How Chile’s state oil firm Enap fared in 2022

Chilean state oil company Enap deployed US$531m in capex in 2022, up from US$370mn in 2021 and driven chiefly by higher repair and maintenance (R&M) outlay which climbed to US$283mn from US$150mn.

Key projects underway or concluding are a 33MW expansion of 48MW Atacama region geothermal plant Cerro Pabellón – being developed in partnership with generator Enel Green Power – and a US$70mn wet gas scrubber at the firm’s Aconcagua refinery in Valparaíso region.

Rating agency Fitch expects annual capex to be around US$500mn in 2022-25, hitting a possible peak of US$700mn this year.

Fitch expects the company will finance the work – about half corresponding to E&P – using internal cash flows, without recurring to acquiring additional debt.

R&M CAPEX

R&M capex last year was channeled into programmed refinery shutdowns and maintenance projects, a sulfur recovery unit and the wet gas scrubber. The wet gas scrubber arrived in November and was programmed to enter service this half.

E&P CAPEX

In terms of E&P capex, this climbed to US$248mn from US$220mn in 2021, targeting the Arenal and Dorado-Riquelme blocks in southern Chile and Mauro Dávalos-Cordero in Ecuador. 

Enap – which also produces in Argentina and Egypt – said its goal was maintaining oil and gas reserves at home and abroad.

PRODUCTION

Consolidated production was 63,700boe/d in 2022, up 5% from 2021. 

In terms of 4Q22 output, Chile accounted for 2,000boe/d oil and 20,000boe/d gas, Ecuador 24,000boe/d oil, Argentina 3,000boe/d oil and 9,000boe/d gas and Egypt 6,000boe/d oil.

In Chile, as well as refinery operations, Enap has production assets in Magallanes region. The company also partners with private sector upstream firms under so-called CEOP contracts.

Players include GeoPark, FDC and Methanex. GeoPark and FDC reportedly said they had stopped operations recently, citing a disagreement with Enap over pricing. 

National crude oil production was 102,874m3 in 2021, according to data from hydrocarbons and electricity watchdog SEC. Gas production was 762Mm3.

In November 2021, Enap’s oil and gas production was 5,605m3 and 70.4Mm3, respectively, compared with 4,503m3 and 31.4Mm3 corresponding to CEOP contracts. 

Chile imports crude oil and gas to meet domestic demand. 

FINANCIALS

Enap saw net income quadruple to US$575mn in 2022 as sales climbed to US$12.3bn from US$7.66bn in 2021, mainly driven by a 40% increase in price of ICE Brent.

Total financial debt stood at US$4.45bn in December, largely in line with levels observed in previous years.