Novatek 1Q Profits Fall, Despite Higher Gas Sales
Largest Russian gas independent Novatek's IFRS profits for 1Q fell despite a rise in its gas sales, it said April 26.
Profit attributable to Novatek shareholders decreased by 38.7% to rubles 71bn ($1.27bn), from rubles 115.9bn in 1Q2016. It said the profit was impacted by foreign exchange movements and disposals of interests in joint ventures. Excluding these, profit was up by 20% at rubles 44.3bn ($791mn).
Two weeks ago Novatek published preliminary 1Q sales and production data.
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On April 26, it repeated that gas sales totalled 18.8bn m3, 5.5% more than its 17.8bn m3 in 1Q2016, due to increased demand for natural gas from its end-customers in Russia arising from colder weather, although its gas inventory at end 1Q2017 was 130mn m3, compared with 429mn m3 a year earlier. It bought in more gas from third parties than a year ago to satisfy demand.
Overall production however declined to 1.42mn barrels of oil equivalent per day (boe/d), from its 1.53mn boe/d in 1Q2016 as liquids output fell. Those figures include equity gas production -- including its share in subsidiaries -- which decreased to 15.7 m3, from 17.2bn m3 in 1Q2016.
Mark Smedley