1

Revision of HR management
systemStrengthen the Risk
Management System by
the Board of Directors

Revision of JAPEX Group
Code of Conduct

Achieved target of
female recruitment

Social*1*2*3

Named the Excellent Enterprises of
Health & Productivity Managementfor 3 consecutive years

Established Nomination
and Compensation
Advisory Committee

Governance

Incorporate internal carbon pricing into our investment criteria
Invest about half of new investment resources in non-E&P business such as renewable energy and new business
DX: Digital transformation

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Toward Achievement of Profit Target
To achieve ROE=>5％ in fiscal 2022 and "Growth to the Integrated Energy
Company" stated in Mid-term business plan, further improve economic efficiency
in existing projects and accelerate promotion of new business in business eachareas.
History and forecast of Profit attributable to owners of parent (Billions of Yen)
Actual29.0

Expanding power and gas sales/
Promoting new projects

29.5

Operating commencement ofFukushima Natural Gas Power Plant

Effects ofdownfall in
crude oil prices

2.0
FY3/142013年度Forecast

FY3/152014年度FY3/16
2015年度Losses on
the PNW
LNG
Project

3.4
FY3/172016年度

14.7

11.4

Productioncommencement in
U.K. North Sea
Offshore Block

Production commencement of ashallow reservoir of Yufutsu Oil and
Gas Field▲30.9
FY3/182017年度FY3/192018年度FY3/20(f)2019年度(予想)

FY3/23(f)2022年度Mid-term Business Plan 2018-2022

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(目標)

Financial Position and Capital Allocation Policy
Consolidated financial
position as of FY3/19 end
Cash and deposits*1 ：￥88.1bn.

Investment securities： ￥137.7bn.
Debt*2：￥151.7bn.

EBITDA*3 ：￥41.7bn.

2019-2022 capital allocation① Investment in existing projects*1：Approx.
￥60.0bn.
② Debt repayment：

Approx. ￥55.0bn.

③ Growth investment：

Approx. ￥65.0bn.

④

Return to Shareholders*4：Approx.￥9.0bn. +α2022 target• Balance of interest-bearing debt
to approx. ￥100 to 120 bn.
• Maintain Debt/EBITDA＜2 andpromote growth investment• Expand shareholder returns in
the medium to long term

Debt/EBITDA ratio： Approx. 3.6

To achieve ROE=>5％,
promote below measures considering high volatility of oil and gas prices :①

Investment of necessary capital to improve profitability of existing projects
Improvement of profitability on 2 projects in Canada as top priority, including continuous investments for
production increase on shale gas project in Canada②

Secure capital for new investment under financial discipline of “Debt/EBITDA< 2”③

Growth investment with capital allocation of “E&P : non-E&P =1 : 1”④

Maintain the policy of stable dividends to shareholders, and aim for the increase of our corporate value and theshareholders return in mid-to-long term, by improving financial structure and promoting growth investment⑤

Conduct verification for continuation of cross-shareholdings, in points of benefit, risks, and capital costsConsidering expected return from holding stocks, and role for buffer of funds.

*1 “Cash and deposits” and “Investment in existing projects” do not include approx. ￥29.3 bn. of funds reserved in Garraf project subsidiary company and thereinvestment amount to achieve 230,000 bbl/d in the Garraf Project.
*2 Debt stated herein includes lease obligations, retirement benefit liabilities and contingent liabilities*3 EBITDA is the total of operating income, depreciation, interest and dividends received*4 Shareholder return is based on the assumption that FY3/20 dividend forecast will continue
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12

Ⅱ. FY3/19 Financial Results
Michiro Yamashita
Director, Managing Executive Officer

Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

13

FY3/19 Results Overview
Billions of Yen

FY3/19Initial forecasts(May 11,2018)(f)

Revised forecasts(Aug. 8,2018)(f)

Revised forecasts(Nov. 9,2018)(f)

Revised forecasts(Feb.12,2019)(f)

265.6

284.0

288.3

282.3

267.9

Operating profit

0.6

2.1

0.5

0.3

2.3

Ordinary profit

9.9

10.0

12.3

9.8

12.5

Profit (loss) attributable toowners of parent

9.4

11.0

12.3

12.4

14.7

JCC price（USD/bbl）

60.00

69.50

73.75

70.45

71.94

Exchange rate

110.00109.39109.60110.19110.35Net sales(a)Assumptions（JPY/USD）

 Initial forecast (May 2018)

Revised forecast (August 2018)

