October 26, 2012
Note: The following report is an English translation of the Japanese-language original.

Company Name: Japan Petroleum Exploration Co., Ltd.
Securities Code: 1662
President: Osamu Watanabe
Inquiries: Shoji Mihara, General Manager, Media and Investor Relations Department
TEL: +81-3-6268-7110

Notice of Recording of Impairment Loss of Business Aseets,
Announcement of Financial Forecast Revision
and Difference between Non-consolidated Forecast and Performance in the Previous Fiscal Year
Japan Petroleum Exploration Co.,Ltd. (hereinafter “the Company”) has decided at a Board of Directors’
meeting held today, October 26, 2012 to post an impairement loss for business assets at Yufutsu Oil and Gas
Field (hereinafter “the Oil and Gas Field”) in Tomakomai City, Hokkaido as an extraordinary loss in thesecond quarter of the fiscal year ending March 31, 2013. Based on the posting of the impairment loss andrecent business performance, the Company hereby revises its consolidated forecast for the six months ended
September 30, 2012, announced on August 3, 2012, and its consolidated forecast for the fiscal year ending
March 31, 2013, announced on May11, 2012.
The Company also announces the difference between the non-consolidated forecast for the current fiscalyear and the performance in the previous fiscal year. Details are as follows:
1. Impairment loss for business assets(1) Impairment loss in the six months ended September 30, 2012
¥37,031 million(2) Reason of the impairment loss
The Company has looked into production trends at the Oil and Gas Field and has assessed its production
capacity. The Company found that the quantity of water brought forth with oil gas from the wells
significantly exceeded its forecast in the winter of the fiscal year 2012. Following the finding, theCompany had measured the bottom hole pressure and etc. since June 2012 and reassessed the production
capacity. As a result, the Company has reached an conclusion that the production capacity declined
considerably, and determined that it needs to revise its forecast of crude oil and natural gas production
downward.
The Company calculated cash flows based on the revised production forecast. As a consequence, theCompany has decided to reduce the book value of the business assets for production operation at the Oiland Gas Field to the present value of future cash flows under the Accounting Standard for Impairment ofFixed Assets and to post the reduction as an impairment loss in extraordinary loss.
In addition to the supply of natural gas produced from the Oil and Gas Field, the Company has alreadycompleted and is now operating its natural gas supply system which is composed of the Yufutsu LNG
Receiving Terminal and its domestic vessles. Meanwhile, Hokkaido Gas Co.,Ltd. will start the operation

of the Ishikari LNG Plant in December 2012. Thus the stable supply of natural gas in Hokkaido will not
be disrupted due to the said revised production forecast downward.
The Company will maintain and expand the supply of oil and natural gas in Hokkaido by continuingwith the long-term, efficient operation of the Oil and Gas Field, promoting exploration and developmentin the surrounding areas, and further utilizing the Yufutsu LNG Receiving Terminal.
2. Financial forecast revision(1) Revision to consolidated forecast for the six months ended September 30, 2012
Revision to consolidated forecast for the six months ended September 30, 2012
(April 1, 2012 – September 30, 2012)

Previous forecast (A)Revised forecast (B)Change in amount (B)-(A)Rate of change (%)(Reference) FY2012 1Q-2Q(Unit: ¥Million)
Net Icomeper Share

Net Sales

Operating
IncomeOrdinary
IncomeNet
Income106,210
105,959(252)(0)
104,596

4,876
1,778
(3,098)
(64)
6,219

5,076
3,062
(2,013)
(40)
7,887

6,145
(24,433)(30,578)－¥107.52(¥427.51)

6,333¥110.81

Reason for Revision：
The Company will post part of its expenses for the stable supply of natural gas in Hokkaido during
the winter ahead of schedule, which will raise the cost of sales. As a result, operating income andordinary income will be below the previous forecast for the six months ended September 30, 2012. In
addition, because of the posting of the extraordinary loss (impairment loss) described above, theCompany has changed its net income forecast from net income of ¥6,145 million to a net loss of¥24,433 million.
(2) Revision to consolidated forecast for the fiscal year ending March 31, 2013

Revision to consolidated forecast for the fiscal year ending March 31, 2013
(April 1, 2012 – March 31, 2013)

Previous forecast (A)Revised forecast (B)Change in amount (B- A)
Rate of change (%)(Reference) FY2012 FullYear(Unit: ¥Million)
Net Icomeper Share

Net Sales

Operating
IncomeOrdinary
IncomeNet
Income214,653
222,2287,575
4

10,003
10,304301
316,81918,8552,036
1216,526(11,630)(28,156)－¥289.15(¥203.50)

230,638

15,045

22,15917,027¥297.92

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Reason for Revision：
Due to the posting of the extraordinary loss (impairment loss) described above, the Company haschanged its consolidated net income forecast for the fiscal year ending March 31, 2013, from net
income of ¥16,526 million to a net loss of ¥11,630 million.
3. Difference between non-consolidated forecast and performance in the previous fiscal year
Difference between non-consolidated forecast for the fiscal year ended March 31, 2013 and performancein the previous fiscal year
(Unit: ¥Million)
Operating
OrdinaryNet
Net IcomeNet Sales
IncomeIncomeIncomeper Share
Performance in fiscal year
173,832
10,351
18,627
16,423¥287.36
ended March 31, 2012 (A)Forecast for fiscal year
169,291
8,119
17,836(10,497)(¥183.67)
ending March 31, 2013 (B)Change in amount (B – A)
(4,541)(2,233)(791)(26,921)
Rate of change (%)
－(3)
(22)
(4)
Reason for Revision：
Due to the posting of the extraordinary loss (impairment loss) described above, the Company
forecasts that it will post a non-consolidated net loss of ¥10,497 million in the fiscal year ending
March 31, 2013, compared with net income of ¥16,423 million in the previous fiscal year.
(Note) The forward-looking statements in this document include projections based on ourassumptions, outlook, and plans as of the date of publication of this document. Actual
results may be different from those statements significantly.

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October 26, 2012
Japan Petroleum Exploration Co.,Ltd.
Notice of Financial Forecast Revision (Reference)【The six months ended September 30,2012】(Unit: ¥Million)

Net Sales

Previous
Forecast Revision
forecast
Before Impairment
Impairment loss
8/3
loss
106,210
105,959

Total
105,959

Rate ofchange(%)
(252)
(0)

Change inamountOperating Income

4,876

1,778-

1,778(3,098)(64)

Ordinary Income

5,076

3,020

42

3,062

(2,013)(40)

Extraordinary gain

2,497

2,797-

2,797300

Extraordinary loss

509

539

37,031

37,57037,061

7,064

5,279(36,989)(31,711)(38,774)

Income taxes

379

118

(7,891)(7,773)(8,152)

Net income

6,145

4,665

(29,099)(24,433)(30,578)

Income before income taxes andminority interests--【The fiscal year ending March 31, 2013】

Net Sales

Previous
Forecast Revision
forecast
Before Impairment
Impairment loss
5/11
loss
214,653
222,228

Total
222,228

Rate ofchange
(%)
7,575
4

Change inamountOperating Income

10,003

7,907

2,397

10,304301

3

Ordinary Income

16,81916,4192,436

18,8552,036

12

Extraordinary gain

2,960

2,961-

2,961

1Extraordinary loss

582

679

37,031

37,711

37,129

Income before income taxes andminority interests

19,197

18,700(34,595)(15,895)(35,092)

Income taxes

1,969

2,224

(7,216)(4,992)(6,961)

Net income

16,526

15,749(27,380)(11,630)(28,156)

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