The consequences of the epidemic of the new corona virus and the crisis on the market will have a significant impact on the results of oil companies in 2020, but despite that NIS will not give up capital investments and further modernization of the company, said Anton Cherepanov, NIS Deputy General Director and CFO.
In an interview with the Bulletin of the National Oil Committee of Serbia, he said that the oil industry around the world is facing two types of shocks.
“On the one hand, it is a matter of a dramatic drop in the value of oil, which lost as much as 30 percent of its value in just one day in March. On the other hand, we also have a drastic drop in demand due to the corona virus pandemic and the slowdown in economic activity around the world. We have come to a situation where demand has practically halved compared to periods of normal business. The combination of these two factors has already affected the financial results and liquidity of oil companies, without exception. Such a loss will leave significant consequences not only on business in 2020, but also on plans in the coming period,” Cherepanov said.
According to him, although NIS will reduce capital and operating costs in the coming period, there will be no savings at the expense of the most important investments that will ensure further development of the company after the end of the crisis period.
“First of all, we mean Deep Processing in the Pancevo Oil Refinery and the Pancevo Thermal Power Plant. Also, it is of great importance for us to further invest in the exploration and production of oil and gas, as well as in the continued development of our retail network. In addition, we expect great benefits from the digital projects we have started, and we will certainly continue to finance those that we see as the most promising and most profitable, and which will make our business even more efficient and secure,” said NIS CFO.
Cherepanov concluded that NIS’s priorities for the rest of the year will be to preserve the company’s liquidity and social stability of employees, while increasing business efficiency in all business segments.
“We must constantly adapt to market conditions and strive to seize every opportunity. We have implemented measures to reduce operating and administrative costs, prioritize investments and work daily to increase operational efficiency in all business segments. Certainly, in these conditions, our priority is to maintain the company’s liquidity. By combining the mentioned measures, I believe that we will fulfill the set goals,” Cherepanov stated, Danas reports.
