Inpex trims profit target on asset write-down

OREANDA-NEWS. Japanese upstream developer Inpex has been forced to trim its profit forecast for the 2014-15 fiscal year ending 31 March this year because of 35bn yen (\$294mn) of foreign upstream asset write-downs.

Inpex today revised the firm's forecast profit to 76bn yen for 2014-15, down by 44bn yen from its previous forecast because of weaker oil prices. The company attributed the revision to a 27.5bn yen write-down of its Joslyn oil sands project in Canada and another 7.5bn yen write-down in the value of the JPDA06-105 block in the Timor Sea. Inpex posted a 184bn yen profit in 2013-14.

It joined the Total-led Joslyn oil sands project in Alberta in 2007 by buying a 10pc stake. But Total this month shelved the C\$11bn (\$8.7bn) project indefinitely because of rising costs. Total has a 38.25pc share, with the rest shared by Canadian energy firm Suncor, US upstream firm Occidental Petroleum and Inpex. The project was targeting 100,000 b/d of bitumen output.

The drop in oil prices has seen Japanese oil refiners already report heavy oil inventory losses and forecast financial losses for 2014-15. JX, Japan's largest oil refiner by capacity, expects to post its first annual loss since its 2010 inception, forecasting a 210bn yen loss. Showa Shell and TonenGeneral posted losses of 10bn yen and 14bn yen respectively for their 2014 results.