Lukoil, one of the world’s largest oil and gas companies, has announced a profit of ₽298.3bn, up 86.2% year-on-year for the first nine months of 2017.
In the third quarter of 2017 profit was decreased by 29.8% quarter-on-quarter to ₽97.3bn due to the non-cash foreign exchange effect and a gain on sale of JSC Arkhangelskgeoldobycha in the second quarter of 2017.
Excluding these items, profit in the third quarter increased by 32.8% quarter-on-quarter and for the first nine months of 2017, it increased by 23.3% year-on-year.
The company also recorded an increase in sales of 11.7% year-on-year to ₽4,274.3bn in its interim consolidated financial statements for the three and nine months ended 30 September 2017.
Higher hydrocarbon prices
The growth was mainly driven by higher hydrocarbon prices as well as the increase in crude oil trading volumes, partially offset by stronger ruble and lower volumes of compensation crude oil from the West Qurna-2 project in Iraq.
In the third quarter of 2017 sales were ₽1,483.5bn, up 9.1% quarter-on quarter primarily due to the hydrocarbon price, as well as higher retail and wholesale sales volumes of its own refined products in Russia and abroad, partially offset by lower trading volumes of refined products.
The Russian oil producer said its earnings before interest, tax, depreciation and amortization for the three months to September 30 came to ₽221.1bn ), up from ₽179.00bn in the earlier quarter.
For the first nine months of 2017 its capital expenditures amounted to ₽373.8bn, up 4.6% year-on-year driven by higher upstream investments due to the development of priority projects in Russia and Uzbekistan, partially offset by lower capital expenditures in the downstream as a result of the completion of a major upgrade program at its refineries.
In the third quarter of 2017 its capital expenditures decreased to ₽118.9bn, or by 4.6% quarter-on-quarter mainly due to the seasonal decrease in West Siberia and Timan-Pechora as well as lower investments in Uzbekistan driven by the commissioning of the main production facilities at Gissar project in the third quarter of 2017.
Lukoil is one of the largest publicly traded, vertically integrated oil and gas companies in the world in terms of proved hydrocarbon reserves and production; and the second largest producer of crude oil in Russia. Established in 1991, the Company currently operates in more than 30 countries with core upstream assets located in Russia.
The price of benchmark Brent Crude has risen steadily in 2017 to over $60 a barrel thanks to a deal struck between the OPEC cartel and Russia to jointly curb production.