Medium Oil Companies Have Record Profits And Invest In Business Expansion – Economy

Medium Oil Companies Have Record Profits And Invest In Business Expansion – Economy

while the Petrobras Suffers from Political pressures due to high gasoline priceswhich already Assigning two heads of stateOther oil companies operating in Brazil only have to celebrate oil prices above $100 per barrel. Companies like peterioAnd 3R PetroleumAnd enauta And Petroconcavo Breaking profit records and scheduling billions of dollars in investments and acquisitions.

The market for medium-sized oil companies in Brazil developed exactly after Petrobras’ decision, in the past decade, to dispose of more mature extraction fields to focus on pre-salt exploration, which is more profitable for the company. As a result, medium-sized oil companies began to dispute the assets of the state-owned company.

This task has become easier in recent years. distance Oil price reached negative levels in 2020At the beginning of a pandemic, COVID-19For more than a year, the barrel of the commodity has been trading at values ​​above the pre-pandemic level. and the The war between Russia and Ukraine Came to me Promote the upward movement of the commodity.

The current price level – the highest in seven years – makes these smaller oil companies report a rise in their stock prices in hand bag Much higher than the Ibovespa index and those recorded by Petrobras itself. “We are in an exciting scenario with big perspectives as companies are in high demand. He says the market is attributing less risk to these companies in relation to Petrobras shares. Ilan Arptmanan analyst at Ativa Investimentos.

The largest of these companies is PetroRio, which analysts have pointed out as the most efficient company in the sector in Latin America. Last year, the company generated revenue of R$4.4 billion, up 131% from 2020. But what most caught the attention of analysts was its 152% profit growth, reaching R$1.3 billion. according to Milton WrangelThe chief financial officer of the oil company said that one of the most important points for this result was the 20% reduction in the cost of extraction to $11.80 per barrel.

With that said, the company is looking forward to new investments and acquisitions. “Petro Rio has extended the useful life of all of its assets by more than ten years, producing more oil with lower carbon emissions, moving the economy and creating jobs. We must continue like this,” Rangel says.

The company will also include exploration of the Wahoo field in the Campos Basin, which can produce up to 125 million barrels. Since it debuted on the stock exchange in 2015, the company’s shares have already surged more than 5,000% – making it a favorite of investors in this period.

increased competition

However, PetroRio is not alone in this market, which is becoming more competitive. 3R Petroleum, as a result of the merger of 3R and Ouro Preto, made its B3 debut in 2020, and has since become an acquisition machine. With three hubs in operation, the company has six more hubs that will start operating in the coming years. “We would have 400 to 500 million barrels of 2P (proven and probable reserves classification),” he says. Riccardo SaviniPresident of 3R Petroleum Company.

From 2020 to 2021, the company more than tripled its revenue, closing at R$727.8 million. Now, after several acquisitions, 3R wants to make the business profitable – a portion of the purchases are assets Petrobras no longer wants. “Now is the time for organic growth and business revitalization,” says Savini.

According to analysts, demonstrating its ability to make the most of its assets is the challenge the company faces in the short and medium term. As for XP, since the 3R has only been in the market for a short time, the lack of production history plays against the company, whose shares are trading at a relatively low value on the stock exchange, despite the price having doubled since it first came to market.

Many investors are questioning whether 3R will be able to extract value from the Papa Terra field, where Petrobras failed. With heavy oil and a low recovery factor, the net present value of a field is highly dependent on the future productivity of the wells,” the analysts wrote. Andre VidalAnd Victor Burke And Marcela Ungaretti.

Upcoming risks

However, the risks are not only centered on the fact that the fields may contain less oil than previously thought – as happened with OGX, in IK Batista – In the event of a decrease in the price of oil with the expected adjustment of demand for the coming years. In the world, there is a movement of energy transition towards cleaner sources. For example, many countries in Europe have already committed to electrifying their entire vehicle fleet between 2030 and 2050.

to Marcio Couto, who is a senior advisor at FGV Energia, said this shift will not happen so quickly, particularly in emerging economies – and the high oil prices during the pandemic have only reinforced this argument. thus, Desio Odonepresident of Enauta, wants to take advantage of this moment to continue the company’s expansion process.

“We will at least double our operations and focus on maximizing shareholder value,” Oddone says. Last year, the oil company made its biggest profit in history, with R$1.4 billion, a figure that helped Enauta achieve the largest increase among companies in the sector listed on B3.

The executive notes that he does not see the transition from oil to renewable energies to take place before 2100, so the company’s plans remain on a medium to long-term horizon. “Oil may reduce its participation in the energy matrix, but I see an increase in production. But Enauta is also looking to invest in new clean energy fronts in the future,” says Oddone.

in the guide

Last year, the company’s revenue was R$4.4 billion, up 131% from 2020. But what most caught the attention of analysts was the 152% profit growth, reaching R$1.3 billion. The financial market praised the company for being able to reduce the cost of production per barrel by 20%.

The fruit of the combination of 3R and Ouro Preto, it debuted at B3 in 2020, and since then, it’s become a takeover machine. With three wells in operation, the company has six more wells that will start operating in the coming years. From 2020 to 2021, the company more than tripled its revenue, which ended the year at R$727.8 million.

Last year, the oil company achieved the largest profit in its history, with a value of 1.4 billion Brazilian reals, a figure that helped Enauta achieve the largest increase among companies in the sector listed on the Brazilian Stock Exchange; Like its peers, it must continue to invest in business expansion