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

Consolidated Financial Results
for the Six Months Ended September 30, 2017
＜Supplementary material＞
November 10 , 2017

Japan Petroleum Exploration Co .,Ltd.

Cautionary Statement
Any information contained herein with respect to JAPEX’s plans, forecasts, strategies
and other statements that are not historical facts are forward-looking statements about
the future performance of JAPEX. Readers should be aware that the actual results andevents may be different from these projections because of various factors that could
occur in the future.
The provision of this document should not be construed as a solicitation for 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 (FY3/18, for instance, means 12 months ending March 31, 2018)
Any inquiries about the information contained herein or other Investor Relations questions arerequested to be directed to:Investor Relations Group, Media & Investor Relations Dept.
Japan Petroleum Exploration Co., Ltd.
Tokyo, JAPANTEL: +81-3-6268-7111

2

2014-09
2014-10
2014-11
2014-12
2015-01
2015-022015-032015-04
2015-05
2015-06
2015-072015-08
2015-09
2015-10
2015-11
2015-12
2016-01
2016-02
2016-03
2016-04
2016-05
2016-06
2016-072016-08
2016-09
2016-10
2016-11
2016-122017-012017-022017-032017-04
2017-05
2017-06
2017-072017-082017-09［Crude Oil Price US$/bbl]
$120

$110

$90
¥160

Crude Oil Price US$/bbl (Left axis)$100

Exchange Rate JP¥/US$ (Right axis)

3

¥150

¥140

¥130

$80
¥120

$70
¥110

$60
¥100

$50
¥90

$40
¥80

$30
¥70

［Foreign Exchange Rate JP¥/US$］

Trends in Crude Oil Price and Foreign Exchange Rate

Japan Crude Cocktail (JCC) Price in the first 10 days of October
2017 on a prompt report basis: US$ 53.83/bbl JP¥ 112.07/US$

Actual Results for 2Q and Forecasts for FY3/18＜Highlight＞
FY3/17[Billion JP¥]

2Q (a)①

FY3/18Full (a)②

2Q (a)③

ChangeFull (f)Previousforecasts(August 8,2017)④

Full (f)Revisedforecasts(November10, 2017)⑤*2Q（③-①）

Full（⑤-②）

Full（⑤-④）

Net sales

91.4

207.1

112.3

211.0

213.8

+20.8+6.6+2.7

Operating income(loss)

-3.2

0.6

3.4

4.4

4.3

+6.6

+3.6

-0.1

Ordinary income(loss)

-2.2

2.2

8.8

-0.9

0.6

+11.1

-1.5

+1.5

Profit (loss)
attributable toowners of parent

-1.2

3.4

7.7

1.2

1.7+9.0

-1.7

+0.5

41.64

45.60

52.44

51.27

51.25

+10.80

+5.65

-0.02

107.67108.53111.79110.62110.94

+4.12

+2.41

+0.32

Assumptions
JCC price(US$/bbl)
Exchange rate
(JP¥/US$)*JAPEX announced the latest forecasts in “Notice of Financial Forecasts Revision” on November 10, 2017, regarding theconsolidated financial forecasts of the fiscal year ending March 31,2018.

4Actual results

Actual Sales of Natural Gas in 2Q FY3/18 ( year-on-year )Sales volume : Million M3
Net sales : Million JP¥

FY3/17

FY3/182Q (a)

2Q (a)

ChangeSales volume845

833

-11

Net sales

23,184

26,839+3,654

Domestic gas

Sales volume531

569+37(Domestically producedgas)

Sales volume(324)

（344）

（+19）

Overseas gas

Sales volume313

264-49Natural gas

Rising selling price

Breakdown

Million M3

900600300-313531

Sales volume ofoverseas gas

Decrease in sales volume ofShale Gas Project in Canada

Sales volume ofdomestic gas

Increase in demand for local
distribution companies andindustrial users

264

569
Sales volume of “Overseas gas” stated herein are amounts of Japex(U.S.) Corp. and JAPEX Montney Ltd., overseas consolidated subsidiaries

2Q FY3/17(a)2Q FY3/18(a)5Actual results

Actual Sales of Crude Oil in 2Q FY3/18 ( year-on-year )FY3/17

FY3/18

2Q(a)

2Q(a)

Sales volume

1,715

1,548-167

Net sales

43,79253,086+9,294Domestic crude oil(*)

