Repsol Profits Soar on Higher Prices
Spanish producer Repsol announced second quarter net profits on July 27 up 79% year on year at €367mn ($430mn). Higher average realised prices helped its E&P performance, with oil up 10% at $44.10/bl and gas up 21% at $2.80/mn Btu; much of Repsol's gas is former Talisman production in North America.
The Spanish group’s adjusted net income, before exceptionals, was 44% higher at €496mn. This included €115mn from upstream (up €69mn higher year on year) and €429mn from downstream (up 14%), but corporate items made a €48mn loss – the latter net of a €50mn contribution from Repsol’s now 20% stake in Spanish utility Gas Natural (30% equity prior to September 2016).
Upstream production declined by 3% to 677,000 barrels of oil equivalent/day, as liquids output rose 2.5% to 253,000 b/d while gas declined by 6% to 2.38bn ft3/d.
The company noted that authorities in Trinidad & Tobago authorised the development of the BP-run Angelin gas development, in which Repsol holds a 30% stake and which is expected to start producing in 1Q 2019. In June too, Repsol made a significant gas discovery offshore Trinidad and brought in Gazprom Neft as a partner to its West Siberian pre-development oil venture.
Output rose with resumed Libyan output and higher Brazilian and UK output, offset by divestments of Indonesian (including a small Tangguh LNG stake) and Norwegian (Varg) assets. The company's net debt at end 2Q 2017 was €7.48bn, €868mn lower than at end-1Q 2017.
Mark Smedley