Lukoil writes off $500 million on projects in Africa and Kazakhstan

Lukoil announced revision of its asset about a month ago, also reported about sale of its first non-core asset - a stake in Caspian Investment Resources Ltd. Lukoil sold 50 % of the company to Chinese Sinopec for $1.2 billion (the deal will be concluded before the end of this year). The Caspian shelf, northern Russia and Iraq were called priority areas.

But it wasn’t easy to get rid of the non core assets. According to the company’s materials, in the first quarter, due to disposal of the stake in Caspian Investment Lukoil made the loss in the amount of $358 million, and wrote off $162 million on projects in North Africa. The paper loss in the amount of $270 million was brought by foreign exchange differences. Mainly because of this the Lukoil’s net profit under US GAAP decreased by 32.9 % to $1.73 billion in the first quarter. Without them, the company’s net profit would be $2.5 billion, The consensus forecast of the Interfax was $2.17 billion.