Sales volume

149

146

-3

Net sales

4,645

5,713+1,068

Overseas crude oil(**)

Sales volume986

809

-176

Net sales

23,11225,604+2,492

Sales volume91－-91

Net sales

589

－-589

JCC price

US$/bbl

41.64

52.44

+10.80

Bitumen price (***)

US$/bbl9.94－-9.94

Exchange rate

JP¥/US$107.67111.79+4.12

Sales volume : Thousand KL
Net sales : Million JP¥
Crude Oil

ChangeRising selling price

Breakdown

Bitumen (***)
Assumptions

Decrease in oil sales volume fromGarraf Oil Field in IraqBitumen production in theDemonstration area has beensuspended from May 2016, decided not
to re-start production operations inAugust 2017(*) Sales volume and net sales of “Domestic crude oil” stated herein do not include purchased crude oil(**) Sales volume and net sales of “Overseas crude oil” stated herein are amounts of 3 overseas subsidiaries (Japex (U.S.) Corp., JAPEX Montney Ltd.
and Japex Garraf Ltd.)(***) Royalty is excluded in the net sales and price of Bitumen6

Actual Results for 2Q FY3/18 ( year-on-year )[ Million JP¥]Net sales

FY3/17

FY3/182Q (a)

2Q (a)

91,494112,382

Change17,884+6,209

645

643

-1

SG&A expenses

14,243

13,788-455

Operating income (loss)-3,2133,452+6,666

Non-operating income(expenses)

975

5,435

+4,460Ordinary income (loss)-2,238

8,888+11,126

Exploration expenses

Extraordinary income (loss)-270-12+258414

1,108+693

Profit (loss) attributable tonon-controlling interests-1,657

10+1,668

Profit (loss) attributable toowners of parent-1,267

7,756+9,023

Income taxes

Main factors for changeIncrease factor (+) / Decrease factor (-)+20,887

11,675Gross profit

Actual results

7

Gross profit
Domestic crude oil and natural gas+ ¥2.0 billion
Overseas consolidated subsidiaries+ ¥3.7 billion

Non-operating income (expenses)
Equity in earnings of affiliates+ ¥3.2 billion
Foreign currency translation adjustments on debt,
foreign currency exchange gains and losses(FY3/17)Losses ¥0.4 billion→ (FY3/18)Gains ¥0.9 billion+ ¥ 1.4 billion

Revised forecasts

Revised Forecasts for FY3/1820172018
Full year
Jan.-Mar. Apr.-Jun. Jul.-Sep. Oct.-Dec. Jan.-Mar.

[Assumptions]
JCC price

US$/bblExchange rate JP\/US$

2.
3.

Previous forecasts
Revised forecasts

US$/bblPrevious forecasts

JACOS

US$/bblPrevious forecasts

C$/mcfPrevious forecasts

JML
Gas

54.63
50.00
50.00
50.00
51.27
54.63 49.88 50.00 50.00 51.25
112.12 110.00 110.00 110.00 110.62
112.12 111.38 110.00 110.00 110.94

Revised forecasts

JACOS
Bitumen
Diluted bitumen

1.

Previous forecasts

Revised forecasts
Revised forecasts
Revised forecasts

2.71
2.71

2.62
2.67

32.89
37.46
2.23
1.29

32.83
32.83
2.23
1.94

32.84
33.15
2.45
2.21

“JACOS Bitumen” stated herein bitumen selling price of Japan Canada Oil Sands Ltd. (Deduction of Royalty). Decided not to re-start
operation at the Demonstration area in August 2017 and not estimated FY3/18 sales.
“JACOS Diluted bitumen” stated herein diluted bitumen selling price of Japan Canada Oil Sands Ltd. (Deduction of Royalty). Started
production operation at the Hangingstone Joint Venture area in August 2017, and started sales thereafter.
“JML Gas” stated herein gas selling price of JAPEX Montney Ltd. (Deduction of Royalty)8Revised forecasts

Revised Forecasts Natural Gas Sales for FY3/18(vs Previous Forecasts)

FY3/18

FY3/18ChangePrevious forecasts Full (f)August 8, 2017

Revised forecasts Full (f)November 10, 2017

Full

Sales volume

1,797

1,757-40

Net sales

59,12858,333-796

Domestic gas

Sales volume

1,245

1,251

+5

(Domesticallyproduced gas)

Sales volume(722)

(723)

(+2)

Overseas gas

Sales volume552

506

-46

Sales volume : Million M3
Net sales : Million JP¥

Natural gas

Decrease of sales volume,
decline in selling price

Breakdown

Million M3

2,0001,600552506

1,200800
4001,245

Sales volume ofoverseas gas

Decrease in shale gas sales volumein Canada

Sales volume ofdomestic gas

Increase in demand for local
distribution companies andindustrial users

1,251
Sales volume of “Overseas gas” stated herein are amounts of Japex (U.S.)
Corp. and JAPEX Montney Ltd., overseas consolidated subsidiaries.

