But it should be noted that the company has received such a significant profit in 2019 from the sale of its stake in the Arctic LNG-2 project.
The Russian energy company stated:
- The spread of the COVID-19 in 2020 and shutdowns have caused financial & economic stress to the global markets
- This negative economic impact lowered demand for oil & gas, which combined with the increase in the supply of oil due to the cancellation of the OPEC+ agreement in the Q1 2020, resulted in a decline in global hydrocarbon commodity prices
- Despite the economic instability, NOVATEK achieved strong operating results and implemented its main investment projects
NOVATEK´s cash used for capital expenditures aggregated RUB 204.6 billion ($2.77 bilion).
A significant portion of its capital expenditures was attributable to the ongoing development of the LNG projects:
- Arctic LNG 2
- the LNG construction center located in the Murmansk region
- the Obskiy LNG project
- of the fields within the North-Russkiy cluster,
- Beregovoye, and Yurkharovskoye fields
- of crude oil deposits of the East-Tarkosalinskoye and Yarudeyskoye fields
Currently, oil prices continue to steadily inch upward to their highest in 12 months, reflecting the optimistic tone of several reports.
After a year of record losses, most companies expect 2021 to improve as the pandemic eases.
Author: Elena Alifirova