
STRATEGIES
The Cosmo Oil Group continues to develop its Oil Exploration and Production Business, designating Abu Dhabi and Qatar, where it has established partnerships of trust over many years, as core areas. To reduce the high risks generally associated with the Oil Exploration and Production Business, the Group strives to acquire mine lots that have already been discovered and are yet to be developed.The Group has extended its interest in three existing oil fields with Abu Dhabi Oil Co., Ltd. (ADOC) for 30 years beginning in 2012. Cosmo Oil is also developing the Hail Oil Field, a new concession area that it acquired with the extension of its interests, with the aim of initiating production in the second half of FY2016.
As one initiative to expand business, Cosmo Oil signed a memorandum of understanding regarding the establishment of a strategic comprehensive alliance with International Petroleum Investment Company's (IPIC's) wholly-owned subsidiary Compania Espanola de Petroleos, S.A.U. (CEPSA), a major Spain-based oil company, in January 2014. Under this arrangement, steps will be taken to pursue petroleum-related business opportunities of mutual interest and prospects for their commercialization. In November of the same year, Cosmo Oil strengthened this alliance further by accepting a 20% investment by CEPSA in the newly established Cosmo Abu Dhabi Energy Exploration & Production Co., Ltd. Cosmo Oil is focusing joint efforts on acquiring new concession areas and further expanding business with Abu Dhabi National Oil Company (ADNOC) and CEPSA through periodic workshop meetings.


STRATEGIES
Building on the safe and stable operations of its three refineries, the Cosmo Oil Group aims to secure margins at an appropriate level and establish a system of top-class oil refineries in Japan through regional collaboration, coordination and integration, modeled after the accomplishments in the Chiba and Yokkaichi areas. Amid the downturn in petroleum product demand in Japan, Cosmo Oil Group is strengthening initiatives in auto leasing operations for consumers in a bid to transition from a conventional business model that revolves solely around fuel oil margins as a primary source of earnings to a business model focused on providing a full array of car services.

STRATEGIES
The Cosmo Oil Group has been shifting its emphasis to the Petrochemical Business amid declining demand for gasoline in Japan. We have been ramping up production of para-xylene (PX), which is used in polyester fiber and PET bottles, and its main ingredient, mixed xylene (MX). We expect demand for these products to grow over the long term, as demand strengthing in Asia. The Group aims to boost its competitiveness in exports of ethylene by promoting larger-lot exports of products. The Group aims to become a leading olefin center for the Asia region.

STRATEGIES
The Cosmo Oil Group is focusing on renewable energy guided by its responsibilities as an integrated energy company working to diversify the energy supply and achieve the best energy mix. Plans are in place for EcoPower Co., Ltd., a group company with about a 6% share of the domestic wind power market, to add approximately 50,000 kW in new capacity by the end of FY2017. In addition, the Group is participating in experimental offshore floating wind power generation projects. In solar power generation, CSD Solar* commenced commercial operations at certain mega-solar power generation sites from June 2014.In addition, Cosmo Oil continued to evaluate the potential of the 5-amino levulinic acid (ALA) business with the objective of expanding earnings opportunities outside the Petroleum Business.
*CSD Solar is a mega-solar project joint venture between Cosmo Oil, Showa Shell Sekiyu K.K., and Development Bank of Japan Inc.
