Galp plans 5 bn euros investment to boost output

Portugual’s Galp Energia said on Monday it plans to invest up to five billion euros ($7 billion) in the next five years to increase its oil output 10 times to 200,000 barrels per day by 2020.

“The capital expenditure planned for the year 2011 is expected to range between 1.2 billion euros and 1.5 billion euros; meanwhile, capital expenditure for the period 2012-2015 is expected to be approximately 3.5 billion euros,” it said in a statement.

It listed upgrades of its Sines and Matosinhos refineries and the development in Brazil of the Lula and Cernambi fields, and a block in Angola.

The investment should ensure annual operating profit growth of around 15 percent through to 2015, it said.

The company also announced a new “production target of approximately 200,000 barrels of oil equivalent per day to be achieved in 2020, which represents a ten times increase from production in 2010.”

This should in turn rise to 300,000 barrels by 2025, it added.

Galp said it plans a capital increase at its Brazilian subsidiary in the second half of this year, aiming to raise two billion euros to help reduce its net debt to equity ratio below 50 percent.