[Explanatory Material]

Financial Results
for the Three Months Ended June 30, 2022

August 9, 2022

Japan Petroleum Exploration Co., Ltd.
Note: This document has been translated from the Japanese original for reference purposes only.
In the event of any discrepancy between this translated document and the Japanese original, the original shall prevail.

Copyright © 2022 Japan Petroleum Exploration Co., Ltd. (JAPEX) All Rights Reserved.

Contents
Ⅰ. Financial Highlights
Ⅱ. Financial Results for the Three Months Ended June 30, 2022
Ⅲ. Revised Financial Forecasts for the fiscal year ending March 31, 2023

Note: This material also serves as the presentation material for the financial results briefing for the institutional investors and analysts
to be held on August 10, 2022.

Copyright © 2022 Japan Petroleum Exploration Co., Ltd. (JAPEX) All Rights Reserved.

2

Ⅰ. Financial Highlights
Ⅱ. Financial Results for the Three Months Ended June 30, 2022
Ⅲ. Revised Financial Forecasts for the fiscal year ending March 31, 2023

Copyright © 2022 Japan Petroleum Exploration Co., Ltd. (JAPEX) All Rights Reserved.

3

Ⅰ. Financial Highlights and Business Progress

Financial Highlights
1Q FY3/23 Results（Year-on-year）(Billion Yen)
Operating profit
Ordinary profit

1Q FY 3/22 (a)
3.4
10.4

1Q FY 3/23 (a)
9.8
22.6

7.1

15.6

Profit attributable to owners of parent

Change
+6.4
+12.1
+8.5

Operating profit ： Increase due to higher sales prices of crude oil and natural, etc.
Ordinary profit ： Increase due to foreign exchange gains and increase in equity in earnings of affiliates

FY3/23 Forecast Revision （vs. May 13 Forecasts）(Billion Yen)
Operating profit
Ordinary profit
Profit attributable to owners of parent

May 13, 2022 (f)
20.9
28.7
25.5

Aug 9, 2022 (f)
39.7
50.9
40.0

Change
+18.7
+22.2
+14.4

Operating profit ： Expect to see an increase in profit due to an improvement in the sales of domestic crude oil, natural gas andelectric power resulting a rise of sales prices.
Ordinary profit ： Expect increase in equity in earnings of affiliates and foreign exchange gains.

Dividend Policy
Revised FY3/23 annual dividend (forecast)：220.0 yen per share (interim 110 yen + year-end 110 yen)

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Ⅰ. Financial Highlights
Ⅱ. Financial Results for the Three Months Ended June 30, 2022
Ⅲ. Revised Financial Forecasts for the fiscal year ending March 31, 2023

Copyright © 2022 Japan Petroleum Exploration Co., Ltd. (JAPEX) All Rights Reserved.

5

Ⅱ. Financial Results for the Fiscal Year Ended March 31, 2022

FY3/22 Results (Year-on-Year)
Million Yen

1Q FY3/22 (a)1Q FY3/23 (a)ChangeNet sales

50,08358,617+8,533+17%Gross profit

11,17916,696+5,517+49%

Operating profit

3,400

9,810

+6,410+189%

Ordinary profit

10,491

22,600+12,108+115%

Profit attributable to owners of parent

7,106

15,640+8,533+120%

Oil Price, Exchange Rate and Sales Price
1Q FY3/22 (a)1Q FY3/23 (a)ChangeWTI

USD/bbl

58.10

94.41

+36.31

Crude oil price (CIF)

USD/bbl64.25

101.55+37.30Exchange rate

JPY/USD

108.43122.50+14.07

Copyright © 2022 Japan Petroleum Exploration Co., Ltd. (JAPEX) All Rights Reserved.

6

Ⅱ. Financial Results for the Fiscal Year Ended March 31, 2022

E&P Business (Year-on-Year)
1Q FY3/22 (a)Net sales：Million Yen

Sales volume-

E&P Business

1Q FY3/23 (a)Net sales

Sales volume

ChangeNet sales

Sales volume

Net sales-

16,796

-

7,266

-

-

(9,530)

(57%)

114

5,556

79

7,251

(35)

(31%)

+1,695

+31%

85

3,927

67

5,640

(18)

(22%)

+1,712

+44%

22

1,312

7

1,192

(15)

(69%)

(119)

(9%)

6

316

5

418

(1)

(24%)

+102

+32%

351

10,058

-

-

[2]

(351)

-

(10,058)

-

128

1,181

0

14

[3]

(127)

(99%)

(1,167)(99%)

Breakdown
Crude oil
Crude oil - Japan
Crude oil - Overseas*1

Thousand KL

Purchased crude oil*2

Diluted bitumen

Natural Gas - Overseas*3

Million M3[1]

Main factors for change[1] Increase in sales price[2] Absence of sales volume of diluted bitumen from the Hangingstone Lease in Canada[3] Decrease in sales volume due to the interests transfer of the shale gas project in Canada*1 FY3/22 includes the amounts of 3 overseas subsidiaries (Japex Garraf Ltd., JAPEX Montney Ltd. and Japex (U.S.) Corp.) and FY3/23 includes the amounts of 2 overseas subsidiaries (Japex Garraf Ltd., and Japex (U.S.) Corp.)*2 Royalty is excluded in the net sales and price of diluted bitumen*3 FY3/22 includes the volume of 2 overseas subsidiaries (JAPEX Montney Ltd., and Japex (U.S.) Corp.) and FY3/23 includes the volume of Japex (U.S.) Corp.

