Strong performances in refining and marketing have helped to boost second-quarter results of Austria's OMV and Hungary's MOL, two companies part-owned by UAE investors.
Oil and gas company OMV saw its underlying net income fall by 29 per cent to €321 million (Dh1.6m) in the three months to June.
OMV said it was hit by declining crude sales in Libya, the United Kingdom and New Zealand. Simultaneously, exploration expenses rose by more than two thirds to €98m because of write-offs in Tunisia and the UK, as well as increased seismic activity at its Norway operations.
But the company avoided a sharper drop in profits by doubling its cash flow from its marketing division to €1.2 billion. This was in part due to the selling off of hundreds of petrol stations, while the company also benefited from rising sales margins.
"Despite weaker-than-expected results of the E&P [exploration & production] and G&P [gathering & processing] segments, we believe the market will appreciate the improvements achieved in the downstream segment, as well as the strong cash generation in 2Q," wrote analyst Oleg Galbur of RCB in a note.
OMV cautioned that refining margins are predicted to remain slim this year due to weak demand and overcapacity in the industry. Retail sales will be tempered by slow economic growth in its core markets, it said. Production in Libya had returned to normal levels after disruptions in the first half of the year.
Abu Dhabi's International Petroleum Investment Company (Ipic) owns a 24.9 per cent stake in the Austrian company.
OMV has also partnered up with Germany's Wintershall to explore a gas and condensate field in Shuweihat in Abu Dhabi, and earlier this year signed an agreement with the Abu Dhabi National Oil Company (Adnoc) to explore another field in the emirate.
MOL quadrupled its net profits in the second quarter, posting a profit of 20bn forints (Dh327m), compared with 500m forints a year earlier. The finances of Hungary's largest refiner were buoyed by the improved performance of its downstream business. The company is also optimistic that it is closer to production at the Shaikan oilfield in Iraqi Kurdistan after the Kurdish Regional Government (KRG) gave its approval for the field development plan. Oil from Shaikan will offset declining production at other sites, said MOL.
"We reached a significant milestone in our Kurdistani operations when the regional government approved the Shaikan Block Field Development plan, which brings the first phase of production within closer reach. These barrels will really help us to counterbalance the decline of matured fields," said Zsolt Hernádi, MOL's chairman.
Analysts see the company's upstream portfolio as MOL's most challenging business segment going forward.
Sharjah-based Dana Gas and its parent company Crescent Petroleum own a 1.4 and 3 per cent stake in the Hungarian firm respectively, which they acquired in return for a share in their gas operations in the KRG.
fneuhof@thenational.ae
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Dubai works towards better air quality by 2021
Dubai is on a mission to record good air quality for 90 per cent of the year – up from 86 per cent annually today – by 2021.
The municipality plans to have seven mobile air-monitoring stations by 2020 to capture more accurate data in hourly and daily trends of pollution.
These will be on the Palm Jumeirah, Al Qusais, Muhaisnah, Rashidiyah, Al Wasl, Al Quoz and Dubai Investment Park.
“It will allow real-time responding for emergency cases,” said Khaldoon Al Daraji, first environment safety officer at the municipality.
“We’re in a good position except for the cases that are out of our hands, such as sandstorms.
“Sandstorms are our main concern because the UAE is just a receiver.
“The hotspots are Iran, Saudi Arabia and southern Iraq, but we’re working hard with the region to reduce the cycle of sandstorm generation.”
Mr Al Daraji said monitoring as it stood covered 47 per cent of Dubai.
There are 12 fixed stations in the emirate, but Dubai also receives information from monitors belonging to other entities.
“There are 25 stations in total,” Mr Al Daraji said.
“We added new technology and equipment used for the first time for the detection of heavy metals.
“A hundred parameters can be detected but we want to expand it to make sure that the data captured can allow a baseline study in some areas to ensure they are well positioned.”
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Key figures in the life of the fort
Sheikh Dhiyab bin Isa (ruled 1761-1793) Built Qasr Al Hosn as a watchtower to guard over the only freshwater well on Abu Dhabi island.
Sheikh Shakhbut bin Dhiyab (ruled 1793-1816) Expanded the tower into a small fort and transferred his ruling place of residence from Liwa Oasis to the fort on the island.
Sheikh Tahnoon bin Shakhbut (ruled 1818-1833) Expanded Qasr Al Hosn further as Abu Dhabi grew from a small village of palm huts to a town of more than 5,000 inhabitants.
Sheikh Khalifa bin Shakhbut (ruled 1833-1845) Repaired and fortified the fort.
Sheikh Saeed bin Tahnoon (ruled 1845-1855) Turned Qasr Al Hosn into a strong two-storied structure.
Sheikh Zayed bin Khalifa (ruled 1855-1909) Expanded Qasr Al Hosn further to reflect the emirate's increasing prominence.
Sheikh Shakhbut bin Sultan (ruled 1928-1966) Renovated and enlarged Qasr Al Hosn, adding a decorative arch and two new villas.
Sheikh Zayed bin Sultan (ruled 1966-2004) Moved the royal residence to Al Manhal palace and kept his diwan at Qasr Al Hosn.
Sources: Jayanti Maitra, www.adach.ae
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- Jumeirah English Speaking School (Dubai) – Dh59,728
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