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Posted on April 15, 2011
Galp Energia SGPS SA (GALP), Portugal’s biggest oil company, said the volume of refined product sales fell 19 percent in the first quarter after its Sines refinery was shut in January.
The company processed 39 percent less crude than in the first three months of 2010, Lisbon-based Galp said today in a regulatory filing. The Rotterdam cracking refining margin, a measure of profit from turning a barrel of crude into fuels, was negative at $0.50 a barrel in the first quarter from $1.90 a barrel a year earlier, the company said.
The Sines refinery was shut in January to install new units as part of a conversion project, Chief Executive Officer Manuel Ferreira de Oliveira said on Feb. 11. The refinery in Oporto can process about 90,000 barrels a day, while the Sines plant has a 220,000-barrel-a-day capacity.
Galp is expanding exploration in regions such as Brazil’s offshore Santos Basin, where the Lula project is located, and Angola to improve access to crude supplies and rely less on refining and sales of fuel in Portugal and Spain.
The company on March 14 said it aims to raise about 2 billion euros ($2.89 billion) from a capital increase at its Brazilian unit as it develops offshore projects in the Latin American nation. It will invest about 3.5 billion euros in the 2012-2015 period, with exploration and production representing 70 percent of the total.
Average working interest production rose 2.7 percent from a year earlier to 19,000 barrels a day, while average net entitlement production fell 24 percent to 9,600 barrels a day. Natural-gas sales rose 36 percent to 1.61 billion cubic meters.
Galp shares have gained 3.9 percent this year, giving the company a market value of 12.4 billion euros. Eni SpA (ENI), Italy’s biggest oil company, and Portuguese holding company Amorim Energia BV each control a third of Galp.
Galp is due to report first-quarter earnings on April 29.
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