Repsol Plans Sale of Non-strategic Assets for €6.2 billion

Spain’s Repsol said it plans to sell non-strategic assets for €6.2 billion, adding it will cut spending by 38% in the next four years with respect to 2014, as part of a strategy aimed at reducing its debt and doubling EBITDA (at CCS) to 11.5 billion euros.

‘These synergies supplement the efficiency program included in the Strategic Plan. This program will be applied to the entire company and will lead to cost savings, including synergies, of 2.1 billion euros per year from 2018’ reads a note released on Thursday, presenting the company’s 2016-2020 Strategic Plan. 

The Spanish company said it wants to be self-financed, and keep dividend payment even with crude prices remaining at 50 dollars per barrel throughout the period. The EBITDA would increase to 11.5 billion euros in the base scenario, while it would increase to 7.0 billion euros in the stress scenario. 

‘Following the Talisman acquisition, Repsol’s Exploration and Production unit will focus on three strategic regions: North America, Latin America, and South-East Asia, with high potential for organic development’ Repsol added, referring to the $8.3 billion take-over of Canada’s Talisman Energy completed in May.  

“We are presenting a Plan with a clear vision, and measurable commitments. This plan not only shows our solidity and resilience, but also how far we can go in terms of creating value and strength for our company,” Repsol CEO Josu Jon Imaz commented.

According to Wall Street Journal, Repsol’s net profit this year will fall to between €1.25 billion and €1.5 billion from €1.61 billion last year.