Consolidated Financial Results for First Quarter Ended June 30, 2005
August 10, 2005
Note: The following report is a translation of the Japanese-language original.
Company Name: Japan Petroleum Exploration Co., Ltd.
(Company Code: 1662, First Section, Tokyo Stock Exchange)(URL: http://www.japex.co.jp/)
President: Yuji Tanahashi
Inquiries: Koichi Shimomura, Manager, Media Relations, Administration Department
TEL: (03) 5461-7413
1. Notes Relating to Preparation of Quarterly Financial Statements(1) Use of simplified accounting procedures: Yes
Income taxes are calculated using an estimated annual income tax rate based on the statutory tax rate.
(2) Changes in accounting treatment from the most recent consolidated fiscal year: No(3) Changes in scope of consolidation and application of equity method: Yes
Consolidated (Excluded ): 1 company
2. Consolidated Financial Results for First Quarter of Fiscal Year 2006 (April 1, 2005 – June 30, 2005)(1) Consolidated Operating Results (Amounts less than one million yen have been omitted)

1Q of FY06
1Q of FY05
（Ref.）FY05

Net Sales
Operating Income
Ordinary Income
Net Income(¥ million)% (¥ million)% (¥ million)% (¥ million)%
25,963
12.9
3,155
88.8
5,799
36.1
3,973 10.0
22,996
4.5
1,671 (56.8)
4,262 (14.2)
3,612 12.9
103,150
14,67819,001
13,234Net Income per
Share
(¥)

1Q of FY06
1Q of FY05
（Ref.）FY05

Diluted Net Income
per Share(¥)

69. 51
63. 20230. 05−−−(Notes)
1. Percentage figures for net sales, operating income and other items represent changes compared with the corresponding period of the previous fiscal
year.
2. Diluted net income per share is not shown because there are no shares with a dilutive effect.

Qualitative Information Concerning Consolidated Business Performance
In the first quarter ended June 30, 2005, consolidated net sales totaled ¥25,963 million, up 12.9%, from the same period of
the previous year. Operating income totaled ¥3,155 million, up 88.8%, from the same period of the previous year.
Ordinary income totaled ¥5,799 million, up 36.1%, from the same period of the previous year. Net income totaled ¥3,973
million, up 10.0%, from the same period of the previous year.
Below is a summary of earnings data for each of the Company’s business segments by division.
1. Oil and Natural Gas Segment(a) E&P Division
The E&P division sells crude oil, natural gas and liquefied natural gas (LNG). Net sales totaled ¥22,500 million, up
25.2%, from the same period of the previous year, reflecting a sharp rise in crude oil prices and highter sales volume fornatural gas.
(b) Contract Services Division
The Contract Services Division accepts orders mainly for drilling projects and geological and geophysical surveys. Net
sales totaled ¥452 million, up 74.8%, from the same period of the previous fiscal year, reflecting a decrease in thevolume of contract services orders.
(c) Other Businesses DivisionThis division mainly includes the manufacturing and trading of products such as LPG and fuel oil, the transmission of-1-

third-party gas, and other miscellaneous consignment orders. Net sales totaled ¥3,010 million, up 4.1%, from the same
period of the previous fiscal year, reflecting higher sales volume for products.
Net sales of geothermal energy division decrease ¥334 million, reflecting Japex Geothermal Kyushu Ltd. determined tocease the geothermal energy business in the previous fiscal year.
(2) Consolidated Financial Position
Total Assets(¥ million)
409,732
247,927
393,733

June 30, 2005
June 30, 2004
(Ref.) Mar. 31,
2005

Shareholders’ Equity

Shareholders’ Equity
Ratio(¥ million)
305,264
197,254
293,152

%
74.5
79.6
74.5

Shareholders’Equity Ratio per
Share
(¥)
5,341.10
3,451.26
5,127.67(3) Consolidated Cash Flows

1Q of FY06
1Q of FY05
（Ref.）FY05

Operating Activities

Investing Activities

Financing Activities(¥ million)
7,224
2,290
21,936(¥ million)(11,496)(2,520)(15,805)(¥ million)(4,652)(3,422)
786

