VIENNA: Turmoil in Libya and Yemen ate into earnings at oil and gas group OMV in the third quarter and it was impossible to predict when production will normalize, the Austrian company said on Wednesday.
OMV said last month it could take up to two years for its Libyan output to reach pre-war levels when it accounted for a tenth of OMV’s 318,000 barrel total daily production.
But on Wednesday executives stressed that they could not give a firm forecast because the security situation in both Libya and Yemen was so unclear.
"On Libya, I really don’t have any concrete information on which to base anything that I could feel remotely confident with," Chief Financial Officer David Davies told a conference call.
OMV shares slipped 4 percent to €24.29 by 1315 GMT, underperforming the sector index which was down 1.4 percent.
Davies said OMV officials including CEO Gerhard Roiss visited the North African country a few weeks ago and made contact with Libyan officials but had not been able to travel to the oil fields.
"We really have only piecemeal information on what the situation out in the fields is like. We are encouraged broadly by what we hear. We understand that production is occurring intermittently at various of the assets," he said.
In Yemen it was difficult to predict when production would recover because of renewed damage to an export pipeline, Davies said. Yemen provided 6,600 barrels of oil equivalent per day (boed) in 2010.
OMV had planned to make investments in Yemen this year but the plans are on hold because of political unrest. The Vienna-based group was also unlikely to put money into the Nabucco gas pipeline project this year because the timetable for the project has been delayed, Davies said.
This means OMV will spend less than the €2.4 billion ($3.3 billion) earmarked for annual capital expenditure.
OMV said the Libya and Yemen shortfall contributed to the drop in net profit for the quarter. Excluding one-offs and unrealized gains from valuing inventories, net profit fell 20 percent to €233 million, lagging a €259 million average estimate a Reuters poll of analysts.
Libyan production fell sharply after Feb. 20 as the revolt against Muammar Qaddafi’s rule broke out, forcing OMV to withdraw staff out of security concerns.
The company has a long-term stake in Libya with 12 exploration and production licenses and petroleum contracts running to 2032.
Last month Italian peer Eni reported a 7 percent rise in underlying net profit as strong oil prices offset disruption of production in Libya.
