Lukoil's 2Q Profit Falls

Lukoil announced Friday that it posted a net income of $1.01 billion in the second quarter of 2015, which marked a decrease of over 50 percent compared to the $2.40 billion figure recorded in 2Q 2014.

The company’s EBITDA decreased by 32.4 percent year on year, in the first half of 2015, to $6.37 billion and revenues during the period were $51.29 billion, which marked a 30.6 percent year on year decrease. Daily hydrocarbon production in 1H 2015 was 2,373 barrels of oil equivalent, which was 4.8 percent higher than daily production during the first half of 2014.

In its latest financial results statement, Lukoil said that its 1H 2015 results “were affected by a sharp decrease in the hydrocarbon prices and non-cash write-off in the amount of $324 million”. The company also stated that the increase in crude oil and natural gas liquids produced by the group was mainly due to the start of commercial production from the West Qurna-2 project in Iraq.

Iraq’s West Qurna-2 is located in the south of the country near Basra. Lukoil recently stated that oil production at the development currently stands at 450,000 barrels per day. Current participants in the West Qurna-2 field include South Oil Company of the Ministry of Oil of Iraq, Lukoil and Iraqi North Oil Company.

According to an article from Reuters on August 18, 2015, hundreds of locals recently blocked some entrance to the Iraqi field, demanding jobs in the process. The Reuters article also stated that South Oil Company warned output could be affected unless the protests were defused.


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