Successful Production of Natural Gas and Crude Oil from an Exploration Well in Hokkaido

Japan Petroleum Exploration Co., Ltd. ("JAPEX" or "the Company") began drilling the Akeno SK-1D exploration well (total depth 5,265m) from August 2011 with the aim of developing the Akeno structure to the west of the Yufutsu oil and gas field in Hokkaido. More recently, and as a result of production test, the Company is successfully producing 60,000m3 of natural gas and 60kl of crude oil per day.

Production test was conducted along the sedimentary layer (the fractured nglomerate of the Ishikari Group and also its underlying fractured granite basement) at a depth of between 4,707m and 5,265m from January 25, 2012. The test newly confirmed the existence of natural gas and crude oil within the Akeno structure.

Moving forward, JAPEX will utilize the results of production test to conduct an evaluation of projected reserves and the extent of oil and gas layers. Together with renewed exploration activities, the Company will the structure's development potential.