Austria’s OMV has dropped to a loss in the third quarter of the year as its upstream segment took a hit amid current market conditions, but the company's downstream arm helped maintain “resilience”.
During the quarter, revenue dropped to €3.7 billion ($4.2 billion) from €6 billion in the same quarter of last year, mainly due to the overall lower global commodity price environment and lower liquid hydrocarbon sales volumes.
Net income fell to just €80 million compared to €457 million in the third quarter last year.
As a result, OMV reported a loss for the third quarter of €487 million compared to a profit of €425 million a year earlier.
During the quarter, OMV revised its Brent oil price planning assumptions to reflect a faster-paced energy transition.
This resulted in net impairments of tangible and intangible assets which, adjusted for tax effects, had an overall €594 million negative impact on OMV group’s net result of the third quarter.
“While upstream was badly affected by the massive slump in oil and gas prices, the downstream business proved to be significantly more resilient. Downstream was able to increase earnings in the gas trading and retail businesses,” OMV said.
Total hydrocarbon production in the quarter decreased by 36,000 barrels of oil equivalent per day to 444,000 boepd compared to the same quarter of last year.
“Force majeure in Libya, lower natural gas demand in New Zealand and natural decline in Romania were to some extent counterbalanced by higher output in Malaysia and the United Arab Emirates,” OMV said.
“OMV Petrom’s total production was down by 9000 boepd at 141,000 boepd, mostly because of natural decline.
“Total hydrocarbon sales volumes declined to 422,000 boepd compared to 466,000 boepd year-on-year as there were no liftings in Libya. This was partially offset by higher sales volumes in Malaysia,” OMV added.
Total capital expenditure during the period came in at €363 million compared to €2.7 billion year-on-year.
Looking ahead, the company expects capex this year to come in around €1.7 billion compared to the €2.3 billion spent in 2019.
For its upstream segment, OMV expects full-year production to be between 450,000 boepd and 470,000 boepd, which will compare to a 2019 output of 487,000 boepd.