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

Financial Results

for the Six Months Ended September 30, 2019

November 8, 2019Japan Petroleum Exploration Co .,Ltd.
Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

AgendaⅠ. Financial Highlights, Business Overview
Masahiro Fujita
Representative Director and President, Chief Executive Officer

Ⅱ. Financial Results for the Six Months
Ended September 30, 2019
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, Business Overview
Masahiro Fujita

Representative Director and President, Chief Executive Officer

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

3

Summary
1-2Q Results

Forecasts for FY3/20

Business Overview

Operating profit 7.7 bn. yen(YoY +8.9 bn. yen)
Profit attributable to owners of parent 12.0 bn. yen(YoY +9.6 bn. yen)

Operating profit 11.7 bn. yen(Previous forecast +0.3 bn. yen / YoY +9.4 bn. yen)
Profit attributable to owners of parent 18.8 bn. yen(Previous forecast +0.7 bn. yen / YoY +4.0 bn. yen)

Promoting Mid-term Business Plan, continuing investment inexisting projects, and examine investment for growth

Revised annual dividend forecast for FY3/20

Return to Shareholders

50 yen per share for FY3/20 annual dividend, increased 10 yen
from the latest forecast (Interim 25 yen, Year-end 25 yen)

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4

Long-term Vision and Mid-term Business Plan
Corporate profit*1 composition
2030 Ratio Long-term Vision 2030
“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 theassumption of 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

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

5

business model utilizing ourcompetitive and advanceresources

Trends in Crude Oil Price and Foreign Exchange Rate
JPY/USD

USD/bbl

JCC Price (USD/bbl）

Exchange Rate (JPY/USD)

1-2Q FY3/20（a)69.13

109.78First 10 days of Oct. 2019(flash report basis)

64.52

107.843-4Q FY3/20 (f)65.00

107.00

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6

Financial Highlights : 1-2Q Results and Full Year Forecasts
FY3/19Billion Yen

FY3/20

1-2Q (a)①

Full year(a)②

1-2Q (a)
③

115.1

267.9

Operating profit(loss)-1.1

Ordinary profit
Profit attributableto owners ofparentFull year(f)ChangeFull year(f)previous
forecasts(Aug. 9, 2019)

Revised forecasts(Nov.8, 2019)⑤*

Full year
（⑤-②）

④

1-2Q
（③-①）

Full year
（⑤-④）

162.3

325.0

318.3

+47.2

+50.3

-6.6

2.3

7.7

11.3

11.7

+8.9

+9.4

+0.3

1.2

12.5

13.6

20.6

21.8

+12.3

+9.3

+1.2

2.4

14.7

12.0

18.0

18.8

+9.6

+4.0

+0.7

JCC (USD/bbl）

72.47

71.94

69.13

66.06

67.07

-3.34

-4.87

+1.01

Exchange rate
（JPY/USD）

109.18110.35109.78110.32108.44

+0.60

-1.91

-1.88

Net sales

Assumptions* JAPEX announced “Revision of Financial Forecasts, Interim Dividend, and Year-end Dividend Forecast” on
November 8, 2019, regarding the latest revision of consolidated financial forecasts of the fiscal year ending
March 31, 2020.
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Business Overview in the First Half of FY3/20
 Promoting Mid-term Business Plan, continuing investment in existing projects

E&P
Hokkaido: Development of Yufutsu
Shallow Reservoir

Under development toward oil production commencement inJune, 2020

Iraq: Garraf Project

Under development to increase of oil production volume
toward 230,000 bbl/d scale at the end of 2020
Underdevelopment

towardoil

U.K. North Sea Offshore Block Project commencement at the end of 2021
Hokkaido: Exploratory Drilling as
National survey

and

gas

production

Conducted exploratory drilling at offshore Hidaka Area from
April to August, 2019

Infrastructure & Utility
Domestic Natural Gas Supply
Natural Gas-Fired Power Generation
Project at Soma Port

