Higher oil prices boost Repsol profit in Q1

Higher oil and gas prices boost Repsol profit in Q1 by 12 percent to $833 million

Associated Press

MADRID (AP) -- Spanish oil company Repsol saw its first-quarter profits rise 12.4 percent to €643 million ($833 million), excluding results from YPF and Repsol YPF Gas, the Argentine units nationalized by the Buenos Aires government.

In an earnings report released Thursday, Repsol YPF SA attributed the strong results mainly to higher crude oil and gas prices, the resumption of production in Libya after the violent insurrection ended there, and good results at the liquefied natural gas division.

Repsol said that including earnings at YPF and Repsol YPF Gas, profits totaled €792 million, up 3.5 percent from the same quarter of 2011.

The nationalization was announced last month by the government of President Cristina Kirchner and completed a few days ago as Argentine lawmakers gave their approval. Repsol has vowed a long legal battle to win compensation.

Repsol shares were up nearly 7 percent at €14.06.

The company said its operating income in the first quarter rose 8.7 percent €1.33 billion.

It highlighted a 33.5 percent increase in the operating income of its upstream unit, saying this was due to higher crude and gas prices and greater liquids production in Libya and a field in the United States.

Repsol had owned a 57 percent stake in YPF and after the nationalization this was reduced to 6 percent. It has valued the part taken away at $10.5 billion.

At a conference call Thursday, Repsol chief financial officer Miguel Martinez said that since Repsol's share price has dropped so much because of the YPF affair, the company has considered spinning off its remaining stake in YPF "in some other kind of vehicle." No decision has been made yet.

Martinez also said he had no word on when an Argentine court due to rule on the value of YPF will issue a decision.

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