Glossary

Ammonia (NH₃) is a colorless gas composed of nitrogen and hydrogen that is widely used as a key raw material in the production of fertilizers and various industrial chemicals. In recent years, ammonia has attracted growing interest as an energy carrier and fuel because it does not emit carbon dioxide (CO₂) during combustion.

A barrel (bbl) is a standard unit of volume used in the oil industry, where one barrel of crude oil equals 42 U.S. gallons, or approximately 159 liters.

Barrel of oil equivalent (BOE) is a standardized unit used to compare and aggregate energy quantities from different hydrocarbon sources, particularly crude oil and natural gas. It represents the amount of energy contained in one barrel of crude oil.

Blue hydrogen is hydrogen produced from fossil fuels with the associated CO₂ emissions captured and stored, resulting in substantially lower greenhouse gas emissions than conventional hydrogen production.

Brent crude is a major benchmark crude oil widely used as a reference for global oil pricing. Brent crude is a light, sweet crude oil characterized by its low sulfur content and is produced from oil fields in the North Sea, including the Brent field offshore the United Kingdom.

A buyback contract is a service contract in which an oil company finances and executes exploration and development work and subsequently recovers its investment, interest, and agreed compensation from production revenues, often in the form of crude oil.

Cargo refers to a single shipment or consignment of energy resources, such as crude oil, liquefied natural gas (LNG) or liquefied petroleum gas (LPG), transported by vessel from one location to another.

Carbon dioxide capture and storage (CCS) is a technology that captures carbon dioxide (CO₂) emissions from industrial facilities and other sources and stores them in deep underground geological formations, preventing their release into the atmosphere and helping to reduce greenhouse gas emissions.

Carbon capture, utilization and storage (CCUS) is a technology that captures carbon dioxide (CO₂) emissions from industrial processes and energy production facilities and either reuses the captured CO₂ for industrial applications or stores it in underground geological formations. CCUS is considered an important approach to reducing atmospheric CO₂ emissions and supporting decarbonization efforts.

INPEX class A shares are a special class of shares held by Japan's Minister of Economy, Trade and Industry (METI) that grants approval rights over certain significant corporate actions. Under INPEX's articles of incorporation, specified matters require approval not only by the shareholders' meeting or board of directors but also by a separate Class A shareholders' meeting. These matters include the appointment or dismissal of directors, disposal of significant assets, amendments to the articles of incorporation, mergers and other corporate reorganizations, capital reductions and the dissolution of the company.
The veto rights associated with the Class A shares are subject to publicly disclosed guidelines under which METI has committed to exercising such rights only in exceptional circumstances, including where there is a high likelihood that the company would be managed in a manner inconsistent with its role in ensuring Japan's stable energy supply, where its ability to fulfill that role could be significantly impaired or where an action could affect the voting rights attached to the Class A shares.
The class A share structure serves as a limited and transparent safeguard against risks such as foreign control or hostile takeovers driven by short-term or speculative interests. By restricting the veto rights to a narrow range of matters and publicly disclosing the conditions for their exercise, the structure is intended to support Japan's energy security while preserving the company's management flexibility and operational efficiency.

A concession agreement is a contractual arrangement under which an oil company is directly granted exploration and production rights by the government of an oil-producing country or its national oil company. These rights may take the form of exploration rights, permits, licenses or leases, depending on the jurisdiction.
Under this arrangement, the oil company bears the investment costs and operational risks associated with exploration and development. In return, it acquires ownership of the produced oil and gas and has the right to market and sell those hydrocarbons.
The host country receives economic benefits through mechanisms such as royalties, taxes, lease payments, and other contractual fees.

Condensate (or condensate oil) is a light hydrocarbon liquid typically associated with natural gas fields. It exists in a gaseous state within the underground reservoir due to high pressure and temperature conditions, but condenses into a liquid when brought to the surface as pressure and temperature decrease.

A contractor is a company or person contracted to perform construction work for the company.

A central processing facility (CPF) receives production fluids from wells via flexible risers and processes them by separating the hydrocarbon stream into its constituent products, typically natural gas and condensate, for further treatment, storage or export.

Development refers to the phase of a project after exploration activities lead to the discovery of an oil or gas field that is considered commercially viable. This phase involves drilling production wells and constructing the infrastructure required to produce, process, store and transport the hydrocarbons. Typical development activities include the installation of production facilities, processing plants, pipelines, storage facilities and export or shipping systems necessary to bring the field into commercial production.