Previous forecasts(f)Revised forecasts(f)9Revised Forecasts Crude Oil Sales for FY3/18

Revised forecasts(vs Previous Forecasts)

FY3/18

FY3/18ChangePrevious forecasts
Full (f) August 8,2017

Revised forecastsFull (f) November 10,2017

FullSales volume2,6542,603-51

Net sales

86,556

87,104+548

Sales volume

285

285

―

Net sales

10,792

10,831+39

Sales volume

1,160

1,154-6

Net sales

35,65436,790+1,137

Sales volume

―

―

―

Net sales―――

Sales volume254

210-44

Net sales

5,768

4,814-953

JCC price

US$/bbl

51.27

51.25

-0.02

Bitumen price (***)

US$/bbl―――Diluted bitumen(****)

US$/bbl32.84

33.15+0.31

Exchange rate

JP¥/US$110.62

110.94+0.32

Sales volume : Thousand KL
Net sales : Million JP¥Crude Oil

Increase in sales volume

Breakdown
Domestic crude oil (*)
Overseas crude oil(**)
Bitumen (***)
Diluted bitumen(****)
Assumptions

10Rising selling price from Garraf Oil
Field in Iraq
Decision not to re-start SAGD
operation in the Demonstration
area
Reduction of sales volume due torevision for the operation plan of
the Hangingstone Joint Venturearea(*) Sales volume and net sales of “Domesticcrude oil” stated herein do not include
purchased crude oil.
(**) Sales volume and net sales of “Overseascrude oil” stated herein are amounts of 3
overseas subsidiaries (Japex (U.S.) Corp.,
JAPEX Montney Ltd. and Japex Garraf Ltd.).
(***) ,(****) Royalty is excluded in the net
sales and price of both Bitumen and Dilutedbitumen.

Revised forecasts

Revised Forecasts for FY3/18 (vs Previous Forecasts)
Previous forecasts
Full(f)August 8, 2017

Revised forecasts
Full(f)November 10, 2017

Net sales

211,025

213,802+2,777Gross profit

35,80435,391-414

Exploration expenses

1,329

1,362+34

SG&A expenses

29,987

29,714-273

Operating income (loss)

4,4894,314-175

Non-operating income-5,399-3,661+1,738

Ordinary income (loss)-910

654+1,564

Extraordinary income-5,564-5,579-15Million JP¥

ChangeIncome taxes-1,361-720+640

Profit (loss) attributable tonon-controlling interests-6,333-5,941+391

Profit (loss) attributable toowners of parent

1,219

1,737+518

11

Main factors for change
Increase factor (+) / Decrease factor (-)

Gross profit
Domestic crude oil and natural gas- ¥0.2billion
Overseas consolidated subsidiaries- ¥0.7billion
Other+ ¥0.2billion

Non-operating income (loss)
Foreign currency translation
adjustments on debt, foreignexchange gains and losses(Previous) Gains ¥0.9billion→(Current) Gains ¥ 2.0billion+ ¥1.1billion

Revised forecasts

Revised Forecasts Natural Gas Sales for FY3/18(year-on-year)
Sales volume : Million M3
Net sales : Million JP¥

FY3/17

FY3/18ChangeFull (a)Revised forecasts Full (f)November 10, 2017

FullSales volume

1,864

1,757-108

Net sales

55,32958,333+3,003

Domestic gas

Sales volume

1,265

1,251-15(Domesticallyproduced gas)

Sales volume(744)

(723)

(-22)

Overseas gas

Sales volume599506-94

Natural gas

Rising selling price

Breakdown

Million M3

2,000
1,600599

506

1,200800

1,265

1,251

FY3/17(a)FY3/18(f)400-Sales volume ofoverseas gas

Decrease in shale gas sales volumein Canada

Sales volume ofdomestic gas

Decrease in sales volume

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

12Revised forecasts

Revised Forecasts Crude Oil Sales for FY3/18(year-on-year)
Sales volume : Thousand KLNet sales : Million JP¥