Revised forecast (November 2018)【＋】Increase in sales price, sales volume of purchased crude oil from overseas, equity in gains of affiliates【－】Decrease in profit from diluted bitumen sales, Fluctuation in foreign currency exchange gains/losses

 Revised forecast (November 2018)

Revised forecast (February 2019)

Actual result (May 2019)【＋】Tax reduction due to application of foreign tax credit on Garraf Project, Increase in gas sales volume in Japan, Increasein sales price【－】Decrease in sales price, Widen the price differential of WCS to WTI, Fluctuation in foreign currency exchange
gains/losses

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Natural Gas Sales for FY3/19 (year-on-year)
Sales volume : Million M3
Net sales : Million Yen

Natural gas

FY3/18 (a)FY3/19 (a)ChangeSales volume

1,773

1,731

-41

Net sales

60,431

67,820+7,388

Sales volume

1,284

1,243

-40

(739)

(630)

-108

488

487

-1

Increase in sales price inJapan

Sales volume by regionJapan
Gas produced inJapan

Overseas

Sales volume

Sales volume

Million M3

Sales volume ofoverseas gas

2,100
1,800
1,500

488

487

1,284

1,243

1,200

Sales volume ofgas in Japan

Temporary demand reduction due tothe client’s reason

900
600
300
-

FY3/18(a)Sales volume of “Overseas” stated herein are amounts of Japex (U.S.)
Corp. and JAPEX Montney Ltd., overseas consolidated subsidiaries.

FY3/19(a)Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

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Crude Oil Sales for FY3/19 (year-on-year)
Sales volume : Thousand KL
Net sales : Million Yen

Crude oil

FY3/18(a)FY3/19(a)ChangeSales
volume

2,506

3,064

+558

Net sales

93,685

124,696+31,010

Sales
volume

291

261

-30

Net sales

12,265

13,746+1,481

Sales
volume

991

366

-625

Net sales

33,74916,599-17,149

Sales
volume160

1,176+1,015Net sales

4,512

30,116+25,603

Increase in sales price

Equity oil sales
Crude oil produced
in Japan*1
Crude oil producedin overseas*2

Diluted bitumen*3

Oil price and exchange rate assumptions
JCC

USD/bbl

56.20

71.94

+15.75

Diluted bitumen*3

USD/bbl

39.63

36.67

-2.96

Exchange rate

JPY/USD

111.67110.35-1.32

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16

Decrease in crude oil sales volumeof Garraf Oil Field, Iraq

Commencement of diluted bitumen
sales of the Hangingstone lease in
3Q of 2017
*1 Sales volume and net sales of “Crude oil
produced in Japan” stated herein do not include
purchased crude oil*2 Sales volume and net sales of “Crude oil
produced in overseas” stated herein are amountsof 3 overseas subsidiaries (Japex (U.S.) Corp.,
JAPEX Montney Ltd. and Japex Garraf Ltd.)*3 Royalty is excluded in the net sales and price ofdiluted bitumen

FY3/19 Results (year-on-year)
Main factors for change
Increase factor “+” / Decrease factor “( )”[Million Yen]

FY3/18(a)FY3/19(a)ChangeNet sales

230,629

267,980+37,350

Gross profit

39,263

34,846-4,416

Exploration expenses

1,324

788

-535

SG&A expenses

29,17331,743+2,570Operating profit (loss)

8,764

2,313

-6,451Non-operating income(expenses)-4,936

10,209+15,146

Ordinary income

3,828

12,523+8,695-73,231550+73,782240-1,254-1,493

Profit (loss) attributable
to non-controllinginterests-38,683-441+38,242

Profit (loss) attributableto owners of parent-30,959

14,770+45,729

Extraordinary income(losses)
Income taxes

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17

Gross profit
Domestic business(¥4.0 bn.)
Overseas consolidated subsidiaries(¥0.4 bn.)
SG & A expenses
Increase in transportation cost of theHangingstone lease(¥2.3 bn.)Non-operating income (expenses)
Equity in earnings of affiliates + ¥15.1 bn.
Foreign currency translation adjustments on
debt, foreign currency exchange gains andlosses(FY3/18 Gains of ¥2.7 bn.→ (FY3/19)Loss of ¥5.2 bn.

(¥ 8.0 bn.)
(FY3/18) Decrease in amortization expense
related to the Hangingstone DEMO area
+ ¥7.7 bn.
Extraordinary income (loss)(FY3/18) Impairment loss spikes due notproceeding LNG Project in Canada+ ¥72.9 bn.
(FY3/19) Gains on sales of real estate+ ¥0.7 bn.

