LONDON Nov 21 Austrian energy company OMV plans a new drilling campaign offshore Romania that may hit its biggest gas find ever, its exploration and production chief said on Wednesday.
The exploration of the Black Sea Neptun block is a joint venture between OMV's Romanian subsidiary and ExxonMobil and includes the first deep-water exploration well in Romanian waters.
The venture discovered potential reserves of 1.5-3 trillion cubic feet in February this year at the ExxonMobil operated Domino-1 well.
OMV has started 3D seismic studies on the block and the new drilling campaign is expected to start at the end of 2013, Jaap Huiskes told reporters.
OMV still expects to meet its output target of around 350,000 barrels of oil equivalent per day by 2016, said Huijskes. However, the focus of exploration and production has shifted away from its Middle Eastern and North African assets, where production and exploration have been disrupted by the Arab Spring.
"We have done a reorientation of our activities into the North Sea," said OMV chief executive Gerhard Roiss.
In OMV's future project pipeline UK and Norwegian projects dominate, with five separate projects in the UK and three in Norway to be appraised and developed in the medium term, said John Austin head of OMV in the UK.
Nevertheless, a resumption of output in Libya and Yemen has helped boost OMV's profits in the third quarter. OMV's output in Libya has reached 90 percent of its pre-war level on average, at around 30,000 bpd.
"On a daily rate we are at pre-crisis levels but due to interruptions, maintenance and some unrest, the average is a bit lower," said Huijskes.
Output in Yemen has been fluctuating since last year due to frequent attacks to pipeline infrastructure. Output was at around 5,000 bpd until a pipeline attack last week. OMV does not know how soon it will resume production as the state controls repairs. Output prior to the start of unrest in 2011 was around 7,000 bpd.
OMV has also increased its expected new output to 70,000-80,000 barrels of oil equivalent by 2016, which will come mainly from its new Edvard Grieg field in Norway, added Huijskes. OMV made three new acquisitions in the North Sea over the last 12 months.
"We have gone from 280 million to 450 million barrels of oil equivalent under development but our production contribution in 2016 has only gone from 50,000-60,000 boe/d to 70,000-80," said Huijskes, "That's because most of the new projects will deliver after 2016. The key project that should deliver in 2016 is Edvard Grieg in Norway."
Previously, OMV targeted 50,000-60,000 boe/d. The rise will make up for output declines at its core producing fields such as in Austria and Romania. OMV aims to keep production at around 200,000-210,000 boe/d at these fields until 2014 by using enhanced drilling techniques and water injection.
The company still expects to divest EUR 1 billion from its refining and marketing division by 2014. So far, only EUR 150 million of such assets have been sold, through the sale of gas stations in Austria and Germany.
OMV is in the final stages of selling its retail assets in Croatia and Bosnia and still intends to sell its 45 percent stake in its Bayernoil refinery by 2014 as it does not expect the current high refining margins to last.
"The structural issues haven't gone away," said David Davies, chief financial officer at OMV.
OMV sees limited opportunities for shale energy for the time being in Europe, stalled by a lack of a common EU position.
"Europe has to find a position on shale ... There are different fundamentals, chemical issues. This cannot be done country by country, it needs a common approach, a European strategy," said Roiss, "We are not even in a position even to drill, and to check and to test chemistry."