Romania: Decreased profit at OMV Petrom in H1 2020

, SEE Energy News

Compared to the same period last year, Romanian largest oil and gas company OMV Petrom, a part of Austrian OMV Group, recorded 56 % lower net profit. In the first half of 2020 a net profit amounted 179 million euro.

Sales fell by 11 %, following a downtrend in commodity prices and lower sales volumes for petroleum products, partially offset by the increase in natural gas volumes sold. Downstream Oil represented 65 % of total consolidated sales, while Downstream Gas accounted for 33 % and Upstream for 1 %.

Capital expenditures fell by 8 % year-on-year to 324 million euros in the first six months, consisting mainly of Upstream investments. For 2020, OMV Petrom plans investments of 620 million euros excluding acquisitions, compared to 870 million euros in 2019. In the Upstream segment, OMV Petrom posted a 5.6 million euros clean operating result, down by 98 % year-on-year, mainly due to lower oil and gas prices and higher depreciation. Total hydrocarbon production decreased by 2 % to 148.8 million barrels of oil equivalent in the first half of the year.

Exploration expenditures fell by 61 % year-on-year in the first half to 18.8 million euros, as no drilling activities were performed, partly counterbalanced by 3D seismic acquisition in the first quarter.

In the Downstream segment, the company’s operating result fell by 19 % year-on-year to 155.8 million euros, reflecting special gains of 29.4 million euros and negative CCS effects of 102 million euros, due to a steep decline in crude quotations.

Total sales of refined products decreased by 9 %, while retail sales volumes were down by 13 % due to the lower demand. Non-retail sales decreased by only 5 % reflecting higher sales of available production to export markets, partly compensating the reduced domestic demand.

In the second quarter only, OMV Petrom recorded a net profit of 44.3 million euros, down 74 % compared to the same quarter in 2019, driven in large part by lower crude and gas prices.