December 7 (SeeNews) - Serbian oil and gas company NIS [BEL:NIIS] said it plans to increase investments by 6% to 28.6 billion dinars ($248.8 million/232 million euro) next year.
NIS plans to focus on investments on key development projects and improvement of operational effectiveness and will aim to maintain profitability despite complex macroeconomic conditions and market circumstances, the company said in a statement on Tuesday after endorsing its 2017 business plan.
The company intends to build a 140 MW combined heat and power plant in Pancevo, near Belgrade, and will proceed with the construction of the Plandiste wind farm in northern Serbia. Also, NIS will build the Ostrovo compressed natural gas (CNG) plant.
"In 2017, NIS is going to continue implementing the business strategy whose main objective is to become the regional energy leader," NIS president Vadim Yakovlev said in the statement.
In the area of oil refining, NIS plans to proceed with implementing the second stage of the modernisation of refining facilities in 2017 and will continue the activities in the Bottom-of-the-Barrel project aimed at expanding the company's product portfolio.
NIS explained that it is going to remain committed to the implementation of measures for improvement of its operational effectiveness as an essential response to adverse market trends. It has been estimated that the potential for operational efficiency improvement at NIS is 9.9 billion dinars in the 2017-2019 period, the company said.
In the first nine months of 2016, the group booked a 41% year-on-year decline in consolidated net profit, to 7.7 billion dinars, amid a 27% fall in the average price of the Urals crude oil on an annual basis.
In the middle of November, the price of Urals crude oil started rising and reached at $49.95 per barrel on the Moscow Exchange on Tuesday, versus $42 on November 7. Since November 7, the share price of NIS increased by 17.8% and closed at 740 dinars on the Belgrade bourse on Tuesday.
As of September 30, Russia's Gazprom Neft owned a 56.15% stake in NIS, while the Serbian state controlled a 29.87% shareholding.
(1 euro = 123.152 dinars)
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