Engineering, procurement and construction (EPC) is a project delivery method under which a single contractor is responsible for the engineering and design, procurement of materials and equipment and construction of a facility or plant under one integrated contract.

Exploration refers to the activities undertaken to locate and evaluate underground mineral resources, such as crude oil and natural gas. The objective is to identify deposits where hydrocarbons or other minerals are present in sufficient quantities and concentrations to be extracted economically.

Exploration subsidies are government financial support measures provided for domestic drilling operations and other exploration activities that involve particularly high levels of risk. Eligible projects may receive partial reimbursement of exploration costs through government subsidy programs.

An exploratory well is a well drilled to search for previously undiscovered oil or gas accumulations. It is typically drilled in areas where geological and geophysical studies indicate the potential presence of hydrocarbons but where no commercial discovery has yet been confirmed.

Front-end engineering design (FEED) is the preliminary engineering phase conducted before engineering, procurement and construction (EPC) activities. FEED involves technical studies, project definition, risk and feasibility assessments, and cost estimation to establish the project's scope and budget. The resulting FEED package serves as the basis for EPC tendering, bidding and project execution planning.

A final investment decision (FID) is a formal decision to proceed with the full-scale development and construction of a project after confirming its commercial viability. The decision is typically based on the results of Front-End Engineering Design (FEED), including technical evaluations, cost estimates, risk assessments and projected economic returns.

Floating LNG (FLNG) is a development concept in which a liquefied natural gas (LNG) processing facility is installed on a floating vessel. The facility processes natural gas into LNG offshore and enables the LNG to be directly transferred to LNG carriers.

Floating production, storage and offloading (FPSO) is the concept supporting a floating offshore facility that processes hydrocarbons produced from subsea wells and stores crude oil and condensate in onboard tanks. The stored products are periodically transferred directly to shuttle tankers for transportation to refineries or export markets.

Geological survey refers to the process of assessing the geological conditions of a given area through methods such as surface inspections, various measurements, drilling and the observation and analysis of rock formations and geological strata.

Geophysical exploration is a collective term for techniques that utilize the physical properties of subsurface rocks and minerals to determine underground structures and identify the presence of mineral resources, groundwater and other geological targets.

Geothermal power generation is a method of generating electricity by harnessing thermal energy from within the Earth. Hot water and steam heated by underground geothermal reservoirs are brought to the surface, where the steam is used to drive turbines connected to generators, producing electricity.

A gas export pipeline (GEP) is a pipeline used to transport produced natural gas from production facilities to downstream processing facilities, such as liquefaction plants, or directly to domestic and international markets and other end-use destinations.

Greenhouse gas (GHG) emissions intensity is an indicator that measures GHG emissions relative to a unit of business activity, such as production volume or sales revenue.

A ground flare system is equipment used to safely dispose of excess hydrocarbon gas generated during crude oil production, gas processing, and refining operations. Rather than venting the gas directly into the atmosphere, the gas is burned in a controlled manner.
In a ground flare system, combustion takes place within an enclosed, chimney-like structure. This design helps minimize visible flames, night-time light emissions, noise, and environmental impacts on surrounding areas, while ensuring the safe and efficient disposal of excess gas.

Hydrogen is a colorless, odorless and highly flammable gas that is the lightest element under standard conditions. When combusted, hydrogen reacts with oxygen to produce water and does not generate carbon dioxide (CO₂) emissions at the point of use.

Liquefied natural gas (LNG) is natural gas, consisting primarily of methane, that has been purified to remove impurities such as water, sulfur compounds and carbon dioxide, and then cooled to approximately −162°C to convert it into a liquid. Liquefaction reduces the volume of the gas to about 1/600 of its original volume, enabling the efficient storage and transportation of large quantities over long distances.

Liquefied petroleum gas (LPG) is a fuel consisting primarily of propane, butane and other light hydrocarbon gases that are liquefied under pressure for ease of storage and transportation. LPG is widely used for residential, industrial, commercial and automotive applications and is valued for its portability and versatility.

A lump sum contract is a contract under which the contractor agrees to complete specified construction work or services for a fixed total price. Unlike a cost-plus contract, where compensation is based on actual costs incurred plus an agreed fee, the contract price under a lump sum contract is established in advance and generally remains unchanged.