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Ⅱ. Financial Results for the Fiscal Year Ended March 31, 2022

I/U Business Sales (Year-on-Year)
1Q FY3/22 (a)Net sales：Million Yen

Sales volume-

Infrastructure & Utility Business

1Q FY3/23 (a)Net sales

Sales volume

ChangeNet sales

Sales volume

Net sales-

23,009-36,009--+12,999+56%

233

10,709231

17,923(1)(1%)[1] +7,213

+67%

123

-

109

-

(13)

(11%)

-

-

52

4,397

49

6,062

△3

(6%)

[2] +1,664

+38%

765

7,163

665

10,986

(99)

(13%)

[3] +3,822

+53%

-

739

-

1,037

-

+298

+40%

Breakdown
Natural Gas - Japan
Million M3- Produced in Japan

LNG
Electricity

Thousand
Ton
Million kWh

Other*--

Main factors for change[1]-[2] Increase in sales price of domestic natural gas and LNG due to soaring JLC price[3] Increase in sales price* Including net sales from commissioned regasification of LNG

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Ⅱ. Financial Results for the Fiscal Year Ended March 31, 2022

Operating Profit (Year-on-Year)
E&P Business(Billion Yen)

3.4

OP total

Overseas : +0.7 bn.

(1.0 bn.) → (0.3) bn.

Domestic : +4.6 bn.

4.0 bn. →•(1.0)

E&P-Overseas

∗

(0.3)

Internal transaction price from E&P Business to Infrastructure/Utilities
Business for the internal control

I/U Business

4.0

E&P-Japan

8.6 bn.

Increase in sales price of crude oil (Japan) due to a rise of
crude oil prices
Increase in sales price* of natural gas (Japan) due to arise of JLC price

•

9.8

8.6

+0.9 bn.

2.3 bn. → 3.3 bn.

Increase in marginal gain on LNG procurement

•
2.3

I/U

3.3

Others *Others+0.1 bn.

(1.9)

∗

(1.8)

(4.0)

(2.0)

0.0

1Q FY3/22 (a)

2.0

4.0

6.0

8.0

10.0

(1.9 bn.) →(1.8 bn.)

Operating income (contracting, oil products and commodities, andothers) not belonging to the above business units, less headquarters
administrative expenses

12.0

1Q FY3/23 (a)Note) The amounts in the operating income breakdown by business segment are the figures for the Group’s internal management
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Ⅱ. Financial Results for the Fiscal Year Ended March 31, 2022

Analysis of Net Income change (Year-on-Year)(Billion Yen)

Japex Garraf
JAPEX
JML

Net
incomeOperating profit*+6.4 bn.

FY3/22
1Q (a)

E&P
overseas

E&P
Japan

I/U

FY3/22
1Q (a)(1.0)

4.0

FY3/22
1Q (a)(0.3)

8.6+2.3 bn.
+1.7 bn.
(1.1 bn.)

SODECO+2.0 bn.

Non-operating income+5.6 bn.

Net
incomeOthersExtraordinary
incomeIncometaxes

Profitattributable tononcontrollinginterest

3.5

(0.3)

(0)

2.8

0.5

5.9

0

(0)

5.3

1.6

OthersForeignexchange
gains and loss

Equity on
earnings

2.3

(1.9)

3.8

3.3

(1.8)

6.7

FY3/23
1Q (a)Note) The amounts in the operating income breakdown by business segment are the figures for the Group’s internal management
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Ⅰ. Financial Highlights
Ⅱ. Financial Results for the Three Months Ended June 30, 2022
Ⅲ. Revised Financial Forecasts for the fiscal year ending March 31, 2023

11

Copyright © 2022 Japan Petroleum Exploration Co., Ltd. (JAPEX) All Rights Reserved.

11

Ⅲ. Financial Forecasts for the Fiscal Year Ending March 31, 2023

FY3/22 Forecasts (vs Initial Forecasts)
Million Yen

Initial (f) May 13, 2022

Revised (f) Aug. 9, 2022

ChangeNet sales

244,344

275,755+31,411+13%

Gross profit

50,35469,575+19,220+38%

Operating profit

20,91639,705+18,789+90%

Ordinary profit

28,75850,988+22,229+77%

Profit attributable to owners of parent

25,59040,007+14,417+56%

Oil Price and Exchange Rate
Initial (f) May 13, 2022

Revised (f) Aug. 9, 2022

ChangeWTI

USD/bbl

73.75

97.05

+23.30

Crude oil price (CIF)

USD/bbl

70.00

95.64

+25.64

Exchange rate

JPY/USD

110.00120.75+10.75

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Ⅲ. Financial Forecasts for the Fiscal Year Ending March 31, 2023

E&P Business Sales Forecasts (vs Initial Forecasts)
Initial (f) May 13, 2022
Net sales：Million Yen

Sales volume-

E&P BusinessNet sales

Revised (f) Aug. 9, 2022
Sales volume

ChangeNet sales

Sales volume

Net sales-

57,557-52,241--(5,316)

(9%)

1,195

57,376697

51,981

(498)

(42%)

(5,395)(9%)

239

11,855242

18,378+3+1%+6,522+55%935

44,461432

31,869

(503)

(54%)

(12,591)

(28%)

21

1,060

23

1,733

+2

+10%

+672

+63%

-

-

-

-

-

-

-

-

15

181

12

260

(3)

(21%)

+79

+44%

Breakdown
Crude oil
Crude oil - Japan
Crude oil - overseas*1

Thousand KL

Purchased crude oil

Diluted bitumen*2
Natural Gas - Overseas*3

Million M3

[2]

[1]

Main factors for change[1] Increase in sales price[2] Decrease in sales volume of crude oil from Garraf Oil Field in Iraq (Crude oil allocation volume is expected to decrease due to a rise of crude oil prices)*1 Includes the amounts of 2 overseas subsidiaries (Japex Garraf Ltd., and Japex (U.S.) Corp.)*2 Royalty is excluded in the net sales and price of diluted bitumen*3 Includes the volume of Japex (U.S.) Corp.

