How Azeri-Chirag-Gunashli affected MOL Group’s Q420 performance

Oil&Gas Materials 22 February 2021 10:05 (UTC +04:00)
How Azeri-Chirag-Gunashli affected MOL Group’s Q420 performance

BAKU, Azerbaijan, Feb.22

By Leman Zeynalova – Trend:

Upstream EBITDA of Hungarian MOL Group declined in Q4 2020 to USD 181mn, affected by technical adjustments related to Azeri-Chirag-Gunashli (ACG), Trend reports with reference to the company.

Oil & gas production slightly decreased QoQ in Q4 2020 to 125.4 mboepd, but was 15% higher YoY, due to the contribution of ACG.

Materially lower oil and gas prices dominated 2020 earnings, while ACG contribution boosted volumes and supported EBITDA; Q4 was affected by ACG-related technical adjustments.

FY EBITDA declined materially YoY and came in at USD 689mn in 2020, down 34 percent, as sharply lower oil and gas prices were only partly offset by the contribution of ACG.

ACG PSA-related technical/accounting adjustments („true-up” mechanism) were USD 37mn negative in Q4 (including USD 12.5mn reversal of the Q3 positive impact and an incremental negative USD 24mn that will be reversed in 2021) vs. USD 12.5mn positive in Q3.

Unit opex was 24 percent lower YoY due to the contribution of the low-cost ACG field to group operations, and significantly lower costs (from a high base).

ACG had a major positive impact on 2P reserves.

BP Exploration (Caspian Sea) Limited is the operator on behalf of the Contractor Parties to the ACG Production Sharing Agreement.

ACG participating interests are: bp (30.37%), SOCAR (25.0%), MOL (replaced Chevron as of 16 April 2020 (9.57%), INPEX (9.31%), Equinor (7.27%), ExxonMobil (6.79%), TPAO (5.73%), ITOCHU (3.65%), ONGC Videsh Limited (OVL) (2.31%).

BP data shows that total ACG production for the full year of 2020 was on average about 477,000 barrels per day (b/d) (about 175 million barrels or 23.6 million tonnes in total) from the Chirag (34,900 b/d), Central Azeri (113,200 b/d), West Azeri (118,900 b/d), East Azeri (64,200 b/d), Deepwater Gunashli (95,400 b/d) and West Chirag (50,400 b/d) platforms.

In 2021, the level of production at ACG is forecasted at 487,000 barrels per day.


Follow the author on Twitter: @Lyaman_Zeyn