Japan's top oil and gas producer Inpex on Thursday increased its full-year net profit forecast to 340 billion yen ($2.3 billion) on expectations of higher oil prices and a weaker yen and after record nine-month earnings.
Inpex had earlier forecast net profit for the year at 320 billion yen. On Thursday, it posted a 5% on-year increase in nine-month net profit to 280.4 billion yen.
The upward revision came despite an impairment loss of 75.6 billion yen the company booked in the third quarter on the Prelude liquefied natural gas (LNG) project in Australia due to higher costs to meet the tightened environmental regulations.
"Despite the loss on the Prelude, we were able to book a record profit for the January-September period, helped by a weaker yen and stronger natural gas sales from the Ichthys LNG project in Australia," Daisuke Yamada, Inpex' managing executive officer, told a press conference.
The Australian government implemented a series of regulations and measures in the gas industry to meet domestic energy needs, manage soaring gas prices and reduce emissions.
Earlier this year, Inpex set aside a clean-up cost of 35 billion yen for Ichthys in response to the stricter regulations, but it has cancelled the cost as growing LNG output will be able to offset the extra expense, Yamada said.
"We have factored in all possible impact of Australia's tightened regulations on our earnings," Yamada said.
For the full-year, the company revised an assumption of Brent oil prices to $82.7 per barrel from its August estimate of $80 and exchange rate to 138.6 yen per U.S. dollar from 135.0 yen.
($1 = 151.0600 yen)
(Reuters - Reporting by Katya Golubkova and Yuka Obayashi; Editing by Christopher Cushing and Emelia Sithole-Matarise)