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

Consolidated Financial Results
for the Fiscal Year Ended March 31, 2017
＜Supplementary material＞
May 12 , 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 couldoccur 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:
1H = First half (1Q-2Q)
2H = Second half (3Q-4Q)(a) = Actual results(f) = Forecasts
FY = Fiscal Year (FY3/17, for instance, means 12 months ended March 31, 2017)
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

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$110

$90

2014-032014-04
2014-05
2014-06
2014-072014-08
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
2016-122017-012017-022017-03［Crude Oil Price US$/bbl]$120

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 Prices and Foreign Exchange Rate
¥160

Actual Results for FY3/17 and Forecasts for FY3/18 (Highlight)■ Actual Results for FY3/17 (vs FY3/16)

Billion ¥FY3/16(a)FY3/17(a)

240.3

207.1

-33.1

-13%

Operating Income

8.3

0.6-7.6-91%

Ordinary Income

4.6

2.2-2.4-52%

Profit attributableto owners of parent

2.0

3.4

+1.3

+64%

51.48

45.60

-5.88-11%

Billion JP¥
Net Sales

JCC Price(US$/bbl)
Exchange Rate(JP¥/US$)

121.06108.53

Change-12.53

207.1

214.8+7.7+3%

Operating Income

0.6

2.9+2.3+336%

Ordinary Income

2.2

5.4+3.2+144%

Profit attributableto owners of parent

3.4

5.5+2.1+61%

45.60

50.00

+4.40+9%108.53110.00+1.47+1%

Exchange Rate(JP¥/US$)Net Sales (Left Axis)

240

13220

207.1

8.3

180

FY3/18(f)JCC Price(US$/bbl)

240.3

214.8

5.45.5

4.6

5Change3.4

4160

108-10%FY3/17(a)Net Sales

15200■ Forecasts for FY3/18 (vs FY3/17)
Billion JP¥

Billion ¥2602.2

2.0

2.9
30.6
140

FY3/16 (a)FY3/17 (a)FY3/18 (f)Right Axis
Operating Income
Ordinary Income
Profit attributable to owners of parent-Actual Result

Actual Results for FY3/17 (Highlight)
Billion JP¥

FY3/17

FY3/16 (a)Initial Forecasts(f) (May 12, 2016)

Revised Forecasts(f) (Nov.8, 2016)

Revised Forecasts(f) (Feb.8, 2017)

240.3

194.5

189.5

210.3

207.1

Operating Income

8.3

0.4

-1.2

-0.8

0.6

Ordinary Income

4.6

1.0-3.7

3.5

2.2

Profit attributable toowners of parent

2.01.9

-0.3

4.9

3.4

51.48

45.00

43.34

45.09

45.60

121.06115.00103.63107.20108.53

Net Sales(a)Assumptions
JCC Price(US$/bbl)

Exchange Rate(JP¥/US$) Initial Forecasts (May 2016)
Revised Forecasts (November 2016)
Revised Forecasts (February 2017)【-】Decline in selling price, Fluctuation in foreign currency exchange gains/losses (Reason for revision in November8, 2016).
【+】Rising selling price, Increase in crude oil sales volume from overseas, Fluctuations in foreign exchange
gains/losses, Sales of real estate (Reason for revision in February 8, 2017).
 Revised Forecasts (February 2017)
Second revision (April 2017) and Actual Result (May 2017)【+】Rising selling price, Increase in sales volume of domestic crude oil, Improvement of income balance ofdomestic contracting business.
【-】Decrease of crude oil sales volume from overseas, Recognizing non-operating expenses based on equity in lossof affiliates.

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Actual Result

Actual Sales of Natural Gas for FY3/17 (year-on-year)
Sales volume : Million M3
Net sales : Million JP¥

FY3/16

FY3/17

ChangeFull (a)Full (a)FullSales volume1,780

1,864+84

Net sales

68,46955,329-13,139

Domestic gas

Sales volume

1,275

1,265-10(Domesticallyproduced gas)

Sales volume(769)

(744)

(-24）

Overseas gas

Sales volume504

599+95Natural gas

Decline in selling price

Breakdown(Million M3)

2,000
1,600

Sales volume ofoverseas gas

504

599

1,200
800

Increase in shale gas sales volume in
CanadaSales volume ofdomestic gas

1,275

1,265

400-

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

FY3/16 (a)FY3/17 (a)6Actual Result

Actual Sales of Crude Oil for FY3/17 (year-on-year)
FY3/16
Full (a)FY3/17Full (a)ChangeFullSales volume