Cash and Cash
Equivalents at
Period-End(¥ million)
25,81324,23734,568

Qualitative Information Concerning Consolidated Financial Position
Total assets at June 30, 2005 stood at ¥409,732 million, an increase of ¥15,999 million from the previous fiscal year,
mainly reflecting an increase in unrealized holding gain on securities due to valuation gains on shares of INPEX.
Shareholders’ equity rose ¥12,111 million to ¥305,264 million.
Cash and cash equivalents at June 30, 2005 stood at ¥25,813 million, a decrease of ¥8,755 million from the previous fiscal
year.
(Cash Flows from Operating Activities)
Operating activities provided net cash of ¥7,224 million, mainly reflecting income before income taxes and minority
interests of ¥18,129 million and depreciation and amortization of ¥3,337 million, which outweighed income taxes of¥1,184 million.
(Cash Flows from Investing Activities)
Investing activities used net cash of ¥11,496 million, mainly reflecting outflow was ¥9,719 million for the purchase ofproperty, plant and equipment.
(Cash Flows from Financing Activities)
Financing activities used net cash of ¥4,652 million, reflecting mainly outflows of ¥2,747 million for the repayment oflong-term debt and ¥1,245 million for the payment of cash dividends.

-2-

3. Consolidated Forecast for Fiscal Year 2006(April 1, 2005 – March 31, 2006)
Net Sales
Ordinary Income(¥ million)(¥ million)
Interim Period
55,431
9,970
Full Year
96,897
18,630Net Income(¥ million)
7,424
13,615Difference from previous consolidated interim period forcast (April 1, 2005 – September 30, 2005)
Net Sales
Ordinary Income
Net Income(¥ million)(¥ million)(¥ million)
Previous Forecast (A)44,325
7,352
6,282
Revised Forecast (B)55,431
9,970
7,424
Increase (B – A )11,106
2,618
1,142
Increase Ratio (%)
25.0%
35.6%
18.1%
Note: The above estimates have been made based on information available as of the date of this release. Actual results may differ from these estimates
due to a variety of factors.

Qualitative Information Concerning Forecast
Mainly due to a rise in crude oil prices and highter sales volume for natural gas, the Company expects first half net sales
to rise ¥11.1billion, or 25.0% to ¥55.4billion compared with consolidated financial results forecast published in the
Company’s consolidated financial results FY2005 released on May 16, 2005. The Company forecasts ordinary income forfirst half of ¥9.9billion, up ¥2.6billion, or 35.6% and net income for first half of ¥7.4billion, up ¥1.1billion, or 18.1%.
These forecasts were formulated on the following assumptions :1) 2nd quarter’s price of US$53/bbl for imported crude oiland 2) 2nd quarter’s exchange rate of ¥110/US$
The Company does not change full year forecast due to unclear of an outlook of crude oil price.
Reference :Non-consolidated Forcast for Fiscal Year 2006(April 1, 2005 – March 31, 2006)
Net Sales
Ordinary Income
Net Income(¥ million)(¥ million)(¥ million)
Interim Period
42,1197,861
6,521
Full Year
76,01813,303
10,820Difference from previous non-consolidated interim period forcast (April 1, 2006 – September 30, 2006)
Net Sales
Ordinary Income
Net Income(¥ million)(¥ million)(¥ million)
Previous Forecast (A)35,6555,536
5,565
Revised Forecast (B)42,119
7,861
6,521
Increase (B – A )
6,464
2,325
956
Increase Ratio (%)
18.1%
42.0%
17.1%

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1.Consolidated 1st Quarter Balance Sheet(¥ million)

1Q of FY06

FY05

As of Jun. 30,2005

As of Mar. 31, 2005

1. Cash and deposits

24,181

32,778(8,597)22,8692. Notes and accounts receivable

9,107

13,913(4,805)9,258

3. Marketable securities

10,098

6,688

3,410

6,494

4. Inventories

10,109

9,158

950

7,662

5. Other current assets

8,751

8,268

482

5,888

Description

Change1Q of FY05
As of Jun. 30, 2004

(Assets)
ⅠCurrent assets

(14)

(17)

3

(12)

62,23370,788(8,555)52,16045,17746,023(845)

51,824(2) Machinery and equipment

25,73526,320(584)