FY3/17

FY3/18ChangeFull (a)Revised forecasts
Full (f) November 10,2017

Full

Sales volume

2,762

2,603

-159

Net sales

82,098

87,104+5,006

Sales volume

301

285

-17

Net sales

10,273

10,831+558

Sales volume

1,181

1,154-28

Net sales

28,65336,790+8,137

Sales volume

91

―-91

Net sales

669

―

-669

Sales volume―210+210

Net sales

―

4,814

+4,814JCC price

US$/bbl45.60

51.25+5.65

Bitumen price (***)

US$/bbl

9.94

―

-9.94

Diluted bitumen(****)

US$/bbl―33.15+33.15

Exchange rate

JP¥/US$108.53110.94+2.41

Crude Oil

Rising selling price

Breakdown
Domestic crude oil(*)
Overseas crude oil(**)
Bitumen (***)
Diluted bitumen(****)
Assumptions

13

Rising selling price from Garraf
Oil Field in Iraq
Decision not to re-start
operation of the Demonstrationarea
Commencement of production
operation of the Hangingstone
Joint Venture area(*) Sales volume and net sales of“Domestic crude oil” stated herein do notinclude purchased crude oil.
(**) Sales volume and net sales of“Overseas crude oil” stated herein areamounts of 3 overseas subsidiaries (Japex(U.S.) Corp., JAPEX Montney Ltd. andJapex Garraf Ltd.).
(***) ,(****) Royalty is excluded in thenet sales and price of both Bitumen andDiluted bitumen.

Revised Forecasts for FY3/18 (year-on-year)[Million JP¥]FY3/17

FY3/18Full (a)Revised forecasts
Full (f)November 10,
2017

Change207,130

213,802+6,671Gross profit

32,17235,391+3,218

1,512

1,362

-150

29,97529,714-261

Operating income (loss)

685

4,314+3,629

Non-operating income(expenses)1,537-3,661-5,198

Ordinary income (loss)

2,222654-1,569Extraordinary income(loss)

970-5,579-6,549

Income taxes

1,642-720-2,363

Profit (loss) attributable
to non-controllinginterests-1,892-5,941-4,049Profit (loss) attributableto owners of parent

3,443

SG&A expenses

1,737
14

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

Net sales

Exploration expenses

Revised forecasts-1,707

Domestic crude oil and natural gas + ¥0.3 billion
Overseas consolidated subsidiaries + ¥3.5 billionOther- ¥1.0 billion

Non-operating income (expenses)

Equity in earnings of affiliates+ ¥4.3 billion(Breakdown: Not proceeding LNG project inCanada- ¥3.2 billion)
Foreign currency translation adjustments on debt,
foreign currency exchange gains and losses(FY3/17)Gains ¥3.4 billion→(FY3/18)Gains ¥2.0 billion- ¥1.3 billion
Not to re-start production operation in theDemonstration area- ¥7.7 billion

Extraordinary income (loss)

Not proceeding LNG Project in Canada- ¥5.3 billion
Decrease in FY3/17 gains on sales of real estate- ¥1.2 billion

Income taxes adjustments
Tax effect accounting regarding the Demonstration
area+ ¥1.9 billion

Assumptions and Impact on Profits [3Q-4Q]
FY3/17Full(a)

Revised forecasts

FY3/18
1Q(a)

2Q(a)

3Q(f)

4Q(f)

Full(f)

JCC price

US$/bbl

45.60

54.63

49.88

50.00

50.00

51.25

Exchange rate

JP¥/US$108.53112.12111.38110.00110.00110.94

Canadian gas

C$/mcf

1.95

2.71

2.67

1.29

1.94

2.21

Assumptions

JCC price(3Q-4Q)

Exchange rate
(3Q-4Q)

US$ 50.00/bbl

110.00 JP¥/US$

Canadian gas(4Q)C$ 2.21/mcf
JP¥ 88/C$Impact on Profit

US$ 1/bbl increase in JCC
prices would push profits
up by...

A weakening in JP¥ 1/US$exchange rates would pushprofits up by…

C$ 1/mcf increase inCanadian gas prices would
push profits up by…

Operating incomeJP¥ 190millionJP¥ 60millionJP¥ 410million

Profit (loss) attributableto owners of parentJP¥ 130million-JP¥ 20millionJP¥ 160million

Note: 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.

15