FOR IMMEDIATE RELEASE

Tokyo, November 1, 2006 --- Japan Tobacco Inc. (JT) (TSE: 2914) announced today that in alignment with its commitment to environmental conservation, the company began its third afforestation project in Nahari, Kochi Prefecture. JT, the Kochi prefectural government, the Gobun forest owner's cooperative and the town of Nahari have formed a joint partnership in "The project for forests conservation in collaboration with environmentally friendly companies." JT is the seventh company to participate in this 160ha afforestation project and it records the largest budget-size project in the Kochi Prefecture's program. JT continues its initiative for forest conservation with this, following its two previous projects, including Nakahechi-cho in Wakayama Prefecture and Kosuge-mura inYamanashi Prefecture.

Beginning in November 2006, JT will implement its five year plan to thin out trees in Kochi Prefecture's Nahari region, in an effort to uphold the local ecosystem. This initiative will allow the forest to continue to thrive and will contribute to the recovery of a number of the local ecosystem's beneficial mechanisms, such as the continued growth of the lower vegetation in the area, as well as a type of coral, unique to this region, that grows on the concrete barriers protecting the coastline downstream from the project site. In the Nahari project, daily forest conservation is entrusted to the Gobun forest owner's cooperative, but JT will invite participants, including JT employees and their families along with local residents, to assist in the project.

JT aims to continue providing enjoyment and relaxation through its products in their three business segments, including tobacco, pharmaceutical, and foods. In those businesses, the company consumes natural raw resources including tobacco leaves, paper (pulp), vegetables and tea leaves to produce a variety of its product portfolio. Taking into account this, JT, as a socially responsible company, is committed to the continued creation and the conservation of natural resources in order to ensure a better eco-environment for future generation, and the afforestation project is part of this commitment.

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Japan Tobacco Inc. is the world's third largest international manufacturer of tobacco products. The company manufactures internationally recognized cigarette brands including Camel, Winston, Mild Seven and Salem. Since its privatization in 1985, JT has actively diversified its operations into pharmaceuticals and foods. The company's net sales were JPY 4,637 trillion in the fiscal year ended March 31, 2006.