Petrom had closed down 350 drilling wells by the end of 2015, and plans to forgo another 20 units in 2016, of more than 7,500 available units.
Speaking at a press conference on Thursday, Selischi said OMV Group has managed to reduce the average cost of production cost to $13.2 per barrel from $17.3, but it does not include amortizations or taxes.
“If a barrel exceeds $16, the company will witness positive cash flow, but it does not necessary mean profit,” according to Selischi.
Selischi also said OMV Petrom has over 7,500 wells in Romania, most of which register low productivity. By comparison, Saudi Arabia has half as many wells, but their productivity is much higher. The difference is that Romania has mature oil fields.
OMV Petrom, majority owned by Austria’s OMV, posted net loss of 690 million lei (EUR155 million) in 2015, compared with a profit of RON2.1 billion in 2014, the company said in its earnings report released Thursday. This is Petrom’s first loss since its 2004 privatization. The company, in which the Romanian government holds 20% interest, said it doesn’t plan to distribute dividends to shareholders.
Last year’s earnings were severely affected by considerable loss in the fourth quarter, when the company incurred a cost of RON1.9 billion from asset impairments due to lower oil prices.