Oil and gas production at record level Wintershall continues on growth course - cpp - chemical plants & processes

Oil and gas production at record level

Wintershall continues on growth course

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In 2016 Wintershall produced 165 million barrels of oil equivalent (BOE) Picture: Wintershall
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Wintershall is on a growth course and attained a historic level of production in 2016 of 165 million barrels of oil equivalent (BOE) despite the difficult conditions in the industry. This means the company has increased its oil and gas production in the last ten years by around 50 %. During that time, Wintershall has doubled its commercially recoverable oil and gas reserves from 814 million BOE to 1.62 billion BOE. „Solid foundations for further profitable growth in the future too,“ CEO Mario Mehren said at the company’s annual press conference and announced that the company would continue on its long-term growth course.

„This is because we made the right investments early: in oil and gas fields in regions with low production costs and in expanding our strong partnerships,“ Mehren explained, adding that the focus in 2017 will primarily be on improving the company’s results. „We plan to achieve much higher earnings for BASF with our oil and gas business in 2017,“ Mehren declared.

In current times where prices are low, the company said it was profiting from its diversified portfolio with low production and reserve replacement costs, especially in Russia and Argentina. The company has raised its production to a record high and at the same time reduced costs and investment expenditures, it said. „We adapted successfully to the new business climate,“ Mehren said, and continued: „The results, especially our continued positive free cash flow, show that the measures we have taken are working.“

Efficiency and effectiveness pay off at Wintershall: although profits fell sharply in 2016 owing to the slump in oil and gas prices and the asset swap with Gazprom completed last year, Wintershall still achieved sales of 2768 million euros and EBIT before special items of 517 million euros.

In 2017, Wintershall plans to stay on course with its investments in expanding oil and gas production, especially in Russia, Norway and Argentina. The focus of the company’s offshore production in Europe will be on enhancing efficiency and effectiveness. However, Wintershall will also push ahead with its exploration activities again. „We have solid foundations for profitable growth with our reserves basis. We will continue to consolidate and build on these,“ Mehren declared. „Our planning for the year 2017 is based on an average oil price for Brent of 55 US dollars/barrel and an exchange rate of 1.05 US dollars per euro.

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