Repsol makes loss as oil, gas prices fall, climate charge bites

By Isla Binnie

MADRID (Reuters) - Spain's Repsol on Thursday reported a net loss for 2019, sapped by lower oil and gas prices and one-off charges mainly related to its pledge to cut its greenhouse gas emissions.

Oil majors around the world have posted steep falls in 2019 income because of price weakness, particularly in Asia.

A 2019 net loss of 3.8 billion euros ($4.10 billion), compared with net income of 2.3 billion euros in the previous year, was primarily because of a 4.8 billion euro impairment Repsol booked mainly on production assets in North America because of its climate targets.

Adjusted net profit came in at 405 million euros ($437.08 million), missing an analyst estimate of 418 million euros provided by the company.

Responding to global concerns about damage caused to the climate by fossil fuels, Repsol announced in December it planned to cut carbon emissions from the barrels it digs out of the ground to net zero by 2050.

Industry behemoth BP followed with a similar emissions-cutting commitment last week. Both companies also sell refined products made from oil they do not extract themselves.

Repsol also boosted its low-carbon electricity generation capacity target for 2025 to 7,500 megawatts, up 3,000 MW from a previous target. Its Portuguese rival Galp this week announced ambitious plans to grow its renewable power business in the Iberian peninsula.

Repsol's net loss was deepened by a further provision, this time of 837 million euros, relating to a legal dispute with China's Sinopec over a joint venture in the North Sea.

The company reassured shareholders the charges would not affect pay-outs.

The downstream unit, which includes refining, was strained by weaker margins of $5.6 per barrel in the fourth quarter, down from $6.2 in the same period of 2018.

Operating cash flow, a measure that includes the amount of money a company has to pay for dividends and share buybacks, rose 8% in 2019, to 5.84 billion euros.

Repsol is set to pay a dividend of 1 euro per share this year as well as conduct a share buy-back programme amounting to 5% of share capital, if shareholders agree in a meeting planned for May.

($1 = 0.9266 euros)

(Additional reporting by Shadia Nasralla in London; Editing by Ingrid Melander and Barbara Lewis)