Gulf Today

Idemitsu halves net profit outlook


TOKYO: Japanese oil refiner Idemitsu Kosan Co more than halved its profit forecast for the three years to March 2023 as the COVID-19 pandemic hit fuel demand, forcing it to make a tougher assumption for longer-term demand.

Idemitsu revised its 3-year business plan unveiled in November 2019, now predicting an accumulate­d net profit of 220 billion yen ($2 billion) for the three years ending March 2023, instead of its earlier target of 480 billion yen.

“It has only been a year and a half, but the environmen­t has undergone tremendous changes with the unpreceden­ted crisis of coronaviru­s pandemic, green recovery and carbon-neutral declaratio­n by the Japanese government,” Idemitsu President Shunichi Kito told a news conference.

The company now estimates local demand for petroleum products will fall 30% by 2030 from 2019 levels, and 80% by 2050, instead of its 2019 assumption of 20% and 70% respective­ly.

“But we want to work positively by taking this as a turning point and an opportunit­y,” Kito said, citing a plan to turn some of its refineries into plaforms for advanced materials such as lithium solid electrolyt­es and for cleaner fuels such as renewable energy, hydrogen and ammonia.

The company also aims to achieve carbon neutrality by 2050 through energy and material transition, including a plan to slash its thermal coal output by making no investment in new mines.

Idemitsu, however, will continue the developmen­t of natural gas assets in Vietnam and other Asian countries to meet growing demand for the fuel, Kito said.

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