Acquiring new clients to increase gas sales in Japan
Under construction of the Fukushima Natural Gas Power
Plant* toward commercial operation commencement of No.1
Power Facilities in spring 2020
Promoting electricity sales of our share*Owned by Fukushima Gas Power Co., Ltd. (JAPEX investment ratio 33%)
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Business Overview in the First Half of FY3/20
 Examining investment for growth
E&P
Additional acquisition of interests
Examining projects or interests mainly development in overseas
in oil & gas properties

Infrastructure & Utility
Renewable Energy BusinessExamining opportunities including secondary market

Other New Business Seeds
LNG Bunkering

Supporting the arrangement of the study group aiming to
implement the LNG Bunkering framework at Tomakomai Port,
with the participation of the local government and Tomakomai
Port authority

LNG Rail Transport

Adopted subsidy projects on feasibility study of LNG/energy
supply business utilizing railways in overseas

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Overview of Canada Oil Sand Project Stable production and sales under recovering market•

Bitumen production: Operated at the maximum production capacity level in the first half of FY3/20•

Sales of diluted bitumen: Expecting significant improvement in profit over the previous year owing to
improved price differential between Western Canadian Select (WCS)* and WTI*Price index for west Canadian heavy oil Current price differential worsened over the first half of 2019•

Continue to optimize production and sales

Trend in WTI and WCS(January 2018 – September 2019)【Assumptions for FY12/19 forecasts】
FY12/18 (a)FY12/19 (f)(Nov.8, 2019)

ChangeAnnual sales
forecasts (1,000 kl/y)

1,176

1,672

+496

Outlook of annual
average WTI（USD/bbl）

64.75

57.00

-7.75

Outlook of annual
average the Pricedifferential (%)-42.30-22.10+20.20*Diluted bitumen basis

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

10

USD

80
70
60
50
40
30
20
10
0

Jan-18 Apr-18

Jul-18WTI USD/bbl

WCS USD/bbl

Oct-18 Jan-19 Apr-19

Jul-19

Policy on Shareholders Return,
Revision of Dividend Forecast
 Maintaining long-term and stable dividend•

Based on mid-long term business outlook, JAPEX determines an amount of dividend
comprehensively considering our financial plan including investments for securing oil
and gas reserves in Japan and overseas, retained earnings for maintaining andexpanding our supply infrastructure, as well as considering profit of each fiscal year
and future capital demands.

 Revision of Dividend Forecast for FY3/20•

Increased annual dividend per share to 50 yen from previous forecast of 40 yen(Interim 25 yen, Year-end 25 yen)

Dividend per Share (Yen)InterimYear-end
25 （Forecasts）

25
30

25

10
5

10
10

10

FY3/16

FY3/17

FY3/18

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

11

25
FY3/20Ⅱ. Financial Results for the Six Months
Ended September 30, 2019
Michiro Yamashita
Director, Managing Executive Officer

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

12

Natural Gas Sales for 1-2Q FY3/20(Year-on-Year)Sales volume : Million M3
Net sales : Million Yen

FY3/19
1-2Q (a)FY3/20
1-2Q (a)ChangeSales volume

813

746

-66

Net sales

27,83529,362

1,527

Japan

Sales volume

548

533

-15

Gas produced in Japan

Sales volume

（287）

(270)

(-17)

Overseas

Sales volume

264

212

-51

Natural gas

Increase in sales price inJapan

Sales volume by region

Million M3

Sales volume ofoverseas gas

Decrease in shale gas sales volume in
CanadaSales volume ofgas in Japan

Sales volume in “Overseas” which are volume of 2 overseas
subsidiaries (Japex (U.S.) Corp. and JAPEX Montney Ltd.,).
2Q FY3/19 (a)2Q FY3/20 (a)Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

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Crude Oil Sales for 1-2Q FY3/20 (Year-on-Year)Sales volume : Thousand KL
Net sales : Million Yen

FY3/191-2Q(a)FY3/201-2Q(a)ChangeSales volume

1,278

2,308

+1,029Net sales

54,30592,288+37,982

Crude oilproduced inJapan*1

Sales volume

131

147

+16

Net sales

6,927

7,371

+443

Crude oilproduced inoverseas*2

Sales volume

185

629

+444

Net sales

9,298

28,719+19,420

Sales volume

496

838

+341

Net sales

13,257

23,385+10,128

Crude Oil

Growth in sales volume of crude oil
produced in overseas, and diluted
bitumenEquity oil sales