3,233

2,762-470

Net sales

102,918

82,098-20,820

Sales volume340

301-38Net sales

13,815

10,273-3,541

Sales volume

1,616

1,181-434

Net sales

48,38428,653-19,730

Sales volume306

91-214

Net sales

4,894

669

-4,225

JCC price

US$/bbl

51.48

45.60

-5.88

Bitumen price (***)

US$/bbl

21.05

9.94

-11.11JP¥ / US$121.06108.53-12.53

Sales volume : Thousand KL
Net sales : Million JP¥
Crude oil
Breakdown
Domestic crude oil (*)

Overseas crude oil (**)

Bitumen (***)

Decrease in crude oil sales volume from
Garraf Oil Field, Iraq.
Decrease in sales volume due to the temporary
suspension of the production operation at
the Hangingstone Demonstration area inCanada.

Assumptions

Exchange rate(*)
(**)
(***)

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 Bitumen.

7Actual Result

Actual Results for FY3/17 (year-on-year)
FY3/16

FY3/17(a)(a)

Net sales

240,302207,130-33,171

Gross profit

47,27932,172-15,107

Exploration expenses

6,516

1,512-5,003

Million JP¥

ChangeSG&A expenses

32,42629,975-2,451

Operating income (loss)

8,336

685-7,651

Non-operating income(expenses)-3,684

1,537+5,221

Ordinary income (loss)

4,6522,222-2,429

Extraordinary income(loss)-3,143970+4,113

Income taxes

6,388

1,642-4,746

Main factors for change
Increase factor (+) / Decreasing factor (-)
Gross profit
Domestic crude oil and natural gas - ¥7.0 billion
Overseas consolidated subsidiaries - ¥7.0 billion
Reduction of consignment revenue - ¥2.8 billion
Other+ ¥1.4 billion
Exploration expenses
Reduction of domestic exploration
Reduction of overseas exploration+ ¥1.4 billion+ ¥3.5 billion

SG&A expenses
Reduction of G&A expenses of JAPEX (Non-consolidated)+ ¥0.5 billion
Decrease in domestic selling expenses + ¥2.5 billion

Non-operating income (expenses)
Equity in earnings of affiliates- ¥5.8 billion
Foreign currency translation adjustments on debt,
foreign currency exchange gains and losses
Losses ¥8.8 billion (FY3/16)→ Gains ¥3.4 billion (FY3/17)+ ¥ 12.2 billion

Profit (loss) attributable
to non-controllinginterests-6,970-1,892+5,077

Profit (loss) attributableto owners of parent

2,090

3,443+1,352

8

Extraordinary income (loss)
Decrease in FY3/16 impairment loss + ¥3.0 billion
Sales of real estate+ ¥0.8 billion

Forecasts for FY3/18

Full Year Forecasts for FY3/18[Assumptions for Crude Oil Prices and Exchange Rate]
Upper: from January 2016 to March 2017.
Lower: from January 2017 to March 2018.

Jan.-Mar. Apr.-Jun.
JCC price

US$/bblExchange rate JP\/US$

JACOS
Bitumen
JACOS
Diluted bitumen

JMLGas1.
2.
3.

US$/bbl
US$/bblC$/mcf2016(a)

37.17
45.92
46.72
52.00
45.60
50.00
50.00
50.00
50.00
50.00
110.71 105.32 103.24 114.38 108.53
110.00 110.00 110.00 110.00 110.00

2017(f)2016(a)2017(f)2016(a)2017(f)2016(a)2017(f)2016(a)2017(f)Jul.-Sep. Oct.-Dec. Jan.-Mar.

Fullyear

7.12
1.58
2.23

16.95
1.36
2.23

33.78
2.20
2.23

33.65
2.73
2.23

9.94
33.81
1.95
2.23

“JACOS Bitumen” stated herein bitumen selling price of Japan Canada Oil Sands Ltd. (Deduction of Royalty). Assuming a temporary
suspension of the production operation at the Hangingstone Demonstration Project area from May 2016, not estimate FY3/18 sales.
“JACOS Diluted bitumen” stated herein diluted bitumen selling price of Japan Canada Oil Sands Ltd. (Deduction of Royalty).
Assuming a commencement of production operation at the “Hangingstone expansion area” from the middle of 2017, estimate 2Hsales.
“JML Gas” stated herein gas selling price of JAPEX Montney Ltd. (Deduction of Royalty)

9Forecasts for FY3/18

Natural Gas Sales Forecasts for FY3/18
Sales volume : Million M3
Net sales : Million JP¥

