Long-term exploration and production in Hungary

MOL Group’s traditional core region is Hungary, where we are dominant player in all three upstream value chain segments (exploration, field development and production).
It now seems that previous forecasts were too pessimistic: production in Hungary is still viable despite of all aspects of maturity. Field developments of new discoveries and the application of secondary and tertiary recovery methods significantly extend the production life of the old fields.

In the Pannonian Basin the primary focus will remain on rigorous cost control, utilizing new production and reservoir engineering methodologies and focusing on the best prospective exploration ideas as well as on profitable field development opportunities. 

In the Hungarian exploration areas we continued efforts to moderate the decline rate of our core Hungarian oil and gas producing assets by maximizing the value of our portfolio with new development projects.

These include the Hosszúpályi-South gas field development and the development of gas caps at the Algyő field.

Furthermore, in this period we focused on exploring lower-risk prospects in Pannonian Basin exploration concessions. As a result, we discovered five additional gas reservoirs through successful exploration drilling activities around the Hosszúpályi-Dél gas field, where the field development is already in progress.

Despite our own results, due to the existing gas regulation royalty mechanism, our actual net reserve position fell below levels seen in previous years in Hungary. Due to a further increase in gas prices, the higher mining royalty reduced our Hungarian net proven gas reserves by 4.7 million tons of oil equivalent and, as a result, our total net proven Hungarian hydrocarbon reserves declined by 5.6 million tons of oil equivalent.