Methanation is a technology that produces synthetic methane through a chemical reaction between hydrogen and carbon dioxide (CO₂). It is gaining attention as a decarbonization solution because the resulting methane can be transported, stored and utilized using existing natural gas infrastructure.

Methane emissions intensity is an indicator that measures methane (CH₄) emissions relative to a unit of business activity, such as energy production volume. It is calculated by dividing total methane emissions by the corresponding output and is used to assess the efficiency of methane emission management across operations.

Methane hydrate is a crystalline compound of methane and water that resembles packed snow or ice and can release methane gas when heated or depressurized.

Natural gas is a naturally occurring combustible gas found in underground reservoirs, composed primarily of methane and other light hydrocarbons, and used both as a fuel and as a feedstock for the production of chemicals such as hydrogen, methanol, and ammonia.

Net production volume is the net economic interest in the total production volume attributable to a company or project participant.

Oil majors, also known as major international oil companies (IOCs), are the world's largest integrated oil and gas companies. Historically, the term has referred to companies with global operations spanning the entire petroleum value chain.
Well-known oil majors include ExxonMobil (United States), Shell (United Kingdom), BP (United Kingdom), Chevron (United States) and TotalEnergies (France).
These companies operate internationally and typically maintain integrated business models, with activities covering both upstream and downstream operations.

Onshore LNG development is a method of producing LNG in which natural gas is liquefied at an onshore plant, stored and shipped to market as LNG.

A project operator is the party designated under the joint operating agreement (JOA) governing an oil and gas exploration and production (E&P) project to manage, execute and supervise day-to-day operations on behalf of all participating parties. Where multiple parties hold interests in the same block or license area, they enter into a JOA, which establishes their respective rights and obligations and provides the framework for project governance, decision-making and operational activities. Parties holding an interest in the project but not directly conducting operations are referred to as non-operators. The JOA defines the roles, responsibilities, voting rights, cost-sharing arrangements and other key obligations of both the operator and non-operators to ensure the efficient and coordinated execution of project activities.

Petroleum is a naturally occurring liquid mineral resource composed primarily of hydrocarbons, which are compounds of carbon and hydrogen. Petroleum is a major source of energy and is refined into transportation fuels such as gasoline, diesel, jet fuel and fuel oil, as well as fuels for power generation. It also serves as an essential raw material for a wide range of petrochemical products, including plastics, synthetic fibers, rubber products, detergents and other consumer and industrial goods.

Primary energy refers to energy that is obtained directly from natural resources before it is converted or transformed into other forms of energy. Examples of primary energy sources include coal,
crude oil, natural gas, fuelwood and other biomass, hydropower, nuclear energy, wind energy, ocean and tidal energy, geothermal energy and solar energy.

Probable reserves are defined in accordance with the Petroleum Resources Management System (PRMS) developed by the Society of Petroleum Engineers (SPE), with the support of the World Petroleum Council (WPC), the American Association of Petroleum Geologists (AAPG), and the Society of Petroleum Evaluation Engineers (SPEE).
Probable reserves represent the estimated quantities of crude oil and natural gas that are less certain to be recovered than proved reserves but are more certain than possible reserves. Based on geological and engineering data, they are considered likely to be commercially recoverable under existing economic conditions, operating methods, and regulatory requirements.

A production sharing contract (PSC), also known as a production sharing agreement (PSA), is a contractual arrangement under which one or more oil and gas companies (the contractors) undertake exploration, development, and production activities on behalf of a host government or national oil company, typically at their own risk and expense.
Under a PSC, the contractor finances the exploration and development of the project. If a commercial discovery is made and production begins, the contractor is entitled to recover eligible exploration, development, and operating costs from a designated portion of the production, known as cost oil or cost gas.
After cost recovery, the remaining production, referred to as profit oil or profit gas, is shared between the host government (or national oil company) and the contractor according to a predetermined allocation formula specified in the contract.

Proved reserves are defined in accordance with Rule 4-10(a) of SEC Regulation S-X. They represent the estimated quantities of crude oil and natural gas that geological and engineering data demonstrate, with reasonable certainty, can be commercially recovered from known reservoirs under existing economic conditions, operating methods, and government regulations as of a specified date.
Proved reserves are those hydrocarbon volumes that are expected to be recoverable with a high degree of confidence based on available technical information and current market and operating conditions.

Petroleum Resource Rent Tax (PRRT) is a resource tax in Australia that applies to the profits generated from petroleum projects. The tax is levied on project profits after eligible exploration, development and operating expenditures have been recovered, thereby targeting excess economic returns rather than gross production or revenue.