23,042(3) Land

12,563

11,191

1,371

12,053(4) Other property, plant and equipment

15,813

11,3984,415

14,810Total property, plant and equipment

99,29094,933

4,356

101,731

Less: Allowance for doubtful receivables
Total current assets
ⅡFixed assets
1. Property, plant and equipment(1) Buildings and structures

2. Intangible fixed assets(1) Goodwill

4,830

5,082

(251)

−

(2) Others

1,920

1,922

(1)

1,889

6,751

7,004

(253)

1,889

(1) Investments in securities

237,084

216,467

20,616

84,223(2) Others

12,606

13,062(455)

20,032

Total intangible fixed assetss
3. Investments and others

Less: Allowance for doubtful receivables

(224)

(211)

(12)

(123)

Allowance for losses on overseas investments(8,009)(8,312)302(11,986)

Total investments and others

241,456

221,005

20,451

92,146

Total fixed assets

347,498

322,944

24,554

195,767

409,732

393,733

15,999247,927

1. Notes and accounts payable

2,238

3,047

(808)

3,218

2. Current portion of long-term debt

6,226

8,973

(2,747)

4,347

3. Other current liabilities

19,477

17,085

2,391

9,798

Total current liabilities

27,941

29,105(1,164)

17,363
6,256

Total assets(Liabilities)
I Current liabilities

II Long-term liabilities
1. Long-term debt

7,000

7,000

−

2. Deferred tax liabilities

51,51946,2135,306−

3. Accrued retirement benefits for employees

3,998

3,831

167

3,693

4. Accrued retirement benefits for officers

668

773

(104)

613

5. Accrued estimated cost of abandonment of wells

2,779

2,690

88

2,319

6. Accrual for losses on projects

1,685

1,688

(2)

12,0297. Other long-term liabilities

80

77

2

2,411

Total long-term liabilities

67,73362,275

5,458

27,323

Total liabilities

95,67591,3804,294

44,687

8,792

9,199

(406)

5,986

(Minority interests)
Minority interests in consolidated subsidiaries(Shareholders’ equity)
I Common stock

14,28814,288−14,288II Retained earnings

193,708

191,116

2,592

182,351

III Unrealized holding gain on securities

97,541

88,313

9,227

3,517

IV Translation adjustments

(269)

(561)

292

(2,900)

(4)

(4)

−

(2)

Total shareholders’ equity

305,264

293,152

12,111

197,254

Total liabilities, minority interests and shareholders’ equity

409,732

393,733

15,999247,927

V Treasury stock-4-

2. Consolidated 1st Quarter Statements of Income(¥ million)

1Q of FY06

1Q of FY05

Description

Apr. – Jun. 2005

Apr. – Jun. 2004

ChangeFY05
Apr. 04 – Mar. 05

I Net sales

25,96322,996

2,967

103,150

II Cost of sales

13,857

15,228(1,370)61,046

12,105

7,768

4,337

42,104

1. Exploration expenses

3,504

1,157

2,346

6,445

2. Exploration subsidies

(485)

(24)

(460)

(317)

3,018

1,133

1,885

6,127

5,931

4,963

967

21,298

3,155

1,671

1,484

14,678Gross profit
III Exploration expenses

Total exploration expense
IV Selling, general and administrative expenses
Operating income
V Non-operating income
1. Interest income

321

279

41

1,162

2. Dividend income

1,353

1,046

307

1,669

3. Equity in profit of non-consolidated subsidiaries and affiliates

357

874

(516)

116

4. Reversal of allowance for losses on overseas investments

302

587

(284)

1,376

5. Reversal of accrual for losses on projects

−

−

−

957

6. Other non-operating income
Total non-operating income

592

319

273

1,127

2,928

3,107

(178)

6,411

40

73

(32)

261

VI Non-operating expenses
1. Interest expense
2. Loss on sale of securities

−

60

(60)

145

3. Loss on redemption of securities

−

−

−

306

4. Devaluation loss on securities

1

105

(103)

121

5. Provision for accrued estimated cost of abandonment of wells

130

35

94

513

6. Provision for losses on projects

−

200

(200)

−

7. Other non-operating expenses
Total non-operating expenses
Ordinary income

111

40

71

739

284

516

(231)

