Expansion of Production at Boggabri Coal Mine, Australia

Idemitsu Kosan Co., Ltd. (Head Office: Chiyoda-ku, Tokyo; President: Kazuhisa Nakano) announces that its Australian subsidiary, Idemitsu Australia Resources Pty Ltd (Head Office: Brisbane, President: Kosuke Yamamoto), through a wholly owned subsidiary Boggabri Coal Pty Limited, in which the company owns a 100% interest, expands the production capacity at the Boggabri Coal Mine in New South Wales.

Open-cut mining at the Boggabri Coal Mine commenced in 2006 with an annual production of 1.5 million tons, and mainly produces high grade (high calorie, low sulfur) thermal coal. A growing demand of coal in the medium and long term is foreseen mainly in Asia and it has been decided to implement a phased mine expansion to an annual level of 4.3 million tons to meet this demand. This expansion is planned with the aim of annual production to 2.5 million tons in the second half of FY2010 and 4.3 million tons in FY2013. It is anticipated that a total of 11.5 billion yen will be invested in this expansion.

The Boggabri Coal Mine holds a development consent to meet this expansion and it is expected that this expansion will create further employment opportunities and contribute to vitalization of the region where the mine is located.

Idemitsu currently owns an 85% interest of the Ensham Coal Mine in Queensland, the Boggabri Coal Mine, the Muswellbrook Coal Mine in New South Wales in which the company owns a 100% interest and 30% of the Tarrawonga Coal Mine in New South Wales. The total production of these four coal mines for FY2009 is expected to reach approximately 10 million tons (Based on Idemitsu’s interest).