Repsol said its upstream unit was becoming its growth engine after posting a 56% growth in operating income to €2.208 billion compared to a 6.1% drop in the firm’s overall net income.
The firm said the increase in upstream business “demonstrated the strength and projection of the unit as the company’s growth engine. The area’s earnings now represent more than half the group’s total.”
Repsol said the improvement was due to the return to normal of activity in Libya, higher earnings from Bolivia (due to the start-up of Margarita-Huacaya) and a stronger Dollar against the Euro.
Commentators said the results showed Repsol had limited damage after it was forced to sell off assets after the Argentinian government seized its YPF subsidiary last year. Just last week Repsol agreed to sell liquefied natural gas assets to Shell for $6.653billion.
Production rose 11% during 2012, to 332.435boe/d, with significant increases in Bolivia,
Libya, the United States, Spain and Russia (from the incorporation of the AROG joint venture), Repsol said. The reserve replacement ratio reached a record high of 204%. Repsol remains on track to reach its 500,000boe/b by 2016, analysts said.
Repsol said last year saw it make one of the world’s largest discoveries, in Pão de Açucar in (Brazil), as well as other finds in Peru, Colombia and Algeria.
Earlier this year, it also started production from the giant Sapinhoá field in Brazil, one of the largest fields developed in that country to date.
Repsol also grew its geographic coverage, adding 68 new blocks in the United States, Angola, Aruba, Australia, Bulgaria, Romania and Namibia.
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