Diluted bitumen*3

Growth in crude oil sales volume ofGarraf Oil Field, Iraq
Growth in bitumen production
volume of the Hangingstone lease

Sales price and exchange rate
JCC

USD/bbl

72.47

69.13

-3.34

Diluted bitumen*3

USD/bbl

38.37

41.20

+2.83

Exchange rate

JPY/USD

109.18109.78+0.60*1 Sales volume and net sales of “Crude oil produced in Japan” which do not include purchased crude oil.
*2 Sales volume and net sales of “Crude oil produced in overseas” which are volume of 3 overseas subsidiaries (Japex (U.S.) Corp., JAPEXMontney Ltd. and Japex Garraf Ltd.).
*3 Royalty is excluded in the net sales and price of diluted bitumen.
Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

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1-2Q FY3/20 Results (Year-on-Year)
Million Yen

FY3/19
1-2Q (a)FY3/20
1-2Q (a)ChangeNet sales

115,136

162,346+47,210Gross profit

14,126

23,101+8,975

362

358

-4

SG&A expenses

14,94615,013+67

Operating profit (loss)-1,183

7,730+8,913Non-operating income

2,476

5,906

+3,429Ordinary income

1,293

13,636+12,342

Extraordinary income(losses)

618

-19

-637

Income taxes

394

1,512

+1,118

Profit (loss)
attributable to noncontrolling interests

-915

34

+950

Profit attributable toowners of parent

2,433

12,069+9,636

Exploration expenses

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Main factors for change
Increase factor “+” / Decrease factor “( )”Gross profit
Domestic business
Overseas business+¥ 2.3 bn.
+¥ 6.6 bn.

Non-operating income (expenses)
Foreign currency translation adjustments on
debt, foreign exchange gains and losses(FY3/19) Loss of ¥2.9 bn. → (FY3/20) Gains of ¥1.4 bn.

Equity on earnings+¥4.4 bn.
(¥1.0 bn.)

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

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16

Price Assumptions for FY3/20 Forecasts
2019

2020

Jan.-Mar. Apr.-Jun. Jul.-Sep. Oct.-Dec. Jan.-Mar.
WTI

USD/bbl

JCC

USD/bblExchange rate JPY/USD

JACOS
Diluted bitumen*1

JML
Natural gas*2

USD/bbl
CAD/mcf

Full year

Previous

54.90

59.76

55.97

55.00

56.41

Revised

54.90

59.90

56.50

56.40

57.00

Previous

68.77

65.00

65.00

65.00

66.06

Revised

68.77

69.55

65.00

65.00

67.07

Previous

111.11 110.00 110.00 110.00 110.32

Revised111.11 108.26 107.00 107.00 108.44

Previous

37.98

44.23

36.21

33.60

38.08

Revised

37.98

44.20

39.94

34.42

39.29

Previous

2.28

1.41

1.57

1.57

1.71

Revised

2.28

1.33

1.57

1.75

1.74

*1 “JACOS Diluted bitumen” which is the diluted bitumen sales price of Japan Canada Oil Sands Ltd. (Excl. Royalty)*2 “JML Natural gas” which is the gas sales price of JAPEX Montney Ltd. (Excl. Royalty)
Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

17

Natural Gas Sales Forecasts for FY3/20(vs Aug. 9 Forecasts)
Sales volume : Million M3
Net sales : Million Yen

Natural gas

FY3/20FY3/20Previous (f)Aug. 9, 2019

Revised (f)Nov. 8, 2019

ChangeSales volume

1,732

1,731

-1

Net sales

70,47969,173-1,306

Sales volume

1,299

1,299

-0

Sales volume

(562)

（569）

(+7)

Sales volume

433

432

-0

Decrease in sales
price in Japan

Sales volume by regionJapan
Gas produced in Japan

Overseas

Sales volume ofoverseas gas

Million M3

Sales volume ofgas in Japan

Sales volume in “Overseas” which are volume of 2 overseas
subsidiaries (Japex (U.S.) Corp. and JAPEX Montney Ltd.,).
Aug. 9 (f)Revised (f)Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