FY3/17

FY3/18ChangeFull (a)Full (f)FullSales volume

1,864

1,736-129

Net sales

55,32956,572+1,242

Domestic gas

Sales volume

1,265

1,240-26(Domesticallyproduced gas)

Sales volume(744)(713)(-32)

Overseas gas

Sales volume599

496

-103

Natural gas ：Rising selling price

Breakdown(Million M3)

2,000
1,600599

Sales volume ofoverseas gas

496

Sales volume ofdomestic gas

1,200800

1,265

Reduction in shale gas sales volume inCanada

1,240400-

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

FY3/17 (a)FY3/18 (f)10Forecasts for FY3/18

Crude Oil Sales Forecasts for FY3/18
FY3/17

FY3/18ChangeFull (a)Full (f)FullSales volume

2,762

2,898+136

Net sales

82,09893,230+11,132

Sales volume301

271-31

Net sales

10,273

9,993-281

Sales volume

1,181

1,329+147

Net sales

28,65340,501+11,848

Sales volume

91

―-91

Net sales

669

―

-669

Sales volume―339+339

Net sales―

7,929+7,929

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

Rising selling price

Breakdown
Domestic crude oil (*)

Overseas crude oil (**)

Bitumen (***)

Diluted bitumen (****)
Assumptions
JCC price

US$/bbl45.60

50.00+4.40

Bitumen price (***)

US$/bbl9.94―-9.94

Diluted bitumen (****)

US$/bbl―33.81+33.81

Exchange rateJP¥ /US$108.53110.00+1.47

11Increase in crude oil sales volume from Garraf
Oil Field, Iraq.
Decrease in sales volume due to the temporary
suspension of the production operation at theHangingstone Demonstration area in Canada.
Increase sales volume because of thecommencement of production operation at theHangingstone Expansion Project in Canada.

(*) Sales volume and net sales of “Domesticcrude 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 MontneyLtd. and Japex Garraf Ltd.).
(***) ,(****) Royalty is excluded in the net
sales and price of both Bitumen and Dilutedbitumen.

Forecasts for FY3/18

Forecasts for FY3/18
FY3/17

FY3/18(a)(f)

Net sales

207,130

214,878+7,747Gross profit

32,172

32,660+487

Exploration expenses

1,512

1,373-140

Million JP¥

Change29,97528,300-1,675685

2,988+2,303

Non-operating income(expenses)

1,537

2,437+900

Ordinary income (loss)

2,222

5,424+3,202

Extraordinary income(loss)

970-31-1,002

1,642

2,301+659

SG&A expenses
Operating income(loss)

Income taxes
Profit (loss)
attributable to noncontrolling interests-1,892-2,472-579

Profit (loss)
attributable to ownersof parent

3,443

5,564+2,121

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Main factors for change
Increase factor (+) / Decreasing factor (-)
Gross profit
Domestic crude oil and natural gas - ¥2.0 billion
Overseas consolidated subsidiaries + ¥3.5 billion
Other- ¥1.6 billion
SG&A expenses
Reduction of G&A expenses of JAPEX (Nonconsolidated)+ ¥1.0 billion

Non-operating income (expenses)
Equity in earnings of affiliates- ¥5.6 billion
Foreign currency translation adjustments on debt,
foreign currency exchange gains and losses
Gains ¥3.4 billion (FY3/17)→ Gains ¥0 billion (FY3/18)- ¥ 3.4 billion

Extraordinary income (loss)
Sales of real estate in FY3/17- ¥0.8 billion

Forecasts for FY3/18

Assumptions and Impact on Profits
JCC price

Exchange rate

Canadian gas prices

US$50.00/bblJP¥110.00 / US$

C$2.23/mcf(JP¥85.00/C$)

FY3/18Impact on Profits

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 in gas
prices would push profits upby…

Operating incomeJP¥ 530 millionJP¥ 230 millionJP¥ 1,740 millionJP¥ 380 millionJP¥ 130 millionJP¥ 760 million

Assumptions

Profit (loss)

attributable to owners ofparent

Assumptions

FY3/17

FY3/18Full (a)Full (f)ChangeJCC price

US$/bbl

45.60

50.00

+4.40

Exchange rate

JP¥/US$108.53110.00+1.47

Canadian gas prices

C$/mcf

1.95

2.23

+0.28

Note:

In addition to the impact of exchange rate fluctuations shown on the above, translation adjustments offoreign-currency-denominated receivables and payables also occur.
Actual profits are influenced by a variety of other factors besides crude oil prices and exchange rates.

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