Building a focused but robust core portfolio

In the Exploration & Production segment MOL Group intends to triple its hydrocarbon production to 300,000 boe per day and triple the total oil and gas reserves to 900 million boe by 2010 whilst maintaining reserve replacement costs under 6.5 USD/boe.

In the Central-Eastern European region MOL aims to expand its exploration and production activity jointly with INA and through new corporate acquisitions.

In the international arena the Group intends to develop a strong and focused portfolio applying rigorous evaluation and portfolio management methods. This includes at least one new core region, in addition to the existing ones, in order to secure long-term reserve growth and at the same time maintaining a balance between exposure to exploration and development & production projects. As a result of these actions the company intends to increase the contribution of upstream to MOL Group EBITDA to over 40%.

Expanding Oil Production in MOL Group

  • Crude production in 2004 was 54,200 bopd (22% increase of the average 44,400 bopd in 2003), as the production decline of the mature Hungarian fields was more than offset by the 85% rise in Russia.
  • The total hydrocarbon production average in 2004 was 110,000 boepd, 11%  above the 2003 level (strong growth even by international standards).
  • The total unit cost of hydrocarbon production in 2004 was also competitive by international standards: 5.2 USD/boe.

Technologies

Petroleum exploration and production requires complex technological support.

MOL Group Upstream segment places high priority on integrated technology development that supports exploration and field development projects, as well as production operations. Implementation of technology is adjusted to the segment’s economies of scale, taking industrial trends into consideration.

Technology developments are focusing on the implementation of benchmarked solutions capable of providing seamless support for project and portfolio analyses, high quality geological and geophysical interpretations and efficient operations. Flagships of technology developments are subjected to areas where MOL traditionally has comparative advantages: visualization techniques in G&G, innovative solutions for drilling and geophysical field survey operations, recovery increase techniques (EOR/IOR) in production.