ENVALITH
株式会社INPEX logo

INPEX CORPORATION

1605・Prime Market・Mining

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株式会社INPEX logo
INPEX CORPORATION1605

Business

INPEX CORPORATION is Japan's largest oil and natural gas exploration and production (E&P) company, established in 2006 through the business integration of International Petroleum Development Co. and Teikoku Oil Co. The group consists of 88 subsidiaries and 30 affiliated companies, holding interests in domestic natural gas and iodine production in Japan as well as major projects worldwide, including the Ichthys LNG Project in Australia (as operator), the ACG oil field in Azerbaijan, the Kashagan oil field in Kazakhstan, and oil fields in Abu Dhabi. As of the end of December 2025, proven reserves totaled 3,115 million BOE. As a core company supporting Japan's stable energy supply, it also holds a policy-related position through Class A shares held by the Minister of Economy, Trade and Industry.

Business Model

INPEX's revenue is centered on sales of crude oil, natural gas, and LNG produced from its oil and gas field interests. Of total revenue of ¥2,011,351 million, crude oil accounted for ¥1,530,291 million (76.1%) and natural gas for ¥448,053 million (22.3%). Revenue levels are structurally highly dependent on international crude oil prices (Brent) and the yen-dollar exchange rate; in FY2025 (ending March 2025), the average oil price was 70.69 US dollars/barrel and the average exchange rate was 149.60 yen/US dollar. INPEX operates the Ichthys LNG Project as operator, and equity-method investment income also contributes to revenue.

Company Strengths

As of the end of December 2025, confirmed reserves totaled 2,441 million barrels of crude oil, condensate, and LPG combined, and 3,562 billion cubic feet of natural gas, amounting to 3,115 million BOE in total. Holdings are diversified across Australia, Southeast Asia, Europe, Abu Dhabi and other regions, with the present value of future net cash flows (discounted, on an SEC basis) reaching ¥2,455,924 million.

INPEX serves as the operator of the Ichthys LNG Project in Australia, and segment profit (profit attributable to owners of parent) for FY2025 stood at ¥270,801 million, the highest among all segments. Exploration expenses were sharply reduced from ¥42,790 million in the previous fiscal year to ¥62 million, improving the cost structure. Equity in earnings of affiliates accounted for using the equity method also contributed ¥60,501 million.

Cash flow from operating activities in FY2025 was ¥693,800 million (up ¥39.1 billion year on year). Against total assets of ¥7,735,100 million, the company holds equity attributable to owners of parent of ¥4,747,100 million, maintaining sound financial health. The company secures diverse funding sources through commitment line agreements with multiple financial institutions and utilization of the JOGMEC guarantee program.

ENVALITH's Perspective

For Q1 FY2026 (ending December 2026), the average overseas crude oil selling price was $67.39 per barrel (down 10.7% year on year), which was the main factor behind the decline across all profit items in double digits: revenue of ¥501,803 million (down 6.5% year on year), operating profit of ¥278,215 million (down 14.1% year on year), and profit attributable to owners of the parent for the quarter of ¥109,414 million (down 13.4% year on year). As an external factor, the oil price level remains the largest source of earnings variability, and given that the assumed crude oil price (Brent) underlying the full-year earnings forecast has been revised to a range of $70.0 to $83.0 per barrel, oil price trends in the second half will determine the full-year outcome.

The full-year earnings forecast for FY2026 (ending December 2026) has been significantly revised upward from the previous forecast. Revenue was raised from ¥1,893,000 million to a range of ¥2,004,000 million to ¥2,291,000 million, operating profit from ¥957,000 million to a range of ¥1,086,000 million to ¥1,368,000 million, and profit attributable to owners of the parent from ¥330,000 million to a range of ¥350,000 million to ¥450,000 million. The main reasons for the revision are the continued stable operation of the Ichthys Project and other projects, and the revision of crude oil price and foreign exchange rate assumptions from the second quarter onward. However, the disclosure is presented as a range reflecting uncertainty in the Middle East situation, and it should be noted that the gap between the lower and upper bounds is wide.

In Q1 FY2026 (ending December 2026), cost of sales was ¥230,253 million (up 6.0% year on year), and depreciation and amortization was ¥101,893 million (up 14.2% from ¥89,232 million in the same period of the previous year), showing an upward trend in expenses. As costs increased while revenue declined, the gross profit margin fell (from 59.5% in the same period of the previous year to 54.1% in the current period). On the other hand, exploration expenses were significantly curtailed at ¥2,202 million (down 42.9% year on year), indicating selective focus in expense management. The New Energy business (Other segment) continued to post a loss of ¥1,481 million, reflecting an ongoing phase of upfront investment.

Growth Strategy

Advancing energy transition businesses in parallel while maintaining a foundation of stable natural gas and LNG supply

Stable operations continued at the Ichthys LNG Project in Australia, with natural gas production in Q1 FY2026 (ending December 2026) reaching 97,059 million CF (up 6.3% year on year) and crude oil sales volume reaching 3,547 thousand barrels (up 20.6% year on year). Against the backdrop of robust medium- to long-term outlook for LNG demand in Asia, the company aims to maintain high profitability as the operator.

The company continues stable production at large-scale projects such as the ACG oilfield and the Kashagan oilfield, while advancing the acquisition of new interests in Abu Dhabi and elsewhere. In Q1 FY2026 (ending December 2026), natural gas sales volume in this segment reached 16,525 million CF (up 13.1% year on year), confirming growth in volume terms.

As part of the energy transition strategy under INPEX Vision 2035, renewable energy power generation volume has been expanded (865 million kWh in Q1 FY2026 (ending December 2026), up 45.4% year on year). The company continues to make upfront investments in CCS and hydrogen businesses, and this segment currently remains in an early investment phase, recording a loss of ¥1,481 million.

The annual dividend forecast for FY2026 (ending December 2026) has been set at ¥108 (up 8% from ¥100 in the previous fiscal year). In Q1 FY2026 (ending December 2026), the company acquired ¥9,975 million in treasury shares, continuing its ongoing shareholder return program. Backed by a solid financial foundation with an equity attributable to owners of the parent ratio of 61.0%, the company aims to balance profit distribution with growth investment.

Last updated: July 17, 2026