Japan Petroleum Exploration Co., the country’s second-biggest oil and gas explorer, forecast its first loss after slashing production estimates at a Hokkaido field.
The company known as Japex expects an 11.6 billion yen ($146 million) loss for the year ending March 31, compared with an earlier projection of a 16.5 billion yen profit.
Japex will book a 37 billion yen first-half charge for the Yufutsu field on Japan’s northern island, it said today in a statement. Natural gas production from the field will fall 40 percent next fiscal year, a spokesman said, declining to be named citing company policy.
The Tokyo-based company reduced production capacity after finding “the quantity of water brought forth with oil and gas from the wells significantly exceeded its forecast,” according to the statement. The company “has reached a conclusion that the production capacity declined considerably.”
Japex shares dropped 2.2 percent to 3,340 yen today on the Tokyo Stock Exchange. The company announced the loss forecast after the market closed.