Japex to Acquire US Tight Oil and Gas Assets in $320 Million Deal

Japan Petroleum Exploration (Japex) announced on Thursday its plans to acquire all equity interests in four Fundare companies for approximately $320 million. The acquisition will secure tight oil and gas assets located in Colorado and Wyoming.

Expected to close during the fourth quarter of this year, the transaction builds upon Japex’s February purchase of neighboring Verdad Resources assets. The company aims to leverage operational synergies to reduce costs and boost development efficiency. During the first quarter of the year, the Fundare assets produced an average of 9,500 barrels of oil equivalent per day (boed).

Japex projects the acquisition will contribute over 1 billion yen ($6.3 million) in operating profit for the fiscal year ending March 2027, with that figure projected to grow to approximately 15 billion yen the following fiscal year.

Yutaka Nishimura, an executive officer at Japex, noted that the company sees opportunities to expand its footprint around the assets purchased in February. He indicated that Japex remains open to further acquisitions of tight oil and gas assets in the United States and other international regions.

To offset supply disruptions from the Middle East, Japex secured two liquefied natural gas (LNG) cargoes during the first half of the current fiscal year. The company intends to purchase another cargo in the second half, with the potential to secure an additional one if necessary, according to Nishimura.

For the April-June quarter, Japex reported a 79.4% drop in net profit to 3.24 billion yen compared to the previous year. This decline was driven by reduced crude oil sales volumes and elevated alternative LNG procurement costs stemming from the closure of the Strait of Hormuz.

Despite the quarterly decline, Japex upgraded its full-year net profit forecast by 8% to 65 billion yen, pointing to stronger-than-anticipated crude oil prices and rising sales volumes.