The A.P. Moller-Maersk Group, parent company of Maersk Line, outlined plans to grow two of its major units outside of liner shipping.
The company said its Maersk Oil division plans to increase oil production by 50 percent by 2010 to 400,000 barrels a day. Currently, Maersk produces about 265,000 barrels per day.
Meanwhile, Maersk said its container terminal operating subsidiary, APM Terminals, has a target of becoming the the leading port and inland terminal operator by 2016.
“APM Terminals has an exciting terminal portfolio and pipeline for continuous expansion and we feel enthusiastic about the opportunities, which will provide value to us and our partners in the many countries in which APM Terminals operates," Maersk Group Chief Executive Officer Nils S. Andersen said.
The strategic plans were laid out at Maersk’s Capital Markets Day Tuesday.
The expansion in oil production will come from maximizing output from current assets and new development projects already sanctioned or likely to be so in the near future, the company said.
"Our exploration activities have been successful and we will in coming years invest significantly in the development of the finds,” Andersen said. “We have the financial resources, the skills and the execution experience it will take to reach a production level of 400,000 bpd. Exploration activities will remain high in order to sustain the production level when we reach it.”
The Maersk Group has leaned heavily on bumper profits from its oil division in recent years as the container shipping industry has been weighted down by sluggish growth. According to American Shipper
research into Maersk’s financial reports in recent years, the group has earned $33 billion
in profits from its oil business in the last five years, a stretch in which the top 15 publicly traded container lines have actually collectively lost money.
The company said it will increase capital expenditure in its oil business from $1-3 billion in recent years to $3-5 billion in the years ahead. It will invest $1 billion in oil exploration activities. - Eric Johnson