Ⅲ. FY3/20 Forecasts
Michiro Yamashita
Director, Managing Executive Officer

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18

Price Assumptions for FY3/20 Forecasts
Upper: from January 2018 to March 2019
Lower: from January 2019 to March 2020
Jan.-Mar.

Apr.-Jun.

2018(a)2019(f)2018(a)
USD/bbl
JCC
2019(f)2018(a)Exchange rate JPY/USD
2019(f)

62.87
53.69

67.88
69.50
55.33
55.00
67.95
76.64
65.00
65.00
107.42 110.61
110.00 110.00

58.75
64.75
55.00
54.76
79.05
65.06
71.94
65.00
65.00
65.00
112.41 110.66 110.35
110.00 110.00 110.00

JACOS

33.48
37.23
2.04
1.70

43.05
35.79
1.21
1.70

25.76
33.55
2.11
1.70

WTI

USD/bbl2018(a)2019(f)Diluted bitumen*1
JML
2018(a)CAD/mcf
2019(f)Natural gas*2
USD/bblJul.-Sep.

41.08
33.51
1.42
1.70

Oct.-Dec.

Full year

Jan.-Mar.

36.67
35.01
1.69
1.70

*1 “JACOS Diluted bitumen” stated herein is the diluted bitumen sales price of Japan Canada Oil Sands Ltd. (Excl. Royalty).
*2 “JML Natural gas” stated herein is the natural gas sales price of JAPEX Montney Ltd. (Excl. Royalty)

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19

Natural Gas Sales Forecasts for FY3/20
Sales volume : Million M3
Net sales : Million Yen

Natural gas

FY3/19 (a)FY3/20 (f)ChangeSales volume

1,731

1,722

-9

Net sales

67,82069,531+1,711

Sales volume

1,243

1,300

+56

Sales volume

(630)

(561)

-69

Sales volume

487

422

-66

Increase in sales volume
in Japan

Sales volume by regionJapan
Gas produced inJapan

Overseas
Million M3

2,000
1,600

Sales volume ofoverseas gas

487

422

1,243

1,300

FY3/19 (a)FY3/20 (f)

1,200
800
400
-

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Sales volume ofdomestic gas

Increased demand forcommissioning of the Fukushima
Natural Gas Power Plant

Sales volume of “Overseas” stated herein are amounts of Japex (U.S.)
Corp. and JAPEX Montney Ltd., overseas consolidated subsidiaries.

20

Crude Oil Sales Forecasts for FY3/20
Sales volume : Thousand KL
Net sales : Million Yen
Crude oil

FY3/19 (a)FY3/20 (f)ChangeSales volume

3,064

4,512

+1,448Net sales

124,696

168,257+43,561

Sales volume

261

265

+4

Net sales

13,746

12,463-1,284

Sales volume

366

1,339

+972

Net sales

16,59955,235+38,636

Sales volume

1,176

1,516

+340

Net sales

30,11636,717+6,600

Increase in sales volume

Equity oil sales
Crude oil produced
in Japan*1
Crude oil producedin overseas*2

Diluted bitumen*3

Increase in crude oil sales
volume of Garraf Oil Field, Iraq
Increase in sales volume of theHangingstone lease

Oil price and exchange rate assumptions
JCC

USD/bbl

71.94

65.00

-6.94

Diluted bitumen*3

USD/bbl

36.67

35.01

-1.66

Exchange rate

JPY/USD

110.35110.00-0.35*1 Sales volume and net sales of “Crude oil produced in Japan” stated herein do not include purchased crude oil.
*2 Sales volume and net sales of “Crude oil produced in overseas” stated herein are amounts of 3 overseas subsidiaries (Japex (U.S.)
Corp., JAPEX Montney Ltd. and Japex Garraf Ltd.).
*3 Royalty is excluded in the net sales and price of diluted bitumen.
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21

FY3/20 Forecasts[Million Yen]

FY3/19 (a)FY3/20 (f)ChangeNet sales

267,980

308,650+40,670

Gross profit

34,84637,783+2,937

788

1,054

+265

31,74331,126-618

Operating income (loss)

2,313

5,603

+3,289Non-operating income(expenses)

10,2097,067-3,142

Ordinary income

12,523

12,670

+147

550

-78

-628

-1,254

1,883+3,138

Profit (loss) attributable
to non-controllinginterests

-441

-704

-262

Profit (loss) attributableto owners of parent

14,77011,413-3,357

Exploration expenses
SG&A expenses

Extraordinary income(losses)
Income taxes

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22

Main factors for change
Increase factor “+” / Decrease factor “( )”Gross profit

Domestic business(¥2.9bn.)
Overseas consolidated subsidiaries+¥5.8bn.

