BP, Saturn Oil & Gas, OMV - Sector rotation for investment success in 2021!

BP PLC - reinventing itself

The British oil Company reported on Dec. 31 the completion of its major Southern Gas Corridor project. After more than seven years of construction, a new supply route for energy from the Caspian Sea to Europe was opened. The pipeline, which is 3,500 km long, consists of three sections that transport the gas from Azerbaijan and Georgia through Turkey via Greece and Albania to Italy.

Last year, however, was primarily characterized by the formulation of a plan for the Group's strategic realignment, with targets for 2030 and 2050. The long-term goal is that BP will no longer produce any environmentally harmful emissions on a net basis by 2050 at the latest. This forecast is linked to extensive measurement and control measures and the promise to implement the highest transparency standards. All oil and gas processing sites are to be analyzed in detail by 2023. The carbon intensity of the products sold is to be reduced by more than half in the long term. In addition, investments in non-oil and gas projects will be increased.

With its ambitious vision, BP has set a clear signal in terms of sustainability and transparency. So far, the steps have only been roughly outlined; this spring, the Group wants to be more specific. By 2030, BP intends to become an integrated energy company focused on providing solutions for customers. But back to the here and now - after halving the share price last year, investors should be able to look forward to increases in BP's share price in 2021 as oil prices pick up.

SATURN OIL & GAS INC - 2021: a new milestone in the Company's history

In the new year, Saturn Oil & Gas is expected to take another significant step in the Company's history. CEO John Jeffrey emphasized during a December interview, "the most efficient way to accelerate our growth right now is through acquisitions." Saturn is focused on acquiring and developing undervalued and low-risk oil and gas areas in Canada. The current focus is the province of Saskatchewan. The stated goal is to build a portfolio with strong cash flows.

To accommodate the further expansion in personnel, the Canadians already brought Wendy Woolsey on board as CFO in October. Woolsey has 25 years of experience in the oil industry. Jean-Pierre Colin joined the Company in November as Strategy Consultant and brings extensive experience in capital markets, commodity project financing, M&A and strategy.

Saturn's potential is currently not reflected in the share price. At the beginning of last year, the Canadian Company's shares were trading at CAD 0.15. Now, the share is about ¼ below this value. The market capitalization is only a moderate CAD 26 million. We are looking forward to further production data from the Company. In the past year, Saturn was able to secure more than half of its production. In our opinion, an acquisition will significantly increase the share price. An increase in the oil price should accelerate the momentum even further.

OMV AG - continues to focus

OMV produces and markets oil and gas, innovative energy solutions and high-quality petrochemical products. In the upstream sector, the Austrians focus on activities in Central and Eastern Europe. Still, they are also active in several core regions such as the Middle East, Africa, the North Sea, Russia and Asia-Pacific. In 2019, average daily production was 487,000 boe/d, dropping to 444,000 boe/d as of the end of September 2020. In the downstream segment, OMV manages three refineries in Europe. The Group also operates around 2,100 service stations in ten European countries.

In the last days of December, OMV reported that its Romanian subsidiary Petrom would divest itself of the two Kazakh Companies Kom-Munai and Tasbulat Oil Corporation. The two Companies hold the licenses for four onshore oil fields, representing only about 4% of Petrom's total production.

OMV is thus consistently moving forward on its chosen path of focusing. The Group made the strategic decision to focus on the Black Sea region concerning international upstream activities. The Group's share price also benefited from a rising oil price; in 2020, investors had to absorb a 34% decline in the share price.