Renewable energy is a collective term for energy derived from natural resources that are continuously replenished, such as solar, wind, hydropower, ocean, and biomass energy. Unlike fossil fuels such as coal, oil, and natural gas, which are finite resources and may eventually be depleted, renewable energy sources are naturally renewed and can be used on a sustainable basis.
Renewable energy also offers environmental benefits, as it generally produces little or no air pollution or greenhouse gas emissions during operation. Technologies for harnessing and utilizing renewable energy continue to advance, improving efficiency, reliability, and cost competitiveness across a wide range of applications.

The reserves-to-production (R/P) ratio is a measure of how long an oil or gas field's reserves are expected to last at current production levels. It is calculated by dividing the remaining reserves at the end of a given year by that year's annual production.
The resulting figure indicates the number of years that production could continue if production remains at the same annual rate and no additional reserves are discovered or added. The R/P ratio is commonly used for individual oil and gas fields, companies, regions, or countries as an indicator of reserve life.

A drilling rig is specialized equipment used to drill wells for the exploration, development and production of oil and natural gas.

Royalty refers to a share of production or revenue reserved by the owner of mineral rights, typically a government or other resource owner, in exchange for granting the right to explore for or produce mineral resources. Royalties are payable without the owner bearing any production costs and may be assessed as a fixed or variable percentage, with rates that in some cases increase as production levels rise.

Reserve replacement ratio (RRR) is an indicator that measures the ratio of newly added proved reserves to the volume of oil and gas produced during a given period.

Scope 1 emissions are greenhouse gas (GHG) emissions that are directly generated from a company's own operations and controlled sources.

Scope 2 emissions are indirect greenhouse gas (GHG) emissions resulting from the consumption of purchased electricity, heat, steam or cooling supplied by third parties.

Scope 3 emissions are indirect greenhouse gas (GHG) emissions that occur across a company's value chain, excluding Scope 1 and Scope 2 emissions.

Secondary energy is obtained by converting or processing primary energy sources into more usable forms, such as electricity, city gas and coke.

Seismic surveying is a geophysical exploration technique used to map and analyze underground rock formations. The method works by generating controlled elastic (seismic) waves and measuring how those waves travel through and are reflected by subsurface structures. Seismic surveys are conducted both onshore and offshore using specialized equipment. At sea, they are typically carried out by dedicated marine seismic survey vessels, while on land they are commonly performed using vibroseis trucks, which generate seismic waves and record the resulting signals.

A service contract is an arrangement under which an oil company carries out exploration, development, and sometimes production activities on behalf of the host government or national oil company in exchange for a predetermined fee.

Shale gas is a type of natural gas classified as an unconventional resource. Unlike conventional natural gas, which accumulates in porous underground reservoirs, shale gas is trapped within dense shale rock formations that have very low permeability.
Extracting shale gas requires specialized drilling and production techniques. Typically, operators drill horizontal wells and use hydraulic fracturing (commonly known as ""fracking"") to create small fractures in the shale rock, allowing the gas to flow to the wellbore and be produced economically.

Solar power generation (photovoltaic power generation) is a technology that converts sunlight directly into electricity using solar cells made from semiconductor materials such as silicon. The solar cells generate direct current (DC) electricity from light energy, which is then converted into alternating current (AC) by a power conditioner (inverter) for use in homes, businesses and power grids.

Subsea umbilicals, risers and flowlines (SURF) are a system of subsea production facilities installed on the seabed to produce and transport oil and natural gas from offshore reservoirs. SURF typically comprises flowlines, which gather and transport produced hydrocarbons to processing facilities; risers, which convey the hydrocarbons from the seabed to surface facilities; and umbilicals, which provide power, control, communication and chemical injection services to subsea equipment.

An LNG train is a production line at an LNG facility comprising the equipment required to process and liquefy natural gas into LNG.

Unconventional oil and gas resources are oil and gas deposits that are difficult to extract using conventional production techniques.

Underground natural gas storage is the storage of natural gas in underground geological formations to ensure a stable supply and accommodate seasonal and temporal variations in demand.

Wind power generation is a method of generating electricity by harnessing the kinetic energy of wind. Wind turbines convert the energy of moving air into mechanical energy, which is then transformed into electricity by generators. Wind power is a renewable energy source, and generation facilities can be installed both onshore and offshore in locations with favorable wind conditions.