Japan's Inpex Lifts Profit Forecast on Higher Energy Prices

Yuka Obayashi
Tuesday, November 8, 2022

Japan's biggest oil and gas explorer, Inpex Corp, lifted its full-year profit forecast by 14% to a record 400 billion yen ($2.7 billion) thanks to higher-than-expected oil and gas prices and the yen's plunge against the U.S. dollar. 

The company raised the forecast for 2022 from its August estimate of 350 billion yen after reporting a 94% jump in its profit for the January-September period at 267.4 billion yen.

"Stronger oil and gas prices and the yen's weakness were positive factors, but stable operation at the Ichthys LNG project (in Australia) also contributed to our solid performance," Daisuke Yamada, Inpex's managing executive officer, told a news conference. 

The one-off gain of 33.3 billion yen from selling its stake in the Lucius and Hadrian North Fields oil project in the U.S. Gulf of Mexico boosted its earnings, offsetting an impairment loss of 18.3 billion yen it booked in the July-September quarter on its stake in the U.S. Eagle Ford shale oil project. 



The impairment loss was due to lower-than-expected output and reserves and the Japanese company may withdraw from the project, Yamada said. 

"We may consider selling the project," Yamada said, adding that Inpex had already posted a similar loss of about $300 million on the stake in 2020 after buying the 100% stake in the project in 2019. 

The sale of the Lucius stake and the possible exit from the Eagle Ford are part of Inpex's portfolio reshuffle, shifting away from North America to focus on its core geographic areas such as Australia, Indonesia, the Middle East, Norway, and Japan, he said. 

($1 = 146.3000 yen) 

(Reuters - Reporting by Yuka Obayashi; Editing by Clarence Fernandez and David Evans)

Categories: People & Company News Finance Industry News Activity Asia North America

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