Slovenia Oil and Gas Report Q4 2009

BMI's latest Slovenia Oil & Gas Report forecasts that the country will account for 1.24% of Central and Eastern European (CEE) regional oil demand by 2013, while making no meaningful contribution to supply. CEE regional oil use of 4.65mn barrels per day (b/d) in 2001 rose to 5.41mn b/d in 2008. It should average 5.15mn b/d in 2009 and then rise to around 5.63mn b/d by 2013. Regional oil production was 8.83mn b/d in 2001, and in 2008 averaged 12.91mn b/d. It is set to rise to 14.37mn b/d by 2013. Oil exports are growing steadily, because demand growth is lagging the pace of supply expansion. In 2001, the region was exporting an average 4.18mn b/d. This total had risen to 7.51mn b/d in 2008 and is forecast to reach 8.74mn b/d by 2013.

In terms of natural gas, the region in 2008 consumed 592.3bn cubic metres (bcm), with demand of 662.8bcm targeted for 2013, representing 12.3% growth. Production of 754.6bcm in 2008 should reach 906.1cm in 2013, which implies net exports rising from 162.3bcm in 2008 to 243.3bcm by the end of the period. Slovenia has no significant share of regional gas consumption or production.

For 2009 as a whole, we are now assuming an average OPEC basket price of US$55.00 per barrel (bbl), a 41.5% decline year-on-year (y-o-y). This represents an upgrade from the US$52 forecast we have stuck with during the past three quarters. Our OPEC basket assumption delivers likely Brent, WTI, Urals and Dubai prices of US$56.30, US$57.50, US$55.60 and US$55.60/bbl respectively. For 2010, we expect to see a recovery to US$60.00/bbl for the OPEC price (up from our previous forecast of US$58), gaining further ground to US$65.00 in 2011 and to US$70.00/bbl in 2012. Our post-2010 forecasts are unchanged and we are continuing to use a long-term price assumption of US$70.00 for 2013-2018.

In 2009, BMI is now assuming a global average gasoline price of US$62.12/bbl, with the fuel having peaked in June. The overall y-o-y fall in 2009 gasoline prices is put at 40.0%. The BMI gasoil forecast is for an average price of US$68.62/bbl, assuming a monthly high of US$92.49/bbl in December. The fullyear outturn represents a 43.4% fall from the 2008 level. The annual jet price level for 2009 is forecast to be US$65.17/bbl. This compares with US$124.95/bbl in 2008. The 2009 average naphtha price is put by BMI at US$49.06/bbl, down 43.9% from the previous year's level.

Slovenian real GDP is now forecast by BMI to fall by 5.0% in 2009, compared with growth of 3.5% in 2008. We are assuming 1.0% growth in 2010, 2.7% in 2011, followed by 3.4% in 2012 and 2.8% in 2013.

Beyond the expected weakness of 2009/2010, oil consumption growth is forecast at an annual rate of 3%, reaching 70,000b/d by 2013. Gas consumption reached an estimated 1.5bcm in 2008, with up to 0.5bcm being produced from domestic sources. Demand is expected to have reached 2.2bcm by 2013, with domestic production potentially down to 0.2bcm and imports totalling 2.0bcm.

Between 2008 and 2018, we are forecasting an increase in Slovenian oil consumption of 33.0%, with import volumes rising steadily from an estimated 63,000b/d to 81,000b/d by the end of the 10-year forecast period. Gas consumption is expected to climb from an estimated 1.1bcm to 2.0bcm by 2018, met largely by imports of 1.9bcm. Details of BMI's 10-year forecasts can be found in the appendix to this report.

Slovenia occupies fifth place in BMI's updated Upstream Business Environment ratings, in spite of extremely limited hydrocarbons resources. The growth outlook for oil and gas is healthy, but volumes are rising from an exceptionally low base. Country risk factors work in Slovenia's favour, but its position may prove precarious, although it currently claims a generous safety margin over Slovakia and Ukraine below it. The country is at the bottom of the league table in BMI's updated Downstream Business Environment rating, taking last place behind Slovakia. There are no particularly high scores and progress further up the rankings seems unlikely over the medium term. There are poor scores for refining capacity, oil and gas demand, population and nominal GDP.

• Executive Summary
• SWOT Analysis
• Slovenia Political SWOT
• Slovenia Economic SWOT
• Slovenia Business Environment SWOT
• Slovenia Energy Market Overview
• Regional Energy Market Overview
• Oil Supply & Demand
• Oil: Downstream
• Gas Supply & Demand
• Liquefied Natural Gas
• Business Environment Ranking
• Central/Eastern Europe Region
• Composite Scores
• Upstream Scores
• Downstream Scores
• Slovenia Upstream Rating – Overview
• Slovenia Upstream Rating – Potential Returns
• Slovenia Upstream Rating – Risks to Potential Returns
• Slovenia Downstream Rating – Overview
• Slovenia Downstream Rating – Potential Returns
• Slovenia Downstream Rating – Risks to Potential Returns
• Business Environment
• Legal Framework
• Infrastructure
• Labour Force
• Foreign Investment Policy
• Tax Regime
• Security Risk
• Industry Forecast Scenario
• Oil And Gas Reserves
• Oil Supply And Demand
• Gas Supply And Demand
• Refining And Oil Products Trade
• Revenues/Import Costs
• Other Energy
• Key Risks To BMI's Forecast Scenario
• Long-Term Oil & Gas Outlook
• Macroeconomic Outlook
• Slovenia - Economic Activity
• Competitive Landscape
• Executive Summary
• Overview/State Role
• Company Monitor
• Petrol
• OMV – Summary
• Others – Summary
• Glossary of Terms
• Oil & Gas Ratings: Revised Methodology
• Introduction
• Ratings Overview
• Indicators
• Oil & Gas Outlook: Long-Term Forecasts
• Regional Oil Demand
• Regional Oil Supply
• Regional Refining Capacity
• Regional Gas Demand
• Regional Gas Supply
• Slovenia Country Overview
• Methodology & Risks To Forecasts
• BMI Forecast Modelling
• How we generate our industry forecasts
• Energy Industry
• Cross checks
• Sources
• List of Tables
  • Table: Central/Eastern Europe Oil Consumption (000b/d)
  • Table: Central/Eastern Europe Oil Production (000b/d)
  • Table: Central/Eastern Europe Oil Refining Capacity (000b/d)
  • Table: Central/Eastern Europe Gas Consumption (bcm)
  • Table: Central/Eastern Europe Gas Production (bcm)
  • Table: Central/Eastern Europe LNG Exports/(Imports) (bcm)
  • Table: Regional Upstream Business Environment Rating
  • Table: Regional Downstream Business Environment Rating
  • Table: Slovenia Oil & Gas – Historical Data & Forecasts
  • Table: Slovenia Other Energy – Historical Data & Forecasts
  • Table: Key Players: Slovenia Oil & Gas Sector
  • Table: Key Downstream Players
  • Table: BMI Oil & Gas Business Environment Ratings: Structure
  • Table: BMI Oil & Gas Business Environment Upstream Ratings: Methodology
  • Table: BMI Oil & Gas Business Environment Downstream Ratings: Methodology
  • Table: CEE Oil Consumption (000b/d)
  • Table: CEE Oil Production (000b/d)
  • Table: CEE Oil Refining Capacity (000b/d)
  • Table: CEE Gas Consumption (bcm)
  • Table: CEE Gas Production (bcm)