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Ⅲ. Financial Forecasts for the Fiscal Year Ending March 31, 2023

I/U Business Sales Forecasts (vs Initial Forecasts)
Initial (f) May 13, 2022
Net sales：Million Yen

Sales volume-

Infrastructure & Utility BusinessNet sales

Revised (f) Aug. 9, 2022
Sales volume

ChangeNet sales

Sales volume

Net sales-

129,922-

163,388--+33,465

+26%

1,018

63,444

1,008

77,744(9)(1%)[1] +14,300

+23%

488

-

483

-

(4)

(1%)

-

-

363

27,712358

35,729

(5)

(2%)

[2]

+8,016

+29%

2,842

33,2782,900

44,664+58+2%[3] +11,386

+34%

-

5,487

-

5,249

-

(237)

(4%)

Breakdown
Natural Gas - Japan
Million M3- Produced in Japan
Thousand

LNG

Ton

Electricity
OthersMillion kWh

*

-

-

Main factors for change[1]-[2]Increase in sales price of domestic natural gas and LNG due to soaring JLC price[3] Increase in sales price* Including net sales from commissioned regasification of LNG

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Ⅲ. Financial Forecasts for the Fiscal Year Ending March 31, 2023

Operating Profit Forecasts(Billion Yen)

Overseas : +1.7 bn.

20.9

OP total

E&P Business

39.7

2.2 bn.

E&P-Overseas•

I/U Business+3.5 bn.

6.7
10.2

•
•

6.7 bn. →10.2 bn.

Increase in marginal gain on LNG procurement
Increase in sales price of electricity (Japan Electric Power
Exchange)(6.2)

Others*(6.2)+0.0 bn.
(10.0) (5.0) 0.0

31.6 bn.

Internal transaction price from E&P Business to Infrastructure/Utilities
Business for the internal control

31.6

I/U

Others∗

18.1

E&P-Japan

18.1 bn. →Increase in sales price of crude oil (Japan) due to a rise of
crude oil prices
Increase in sales price* of natural gas (Japan) due to a riseof JLC price•

4.0

4.0 bn.

Increase in sales volume of tight oil in United States due toa rise of crude oil prices, etc.

•

Domestic : +13.4 bn.
2.2

→

5.0

Initial (f) May 13, 2022

10.0 15.0 20.0 25.0 30.0 35.0 40.0∗

(6.2 bn.) →(6.2 bn.)

Operating income (contracting, oil products and commodities, andothers) not belonging to the above business units, less headquarters
administrative expenses

Revised (f) Aug. 9, 2022

Note) The amounts in the operating income breakdown by business segment are the figures for the Group’s internal management
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Ⅲ. Financial Forecasts for the Fiscal Year Ending March 31, 2023

Analysis of Change in Net Income Forecasts(Billion Yen)

SODECO
DGN

Net
incomeOperating profit*+18.7 bn.

FY3/23 (f)May 13

E&P
overseas

E&P
Japan

I/U

FY3/23 (f)May 132.2

18.1

FY3/22 (f)Aug. 94.0

31.6+1.0 bn.
+0.9 bn.

Non-operating income+3.4 bn.

Net
incomeOthersExtraordinary
incomeIncometaxes

Profitattributable tononcontrollinginterest

4.9

2.8

(0.0)

2.5

0.5

7.0

3.2

(0.0)

9.8

1.1

OthersForeignexchange
gains and loss

Equity on
earnings

6.7

(6.2)

-

10.2

(6.2)

1.0

FY3/22 (f)Aug. 9Note) The amounts in the operating income breakdown by business segment are the figures for the Group’s internal management
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16

Ⅲ. Financial Forecasts for the Fiscal Year Ending March 31, 2023

FY3/23 Forecasts
Million Yen

FY3/22 (a)FY3/23 Revised (f)ChangeNet sales

249,140

275,755+26,614+11%

Gross profit

49,90369,575+19,672+39%

Operating profit

19,80939,705+19,896+100%

Ordinary profit

43,67450,988+7,314+17%(30,988)

40,007+70,996-

Profit (loss) attributable to owners of parent

Oil Price and Exchange Rate
FY3/22 (a)FY3/23 Revised (f)ChangeWTI

USD/bbl

64.06

97.05

+32.99Crude oil price (CIF)

USD/bbl

73.28

95.64

+22.36

Exchange rate

JPY/USD

111.20120.75+9.55**FY3/22 is the WTI average for JACOS's diluted bitumen sales (8 months from January to August 2021)

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17

Ⅲ. Financial Forecasts for the Fiscal Year Ending March 31, 2023

E&P Business Sales Forecasts
FY3/22 (a)Net sales：Million Yen

Sales volume

FY3/23 Revised (f)Net sales

Sales volume

ChangeNet sales

Sales volume

Net sales-

73,422-

52,241--(21,181)(29%)

Crude oil

669

41,056697

51,981+27+4%+10,924+27%

Crude oil - Japan286

15,570242

18,378

(44)

(15%)

+2,808+18%357

24,105432

31,869+74+21%+7,764

+32%

25

1,381

23

1,733

(2)

(9%)

+351

+25%

959

31,121

-

-

[3]

(959)

-

(31,121)

-

130

1,244

12

260

[4]

(117)

(91%)

(983)

(79%)

-

E&P Business
Breakdown

Crude oil - overseas*1

Thousand KL

Purchased crude oil

Diluted bitumen*2
Natural Gas - Overseas*3

Million M3

[2]

[1]

Main factors for change[1] Increase in sales price[2] Increase in sales volume and sales price of tight oil in United States[3] Absence of sales volume of diluted bitumen due to the interests transfer of the Hangingstone Lease in Canada[4] Decrease in sales volume due to the interests transfer of the Canadian shale gas project*1 FY3/22 includes the amounts of 3 overseas subsidiaries (Japex Garraf Ltd., JAPEX Montney Ltd. and Japex (U.S.) Corp.) and FY3/23 includes the amounts of 2 overseas subsidiaries (Japex Garraf Ltd., and Japex (U.S.) Corp.)*2 Royalty is excluded in the net sales and price of diluted bitumen*3 FY3/22 includes the volume of 2 overseas subsidiaries (JAPEX Montney Ltd., and Japex (U.S.) Corp.) and FY3/23 includes the volume of Japex (U.S.) Corp.

