KASSEL, Germany, April 7 (Reuters) - BASF’s oil and gas subsidiary Wintershall expects lower sales and earnings in 2016 after being hit in 2015 by a sharp oil price decline that squeezed revenues in its exploration business.
Chief Executive Mario Mehren said that the ongoing weakness in oil prices would result in cost savings and lower investments but that production would be expanded, especially in low-cost regions such as Russia and Argentina.
“Wintershall will do both in coming years - save and invest. Those goals are not contradictory,” he told a news conference.
Last year, oil prices slumped 47 percent to $52 on average for North Sea grade Brent. Wintershall’s planning is based on an average $40 this year.
Wintershall accounted for more than a fifth of EBIT at parent group BASF in 2015, which had reported results on Feb 26. (Reporting by Vera Eckert; Editing by Christoph Steitz)