Inpex sees $606 million in writedowns amid oil rout
Pubdate：2016-04-06 11:32
Source：mcc
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TOKYO (Bloomberg) -- Inpex Corp., Japan’s biggest oil and gas explorer, expects to book $606 million in impairment charges for the year just ended, following the collapse in oil and gas prices.
The charge will probably reduce net income to 26 billion yen for the 12 months ended March 31, half the 52 billion yen the company projected in February, and 67% lower than the 77.8 billion yen in profit a year earlier, the Tokyo-based company said in a preliminary earnings statement Tuesday. Sales probably fell 14% on year to 1.01 trillion yen.
Inpex joins Mitsubishi Corp. and other companies reporting writedowns after oil prices fell more than 30% last year. Inpex is among a host of explorers and producers likely to report full-year net losses because of writedowns that may be equal to as much as 10% of book value, Sanford C. Bernstein & Co. said in February.
The company’s writedowns include about 25.5 billion yen on Lucius oil field in the U.S. Gulf of Mexico, 19 billion yen on Block 14 offshore Angola and 8 billion yen on a shale gas project in Canada, the company said in a statement.
The Japanese oil and gas explorer is facing a number of challenges, most notably in Indonesia, where the government is seeking changes to its Abadi liquefied natural gas project. Indonesia wants Inpex to build the massive liquefaction facility on a remote eastern island to help local economic development, instead of offshore as the Japanese company desires.
Inpex’s shares have dropped 34% since the beginning of the year.
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