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18

Ⅲ. Financial Forecasts for the Fiscal Year Ending March 31, 2023

I/U Business Sales Forecasts
FY3/22 (a)Net sales：Million Yen

Sales volume-

Infrastructure & Utility Business

FY3/23 Revised (f)Net sales

Sales volume

ChangeNet sales

Sales volume

Net sales-

119,845-

163,388--+43,543

+36%

1,061

58,024

1,008

77,744(52)(5%)[1] +19,719

+34%

527

-

483

-

(43)

(8%)

-

-

295

22,596358

35,729+62+21%+13,133

+58%

3,023

34,3202,900

44,664

(122)

(4%)

[3] +10,343

+30%

-

4,903

-

5,249

-

+346

+7%

Breakdown
Natural Gas - Japan
Million M3- Produced in Japan
Thousand

LNG

Ton

Electricity
OthersMillion kWh

*

-

[2]

-

Main factors for change[1]-[2]Increase in sales price of domestic natural gas and LNG due to soaring JLC price ,and increase in sales volume of LNG[3] Increase in sales price* Including net sales from commissioned regasification of LNG

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19

Ⅲ. Financial Forecasts for the Fiscal Year Ending March 31, 2023

Operating Profit Forecasts(Billion Yen)

Overseas : +1.3 bn.

19.8

OP total

E&P Business
•
•

39.7

2.6 bn.

2.6

E&P-Overseas•

4.0

20.1 bn. →31.6 bn.

Increase in sales price of crude oil (Japan) due to a rise of
crude oil prices
Increase in sales price* of natural gas (Japan) due to a riseof JLC price∗Internal transaction price from E&P Business to Infrastructure/Utilities
Business for the internal control

20.1

E&P-Japan

31.6

I/U Business+6.7 bn.
•

3.5

I/U

Others

4.0 bn.

Increase in sales volume of tight oil in United States
Absence of sales volume of diluted bitumen

Domestic : +11.4 bn.
•

→

10.2

10.2 bn.

Absence of temporary factor (Increase in the cost due to analternative LNG cargo procurement from the LNG spot
market)(6.5)

Others*(6.2)+0.3 bn.
(10.0)

3.5 bn. →

0.0

10.0

FY3/22 (a)

20.0

30.0

40.0

FY3/23 Revised (f)

50.0

∗

(6.5 bn.) →(6.2 bn.)

Operating income (contracting, oil products and commodities, andothers) not belonging to the above business units, less headquarters
administrative expenses

Note) The amounts in the operating income breakdown by business segment are the figures for the Group’s internal management
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20

Ⅲ. Financial Forecasts for the Fiscal Year Ending March 31, 2023

Analysis of Change in Net Income Forecasts(Billion Yen)

(FY3/22) Gain on sale of investment securities(39.8 bn.)
(FY3/22) Gain on JML’s forgiveness of debts(29.3 bn.)
(FY3/22) Gain on CANOS’s forgiveness of debts(13.1 bn.)
(FY3/22) Gain on sales of non-current assets(1.2 bn.)(FY3/22) Losses on sale of JACOS' shares+94.3 bn.
(FY3/22) Losses on JML’s interests transfer+44.7 bn.
(FY3/22) Losses on JML’s liquidation of subsidiaries +3.8 bn.

CANOS+3.0 bn.
Japex Garraf (5.6 bn.)
JAPEX
(6.0 bn.)

Net
incomeOperating profit*+19.8 bn.

SODECO

Non-operating income(12.5 bn.)
OthersIncometaxes

Profitattributable tononcontrollinginterest

14.2

(0.3)

(62.1)

9.6

2.8

7.0

3.2

(0.0)

9.8

1.1

OthersEquity on
earnings

3.5

(6.5)

10.0

10.2

(6.2)

1.0

FY3/22 (a)

E&P
Japan

I/U

FY3/22 (a)

2.6

20.1

FY3/23
Revised (f)

4.0

31.6

Net
incomeExtraordinary
incomeForeignexchange
gains and loss

E&P
overseas(7.0 bn.)

FY3/23
Revised (f)Note) The amounts in the operating income breakdown by business segment are the figures for the Group’s internal management
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21

Ⅲ. Financial Forecasts for the Fiscal Year Ending March 31, 2023

Cash Flows and Debt
Million Yen

FY3/22 (a)FY3/23 (f)Full year

Full year

Cash flows from operating activities

May 13Aug.9(1,052)

83,14881,582

Depreciation

17,721

13,64913,262

Recovery of recoverable accounts

17,78036,363

21,539Cash flows from investing activities

52,067(58,080)(60,870)

Purchase of property, plant and equipment(16,278)(33,274)(42,069)

Payments of recoverable accounts(23,244)(35,933)(33,197)

Cash flows from financing activities(70,940)(9,811)(12,069)

