Spain: Repsol Profit Up on LNG

Repsol posted net income of 1.901 billion euros in the first nine months of 2011, 6.4% higher than the 1.786 billion euros reported in the year-earlier period. The group’s operating income totalled 4.102 billion euros, 1% higher than that recorded in September 2010.

The company’s encouraging results are partly due to the improvement of crude oil and gas realization prices and the continued recovery of the chemicals business, as well as the excellent results achieved by the LNG unit.

Repsol’s Upstream oil and gas realization prices increased 16.8% and 29.6% respectively, offsetting the lower production of liquids due to temporary circumstances. In this respect, operations in Libya that had been halted since 5 March resumed in October with encouraging initial production levels.

Operating income for the Upstream business was 1.206 billion euros, 15.7% higher than in the first nine months of 2010.

The LNG division showed an especially positive performance based on higher sales after the start-up of Peru LNG, boosting operating income by 367.8%.

The Downstream unit’s operating income was 1.097 billion euros, a fall of 3.2% due to the drop in sales and international refining margins. Nevertheless, and on a more positive note for the unit’s profits, the Chemicals business has consolidated its recovery.

At the end of the quarter, operations began in the new units at the Cartagena refinery, and tests are set to begin in mid-November on the new unit of the Petronor refinery in Bilbao. These projects have been completed 200 million euros below initial planned investment, due to lower costs during the construction phase.

YPF’s operating income was 1.008 billion euros compared with 1.205 billion euros in the first nine months of 2010, due to prolonged strikes in Argentina during the second quarter of 2011, now resolved, and higher costs. Gas Natural Fenosa posted an operating income of 712 million euros, 4.9% less than the year-earlier period.

Repsol maintains a secure financial position thanks to sound management practices and continued financial discipline. The group’s net financial debt, excluding Gas Natural Fenosa, was 2.909 billion euros at the close of the third quarter, a net debt over capital employed ratio of 8.4%.

[mappress]

Source: Repsol, November 10, 2011