Discovered in 1979 and in production since 1984, Minami-Nagaoka is one of the largest gas fields in Japan. After processing, the natural gas is transported through a 1,400-km trunk pipeline network stretching across the Kanto and Koshinetsu regions that surround the greater Tokyo metropolitan area and delivered to city gas companies and industrial customers along this network.

INPEX has experienced substantial sales growth in recent years due to sharp rises in the prices of competing fuels, as well as the highly environmentally friendly attributes of natural gas. The medium- to long-term projection is for annual sales demand of 2.5 billion m3 by the early 2020s and in the 3.0 billion m3 range over the long term, reflecting further capacity increases for our core Shin Tokyo Line and development of the Toyama Line (extending from Itoigawa City, Niigata Prefecture, to Toyama City, Toyama Prefecture), construction of which began in April 2012.

Supply capacity and reliability have been enhanced through the reinforcement of pipeline network expansion and the introduction of LNG from Shizuoka Gas Co., Ltd., in 2010. INPEX decided to build an LNG receiving terminal at Naoetsu, Joetsu City, in Niigata Prefecture, which is slated to start in the beginning of 2014.

INPEX also produces natural gas dissolved in water at the Naruto Gas Field in Chiba Prefecture. Natural gas dissolved in water is contained in underground "brine water." We pump up the brine water, extract natural gas and supply the gas to surrounding areas. The brine water also contains high levels of iodine. We export the iodine to Europe, the United States and elsewhere.

We expect domestic demand for natural gas to rise steadily and continue to be firm due to factors such as the shift to natural gas from oil as consciousness about the environment and energy conservation increases, as well as rising oil prices. To ensure stable supply to the domestic natural gas market over the long term, INPEX has been engaged in constructing an LNG receiving terminal in Joetsu City (the port of Naoetsu) in Niigata Prefecture since 2009. The operational startup is planned for the beginning of 2014. Afterward, we plan to receive LNG from our overseas projects at the Naoetsu terminal, and by combining that supply with existing domestic supplies from Minami-Nagaoka and other fields we will be able to enhance the capacity and stability of our supply structure.