Cash and cash equivalents at end of period

144,513

159,769

153,156

Interest-bearing debt*1

6,156

10,457

10,457

EBITDA*2

57,391

44,02265,723

0.1

0.2

0.1

Debt-to-EBITDA ratio*1 Interest-bearing debt includes lease obligations, retirement benefit liabilities and contingent liabilities*2 EBITDA is the total of operating profit, depreciation, interest and dividends received based on investment cash flow statement

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22

Appendix
1. Net Sales
2. Financial Results
3. Segment Profit
4. Price Assumptions for FY3/23 Forecasts
5. Sensitivities Analysis on FY3/23 Forecasts Basis
6. Business Overview
7. Integrated Report and IR Materials
8. Glossary

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23

Appendix

1. Net Sales - E&P
Million Yen

FY3/22 (a)
1Q

Sales

FY3/23Full year

1Q

Full year (f)
5.13

8.9

16,79673,422

7,266

57,55752,241

114

669

79

1,195

697

5,556

41,056

7,251

57,376

51,981

85

286

67

239

242

3,927

15,5705,640

11,855

18,378

22

357

7

935

432

1,312

24,105

1,192

44,461

31,869

6

25

5

21

23

316

1,381

418

1,060

1,733

351

959

-

-

-

10,05831,121

-

-

-

128

130

0

15

12

Net sales

1,181

1,244

14

181

260

WTI（USD/bbl）

58.10

64.06

94.41

73.75

97.05

Crude oil price (CIF) (USD/bbl) *4

64.25

73.28

101.55

70.00

95.64

Exchange rate (JPY/USD) *4

108.43111.20122.50110.00120.75

Diluted bitumen *2 (USD/bbl)

40.99

46.90

-

-

-

JML natural gas *5 (CAD/mcf)

2.96

2.96

-

-

-

Sales volume of Crude oil (Thousand KL)
Net sales
Sales volume of Crude oil - Japan (Thousand KL)
Net sales
Sales volume of Crude oil - overseas *1 (Thousand KL)
Net sales
Sales volume of Purchased crude oil (Thousand KL)
Net sales
Sales volume of Diluted bitumen (Thousand KL)
Net sales *2
Sales volume of Natural gas -overseas *3(Million M3)*1 FY3/22 include the amounts of 3 overseas subsidiaries (Japex Garraf Ltd., JAPEX Montney Ltd. and Japex (U.S.) Corp.), FY3/23 includes the amounts of 2 overseas subsidiaries (Japex Garraf Ltd.,and Japex (U.S.) Corp.)*2 Royalty is excluded in the net sales and price of diluted bitumen*3 FY3/22 include the volume of 2 overseas subsidiaries (JAPEX Montney Ltd., and Japex (U.S.) Corp.), FY3/23 includes the volume of Japex (U.S.) Corp.
*4 Domestic sales price average of crude oil referring to crude oil (CIF) price and its conversion exchange rate
*5 Gas sales price of JAPEX Montney Ltd. (Excl. Royalty)

Copyright © 2022 Japan Petroleum Exploration Co., Ltd. (JAPEX) All Rights Reserved.

24Appendix

1. Net Sales - I/UMillion Yen

FY3/22 (a)1Q

FY3/23Full year

1Q

Full year (f)
5.13
8.9

23,009

119,845

36,009129,922

163,388

233

1,061

231

1,018

1,008

10,70958,024

17,92363,44477,744

123

527

109

488

483

52

295

49

363

358

4,397

22,596

6,062

27,71235,729

765

3,023

665

2,842

2,900

Net sales

7,163

34,32010,98633,27844,664

Others*

739

4,903

1,037

5,487

5,249

Sales
Sales volume of Natural gas – Japan (Million M3)
Net sales
Sales volume of Natural gas produced in Japan (Million M3)
Sales volume of LNG (Thousand ton)
Net sales
Sales volume of Electricity (Million kWh)

* Including the revenue from contracted transportation of natural gas and commissioned regasification of LNG

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25

Appendix

2. Financial Results
Million Yen

FY3/22 (a)1Q

FY3/23Full year

1Q

Full year (f)5.13

Net sales

8.9

50,083249,140

58,617244,344

275,755

E&P Business

16,79673,422

7,266

57,55752,241

Infrastructure/Utility Business

23,009

119,845

36,009129,922

163,388

Others

10,27755,872

15,341

56,86360,126

Cost of sales

38,904

199,237

41,920193,989

206,180

Gross profit

11,17949,903

16,69650,35469,575

132

359

97

1,604

1,375

SG&A expenses

7,647

29,734

6,788

27,83328,494

Operating profit

3,400

19,8099,810

20,91639,705Non-operation income

7,091

23,864

12,789

7,842

11,283

37

266

149

310

702

Interest expenses(322)(1,187)

(1)

(8)

(6)

Dividend income

48

4,049

47

3,022

3,173

3,549

14,226

5,988

4,986

7,046

Provision for overseas investment

92

66

-

(10)

(83)

Foreign exchange gains and loss

3,851

10,002

6,748

-

1,024

Other

(165)

(3,559)

(142)

(459)

(572)

10,491

43,67422,60028,75850,988(1)(62,175)

(1)

(67)

(54)

10,489(18,501)

22,59828,69150,934

2,832

9,652

5,304

2,599

9,817

550

2,835

1,653

501

1,108

7,106

(30,988)

15,64025,59040,007

Exploration expenses

Interest income

Share of profit of entities accounted forusing equity method

Ordinary profit
Extraordinary income
Profit before income taxes
Income taxes
Profit attributable to non-controlling interests
Profit (loss) attributable to owners of parent
Copyright © 2022 Japan Petroleum Exploration Co., Ltd. (JAPEX) All Rights Reserved.

