Japan Petroleum Exploration (Japex) is looking to invest in the U.S. tight oil and gas sector, with the aim of becoming an operator, an executive said on Wednesday.
“We are exploring investment opportunities in the U.S. tight oil and gas sectors, where we are seeking operatorship,” Yutaka Nishimura, Japex’s executive officer, told a news conference.
“We have some projects under consideration, but there is nothing specific we can announce at this time,” he said.
Japan’s second-biggest oil and gas explorer aims to leverage the expertise and know-how it has gained from investing in U.S. tight oil and gas projects over the past years, he added.
Tight oil is unconventional crude oil extracted from dense rock formations, such as shale and sandstone, often requiring hydraulic fracturing to produce at viable rates.
The U.S. Trump administration’s anticipated support for oil and gas development is also welcomed, Nishimura said.
Japex has said that it views the United States as the most appealing investment destination for oil and gas exploration and production, and that natural gas and liquefied natural gas (LNG) are poised to play a pivotal role in facilitating energy transitions.
On Wednesday, Japex reported a 24% year-on-year drop in net profit for April-September to 21.14 billion yen ($136 million) due to the yen’s rise against the U.S. dollar toward the end of September, which led to appraisal losses on its dollar-denominated receivables and payables.
But the company raised its annual profit forecast by 78% to 78.5 billion yen, driven by stronger-than-expected sales of LNG and electricity, as well as a one-off gain from selling part of its cross-shareholdings.
Japex plans to book a 42 billion yen special gain from selling one listed security, with proceeds intended for growth investments. The gain has been included in the revised profit forecast, Nishimura said.
“We plan to use 36 billion yen of after-tax profit from the sale to fund growth investments,” Nishimura said.
(Reporting by Yuka Obayashi; Editing by Kim Coghill)