2,088

5,799

4,262

1,537

19,001

2

2

(0)

−

VII Extraordinary income
1. Reversal of allowance for doubtful receivables
VIII Extraordinary losses
1. Loss on disposal of fixed assets

14

40

(25)

665

2. Earthquake disaster recovery expense

−

−

−

206

5,787

4,224

1,562

18,129

1,652

554

1,097

4,270

162

57

104

624

3,973

3,612

360

13,234

Income before income taxes and minority interests
Income taxes
Minority interests
Net income-5-3. 1st Quarter Consolidated Statements of Cash Flows( ¥ million)
Description
I Operating activities
1. Income before income taxes and minority interests
2. Depreciation and amortization
3. Amortization of goodwill
4. Loss on devaluation of marketable securities and investments in securities
5.Increase (decrease) in allowance for doubtful receivables
6. Increase in provision for accrued retirement benefits for employees
7. Increase (decrease) in provision for accrued retirement benefits for officers
8. Increase (decrease) in provision for accrued estimated cost of abandonmentof wells
9. Decrease in provision for allowance for losses on overseas investments andaccrual for losses on projects
10. Interest and dividend income
11. Interest expense
12. Gain on redemption and sales of marketable securities and investments insecurities
13. Loss on redemption and sales of marketable securities and investments insecurities
14. Equity in losses (profits) of non-consolidated subsidiaries and affiliates
15. Decrease in notes and accounts receivable
16. Decrease (increase) in inventories
17. Increase (decrease) in notes and accounts payable
18. Increase (decrease) in consumption tax payable
19. Other, net
Subtotal
20. Income taxes (paid) refunded
Net cash provided by operating activities
II Investing activities
1. Investments in time deposits
2. Proceeds from time deposits
3. Payments for purchase of marketable securities
4. Proceeds from redemption and sale of marketable securities
5. Additions to property, plant and equipment
6. Proceeds from sales of property, plant and equipment
7. Additions to intangible fixed assets
8. Payments for purchase of investments in securities
9. Proceeds from redemption and sale of investments in securities
10. Payment for purchase of consolidated subsidiary stock accompanied bychanges in scope of consolidation
11. Proceeds from purchase of consolidated subsidiary stock accompanied bychanges in scope of consolidation
12. Increase in loans receivable
13. Decrease in loans receivable
14. Interest and dividends received
15. Other, net
Net cash used in investing activities
III Financing activities
1.Decrease in short-term bank loans
2. Proceeds from long-term debt
3. Repayment of long-term debt
4. Purchase of treasury stock
5. Cash dividends paid
6. Dividends paid to minority shareholders
7. Interest paid
Net cash used in financing activities
IV Effect of exchange rate changes on cash and cash equivalents
V Increase (decrease) in cash and cash equivalents
VI Cash and cash equivalents at beginning of year
VII Decrease in cash and cash equivalents accompanied by exclusion of
consolidation
VIII Cash and cash equivalents at period-end-6-

1Q of FY06
Apr. – Jun. 2005

1Q of FY05
Apr. – Jun. 2004

FY05
Apr. 04 – Mar. 05

5,787
3,337
251
−
8
167
(104)

4,224
3,160
−
105
(1)
115
(82)

18,12914,081
−
−
90
244
76

76

(99)

(12)

(302)

(293)

(2,173)(1,675)40(1,326)73(2,833)
261

(206)

(51)

(239)

−

60

452

(357)
4,808
(950)
(1,221)
(588)
(661)
8,408
(1,184)
7,224

(874)
2,644
(1,546)(1,829)
11
(166)
4,175
(1,884)
2,290

(116)
(1,823)(3,042)
152
783
1,922
26,075(4,139)21,936−397(5,998)2,699(9,719)217(192)(1,441)
787

(10)
300
−
819
(4,865)116(144)(2,835)
1,068

(30)
330
(100)
4,220
(11,978)550(586)(14,588)
7,435

−

−

(2,269)

−

1,830

−

(409)
135
1,548
479
(11,496)

(12)
23
1,331
(142)
(2,520)(1,127)
186
2,815
(662)
(15,805)−−(2,747)−(1,245)(609)(50)(4,652)
246(8,678)34,568