26

Appendix

3. Segment Profit
Million Yen

FY3/22 (a)1QOperating profit

Japan

FY3/23 (f)Full year

1Q

Full year
5.13

8.9

6,122

24,73911,47227,004

43,812

19

(47)

291

381

363

(1,146)

1,789

227

2,722

4,181

-

-

-

-

-

(47)

(151)

(33)

(204)

(195)

-

-

-

-

-

537

2,644

522

986

1,978

(3)

(13)

(3)

(25)

(27)

-

-

-

-

-

3,534

14,287

5,699

4,631

6,710

(2,066)(9,213)(2,378)(9,592)(10,070)

3,400

19,8099,810

20,91639,705

Share of profit (loss) of entities
accounted for using equity
methodOperating profit (loss)

North America

Share of profit of entities
accounted for using equity
methodOperating loss

EuropeShare of profit of entities
accounted for using equity
methodOperating profit

Middle East

Share of loss of entities
accounted for using equity
methodOperating profit

Others*1

Share of profit of entities
accounted for using equity
methodAdjustments andEliminations*2
Amounts on consolidated
statement of income *3
*1
*2
*3

Operating profit (loss)

Include the Sakhalin Oil and Gas Development Co., Ltd., Energi Mega Pratama Inc., and others
Mainly intersegment elimination and corporate expense.
Furthermore, Corporate expense represents mainly general and administrative expenses and experiment and research expense that are not allocated to reporting segments.
Segment profit (loss) is reconciled to operating profit in the consolidated statements of income.

Copyright © 2022 Japan Petroleum Exploration Co., Ltd. (JAPEX) All Rights Reserved.

27

Appendix

4. Price Assumptions for FY3/23 Forecasts
Upper: from January 2021 to March 2022
Full year

Lower: from January 2022 to March 2023
Jan.-Mar.

Apr.-Jun.

Jul.-Sep.

Oct.-Dec.

Jan.-Mar.

2021 (a)

58.10

66.07

69.85

-

-

64.06

Revised (f)Aug. 994.41*1

103.78100.00

90.00

-

97.05

2021 (a)

-

64.25

71.31

77.30

82.70

73.28

Revised (f)Aug. 9-101.55*1

100.00

90.00

90.00

95.64

2021 (a)-108.43109.96111.69114.52111.20

Revised (f)Aug. 9-122.50*1

120.00120.00120.00120.75Market Price
WTI*2

USD/bblCrude oil price (CIF) *3

Exchange rate

*3

USD/bbl

JPY/USD*1 Actual*2 FY3/22 is the WTI average for JACOS's diluted bitumen sales (8 months from January to August 2021)*3 Domestic sales price average of crude oil referring to crude oil (CIF) price and its conversion exchange rate

Copyright © 2022 Japan Petroleum Exploration Co., Ltd. (JAPEX) All Rights Reserved.

28

Appendix

5. Sensitivities Analysis on FY3/23 Forecasts Basis
FY3/23
2Q-4Q
Assumptions

Crude oil price

WTI
2Q： USD 103.78/bbl
3Q： USD 100.00/bbl
4Q： USD 90.00/bbl

Impacts on profit（Million Yen）
Fluctuation

Main factors for change
positive factor “+”/ negative factor “( )”Operating profit

Profitattributable toowners of parent

Increase by
1USD/bbl

50

40+ Sales of oil and gas(Increase in LNG procurement cost)

1 weaker JPY
against USD

380

220

+ Sales of oil and gas(Increase in LNG procurement cost)

Crude oil price (CIF)
2Q： USD 100.00/bbl
3Q-4Q：USD 90.00/bbl

Exchange rate

JPY 120.00/USD【Assumptions】• 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-currency-denominatedreceivables and payables also may occur.
• Actual profits are influenced by various other factors besides crude oil prices and exchange rates.

Copyright © 2022 Japan Petroleum Exploration Co., Ltd. (JAPEX) All Rights Reserved.

29

Appendix

6. Business Overview ① 1Q of FY3/23 and onwards
E&P Field
 Japan: Producing oil and gas at 10 fields in Hokkaido, Akita, Yamagata, and Niigata / considering measures to increase production at existing fields• Proceeding an additional development around Katakai oil and gas field in Niigata• Considering measures for carbon neutrality including reduction of GHG emissions from field operations, investigation of CO2 storage capacity

 Overseas: Participating in the projects of crude oil and natural gas development / Considering new interests acquisition

 Adopted to an operator of a joint study for acid stimulation in Onnagawa tight oil formation as a publicly solicited projects by JOGMEC in
Apr.
 Increased investment of tight oil development in the United States in May (acquisition of additional tight oil interests)
 Started drilling the 1st well for additional development work of Katakai gas field in Niigata in Jul.

I/U Field

 Domestic gas supply: Stably supplying natural gas and LNG by our supply network / Expanding sales volume including demands for fuel conversion•

Soma LNG terminal: Engaging the contract work of LNG vaporization and delivery of power generation fuel to the adjacent Fukushima Natural Gas Power Plant

 Overseas LNG Supply Infrastructure: Considering participation in projects to develop and operate supply infrastructure such as LNG terminals,
mainly in Southeast Asia, where natural gas demands are growing demands

 Electricity: Stably supplying electricity as a energy source with lower environmental impact generated by the power plants in operation /Participating in renewable energy development as well as considering participation to new projects

 Started construction on the Ozu biomass power plant in Jun.
 Signed a green loan financing agreement for the Abashiri Biomass 2nd &3rd Power Plants Project in Jun.
 Started construction of the Chofu biomass power plant in Jul.

