Japan Petroleum Exploration Co., Ltd. · TSE:1662

Japan Petroleum Exploration — 1H FY3/16 Earnings Presentation

34 slides from Japan Petroleum Exploration's earnings presentation, Nov 9, 2015

  1. Slide 1: Presentation Meeting of Consolidated Financial Results for the Six Months Ended September 30, 2015

    Note: The following report is an English translation of the Japanese-language original. Presentation Meeting of Consolidated Financial Results for the Six Months Ended September 30, 2015 November 9 , 2015 Japan Petroleum Exploration Co., Ltd.

  2. Slide 2: Cautionary Statement

    Cautionary Statement Any information contained herein with respect to JAPEX’s plans, estimates, strategies and other statements that are not historical facts are forward-looking statements about the future performance of JAPEX. Readers should be aware that actual results and events may differ substa

  3. Slide 3: Contents

    Contents １．Business Overview President Osamu Watanabe ２．Consolidated Financial Results for the Six Months Ended September 30, 2015 Executive Officer Michiro Yamashita ３．Revised Full Year Estimates for the Fiscal Year Ending March 31, 2016 Executive Officer Michiro Yamashita 3

  4. Slide 4: 1. Business Overview

    1. Business Overview President Osamu Watanabe 4

  5. Slide 5: Trends in Crude Oil Prices and Foreign Exchange Rate

    ［Crede Oil Price US$/bbl] $100 $110 $120 $130 $40 $50 $60 $70 $80 $90 2012-09 2012-10 2012-11 2012-12 2013-01 2013-02 2013-03 2013-04 2013-05 2013-06 2013-07 2013-08 2013-09 2013-10 2013-11 2013-12 2014-01 2014-02 5 2014-03 2014-04 2014-05 Crude Oil price US$/bbl (Left axis) 2014-06 2014-07 2014-08

  6. Slide 6: Revised Estimates for FY3/16 (Highlight)

    Revised Estimates for FY3/16 (Highlight) FY3/15 FY3/16 Change Initial Initial Revised Billion ￥ estimate 1H (a) estimate estimate 1H Full Full 1H(e) ② Full (e) Full (e) （②-①） （④-③） (a) May12,’15① Nov.6,’15④ May12,’15③ Net sales 304.9 144.0 124.1 271.1 257.7 ▲19.8 ▲13.4 Operating income 32.1 3.9 5.4

  7. Slide 7: Long-term business vision and Medium-term business plan

    Long-term business vision and Medium-term business plan Transformation to an Integrated Energy Company around Oil and Gas E&P Business Growth investing Improve revenue Substantial Stable dividend and profit Shareholder return Shareholder return FY 3/15 By the end of FY3/20 By the end of FY3/26 Produ

  8. Slide 8: Domestic exploration: Result for 1H & Plan for 2H

    E&P Business ① Domestic exploration: Result for 1H & Plan for 2H ● Drilling schedule for FY3/16 Total 1Q 2Q 3Q 4Q Depth 4 5 6 7 8 9 10 11 12 1 2 3 Minami-Kashiwazaki SK-1D 2,900m (Exploratory Well) ■ Geophysical prospecting survey work FY3/16 Nagaoka and Ojiya-city, Niigata pref. (82 point) Uonuma M

  9. Slide 9: Current status of global business

    E&P Business ② Current status of global business Oil Sands project (Production & Development) Sakhalin Shale Gas/LNG project U.K./Norway Sakhalin 1 project (Production of natural gas / (Production & Development) planning of LNG plant) U.K. North Sea Block (Exploration) Canada Iraq Garraf oil field (

  10. Slide 10: Indonesia: Kangean Block

    E&P Business ③ Indonesia: Kangean Block Pagerungan Utara oil field West Kangean gas field （Production suspended） (Exploration) Jakarta Pagerungan gas field (Production) West Java Pipeline Java Island Sepanｊang Island oil field (Production suspended) TSB gas field Bali Island （Production-partly） to S

  11. Slide 11: Iraq: Garraf oil field

    E&P Business ④ Iraq : Garraf oil field Project Japex Garraf Ltd. company Interest 30％ (cost share 40%) Operator ： PETRONAS Baghdad Garraf oil field Field Garraf In Production Samawah 2013 2030 Nasiriyah Expected cumulative production : Basrah Around 1.3 billion bbl ■ Time Schedule First oil producti

  12. Slide 12: Sakhalin 1 project

    E&P Business ⑤ Sakhalin 1 project Sakhalin Oil and Odoptu Project Gas Development Co., Ltd. Company (SODECO) Equity-method affiliate Interest Sakhalin 1 Consortium SODECO Minister of Arkutun-Dagi Economy, JAPEX Exxon Neftegas Ltd. Trade and 15.29% 30% Industry SODECO 50.00% Others 30% Others 40% 34.