(600)
−
(706)
(1)
(1,905)(192)(17)(3,422)39(3,613)27,851(600)
7,000(2,311)(2)(2,854)
(192)
(252)
786
(199)
6,717
27,851(76)−−

25,81324,23734,568

4.Status of Production and Sales
１．Production(1) Oil and Natural Gas Segment
Division

1Q of FY 2006

Product

Apr. 1 – Jun. 30, 2005
Crude

E&P

Natural gas
L

Other
Businesses

oil

5,411

B i t u m e n

106,524(106,524)

P

G

Fuel oil, etc.

t(Ref.) FY2005
Apr. 1, 2004 – Mar. 31, 2005

kl

128,791(1,090)292,933 thousand m3(15,151)

G

L

N

kl

196,673(43,525)

1Q of FY2005
Apr. 1 –Jun. 30, 2004

696,814 kl（101,436）

231,198 thousand m3
(890)
3,141

1,091,902 thousand m3（2,904）t

19,771

t

kl

−

2,680

t

13,826

kl

−

2,223

t

10,338t

11,171kl

49,751kl（Notes）
1. The figures in parentheses in E&P represent overseas production and are included in the total.
2. Part of the oil production volume is used as a feedstock for LPG, fuel oil and other products.
3. Part of the natural gas production volume is used as a feedstock for LNG, LPG and other energies
4. Bitumen is a heavy oil extracted from oil sands. .

(2) Geothermal Energy Segment
Division

Product

1Q of FY 2006
Apr. 1 – Jun. 30, 2005

Geothermal
EnergySteam−

1Q of FY2005
Apr. 1 – Jun. 30, 2004

270,687t(Ref.) FY 2005
Apr. 1, 2004 – Mar. 31, 2005

863,241t（Notes）
1. No steam production from the first quarter ended June 30, 2005, reflecting Japex Geothermal Kyushu Ltd. determined to cease thegeothermal energy business in the previous fiscal year..

-7-２．Sales(1)Oil and Natural Gas Segment
Division

1Q of FY2006
Apr. 1 – Jun. 30, 2005

Product

VolumeAmount
kl

Crude

Oil

Volume(¥ million)

304,747

Natural Gas

11,040N

8,947

1,380,337

8,003

39,867t20,468

1,210

38,211

1,276,887

t

24,212(¥million)

thousand m3

259,830

9,413

Amountkl

thousand m3

313,490

G

Volume(¥million)

353,464t

L

Amountkl

thousand m3

E&P（Ref.）FY2005
Apr. 1,2004 Mar. 31, 2005

1Q of FY2005
Apr.1 – Jun. 30, 2004

98,825

1,021

4,888

kl

B i t u m e n

107,272

836

−

−

−

−

Subtotal−

22,500−17,972−82,966

−

452

−

1,797

−

6,987

−

452

−

1,797

−

6,987

Contract
services
Subtotal

t

L

P

G

(¥ million)

6,458

t

370

6,865

kl

Other
Businesses(2)(¥ million)t

30,781321
kl

Fueloil,etc

19,565

1,181

22,278O t h e r s

−

1,459

−

(¥ million)

1,622
kl

94,430

4,202

1,602

−

6,553

968

Subtotal

−

3,010

−

2,892

−

12,378

Total−

25,963−

22,662−

102,332

Geothermal Energy Segment
Division

Product

1Q of FY2006
Apr. 1 – Jun. 30, 2005
VolumeGeothermal
EnergyAmount
t

Steam
Total

（Ref.）FY2005
Apr. 1, 2004 Mar. 31, 2005

1Q of FY2005
Apr. 1 – Jun. 30, 2004
Volume(¥ million)

AmounttVolume(¥ million)

Amountt(¥ million)−−

254,527334

813,999

818

−

−

−

334

−

818

（Notes）
1. Others in Other Businesses includes revenue from the transmission of third-party gas through JAPEX’s pipeline network and salescommissions.
2. No steam product sales from the first quarter ended June 30, 2005, reflecting Japex Geothermal Kyushu Ltd. determined to cease thegeothermal energy business in the previous fiscal year..
3. Monetary amounts in the tables do not include consumption tax.

-8-