Non-operating income(expenses)
Equity on earnings(¥5.5bn.)

Foreign currency translation
adjustments on debt, foreignexchange gains and losses(FY3/19) Loss of ¥5.2bn.
→(FY3/20) Not expected+¥5.2bn.
(FY3/19)Gains of ARO cancellation
due to selling interests of theHangingstone lease(¥3.2bn.)

Income taxes(FY3/19) Application of foreign tax
credit on Garraf Project(¥2.6bn.)
Tax effect of U.K. North Sea
Offshore Block Project+¥1.7bn.

Sensitivities Analysis on FY3/20 Forecasts basis
Impacts on profit（Million Yen）
FY3/20Assumptions

Fluctuation

JCC
Crude oilprice

USD 65.00/bbl

Increase by
USD1/bbl

Operatingincome

500
263

WTI
USD 55.00/bbl
Exchangerate￥ 110.00/USD

Natural gas
price in
CanadaCAD 1.70/mcf￥ 82.00/CAD

1 weaker yen
against USD

Increase by
CAD1/mcf

360

390

Profitattributableto owners ofparent

420
248

200

290

Main factors for change

Increase factor “+” / Decrease factor “( )”+ Sales of oil and gas(Increase of LNG procurement cost)+ Sales of diluted bitumen+ Sales of oil and gas(Increase of LNG procurement cost)+ Sales of shale gas in Canada(Increase of operation cost of theHangingstone lease)• Changes in equity method investment gain is not included in the above amount.
• In addition to the impact of exchange rate fluctuations shown on the above, translation adjustments of foreign-currencydenominated receivables and payables also occur. Actual profits are influenced by a variety of other factors besides crude
oil prices and exchange rates.
Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

23

Appendix

Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

24

＜Appendix＞
E&P Business-1 Main Projects
Canada Oil Sands Project(Production)

U.K. North Sea Offshore Block(Development)

Canada Shale Gas Project
Russia Sakhalin-1 Project(Production / Development)

Oil and Gas Fields in Japan
Iraq Garraf Project(Production / Development)(Production / Development)

United States Tight Oil Project(Production / Development)(Production / Development)Indonesia Kangean Project(Production)

Blocks owned by our consolidated subsidiaries or equity-method affiliates

Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

25

＜Appendix＞
E&P Business-2

Activities in Japan Operating 10 oil and gas fields in Japan Pursuing compensation of reserves andmaintaining the production volume
 Pursuing additional E&P potential including
national surveys■Major projects in progress
Development of ashallow reservoir of
Yufutsu Oil and Gas
Field

In process of development
toward productioncommencement in fiscal
2020

1,900m reservoir at
Iwafune-oki Oil and
Gas Field

Completed drilling work andcommenced production inlate March of 2019

Exploratory Drillingas National survey in
Hokkaido

Commencement of
exploratory drilling at
offshore Hidaka Area in
April 2019

Yurihara
Oil and Gas Field

Yufutsu
Oil and Gas Field

Katakai Gas
Field
Iwafune-oki
Oil and Gas Field

Yoshii Gas Field

Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

26

＜Appendix＞
E&P Business-3
Project

Canada: Oil Sands Projectcompany

Canada Oil Sands Co., Ltd. (CANOS)
Operator ： Japan Canada Oil Sands Ltd.

Block &
Interest

Hangingstone Leases
75％ interests (Operator)

In Production/ Status

Corner JV Lease
12％ interests

Undergoingappraisal

Other bitumen leases(includes Corner & Chard)Grossproduction rate

Recentactivities(JACOS)

Considering future
activities

Calgary
FORT McMURRAY Area
Hangingstone
Leases

26,000bbl/d as of March 2019••

Relinquished 25% interests of Thornbury & Chard
North in January 2018
Sold 100% interests of Hangingstone DEMO area in
April 2018

■Schedule of Hangingstone ProjectFebruary 2013

Commenced development works (early civil work)

February 2017

Completed construction of facilities

April 2017

Commenced steam injection to horizontal well pairs

August 2017

Commenced production

June 2018

Transition to stable 20,000 bbl/d level bitumen
production

Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

27

Corner JV Lease＜Appendix＞
E&P Business-4

Canada: Shale Gas Project

JAPEX Montney Ltd.
(JML)

Pacific NorthWest LNG

Upstream: Shale gas project

Midstream: LNG project

Block

North Montney Area

Lelu Island,
the Port of Prince Rupert

Interest

10%

10%

Status

Production/Development-

Operator

PETRONAS group

PETRONAS groupGross
production
rate

12,980,000M3/d

Project
company

Recentactivities

JAPEX’s share 45%

JML’s share10%-

Executing the development
plan prioritizing the areawith high economics.
Working on to maximize thevalue and economics of the
project.