18

Crude Oil Sales Forecasts for FY3/20(vs Aug. 9 Forecasts)
Sales volume : Thousand KL
Net sales : Million Yen

FY3/20Previous (f)Aug. 9, 2019

FY3/20
Revised (f)Nov. 8, 2019

ChangeSales volume

4,662

4,536

-126

Net sales

180,270

173,367-6,902

Crude oilproduced inJapan*1

Sales volume

278

291

+13

Net sales

13,392

13,904+512

Crude oilproduced inoverseas*2

Sales volume

1,349

1,185

-165

Net sales

58,95951,453‐7,506

Dilutedbitumen*3

Sales volume

1,654

1,672

+19

Net sales

43,60644,191+585

JCC

USD/bbl

66.06

67.07

+1.01

Dilutedbitumen*3

USD/bbl

38.08

39.29

+1.21

Exchange rate

JPY/USD

110.32108.44-1.88

Crude Oil

Decrease in sales volume ofcrude oil produced inoverseas

Equity oil sales

Decrease in crude oil sales
volume of Garraf Oil Field,
Iraq

Assumptions*1 Sales volume and net sales of “Crude oil produced in Japan” which do not include purchased crude oil.
*2 Sales volume and net sales of “Crude oil produced in overseas” which are volume 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.
Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

19

FY3/20 Forecast (vs Aug. 9 Forecasts)
Million Yen

FY3/20Previous (f)Aug. 9, 2019

FY3/20
Revised (f)Nov. 8, 2019

ChangeNet sales

325,014318,351-6,663Gross profit

43,28543,912

+627

1,083

969

-114

SG&A expenses

30,85831,208+350

Operating profit (loss)

11,344

11,735+391

Non-operating income(expenses)

9,350

10,163+813

Ordinary profit (loss)

20,694

21,898+1,204Extraordinary income(losses)

-62

-111

-49

2,898

3,415

+517

-288

-447

-159

18,022

18,820+797

Exploration expenses

Income taxes
Loss attributable to noncontrolling interests
Profit attributable toowners of parent

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

20

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

Domestic business
Overseas business(¥0.4 bn.)
+ ¥1.0 bn.

Non-operating income

Equity on earnings+¥ 1.3 bn.
Foreign currency translation adjustments on
debt, foreign currency exchange gains andlosses(¥ 0.4 bn.)

Natural Gas Sales Forecasts for FY3/20(Year-on-Year)Sales volume : Million M3
Net sales : Million Yen

Natural gas

FY3/20FY3/19(a)ChangeRevised (f)Nov. 8, 2019

Sales volume

1,731

1,731

+0

Net sales

67,82069,173+1,353

Sales volume

1,243

1,299

+55

Sales volume

(630)

(569)

（-62）

Sales volume

487

432

-55

Growth in sales
volume in Japan

Sales volume by regionJapan
Gas produced in Japan

Overseas
Million M3

Sales volume ofoverseas gas

Decrease in shale gas sales volume in
CanadaSales volume ofgas in Japan

Growth in demand for commissioningof the Fukushima Natural Gas Power
Plant

Sales volume in “Overseas” which are volume of 2 overseas
subsidiaries (Japex (U.S.) Corp. and JAPEX Montney Ltd.,).
FY3/19 (a)FY3/20 (f)Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

21

Crude Oil Sales Forecasts for FY3/20(Year-on-Year)Sales volume : Thousand KL
Net sales : Million Yen

FY3/19(a)FY3/20
Revised (f)Nov. 8, 2019

ChangeSales volume

3,064

4,536

+1,471

Net sales

124,696

173,367+48,671

Crude oilproduced inJapan*1

Sales volume

261

291

+29

Net sales

13,746

13,904+158

Crude oilproduced inoverseas*2

Sales volume

366

1,185

+818

Net sales

16,59951,453+34,854

Sales volume

1,176

1,672

+496

Net sales

30,11644,191+14,075

JCC

USD/bbl

71.94

67.07

-4.87

Diluted bitumen*3

USD/bbl

36.67

39.29

+2.62

Exchange rate

JPY/USD

110.35108.44-1.91

Crude Oil

Growth in sales volume

Equity oil sales

Diluted bitumen*3

Growth in crude oil sales
volume of Garraf Oil Field,
Iraq
Growth in bitumen production
volume of the Hangingstone
lease

Assumptions*1 Sales volume and net sales of “Crude oil produced in Japan” which do not include purchased crude oil.

