Upstream

The Repsol Upstream area comprises the exploration and project development, and production of oil and natural gas. It has a balanced asset portfolio which, supported by effcient management and digitalization of operations, is profitable in any price scenario.

Figures
 

Average
net production
715,000
barrels of oil
equivalent per day
Net proven
reserves
2.3 Billion
barrels of oil
equivalent
Gas percentage in our asset portfolio
73%
of our reserves
63%
of our production

Cornerstones
 

Imagen Flechas
Average production
increase of 3%
in 2018
Efficient management
of a sturdy
asset portfolio
Profitable
in any price scenario
Efficiency and digitalization
are the two drivers behind the company’s
constant business improvements

Ajusted
net income

In 2018, the Upstream business focused its efforts on improving efficiency, reducing cash breakeven and optimizing the portfolio.

The adjusted net income increased by 110%, reaching 1.325 billion euros, compared to 632 million in 2017. This result, which was driven by the company's management and its efficiency and digitalization programs, was driven by decisive factors such as the increase in production and the improvement in crude and gas realization prices.

In 2018, Upstream participated in exploration and production projects in 28 countries. In total, the company held mineral rights to a total surface area of 237,825 km2 by December 31.

During the year, our company implemented projects that provide great value and guarantee sustained growth.

In the US Gulf of Mexico, the drilling operations included within the development and commissioning program of the Buckskin deep-water project were initiated. Repsol holds a 22.5% interest as the operator of the LIOG company. Buckskin is expected to enter production in the second half of 2019.

In Colombia, at the CPO-9 block, the start of Phase 1 of the Akacias project Development Plan was approved. Repsol has a 45% stake in it, while Ecopetrol, the operator, holds 55%. This stage includes drilling of 19 wells. Akacias reached a record production rate of 20,000 bbl/d (including existent wells) in March 2019.

As part of the Development Plan of the Sagari field in eru, production started in a new well in block 57 and the compression project was completed. This field, located i the Ucayali-Madre de Dios basin, is operated by Repsol with a stake of 53.84%.

In Bolivia, we the Caipipendi license in the Margarita field was officially extend for another ten years, until 2041, plus fiv additional years depending on the volume of reserves to be incorporated. This includes exploration investments in the Boyuy and Boicobo South projects. Repsol has a stake of 37.5%

The Bolivian Legislative Assembly also approved awarding the exploration and exploraitation contract for the Iñiguazu area, which Repsol operates, holding 37.5%.

In Brazil, we obtained the declaration of commercial viability in the Sapinhoá Environment, in the country's prolific pre-salt area.

In Trinidad and Tobago, the non-operated Angelin production platform was installed in the West Block field, 60 km from the southeast coast. Facilities are operated remotely and the gas generated is taken to the Serrette platform through a new 21 km pipeline, before reaching the Cassia Hub for processing. Two new development projects were approved in December for existing gas production blocks.

In Malaysia, new wells in the redevelopment project of the Kinabalu offshore block, in the West Malay basin, entered production. In 2017, crude production began in this project, where Repsol is the operating company with a stake of 60%.

In Indonesia, three development wells were completed in the Corridor block, one in the Sumpal field, and two in the Suban field.

In Norway, our company acquired 7.7% of the Visund field and, in early 2019, it acquired a stake of 7.65% in the Mikkel field Furthermore, the redevelopment project of the Yme field was approved.

We were also awarded new exploration blocks in different bidding rounds in Mexico, Brazil, Norway, Greece, Bulgaria and the United States, as well as in Indonesia through direct allocation.

Average production increased by 3% compared to 2017, reaching 715,000 barrels of oil equivalent per day (boed). Gas comprised 63% of the company's production, whereas liquids accounted for 37%.

The increase in production is mainly due to new barrels obtained from projects like Reggane (Algeria), Juniper and TROC (Trinidad and Tobago), Monarb (United Kingdom), Kinabalu and Bunga Pakma (Malaysia), and Sagari (Peru), combined with the acquisition of the Visund field (Norway), the tie-in of new wells in Marcellus (United States), and Libya's increased contribution.

Regarding the exploration campaign, in 2018, 21 exploration wells and an appraisal well were drilled, five with positive result (four exploration wells in Colombia and one appraisal well in Russia), 16 with negative results, and one with pending results (Norway).

In February 2019, the important discovery of the Kaliberau Dalam-2X (KBD-2X) well was announced, in the Sakakemang onshore block located in the south of Sumatra island (Indonesia), where Repsol is the operating company with 45% of stake.

The preliminary estimates of recoverable resources point to around two trillion cubic feet (TCF) of gas, which places it as one of the main hydrocarbon discoveries in the world in the last 12 months and the greatest gas discovery in Indonesia in the last 18 years.

On December 31st, 2018, Repsol's proved net reserves amounted to 2.340 billion barrels of oil equivalent (Bboe), of which 1.702 Bboe (73%) are natural gas and the rest, 638 Mbbl (27%) are crude, condensates, and liquefied gases.

The total reserve replacement ratio stood at 94% in 2018, five points above the 89% obtained in 2017.

+246 Mboe
Incorporation of net
proven reserves

Upstream data
by regions

Imagen del mundo

Net production
Barrels of oil
equivalent per day
175,000

Proved net reserves
Millions of barrels barrels of oil equivalent
535

Proved net domain
Km2
14,696

Net production
Barrels of oil
equivalent per day
343,000

Proved net reserves
Millions of barrels barrels of oil equivalent
1,419

Proved net domain
Km2
95,786

Net production
Barrels of oil
equivalent per day
60,000

Proved net reserves
Millions of barrels barrels of oil equivalent
102

Proved net domain
Km2
13,044

Net production
Barrels of oil
equivalent per day
57,000

Proved net reserves
Millions of barrels barrels of oil equivalent
129

Proved net domain
Km2
13,195

Net production
Barrels of oil
equivalent per day
80,000

Proved net reserves
Millions of barrels barrels of oil equivalent
154

Proved net domain
Km2
101,103

Million euros 2017 2018 Variation
Profit from operations 1,009 2,514 1,505
Tax on profits (408) (1,211) (803)
Participating and minority interests 31 22 (9)
Adjusted Net Income(1) 632 1,325 693
Special items (151) (326) (175)
Net Income 481 999 518
Effective tax rate (%) (40) (48) (8)
EBITDA 3,507 4,801 1,294
Investments 2,089 1,973 (116)
(1) Adjusted Net Income by geographical area.
Million euros 2017 2018 Variation
Europe, Africa and Brazil 355 768 413
Latin America - Caribbean 386 501 115
North America (43) 212 225
Asia and Russia 161 264 103
Exploration and others (227) (420) (193)
Adjusted Net Income 632 1,325 693