Page 9 - EurOil Week 18 2022

EurOil INVESTMENT EurOil

ExxonMobil announces exit from Romania

ROMANIA EXXONMOBIL has agreed to sell its Romanian success with potential to help increase resource
upstream business to Romgaz for more than production within Romania and the European
$1bn. The sale includes the super-major’s 50% Union.”
stake in the Neptun Deep gas discovery in the ExxonMobil acquired its stake in Neptun
Black Sea off the coast of Romania, which Exx- Deep, which is estimated to hold up to 84bn
onMobil had previously said it would sell. cubic metres of gas, in 2008. The partners in
Romgaz signed an exclusivity agreement to the project repeatedly delayed a final invest-
buy the Neptun Deep stake in June 2021, and ment decision (FID) on the project owing to
subsequently reached a deal with ExxonMobil on unfavourable law changes in Romania in 2018,
the transaction in October. The deal announced among other factors. ExxonMobil signalled in
this week covers this stake and also includes all 2020 that it was weighing an exit from Neptun
of the shares in ExxonMobil Exploration and Deep, confirming reports that had already been
Production Romania. Operatorship of the deep- circulating since the previous year. But in 2019,
water XIX Neptun Block, where Neptun Deep is amid lower oil and gas prices, the stake had only
located, will be transferred to OMV Petrom, the been estimated to be worth around $250mn. In
other 50% shareholder. recent weeks, prices have hit multi-year highs,
The transaction is anticipated to close during raising the value of oil and gas projects and
the current quarter of 2022. allowing ExxonMobil to benefit from the delays
“ExxonMobil continues to evaluate our port- it experienced in finalising a sale.
folio of opportunities, focusing our investments The sale comes less than a month after Roma-
in advantaged assets with a low cost of sup- nia’s government agreed to make changes to its
ply,” stated ExxonMobil Upstream’s president, current offshore law, making it more friendly to
Liam Mallon. “Our investments to date have investors and easing restrictions on where output
positioned the Neptun Deep project for future can be sold.™

PERFORMANCE

TotalEnergies reports first-quarter profit

EUROPE FRANCE’S TotalEnergies has posted a profit for stakes in the Yamal LNG and Arctic LNG 2
the first quarter of 2022, despite a $4.1bn impair- projects. It did say in March that it would halt
ment that was attributed to its business in Russia. any new investments in Russia in light of Mos-
The company’s net income amounted to cow’s invasion of Ukraine. This has implications
$4.9bn, but while this marked a 48% increase for Arctic LNG 2 in particular, which is in the
year on year from $3.3bn in the first quarter of process of being built. On the earnings call,
2021, it was also a sequential drop of 15% from TotalEnergies’ chairman, president and CEO,
$5.8bn in the fourth quarter of last year. This Patrick Pouyanné, said it was “difficult to believe”
TotalEnergies is figure takes into account the impairment associ- that the project could be built given the current
sceptical over Arctic ated with the exposure to Russia, TotalEnergies’ sanctions regime and the fact that his company
LNG 2’s chances of chief financial officer, Jean-Pierre Sbraire, said would not spend any more capital on it.
being built now given on the company’s earnings call. Adjusted net Pouyanné also indicated that the com-
the sanctions regime income, meanwhile, came in at $9.0bn for the pany could yet abandon its existing Russian
and the fact that it will first quarter, triple the $3bn posted in the first operations.
not spend any more quarter of 2021 and up 32% sequentially. “We never stated we will stay in Russia”, he
capital on the project. TotalEnergies’ adjusted earnings before said. “We have just not stated that we will exit
interest, taxes, depreciation and amortisation from Russia, which is a little different.”
(EBITDA) for the latest quarter reached $17.4bn, Meanwhile, high oil and gas prices have
up 22% sequentially and more than double the encouraged the company to ramp up share buy-
$8.2bn recorded a year ago. backs. TotalEnergies said it will now repurchase
Unlike other super-majors, TotalEnergies has up to $2bn of its shares by the end of the second
stopped short of announcing a full withdrawal quarter of 2022, after buying back $1bn during
from its Russian operations, which include the last quarter.™

Week 18 04•May•2022 www. NEWSBASE .com P9