Petrobras books smaller profit as output declines

Hit by lower crude oil prices, Brazilian state-owned oil and gas giant Petrobras recorded a smaller profit in the first quarter of 2019 when compared to the same period last year amid production decline due to a series of stoppages.

P-74 FPSO; Source: Petrobras

The Brazilian giant on Tuesday posted a net income of $1.125 billion for the first quarter of the year, a 49% decrease when compared to the profit of $2.196 billion in the corresponding quarter of 2018. Net income attributable to shareholders of Petrobras in 1Q 2019 was $1.07 billion compared to $2.1 billion in 1Q 2019.

The company’s revenues amounted to $21.2 billion in the first quarter of 2019, an 8% decrease when compared to the revenues of $22.96 billion in 1Q 2018.

According to the company, this was mainly due to decrease in domestic revenues, lower export revenues driven by lower international prices of crude oil and oil products and by lower oil product export volumes; and decreased revenues from operations abroad following the disposal of E&P assets of Petrobras America Inc., the sale of distribution companies in Paraguay and lower international prices.

Exploration costs were $174 million in 1Q 2019, a 28% increase ($38 million) compared to $136 million in 1Q18, mainly due to higher exploration expenditures relative to projects without commercial feasibility ($42 million) and to increased geological and geophysical expenses ($14 million).

Petrobras CEO, Roberto Castello Branco, said: “From the beginning of the year, we initiated a transformational agenda based on our five strategic pillars. Consistent with the focus on the assets in which we are natural owners, in the first four months of the year our divestments reached $11.3 billion, a record for Petrobras. The highest value transaction was the sale of 90% of TAG for US$ 8.6 billion. In the near future it is our firm intention to sell the residual holdings of 10% in TAG and NTS.”

Petrobras Crude oil, NGL and Natural Gas production in Brazil in 1Q 2019 decreased by 5% to 2,460 mbpd from 2,582 mbpd in the same period last year.

The company explained that the oil, NGL and natural gas production decreased mainly due to the sale of 25% in Roncador field and the reduction of Petrobras’ participation in fields in the US, associated with the higher concentration of maintenance in platforms in the first quarter of 2019 and the natural decline in production.

The decrease in production was partially offset by the start-up of seven new systems in the last 12 months, which are still in the process of commissioning and interconnecting new wells: P-74, P-75, P- 76 and P-77, in Búzios field; FPSO Campos dos Goytacazes, in Tartaruga Verde field, P-69, in the extreme south of Lula; and P-67, in the northern area of Lula.

Offshore Energy Today Staff

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