CN Field Conducting study towards early adaptation and commercialization of CCS (Carbon dioxide Capture and Storage)/CCUS (Carbon dioxide Capture,
Utilization, and Storage)
 Considering cooperation and participation in carbon-neutral businesses, with the potential collaboration with CCS/CCUS• Seeking regional and inter-industrial collaboration in combination with CCS/CCUS, such as the realization of carbon recyclingJoined Global CCS Institute in May / participated in CCS+ Initiative in Jun.
Adopted a feasibility study for the hub & cluster type CCUS project in Niigata east port area as a publicly solicited project by JOGMEC in May
JGC CORPORATION and Kawasaki Kisen Kaisha, Ltd. joined a joint feasibility study for CCS with Petronas in Malaysia in Jul.

Copyright © 2022 Japan Petroleum Exploration Co., Ltd. (JAPEX) All Rights Reserved.

30

Appendix

6. Business Overview ② E&P Field
development andproduction site

[4] Russia・Sakhalin 1 Project*

O&G [3] UK North Sea: Seagull Project* Included in oursales profit

OIL[1] Iraq: Garraf Project*
OIL[5] United States:
Tight Oil Development*

O&G

OIL

[A] Japan: Domestic oil and gas fields*(10 sites in Hokkaido, Akita, Yamagata, and Niigata)

Our affiliated oil and gas development
and production base[2] Indonesia・Kangean Project

Japan

GAS

Overseas

10 fields
5 projects

 Our oil and gas E&P fields/projects (as of June,2022)
No.

Oil and gas field/Project title (Operator)

Interest Share（JAPEX’s net）

Production type

Status

Production Volume*1

A

Japan: Domestic oil and gas fields(Total of 10 locations in Hokkaido, Akita, Yamagata, and Niigata)

Differ by interest

Crude oil/natural gas

In production/
Additional development

Undisclosed

1

Iraq: Garraff Project (PETRONAS Carigali Iraq Holding B.V.)

30% (16.5%)

Crude oilIn production/
Additional Development

Approx. 128,000bbl*2

2

Indonesia: Kangean Project (Kangean Energy Indonesia Ltd.)

100％ (25%)

Natural gas

In production

Approx. 3,990,000m3(Approx. 24,000boed)

3

UK North Sea: Seagull Project (Neptune E&P UK Limited)

15% (15％)

Crude oil/natural gas

In development-

4

Russia: Sakhalin 1 Project (Exxon Neftegas Ltd.*3)

30% (4.59%)

Crude oilIn production/
development

Undisclosed

5

North America: Tight Oil Development(Marathon Oil Corporation, EOG Resources Inc., etc.)

Differ by interest

Crude oilIn production/
development

Undisclosed*1: Average daily production for 1Q FY2022 (Jan-Mar 2022 for overseas projects) / *2:Average daily production Apr-June 2022
*3: On March 1, 2022 (local time) Exxon Mobil, parent company of operator Exxon Neftegas Limited, announced its exit policy.

Copyright © 2022 Japan Petroleum Exploration Co., Ltd. (JAPEX) All Rights Reserved.

31

Appendix

6. Business Overview ③ I/U Field - Gas Supply
Features of JAPEX's domestic gas supply network

High-pressure gas pipeline network over 800 km total

2 LNG terminals for ocean-going carriers
Capable to supply from Sea of Japan and Pacific Ocean Domestic gas supplyDomestic produced gas and regasified LNG supply via pipelines
Receive, storage, regasify, and deliver LNG
LNG satellite system: tank trucks, tank containers on rail, domestic vessels)
Third-party or consignment use of our gas pipelines and LNG terminals etc.

 Respond to diversification of domestic gas supplySupport fuel switching to natural gas from other fossil fuels
Propose and provide energy services in cooperation with city
gas suppliers LNG procurement
Procure competitive LNG with a combination of term and spot
contracts Overseas LNG supply infrastructure

Launch new projects or other process mainly in Southeast Asiawith stronger demands for gasOngoing feasibility study: Northern Vietnam LNG terminal project

Copyright © 2022 Japan Petroleum Exploration Co., Ltd. (JAPEX) All Rights Reserved.

32

Appendix

6. Business Overview ④ I/U Field - Electricity[1] Abashiri Biomass
BIO
Power Plant No.2&3

JAPEX’s joining power plants are

7 sites

Total(Renewable energy 6 sites

Total output 1,389,550kW
Renewable energy[2] Mega solar power generation
at JAPEX Hokkaido District Office*209,550kW)PV[3] Yufutsu Solar Power Plant

PV Power plants in development and operation (as of the end of July 2022)
No.

Name

Location

Type

Capacity
(kW)

Share

StatusA

Fukushima Natural Gas Power Plant

Shinchi Town,
Fukushima

Natural gas(LNG)

1,180,000

33%

In operation

1

Abashiri Biomass No.2&3 Power Plants

Abashiri City,
Hokkaido

Biomass(wood chip)

19,80033.8%

In construction

2

Mega solar power generation
at JAPEX Hokkaido District Office

Tomakomai City,
Hokkaido

PV

1,800

100%

In operation

3

Yufutsu Solar Power Plant

Tomakomai City,
HokkaidoPV13,00020%

In operation

Tahara Biomass Power Plant

Tahara City,
Aichi

Biomass(wood pellets)

50,00039.9%

In development

Biomass(wood pellet)

50,00035%

In construction

Biomass(wood pellet)

74,95039.9%

In construction

4
5

Ozu Biomass Power Plant

Ozu City,
Ehime

6

Chofu Biomass Power Plant

Shimonoseki City,
Yamaguchi Other renewable energy project[A] Fukushima Natural Gas Power Plant

LNG[4] Tahara Biomass Power Plant

 PHOTON Sustainable Solar Investment Limited Partnership(funding up to 10 billion yen in PV generation projects including
non-FIT projects; 50% of our investment ratio)[5] Ozu Biomass Power Plant

BIO

BIO

[6] Chofu Biomass Power Plant
Copyright © 2022 Japan Petroleum Exploration Co., Ltd. (JAPEX) All Rights Reserved.

