Spain's Repsol Writes Off YPF Loss As Dispute Nears End
MADRID, Feb 21 (Reuters) - Spanish oil major Repsol will take a 1.3 billion euro ($1.8 billion) hit on its stake in energy firm YPF that was seized by Argentina, as a two-year battle for compensation draws to a close.
Repsol has revalued its majority stake in Argentina's largest energy company at $5 billion, to reflect the size of an imminent financial settlement that will end one of the rockiest chapters in the oil major's history.
The compensation package revealed by Reuters on Thursday is expected to be signed before a Repsolboard meeting next Tuesday.
Ending the dispute over YPF, which Argentina nationalised in 2012, will allow Repsol to focus on expanding its international exploration and production operations to better compete with larger European rivals such as Eni and Total without a legal battle hanging over its head.
Repsol had been carrying the value of YPF on its books at 5.4 billion euros. It will make a 1.28 billion euro writedown in its 2013 results, it said in a regulatory filing on Friday, to reflect the difference between the book value and the size of the compensation.
It was not clear whether Repsol would use some $2.9 billion of capital gains from the sale of gas assets to Shell to offset the impact of the YPF loss on 2013 results, due to be published next Wednesday, because part of the Shell deal was closed this year.
Repsol has left the door open to paying part of the compensation to shareholders in the form of a special dividend, but prefer to keep cash for potential acquisitions, analysts said. The company has said it is eyeing opportunities in North America.
View Full Article
WHAT DO YOU THINK?
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
- Big Oil Reuses Platforms in Latest Cost-Cutting Trick (Nov 15)
- Sources: Spain's Repsol Hires Tanker For Iran's Pars Oil As Sanctions Loom (Jun 19)
- Total Signs Deal to Extend TFT Gas Field License in Algeria (Jun 11)
Company: YPF SA more info
- Vaca Muerta Shale Output Projection Revised (Oct 26)
- YPF Is Said to Shut Gas Wells as Argentine Economy Flops (Oct 02)
- Argentina's YPF Names Ex-CFO Daniel Gonzalez as New CEO (Apr 05)