*2 Sales volume and net sales of “Crude oil produced in overseas” which are volume 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.
Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

22

FY3/20 Forecast (Year-on-Year)
Million Yen

FY3/19(a)FY3/20
Revised (f)Nov. 8, 2019

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

Net sales

267,980

318,351+50,371

Gross profit

34,84643,912+9,065

788

969

+180

SG&A expenses

31,74331,208-536

Operating profit

2,313

11,735+9,422Non-operating income

10,209

10,163-47

Ordinary profit

12,523

21,898+9,375

550

-111

-661

-1,254

3,415+4,670

-441

-447

-6

14,77018,820+4,049

Exploration expenses

Extraordinary income(losses)
Income taxes
Loss attributable to noncontrolling interests
Profit attributable toowners of parent

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

23

Domestic business
Overseas business(¥1.5 bn.)+¥10.6 bn.

Non-operating income (expenses)•••

Equity on earnings(¥ 4.4 bn.)
Dividend income+¥2.9 bn.
Foreign currency translation adjustments
on debt, foreign exchange gains andlosses(FY3/19) Loss of ¥5.2bn. →(FY3/20) Gains of ¥0.1bn.

•••+¥5.4 bn.
(FY3/19)Gains of ARO cancellation due toselling interests of the Hangingstone lease(¥3.2bn.)
Decrease in interest income (¥0.5bn.)
Increase in interest expenses (¥0.3bn.)

Income taxes(FY3/19) Increase in tax expense due toabsence of one-time factor incurred inprecious period(¥2.8bn.)(FY3/19) Application of foreign tax credit on
Garraf Project(¥2.3bn.)
Tax expense of JACOS(¥1.0bn.)
Tax effect of U.K. North Sea Offshore Project+¥1.6bn.

Sensitivities Analysis on FY3/20 Forecasts basis (3Q-4Q)

FY3/20
3Q-4Q
Assumptions

Impacts on profit（Million Yen）
Fluctuation

JCC
Crude oilprice

USD 65.00/bbl

Increase by
USD1/bbl

OperatingincomeProfitattributableto owners ofparent

120

90

24

16

WTI

Main factors for change

Increase factor “+” / Decrease factor “( )”+ Sales of oil and gas(Increase in LNG procurement cost)+ Sales of diluted bitumen

USD 56.50/bbl

Exchangerate￥ 107.00/USD

Natural gas
price in
CanadaCAD 1.66/mcf￥ 80.75/CAD

1 weaker yen
against USD

240

Increase by
CAD1/mcf

90

170

90

+ Sales of oil and gas(Increase in LNG procurement cost)+ Sales of shale gas in Canada(Increase in operation cost of theHangingstone lease)• Changes in equity method investment gain are 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 various other factors besides crude oil
prices and exchange rates.
Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

24Appendix

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

25

＜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 the JAPEX Group

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

26

＜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

Exploratory Drillingas National survey in
Hokkaido

Drilled exploratory well at
offshore Hidaka Area from
April to August 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.

27

＜Appendix＞
E&P Business-3

Canada: Oil Sands Project

Project

Canada Oil Sands Co., Ltd. (CANOS)

company

JAPEX‘s share 94.58%
Overseas subsidiary ： Japan Canada Oil Sands
Ltd. (JACOS)

Block & Interest

Hangingstone Leases
75％ interests (Operator)

In Production

Corner JV Lease
12％ interests

Undergoingappraisal/Status

Other bitumen leases(includes Corner & Chard)

Considering future
activities

Gross production
rate

26,066bbl/d as average of September 2019

Recent activities••

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

■Timeline 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.