  13. Slide 13: Canada Oil Sands project

    E&P Business ⑥ Canada Oil Sands project Project Canada Oil Sands Co., Ltd. (CANOS) Company Operator : Japan Canada Oil Sands Ltd. (JACOS) Calgary Hangingstone 3.75 section In production FORT McMURRAY Area 100％ Interests (Cumulative production：34.13M bbl as of end of Sep. 2015) Approximately 5,000 -

  14. Slide 14: Canada Shale Gas and LNG project

    E&P Business ⑦ Canada Shale Gas and LNG project Shale Gas development LNG project and Production project (Up-stream) (Middle-stream) Calgary North Montney Area, Lelu Island, Block / British Columbia, The Port of Prince Proposed site Canada Prince Rupert Rupert, B.C. North Montney (Proposed LNG （Bloc

  15. Slide 15: Construction of Soma LNG terminal

    Domestic supply business ① Construction of Soma LNG terminal ■Soma LNG terminal Facilities Shinchi-Town, Fukushima Pref. (No.4 wharf area of Site Soma Port) One LNG Tank of Aboveground Style/PC type Capacity containing 230,000kl LNG ocean-going vessel ：Full set (maximum Receiving 210,000m3 class) ca

  16. Slide 16: Soma power generation

    Domestic supply business ② Soma power generation ■Outline of the plan of Soma natural gas power plant (provisional name) Gas turbine and steam power Driving force (combined cycle system) Approximately 1.2 million kW Output power (approximately 600 thousand kW×2) Establishment of Fukushima Gas Power

  17. Slide 17: Geothermal, MH, CCS, Solar power

    Environment and innovative technology Geothermal, MH, CCS, Solar power CCS Geothermal power Mt. Musa area （Shibetsu Town） ● Tomakomai City ● ● ● Mt. Furebetsu south area Photo provided by Japan （Kushiro City) CCS Co., Ltd * Ongoing local negotiation. Facilities of CCS demonstration project in Tomako

  18. Slide 18: Timeline of major projects

    Timeline of major projects FY3/16 FY3/17 FY3/18 FY3/19 FY3/20 FY3/21 Canada Oil Sands ◆ ◆ HE Exploration (Under construction) Commencement of production Iraq Garraf Pending approval (Production and sale, ◆Achieve the target production volume Operational expansion Preparing expanding development) Ind

  19. Slide 19: CSR - Promotion priority agenda "SHINE"

    CSR - Promotion priority agenda “SHINE”  Pursue efforts to priority agendas “SHINE” in order to respond expectations and requests from all stakeholders and grow as a trusted global company S ：Stable & Sustainable Energy Supply ⇒Development of New Technologies H ：HSE as Our Culture ⇒HSE activities,

  20. Slide 20: 2. Consolidated Financial Results for the Six Months Ended September 30, 2015

    1H Result 2. Consolidated Financial Results for the Six Months Ended September 30, 2015 Executive Officer Michiro Yamashita 20

  21. Slide 21: Actual Financial Results for 1H FY3/16 (Summary)

    1H Result Actual Financial Results for 1H FY3/16 (Summary) FY3/16 change FY3/15 FY3/161 vs Initial Billion ￥ 1H (e) Billion ￥ 1H (a) (May12 ,’15) H (a) estimates Net Sales (left axis) Billion ￥ % 175.0 35.0 Net Sales 146.8 144.0 124.1 ▲13% 146.8 144.0 150.0 30.0 Operating income 15.1 3.9 5.4 +38% 12

  22. Slide 22: Actual Sales of Natural Gas in 1H FY3/16 (vs 1H FY3/15)

    1H Result Actual Sales of Natural Gas in 1H FY3/16 (vs 1H FY3/15) Sales volume : Million M3 FY2015 FY2016 Change Net sales : Million ￥ 1H(a) 1H (a) Sales volume 775 820 +45 Natural gas Net sales 37,458 33,031 ▲4,427 Breakdown of equity natural gas Domestic gas Sales volume 578 579 +0 (Domestically p

  23. Slide 23: Actual Sales of Crude Oil in 1H FY3/16 (vs 1H FY3/15)

    1H Result Actual Sales of Crude Oil in 1H FY3/16 ( vs 1H FY3/15 ) Sales volume : Thousand KL FY3/15 FY3/16 Change Net sales : Million ￥ 1H(a) 1H(a) Sales volume 1,107 1,480 +372 Crude oil Net sales 73,500 57,148 ▲16,352 Breakdown of equity oil sales Sales volume 190 180 ▲10 Domestic crude oil: Decli

  24. Slide 24: Actual Financial Results for 1H FY3/16 (vs 1H FY3/15)

    1H Result Actual Financial Results for 1H FY3/16 (vs 1H FY3/15) FY3/15 FY3/16 Causes of increase(+) or decrease(▲) [ Million ￥] Change 1H(a) 1H(a) Gross profit Net sales 146,850 124,157 ▲22,692 Domestic crude oil and natural gas ▲¥3.7billion Overseas consolidated Gross profit 34,515 26,408 ▲8,106 su

