Japex sees U.S. as 'enticing' destination for energy exploration

TOKYO, Feb 9 (Reuters) - Japan Petroleum Exploration (Japex) 1662.T sees the United States as the most appealing investment destination for oil and gas exploration and production, despite political risks posed by this year’s election, its senior managing executive officer said on Friday.

“With its wealth of natural resources, low production costs, and well-developed infrastructure, we view the United States as the most enticing investment destination for E&P at present,” Michiro Yamashita, senior managing executive officer, told a news conference.

Yamashita, slated to become Japex’ president from April 1, said that the U.S. move to pause approvals for pending and future applications to export liquefied natural gas (LNG) from new projects was a surprise and raised concerns.

Natural gas and LNG are poised to play a pivotal role in facilitating energy transitions and the U.S., the world’s largest LNG exporter, has adopted a notably inward-looking policy, when it should assume a leadership role in supporting the global economy and the transition to address global climate change, Yamashita said.

“Given the inward-looking policies under Donald Trump, we need to be mindful of U.S. political risk to some extent, irrespective of whether the Democrats or Republicans emerge victorious in this year’s election,” he said.

Still, the pause would not cause any direct impact on Japex business or earnings, and the company would not shelve its investment in the U.S., Yamashita said.

“We are not thinking of slowing down the pace of our U.S. business,” he said.

Japex on Friday reported a 15.6% drop in April-December net profit to 36.5 billion yen ($244 million) on lower energy prices and a reduced dividend from the Sakhalin 1 oil project in Russia.

It stuck to its full-year profit forecast of 45 billion yen.

($1 = 149.4500 yen)

(Reporting by Yuka Obayashi. Editing by Jane Merriman)