Decided not to proceedwith the LNG project on
July 25,2017

Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

The North Montney Area

(Production & Development)

Vancouver Calgary

Approx. 85,000 boe/das of March 2019

Calgary28

＜Appendix＞
E&P Business-5
Project
company

JAPEX’s share 55%

Field

Garraf Oil Field

Project
share

30% (cost share 40%)

Status

Production / Development

Operator

PETRONAS groupGross
production
rate

Approx. 90,000 bbl/das of March 2019

Iraq: Garraf Project

Japex Garraf Ltd.

BaghdadGarraf Oil Field
SamawahNasiriyah■Schedule
2013

First oil production

2018

Commencement of further development
due to approval of the Final Development
plan by the Iraqi government

2018 - 2020

Gradual increase the production rate

2020 4Q

Achievement of plateau production target of
230,000 bbl/d

Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

29

Basrah＜Appendix＞
E&P Business-6

Indonesia: Kangean Project

Project
company

Energi Mega Pratama Inc.

Block

Kangean Block

Interest

100％

Status

Production

Operator

Kangean Energy Indonesia Ltd.

Gross
production
rate

4,400,000M3/d

JAPEX’s share 25%
2 other affiliates

Pagerungan Gas Field(Production)
TSB Gas Field（Production）
Sirasun Gas Field
Terang Gas Field

Batur Gas Field

Approx. 27,000boe/das of March 2019

■ History of TSB Gas Field Development
2012

Commencement of production at the
Terang Gas Field (TSB Phase1)

March 2019

Commencement of production at the
Sirasun and Batur Gas Field (TSB
Phase2)

Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

FPU (Floating production unit)
in the TSB Gas Field

30

＜Appendix＞
E&P Business-7
Project
company
Block

Russia: Sakhalin-1 Project

Sakhalin Oil and Gas
Development Co., Ltd. (SODECO)

OdoptuJAPEX’s share 15.29%

Chayvo, Odoptu and Arkutun-Dagi

Interest
Sakhalin 1 Consortium

Exxon Neftegas
Ltd. 30％
Others40%

SODECOSODECO

METI
50.00%

30％

StatusDevelopment/ Production

Operator

Exxon Neftegas Ltd.

Arktun-Dagi

JAPEX
15.29％
ChayvoOthers
34.71%

Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

The Arkutun-Dagi Offshore Field
Provided by Exxon Neftegas Ltd.

31

＜Appendix＞
E&P Business-8
Project
company

JAPEX UK E&P Ltd.

Block

Seagul Field

Interest

15％

U.K. North Sea Offshore Block
NorwayJAPEX’s share 100%

StatusDevelopment

Operator

Neptune E&P UKCS Limited

Seagull
Aberdeen

U.K.

■Schedule
March 2014

Acquisition of interest in
exploration license

November
2015

Success of flow test in appraisal
well

March 2019

Final Investment Decision

By the end of

Planned commencement of

2021

production

Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

32

＜Appendix＞ Infrastructure & Utility Business-1
Natural Gas Supply Chain in JapanJAPEX establish an integrated supply structure fornatural gas (gas integration), from gas fielddevelopment and production (upstream) throughtransportation (midstream) by pipeline and othermeans including railway tank containers, tank trucks
and coastal tankers to supply and sale to electric
power providers and local distribution companies, aswell as industrial customers (downstream).
Additionally, we launch the studies concerning theimplementation of LNG bunkering by utilizing
pioneering expertise including Japan’s first Ship-toShip LNG transfer experience.