  25. Slide 25: 3. Revised Full Year Estimates for the Fiscal Year Ending March 31, 2016

    3. Revised Full Year Estimates for the Fiscal Year Ending March 31, 2016 Executive Officer Michiro Yamashita 25

  26. Slide 26: Revised Full Year Estimates for FY3/16

    Full Year Estimates Revised Full Year Estimates for FY3/16 [Assumption for Crude Oil Prices and Exchange Rate] 2015 2016 Full year Jan.-Mar. Apr.-Jun. Jul.-Sep. Oct.-Dec. Jan.-Mar. Initial estimates 50.00 55.00 60.00 60.00 56.25 WTI US$/bbl Revised estimates 48.70 57.75 46.50 40.00 48.24 Initial est

  27. Slide 27: Revised Estimates in FY3/16 (Summary)

    Revised Full Year Estimates Revised Estimates in FY3/16 (Summary) Initial Revised Change estimates estimates VS Initial [Billion ￥] Full(e) Full(e) Change Estimates(%) Billion￥ Billion￥ May12,’15 Nov.6,’15 Net Sales (left axis) 18.0 285.0 Net Sales 271.1 257.7 ▲13.4 ▲4% 271.1 16.0 270.0 Operating in

  28. Slide 28: Revised Estimated Natural Gas Sales in FY3/16 (vs Initial Estimates)

    Revised Full Year Estimates Revised Estimated Natural Gas Sales in FY3/16 (vs Initial Estimates) Initial estimates Revised estimates Sales volume : Million M3 Full(e) Full(e) Change Net sales : Million ￥ May12,’15 Nov.6,’15 Sales volume 1,773 1,797 +23 Natural gas Net sales 67,856 70,094 +2,239 Brea

  29. Slide 29: Revised Estimated Crude Oil Sales in FY3/16 (vs Initial Estimates)

    Revised Full Year Estimates Revised Estimated Crude Oil Sales in FY3/16 (vs Initial Estimates) Initial Revised Sales volume : Thousand KL estimates estimates Change Net sales : Million ￥ Full(e) Full(e) May12,’15 Nov.6,’15 Sales volume 3,423 3,397 ▲25 Crude Oil Net sales 135,841 119,837 ▲16,004 Brea

  30. Slide 30: Revised Estimates for FY3/16 (vs Initial Estimates)

    Revised Full Year Estimates Revised Estimates for FY3/16 (vs Initial Estimates) Initial estimates Revised estimates Causes of increase(+) or decrease(▲) Million ￥ Full(e) Full(e) Change May12,’15 Nov.6,’15 Gross profit Domestic crude oil and natural gas +¥2.7billion Net sales 271,118 257,724 ▲13,394

  31. Slide 31: Revised Estimated Natural Gas Sales in FY3/16 (vs FY3/15)

    Revised Full Year Estimates Revised Estimated Natural Gas Sales in FY3/16 (vs FY3/15) FY3/15 FY3/16 Sales volume : Million M3 Revised estimates Change Net sales : Million ￥ Full (a) Full(e) Nov.6,’15 Sales volume 1,710 1,797 +86 Natural gas Net sales 83,974 70,094 ▲13,880 Breakdown of equity natural

  32. Slide 32: Revised estimated crude oil sales in FY3/16 (vs FY3/15)

    Revised Full Year Estimates Revised estimated crude oil sales in FY3/16 (vs FY3/15) FY3/15 FY3/16 Sales volume : Thousand KL Revised estimates Change Net sales : Million ￥ Full (a) Full(e) Nov.6,’15 Sales volume 2,396 3,397 +1,001 Crude oil Net sales 133,346 119,837 ▲13,510 Breakdown of equity oil s

  33. Slide 33: Revised Estimates for FY3/16 (vs FY3/15)

    Revised Full Year Estimates Revised Estimates for FY3/16 (vs FY3/15) FY3/16 Causes of increase(+) or decrease(▲) FY3/15 Revised Million ￥ Change Gross profit Full(a) estimates Domestic crude oil Full(e)Nov.6,’15 and natural gas ▲¥7.6billion Overseas consolidated Net sales 304,911 257,724 ▲47,188 sub

  34. Slide 34: Crude Oil Prices and Exchange Rate Assumptions and Impact on Profits [3Q-4Q]

    Crude Oil Prices and Exchange Rate Assumptions and Impact on Profits [3Q-4Q] FY3/15 FY3/16 1Q-4Q(a) 1stQ(a) 2ndQ(a) 3rdQ(e) 4thQ(e) 1Q-4Q(e) JCC price US$/bbl 96.48 56.49 62.50 50.00 50.00 54.81 Exchange rate JP¥/USD 106.23 119.74 123.31 120.00 120.00 120.82 Bitumen CA$/bbl 55.74 28.15 38.57 24.32 2

Japan Petroleum Exploration — 1H FY3/16 Earnings Presentation on 6ix