OMV Petrom estimates investments lower than 700 mln euros in 2017

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OMV Petrom Group estimates that it will invest less than 700 million euros this year, with more than 80pct to be directed to Upstream projects (exploration and production), according to the unaudited financial results released on Thursday by the company.

In the third quarter, the company made investments of 811 million lei, up 70pct from the same period of last year. On the other hand, the investments made in the first nine months of this year decreased by 5pct to 1,727 billion lei.

In the Upstream segment, the investments made in July-September were worth 675 million lei, compared to 420 million lei in Q3 of 2016, and the Downstream investments (refining and marketing) amounted to 135 million lei, from which 122 million lei in Downstream Oil (in Q3 last year these stood at 56 million lei).

For 2017, OMV Petrom forecasts that the average price of Brent crude oil will be 52 dollars / bbl.

“The increase in private consumption in Romania is expected to continue to sustain the demand for oil products, despite some expectations on its decline in Q4 2017 due to seasonality and higher excise duties on fuels,” the company said.

At the same time, OMV Petrom’s estimates indicate an increase in the demand for natural gas and fuels and a slight increase in electricity demand compared to 2016.

 

Three-quarter net income at 1.85 bln lei, up twofold plus from year ago

 

OMV Petrom Group posted a three-quarter net income of 1.848 bln lei, more than two times higher (111 pct) than the net 878 ml lei registered in the similar period of the year before, shows the unaudited financial report released on Thursday by the company.

The clean CCS net income attributable to company stockholders was of 2.054 bln lei, by 128 percent higher from the same period of the year before. The clean CCS earnings per share stood at 0.0363 lei.

The group’s sales in the first nine months of the year totaled 14.294 bln lei, up 20 percent from the 11.953 bln lei registered in the same period of the year before.

“In Q3/17, we enjoyed another quarter with strong macroeconomic fundamentals supporting higher demand for our products and higher sales volumes. We benefitted from increased commodity prices and very strong refining margins. In addition, we continued our strict cost discipline to increase our competitive position and moved forward with investments. As a result, our 9m/17 Clean CCS Operating Result reached RON 2.7 bn, with both Upstream and Downstream showing significant increases. In Upstream, further reduced production costs overcompensated the impact of production decline. In Downstream Oil, the solid results reflected higher sales volumes, mostly in retail, and a continued high asset utilisation. Downstream Gas had an improved performance and benefitted from the booking of insurance revenues for the Brazi power plant. The free cash flow improvement was a result of higher operating cash flow and lower investments,” said OMV Petrom CEO Mariana Gheorghe.

Austrian group OMV holds a 51.01 pct majority stake in OMV Petrom, while Romania’s Ministry of Energy holds 20.64 pct of the company’s stake. Petrom is Romania’s largest oil and gas company with activities in the business segments Upstream (Exploration and Production), Downstream Oil (Refining and Marketing), Downstream Gas (Gas and Energy).