July 27, 2004
Oil Found in the Kairan Structure in the Offshore Field of the North Caspian Sea
in the Republic of Kazakhstan
INPEX CORPORATION (INPEX), through its subsidiary INPEX North Caspian Sea,Ltd., which has been exploring and appraising sites in offshore fields of the North
Caspian Sea in the Republic of Kazakhstan, has discovered an oil stratum at a depth of3,126 meters with the Kairan-1 exploration well. Recent tests have shown that the well
will produce 4,100 barrels of oil per day.
Analysis of production data and further studies are expected to be conducted to assess
the potential of this discovery.
With the discovery of oil in the Kairan structure, all six exploration wells drilled in
offshore fields in the five structures of the North Caspian Sea (two wells in theKashagan structure, one well each in the Kalamkas structure, the Aktote structure, andthe Kasahgan Southwest structure) have successfully found oil. All five structures areconfirmed to be capable of commercial oil production.
In accordance with the development plan approved by the government of the Republic ofKazakhstan in February 2004, production of the Kashagan oil field will begin in 2008
with a daily output of 75,000 barrels, with an objective of increasing to 450,000 barrels
per day by 2010. Plans in the future call for a phased increase to an eventual productionlevel of 1,200,000 barrels per day. The Kashagan oil field is the largest oil fielddiscovered in the past 30 years. Total oil production is anticipated to reach 13 billion
barrels by maximizing oil production through the injection of gas produced
concomitantly with the oil into the reservoir.
INPEX Corporation is a part of an international consortium of Japanese, European, andU.S. companies involved in exploring and appraising sites under a production sharing
agreement (PSA) with the government of the Republic of Kazakhstan.
In addition to INPEX of Japan, with an 8.33% share, the partners of this international
consortium are; Agip (operator, 16.67% share, Italy), British Gas (16.67%, GreatBritain), ExxonMobil (16.67%, U.S.A.), Shell (16.67%, Great Britain/Netherlands), Total(16.67%, France) and ConocoPhillips (8.33%, U.S.A.).
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* Supplemental Information
1. The North Caspian Sea offshore field is comprised of two blocks: the eastern blockand the western block. The Kairan structure is located in the eastern block;approximately 45 kilometers east of the Kashagan oil field and approximately 100
kilometers southeast of Atyrau, the Republic of Kazakhstan, in the waters of theCaspian Sea at a depth of 2 meters.
2. Out of concern of the impact on the environment, a 32/64-inch choke was used toconfirm the 4,100 barrels per day production capacity of the Kairan-1 exploratory well.
Further appraisals are necessary to determine the size of the oil reserves of the Kairanfield.
3. In September 1998, INPEX, through its subsidiary INPEX North Caspian Sea, Ltd.,acquired a one-fourteenth interest in the oil filed from Kazakhstan’s state-owned oilcompany

Kazakhstan

Caspian

ShelfCo.,andbecameamemberof

theEuropean-American consortium. Subsequently, it further increased its interest throughseparate agreements signed with BP and Statoil respectively in September 2001.
4. INPEX North Caspian Sea, Ltd. was founded in August 1998. It was capitalized bythe Japan National Oil Corporation, Japan Petroleum Exploration Co., Ltd., andMitsubishi Corporation. (As of the end of June 2004, its total capital is ¥43.98 billion,
which is divided as follows: Japan National Oil Corporation, 50%; INPEX, 45%; Japan
Petroleum Exploration Co., Ltd. and Mitsubishi Corporation, 2.5% each.)2