BIO

Gas power plant
Renewable power plant* Included in our sales profit

33

Appendix

6. Business Overview ⑤ CN Field Required factors to realize a hub & cluster CCS/CCUS
Verification and Establishment ofTechnology

 Survey of suitable sites for CO2 storage
and amounts that can be stored CO2 capture and transportation
technology
 CO2 indention and storage technology•

Inter-company and Cross-industry

Examination and Development of Collection of CO2 from emitting sites

 Legal system for CO2 underground storage

Collaboration

Legal Systems, etc.

＋  CO transportation network construction ＋  Appropriate system of CO transportation•

2

Transportation to utilization destinations
and collection surpluses Underground storage of surplus CO2

2

infrastructures with publicness

 CO2 trading system•

Including stored CO2 monitoring

Including collaboration with overseas CO2
trading

 Ongoing CCS/CCUS initiatives to promote/participate in (as of the end of July, 2022)
Japan

Realize hub & cluster model by FY2030

 Consideration in JAPEX Examination of CO2 storage capacity in our oil and gas fields, etc.
 Study of re-injection of associated CO2 from our oil and gas field
operations

 Feasibility study with companies/cross-industry
 Feasibility study on carbon recycling business utilizing interindustry collaboration in the Tomakomai area with Deloitte
Tohmatsu Consulting as a NEDO-commissioned project Feasibility study of a business in the Niigata area that makes
effective use of CO2 with Mitsubishi Gas Chemical Feasibility Study for a Hub & Cluster Type CCUS Project in Niigata
East Port Area (FY2022 Publicly solicited project by JOGMEC)

CommonOverseas

Early profit earning in advanced countries& consideration in emerging countries

 Consideration in JAPEX
 Consideration for participation in CCS/CCUS projects in North
America, Europe and other systematically advanced areas
 Feasibility study on companies/cross-industry
 Joint feasibility study of a CCUS project in Indonesia's Sukowati
oil field utilizing bilateral credits with Pertamina Group andRemigas Joint CCS study in Malaysia: Investigation of suitable sites andtechnical evalutions for CO2 underground storage (withPETRONAS, JGC CORPORATION, and Kawasaki Kisen Kaisha, Ltd.,and works by 3 Japanese companies are adopted as a subsidy
project by the Japanese government

 Technical and other related study Study on technical issues of energy transportation infrastructure for the realization of a CN society with JFE Engineering

Copyright © 2022 Japan Petroleum Exploration Co., Ltd. (JAPEX) All Rights Reserved.

34

Appendix

7. Integrated Report and IR Materials
Please visit our website for the integrated report and IR materials.
Integrated Report Integrated Reporthttps://www.japex.co.jp/en/ir/library/integratedreport/
The latest issue(Integrated Report 2021, published in September 2021)

is available directly via the following link

https://www.japex.co.jp/ir/uploads/JAPEX_IR2021_e.pdf

Disclosure Materials Archive Financial Results

https://www.japex.co.jp/en/ir/library/result/ Explanatory Materials

https://www.japex.co.jp/en/ir/library/explanatory/

Performance information, etc.
 Financial highlights for 5 years* Past 10 years’ CVS data is also available Shareholder Returns (Dividends)

Copyright © 2022 Japan Petroleum Exploration Co., Ltd. (JAPEX) All Rights Reserved.

https://www.japex.co.jp/en/ir/figure/https://www.japex.co.jp/ir/uploads/JAPEX_10yearFinancialData_e.xlsx

https://www.japex.co.jp/en/ir/stock/dividend/35

Appendix

8. Glossary Abbreviations
BOE(D)

Barrels of Oil Equivalent (per Day)

CCS

Carbon dioxide Capture and Storage

CCUS

Carbon dioxide Capture, Utilization and Storage

CIF

Cost, Insurance and Freight

FID

Final Investment Decision

GHG

Greenhouse Gas

HSE

Health, Safety and Environment

JCC

Japan Crude Cocktail

MH

Methane Hydrate

RRR

Reserve Replacement Ratio

WTIWest Texas Intermediate Main Subsidiaries and Affiliates
Japex Garraf

Japex Garraf Ltd.

Iraq / Garraf Project

EMPI

Energi Mega Pratama Inc.

Indonesia / Kangean Project

SODECO

Sakhalin Oil & Gas Development Co., Ltd.

Russia / Sakhalin-1 Project

DGN

Diamond Gas Netherlands B.V.

Malaysia LNG Project 3（Tiga）

FGP

Fukushima Gas Power Co., Ltd.

Natural gas-fired electric power generation Business

Copyright © 2022 Japan Petroleum Exploration Co., Ltd. (JAPEX) All Rights Reserved.

36

Cautionary Statement
This document contains future outlooks such as plans, forecasts, strategies, and others which are nothistorical fact and these are made by the management’s judgement based on the obtainable information
at the time of the disclosure. Actual results may significantly differ from those future outlooks due tovarious 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 (FY3/22, for instance, means 12 months ending March 31, 2022)
・Figures in parentheses in "Operating profit," "Ordinary profit," " Share of profit of entities accounted for using equity
method," and " Profit attributable to owners of parent" represent losses in each category.
Any inquiries about the information contained herein or other Investor Relations questions are requested to be directed to:
Corporate Communication Office, Japan Petroleum Exploration Co., Ltd. (JAPEX)Tokyo, JAPAN TEL: +81-3-6268-7111

Copyright © 2022 Japan Petroleum Exploration Co., Ltd. (JAPEX) All Rights Reserved.

37

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38