28

The Central Processing Facility

＜Appendix＞
E&P Business-4

Canada: Shale Gas Project

Project company

JAPEX Montney Ltd. (JML)

Block

North Montney Area

Interest

10%

Status

Production/Development

Operator

PETRONAS group

JAPEX’s share 45%

1,186M3/d

Gross production
rate

Approx. 6.9Kboe/dRecent activities

Executing the development planprioritizing the area with higheconomics. Working on to maximize
the value and economics of the project.

as of September 2019

The bird’s-eye View of the Plant
Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

29

＜Appendix＞
E&P Business-5

Iraq: Garraf Project

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. 97,000Kbbl/d
as average of September 2019

Japex Garraf Ltd.

■ Timeline of Garraf Project
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 of the production

2020 4Q

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

Production Well of Garraf Oil Field
Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

30

＜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

JAPEX’s share 25%
2 other affiliates

6,200,000M3/d

Approx. 38,000 boe/d

as average of September
2019■ Timeline 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

31

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

Russia: Sakhalin-1 Project

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

JAPEX
15.29％
Others
34.71%

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

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

32

＜Appendix＞
E&P Business-8
Project
company

JAPEX UK E&P Ltd.

Block

Seagull Field

Interest

15％

StatusDevelopment

Operator

Neptune E&P UK Limited

U.K. North Sea Offshore BlockJAPEX’s share 100%

■ Timeline of Seagull Field Development
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
Production test at the Seagull Block

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

33

＜Appendix＞ Infrastructure & Utility Business-1
Natural Gas Supply Chain in JapanJAPEX transport and supply crude oil andnatural gas through pipelines and by tanktrucks and tankers. Also, we are expanding
the scope of our energy business, which
includes receiving imported LNG and electric
power generation.

LNG tank containers by railway
LNG tank truck

The Soma LNG Terminal and theArch bridge of Niigata-Sendai
Gas Pipeline

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

Fukushima Natural Gas Power Plant

34

＜Appendix＞ Infrastructure & Utility Business-2
Power Generation Project

Natural Gas-Fired Power
Generation Project

Renewable Energy Business

Head Office: Fukushima Gas Power Co., Ltd.*We aim to develop businesses in solar, biomass,wind power and geothermal, utilizing our
expertise in oil and natural gas development andproduction operations, building good
relationships with local communities, operating
power generation facilities and fuel procurementin the Natural Gas-Fired Power Generation
Project.

Rendering of the Soma LNG Terminal and the Fukushima
Natural Gas Power Plant■Power Plant Construction Schedule
October 2016 FID
June 2017

Approved Environmental Assessment

October 2017 Commencement of construction
2019

Commissioning of No.1 Power Facilities isplanned in Q3

2020

Commencement of commercial operations
planned (No.1 Gas Turbine : Spring, No.2
Gas Turbine: Autumn)*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.

JAPEX Hokkaido District Office’s mega-solar power
plant site

35

＜Appendix＞
New Business Development
CCS (Carbon Dioxide Capture and Storage)
Implementing a CCS demonstration project in the Tomakomai area of
Hokkaido since April 2012, through Japan CCS Co., Ltd. (JCCS).
Cumulative CO2 injection was 284,009 tons as of the end of September
2019.

Methane Hydrate
Implemented the second offshore methane hydrate production test from2017, through Japan Methane Hydrate Operating Co., Ltd. Currently,
working on investigating, researching and developing technology forresource recovery, exploration and other areas related to sand-layer typemethane hydrate.

Photo provided by Japan CCS Co., Ltd

Ground facilities of CCS Demonstration
Project at Tomakomai

Deep-Sea Mineral Resources Exploration
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 Technologyof Marine Resources Survey)

Creating unique business seeds
Implementing new initiatives to identify and materialize new businessseeds in the peripheral fields of existing businesses that utilize JAPEX
technology and knowledge. In February, 2019, JAPEX and partners
launched the study group aiming to implement the LNG Bunkering
framework based on Tomakomai Port.
Copyright © 2019 Japan Petroleum Exploration Co., Ltd. All rights reserved.

36

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.

37

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 (FY3/20, for instance, means 12 months ending March 31, 2020)
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.

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