OMV writes off EUR 1,8 billion of property due to oil collapse

Low oil prices made Austrian energy group OMV to start write off of property totaling EUR 1,8 billion ( USD 2 billion), which points out at problems the company has been facing before presenting new business strategy in February, Reuters reports.

In Q4 last year OMV booked app. EUR 1,5 billion (USD 1,6 billion) write off in oil exploration and EUR 300 m in processing department, the company announced on Friday, January 29, 2016, decreasing its former “black gold” prices estimations for this year. Austrian group now expects that raw oil price for “brent” type in 2016 will total USD 40 per barrel compared to previous estimation of USD 55 provided only three months ago, British agency states.

GM at OMV, Reiner Zele said that if scenario with a price of USD 40 for a barrel becomes reality then there will no longer be a need for further write off, APA agency reports.

In preliminary reports for the past three months last year the company also estimated that next year oil price on the average will total USD 55 per barrel and in 2018 USD 65, a year later 70 USD and as of 2020 on, USD 75 .