The information below aims to provide the key macroeconomic, operational and trading conditions experienced by Galp during the second quarter of 2022. All data referred to below is currently provisional and may differ from the final figures which will be reported on July 25, 2022.
Galp’s 2Q22 results will be published on July 25, before the opening of Euronext Lisbon. On that day, the Company will hold a conference call and webcast at 14:00 (Lisbon/London time). Further details can be found at the end of the Trading Update.
Consolidated earnings and financial position
- Expecting a robust operational cash flow (OCF) generation in 2Q22, partially offset by a working capital build from the higher commodities prices, although mitigated by the reduction in margin account balances (natural gas hedging positions roll-off).
- Solid cash flow performance to lead to a net debt reduction, with net debt to RCA Ebitda at the end of the period significantly below 1x
Net income RCA in 2Q22 to include:
- Impairments related with exploration assets in Upstream (c.€90 m, or c.€40 m post-tax and minorities);
- Financial Results with mark-to-market swings on Brent and refining margin hedges (c.€-330 m, or €-230 m post-tax) related to the entire 1H22 (in 1Q22 booked as a special item).
Upstream
| |
|
| |
2Q21 |
1Q22 |
2Q22 |
Var. YoY |
Var. QoQ |
| Working interest production (kboepd) |
128.4 |
131.2 |
119.6 |
(7%) |
(9%) |
| Oil production (kbpd) |
114.9 |
117.7 |
107.7 |
(6%) |
(8%) |
| Net entitlement production (kboepd) |
126.6 |
129.6 |
118.1 |
(7%) |
(9%) |
| Angola (kbpd) |
11.6 |
10.3 |
10.1 |
(13%) |
(2%) |
| Brazil (kboepd) |
115.0 |
119.3 |
108.0 |
(6%) |
(9%) |
- Working interest production lower QoQ, reflecting the higher concentration of maintenance activities in the period.
- As highlighted in 1Q22, oil hedges covered 1.6 mbbl during 2Q22 (c.15% of production).
- Impairments of c.€90 m related with exploration assets in Brazil, with no impact on the 2022-25 business plan production.
Commercial
| |
|
| |
2Q21 |
1Q22 |
2Q22 |
Var. YoY |
Var. QoQ |
| Oil products - client sales (mton) |
1.5 |
1.7 |
1.9 |
22% |
13% |
| Natural gas sales - client sales (GWh) |
4,461 |
5,590 |
5,006 |
12% |
(10%) |
| Electricity - client sales (GWh) |
1,020 |
1,139 |
1,088 |
7% |
(4%) |
- Oil products sales reflecting higher B2C and B2B volumes QoQ, following seasonality and despite the higher commodity price environment.
- Natural gas and electricity sales evolution QoQ mostly following seasonality.
Industrial & Energy Management
| |
|
| |
2Q21 |
1Q22 |
2Q22 |
Var. YoY |
Var. QoQ |
| Raw materials processed (mboe) |
21.0 |
21.8 |
22.9 |
9% |
5% |
| Galp refining margin (USD/boe) |
2.4 |
6.9 |
22.3 |
n.m. |
n.m. |
| Oil products supply1 (mton) |
3.6 |
3.7 |
4.1 |
11% |
10% |
| NG/LNG supply & trading volumes1 (TWh) |
18.1 |
14.8 |
14.0 |
(23%) |
(5%) |
| Trading (TWh) |
9.1 |
6.1 |
6.0 |
(35%) |
(2%) |
| Sales of electricity from cogeneration (GWh) |
269 |
113 |
174 |
(35%) |
55% |
1 Includes volumes sold to the Commercial segment.
- Refining raw materials processed increased QoQ capturing the favourable market environment during the period.
- As highlighted in 1Q22, refining margin hedges covered 5.6 mboe during 2Q22 (c.25% of throughput), with an expected impact of c.€100 m at the Ebitda level.
- NG/LNG supply & trading volumes still limited by sourcing restrictions and the challenging European natural gas environment.
Renewables & New Businesses
| |
|
| |
2Q21 |
1Q22 |
2Q22 |
Var. YoY |
Var. QoQ |
| Renewable installed capacity1 (MW) |
|
|
|
|
|
| Gross (100%) |
927 |
1,012 |
1,162 |
25% |
15% |
| Equity to Galp |
692 |
757 |
875 |
26% |
16% |
| Renewable generation (GWh) |
|
|
|
|
|
| Gross (100%) |
475 |
243 |
687 |
45% |
n.m. |
| Equity to Galp |
355 |
180 |
515 |
45% |
n.m. |
1 Capacity installed by the end of the period.
- Renewable energy generation higher QoQ reflecting higher irradiation and plants’ availability, as well as 150 MW of new operating solar capacity online.
Market Indicators
| |
|
| |
2Q21 |
1Q22 |
2Q22 |
Var. YoY |
Var. QoQ |
| Exchange rate (EUR/USD) |
1.21 |
1.12 |
1.06 |
(12%) |
(5%) |
| Dated Brent price (USD/bbl) |
69.0 |
102.2 |
113.9 |
65% |
11% |
| Japan/Korea Marker LNG price (EUR/MWh) |
28.5 |
95.3 |
87.4 |
n.m. |
(8%) |
| Dutch TTF natural gas price (EUR/MWh) |
25.4 |
98.4 |
97.9 |
n.m. |
(0%) |
| Iberian MIBGAS natural gas price (EUR/MWh) |
25.0 |
96.9 |
87.1 |
n.m. |
(10%) |
| Iberian power baseload price1 (EUR/MWh) |
71.8 |
229.3 |
182.8 |
n.m. |
(20%) |
| Iberian solar market price2 (EUR/MWh) |
69.2 |
218.3 |
163.0 |
n.m. |
(25%) |
Source: Platts/MIBGAS/Bloomberg/OMIE/REE.
1 The Iberian power price is based on the Spanish power pool price published by the Iberian Energy Market Operator (OMIE)
2 The Iberian solar captured price is based on the Spanish power pool price published by the Iberian Energy Market Operator (OMIE) and on the power generation published by the Red Eléctrica Española (REE)