In a significant shift in strategic focus, Japan Petroleum Exploration (Japex) has announced it will prioritise investment in oil and gas exploration and production (E&P) through 2030. Previously, the company had planned to aggressively expand its renewables businesses.

Speaking to Reuters last week, Japex president Michiro Yamashita said securing “a fair return from renewable energy sources such as offshore wind is challenging due to rising costs.”

According to Reuters, in 2022, Japex set a goal to split profits equally between E&P and other businesses by the 2030 financial year to support the energy transition towards carbon neutrality.

However, profits from oil and gas have ballooned since the Ukraine invasion, and, given that current crude prices far exceed the assumptions underlying the original Japex plan, the decision has been made to maintain the current ratio of E&P contributing 70%-80% of earnings through 2030. Selective investment in non-oil and gas sectors will be made only if considered viable.

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