Spanish oil and gas group Repsol returned to profit in the third quarter after a deep loss in the second, and suggested it could spin off some of its growing renewables business to maximize investment returns.
Repsol, however, said it would cut its new capital expenditure plans by a further 200 million euros ($236.4 million), adding to a previous target to reduce that by 1 billion euros.
Plummeting crude oil prices prompted oil producers around the world to slash investments this year.
Adjusted net profit of 7 million euros beat a company-provided analyst forecast of a 15 million euro loss, but this was still 515 million euros lower than in the same period a year earlier, highlighting the scale of demand destruction wrought by the COVID-19 pandemic.
The upstream business that extracts oil and gas turned a profit as crude prices rebounded from historic lows, while growth in the commercial and renewables unit that includes lower-emission motor fuels helped balance losses in refining and unfavorable exchange rates.
Chief Executive Josu Jon Imaz suggested a joint venture the company agreed this year to run a portfolio of wind and solar sites in Chile could serve as a blueprint for the future of the renewables business.
"We are of course working on the best financial structure that could allow to boost the return on equity," Imaz said, adding, "this might include potential JVs, partnerships ... why not, even a potential IPO in the future of this business."
Repsol shares initially rose more than 1%, outperforming Madrid's stock exchange before reversing to trade down 2% by 1326 GMT at 1326 GMT.
Investors have questioned its bigger rivals such as BP and Total on their plans for boosting returns on investment from renewables.
Total CEO Patrick Pouyanne has said the key was to invest in developing projects and subsequently sell down stakes at a profit, rather than buy production, but so far no peer of Repsol's has floated the idea of a spin-off on the stock exchange.
($1 = 0.8461 euros)
(Reporting by Isla Binnie and Jose Elias Rodriguez, additional reporting by Shadia Nasralla; editing by Emelia Sithole-Matarise)