JX Nippon: The New Mission

Abstract

Hironori Wasada, senior vice president of JX Nippon Oil & Gas Exploration, highlights the ambitions and challenges facing the domestic and international operations of his company. What is the current status of the oil and gas industry in Japan? Japan imports almost 99.6% of its oil requirements, as we produce only 14,000 BOPD, which is less than 0.4% of our consumption. For gas, Japan produces about 3% of its consumption, with 97% of our consumption imported in the form of liquefied natural gas (LNG). The country is trying to reduce its energy export reliance, and the Japanese government is assisting and encouraging local companies to search for oil and gas offshore. Onshore fields in Japan are old and have started depleting, and recently a Japanese firm made a trial production of shale oil from an onshore oil field. In addition, the government is looking for alternative energy resources to meet growing local demand, and is currently looking at the commerciality of offshore methane hydrates. Also, several companies recently have been listed on the local stock exchange, which has put the industry under the scrutiny of investors who expect it to deliver revenue. Who are the major shareholders of JX Nippon? What major projects are you currently involved in? JX Nippon Oil & Gas Exploration Corporation is a business unit of JX Group, and is engaged in oil and gas development all over the world. We are very active in Japan, where development of local energy resources is the mission of Japanese companies. We are committed to continuing exploration activities in Japan, with the aim of contributing to a stable supply of energy. Currently, we are involved in exploration activities offshore Japan, and this includes the Sanriku and offshore Erimo blocks. Also, we hold a 100% interest in offshore blocks Shikoku, Nishi-kyushu, Sado, and Toyama Bay. The onshore Nakajo oil and gas field in Niigata Prefecture, Japan, is the domestic E&P base of JX Group. Our mission in the Nakajo field is to steadily supply natural gas to customers, including industries and local communities. How about investment outside Japan? NOEX (JX Nippon) currently operates in 14 countries. We are leading projects as operators in crude oil production in Vietnam, natural gas production in Malaysia, and exploration in the UK North Sea. We have also been part of a consortium producing oil in the United Arab Emirates (UAE) for more than 30 years. We are very active in several Asian countries, including Thailand, Myanmar, Vietnam, Indonesia, and East Timor. In Thailand, we will apply our own experience and technologies acquired through our operations in Vietnam to improve the efficiency of crude oil production at the Nang Nuan oil field in Block B6/27, where we hold a 40% interest with PTTEP Siam, the operator with a 60% interest in the field. In Vietnam, we are involved in Block 15-2, Block 05-1 b/c, and Block 16-2, while in Myanmar, we hold interests in Blocks M12, 13, and 14 and Block M11. We are also involved in LNG projects, including the Tangguh LNG project in Indonesia, and Papua New Guinea’s first LNG project, which is set to deliver its first LNG cargo in 2014.