LNG tank containers by railway

Ship-to-Ship work in Tomakomai
LNG tank truck

The Soma LNG Terminal and the
Fukushima Natural Gas Power Plant

Arch bridge of Niigata-Sendai
Gas Pipeline
Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

33

＜Appendix＞ Infrastructure & Utility Business-2
Natural Gas-Fired Power Generation Project■The overview of Fukushima Natural Gas Power Plant
Head Office

Fukushima Gas Power Co., Ltd.* (Founded April 2015)

MethodGas Turbine and Steam Power (Gas Turbine
Combined-cycle)

Capacity

1.18 million kW (2 units of 0.59 million kW)

FuelNatural Gas (Vaporized LNG)
Amount 700,000-1,000,000t/y (Utilization Ratio
60%-90%)

Thermal Efficiency

Sending End 60.64% (LHV, Temperature 15°C)

Gas Turbine

1,500°C Class

Steam Turbine

Steam Condition (High-pressure/ Medium-pressure/Low-pressure)
600/600/284°C
15.6/3.34/0.5MPa

Heat Recovery Boiler■Schedule

Rendering of the Soma LNG Terminal and the
Fukushima Natural Gas Power Plant

Revitalization of
local area

e.g. Job creation,
Enterprise attractions

Steam Flow 370/85/50t/h
NOx Emission concentration Less than 5ppm

October 2016

FID

June 2017

Approved Environmental Assessment

October 2017

Commencement of construction

2019

Commissioning of No.1 Power Facilities is planned in Q3

2020

Commencement of commercial operations planned(No.1 Gas Turbine : Q1, No.2 Gas Turbine: Q2)*Investment ratio: JAPEX 33%, Mitsui & Co., Ltd. 29%, Osaka Gas Co., Ltd. 20%,
Mitsubishi Gas Chemical Co., Inc. 9%, Hokkaido Electric Power Co., Inc. 9%
Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

34

Inexpensive
and stableelectric power
supply＜Appendix＞
New Business Development
CCS (Carbon Dioxide Capture and Storage)
Implementing a CCS demonstration project in the
Tomakomai area of Hokkaido since April 2012, throughJapan CCS Co., Ltd. (JCCS). Cumulative CO2 injection was
235,598 tons as of the end of March 2019.
Photo provided by Japan CCS Co., Ltd

Ground facilities of CCS Demonstration
Project at Tomakomai

Methane Hydrate
Implemented the second offshore methane hydrate
production test from 2017, through Japan Methane Hydrate
Operating Co., Ltd. Currently, working on investigating,researching and developing technology for resource recovery,
exploration and other areas related to shallow-type methane
hydrate.

Innovative Technology for Deep Sea
Resources
Establishing a business model for exploration and/or
development of deep sea mineral resources as a private
sector through J-MARES (Research and Development
Partnership for Next-Generation Technology of Marine
Resources Survey)
Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

35

Collected deposit samples with pellets ofpolymetallic nodules at sea bottom of deeper
than 5,000m water depth（Cabinet Office of Japan, SIP "Innovative
Technology for Exploration of Deep Sea Resources" ;News Letter Vol.6, Mar. 2019）Abbreviations
BOE(D)

Barrels of Oil Equivalent (per Day)

CCS

Carbon dioxide Capture and Storage

CIF

Cost, Insurance and Freight

COP

Conference Of the Parties

CSR

Corporate Social Responsibility

E&P

Exploration and Production

FID

Final Investment Decision

GHG

Greenhouse Gas

HSE

Health, Safety and Environment

IOR (EOR) Improved (Enhanced) Oil Recovery
JCC

LNG

Japan Crude Cocktail
Japan Oil, Gas and Metals National
Corporation
Liquefied Natural Gas

MH

Methane Hydrate

P/L

Pipeline

ROE

Return on Equity

RRR

Reserve Replacement Ratio

SODECO

Sakhalin Oil & Gas Development Co., Ltd.

TSBTerang, Sirasun, Batur

WCS

Western Canadian Select

WTIWest Texas Intermediate

JOGMEC

Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

36

Cautionary Statement
This document contains future prospects such as plans, forecasts, strategies, and others
which are not historical fact and these are made by the management’s judgement basedon the obtainable information at the time of the disclosure. Actual results may significantly
differ from those future prospects due to various factors.
This document is not intended to invite investment.
Copyright : All information contained herein is protected by copyright, and may not be
copied or reproduced without prior consent of JAPEX.
Note: Abbreviations used herein are as follows:(a) = Actual results(f) = Forecasts
FY = Fiscal Year (FY3/19, for instance, means 12 months ended March 31, 2019)
Any inquiries about the information contained herein or other Investor Relations questions
are requested to be directed to:Investor Relations Group, Media & Investor Relations Dept.
Japan Petroleum Exploration Co., Ltd. (JAPEX)Tokyo, JAPANTEL: +81-3-6268-7111

Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

37