At the end of last year, against the backdrop of the consolidation of the global oil crisis, OMV Petrom officials were estimating lower investments in 2015. The investment programme was estimated at EUR 0.8 – 1.1 bln in 2015, 85 per cent of which was about to go into production projects.
In the production segment, OMV Petrom planned to implement operational excellence initiatives with a focus on efficiency, bearing in mind the operational environment too. Operational activities were about to focus on carrying out approximately 1,200 overhaul works and the drilling of up to 70 new wells, depending on the evolution of the market and fiscal environment. The redevelopment projects will be prioritized based on added value criteria, the projects currently in development/execution will be slowed down, and the assessment projects will be redesigned or their goals will be diminished.
These days, OMV Petrom has put up for tender a drilling contract whose value is up to USD 121 M (EUR 107 M), through which it wants to bring to light the deepest oil and natural gas deposits.
The drilling operations will take place onshore, “throughout Romania’s territory,” revealing that the onshore segment has not disappeared completely from Petrom’s investment portfolio which focuses more on off-shore exploration in the Black Sea.
The tender organized by the region’s largest hydrocarbon producer is a breath of fresh air for profile companies severely hit by the big oil companies’ lowered investment budgets as a result of the collapse of oil prices. OMV Petrom, which has based its budget on an oil price of USD 50-60 per barrel in 2015, has lowered its investments by 30 per cent year-on-year to EUR 1 bln. Petrom’s shares have dropped by 27 per cent year-on-year, to RON 0.33 per cent per share, the lowest level in the last three years.
OMV Petrom’s value drops 31.5 pc because of cheaper oil
OMV Petrom’s market value, calculated on the stock exchange, has dropped by 29.3 per cent since the end of 2014. At the same time, the total value of the world’s oil companies has dropped by 34 per cent.
OMV Petrom’s value seems to have taken a less severe hit on the capital markets than many other global oil companies, according to a report authored by BT Securities, Banca Transilvania’s brokerage house.
“In the last one and a half years, USD 1.750 bln evaporated from the capitalization of the global oil sector. Oil companies have lost one third of their value, against the backdrop of the drastic drop in the price of an oil barrel,” the aforementioned source points out.
Thus, the market value of oil companies all over the world has dropped by 34 per cent since December 2013, to USD 3,419 bln.
In the same period (December 2013 – October 2015), OMV Petrom’s market value dropped by 29.3 per cent (RON 18.8 bln) to USD 4.78 bln.
European oil companies lost 37 per cent of their market value, while North American companies lost 35 per cent. SNP’s loss however is nevertheless higher than that registered by Asian companies (-25 per cent), Middle East companies (-27 per cent) and African companies (-28 per cent).
During the same period, the price of oil dropped by 55 per cent, to below USD 45 per barrel (approximately seven barrels amount to one ton of oil, depending on the type of oil concerned).