Repsol has presented its new 2021-2025 strategy with which it intends to accelerate its transformation towards a more sustainable business model without losing sight of profitability.
With this objective in mind, the group will invest in the next five years a total of 5.5 billion euros in renewable energy to double its generating power to 7.5 gigawatts in a first phase. From then on, the group hopes to double this figure again to 15 gigawatts in 2030, as EL MUNDO advanced.
The company explains that it will finance this growth using cash from its oil business and without the need to increase its debt. To do this, he estimates that a barrel of Brent crude will cost around 50 euros in the next five years. In addition, the oil company opens the door to the incorporation of a financial partner or the listing of its ‘green’ business to reduce its capital costs, while always maintaining operational control of these assets.
The investment will focus in a first phase in Spain, although later it focuses on the international market with the expansion in Chile and in other markets that the group is already surveying, but that its CEO, Josu Jon Imaz, has not wanted to reveal.
The increased investment in renewables will lead to a reduction in the hydrocarbon exploration business, depressed by the sharp reduction in energy prices. In the case of the group, it will represent 800 million euros of the total of 18,000 million that Repsol will invest in five years.
The plan includes a reduction of the dividend to adjust it to the current context of crude prices. The cut will be 40% compared to current levels, which will place the shareholder payment at 60 cents per share. From there, the group intends to raise it progressively throughout the plan to 75 cents in 2025 with plans to buy back additional shares.
“It is a growth plan in new businesses and in metrics. Free cash flow per share per share grows by 20% per year and adjusted net income per share by 10%”, explained Imaz at a conference press.