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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: Douglas V. Fant who wrote (30986)	10/21/1998 2:30:00 PM
From: Douglas V. Fant	Respond to of 95453

Gang, FYI... Mobil sees light at the end of the Asian tunnel FAIRFAX, Va., Oct 21 (Reuters) - Mobil Corp.'s (NYSE:MOB - news) refining and marketing officials are starting to see light at the end of the Asian economic tunnel, the company said in a statement released on Wednesday. It said the Asian economic environment was discussed on Tuesday by Stephen Pryor, president, international marketing & refining, at a meeting with analysts in New York City. ''We're starting to see light at the end of the tunnel,'' Pryor said. ''Some countries, for example, South Korea, Thailand and now Japan, are taking the necessary steps to restore confidence and stimulate renewed growth.'' ''The turning point for Asian oil (product) demand is likely to occur in late 1999 or 2000, putting the region back on the path of sustained growth at a rate which exceeds that of most of the world,'' Pryor said. Despite the difficult conditions in several Asian markets, he pointed out "Mobil's international downstream businesses generated an 11 percent increase in operating earnings and a 12 percent return on capital in the first half of 1998. ''At the same time, sales volumes increased 3 percent and cash operating expenses decreased 7 percent.'' Downstream is the oil industry's term for refining and marketing. Calling Mobil's position in Asia Pacific downstream markets ''a crown jewel over the long term,'' he said it is ''on the lookout for attractive opportunities to acquire assets'' there. Mobil has significant operations in Japan, Singapore, Australia, New Zealand and Hong Kong, with a platform for growth established in China and other emerging markets, said Pryor, adding that ''Japan also presents great growth opportunities for efficient companies which can capitalize on the expected shakeout in the downstream business.'' He said ''only 5 percent of Mobil's Asia Pacific business is in countries hardest hit by the economic crisis, but this doesn't mean business as usual.'' Pryor said self-help programs are being implemented throughout the region to deliver pre-tax annualized benefits of $300 million, including a planned refining joint venture with the Royal Dutch/Shell Group (quote from Yahoo! UK & Ireland: SHEL.L) in Australia. One-third of the self-help benefits have been realized so far, contributing to a 15 percent increase in Asian M&R earnings in the first half of 1998, he added. In other key international downstream markets, Pryor said the European joint venture with British Petroleum Co. Plc (quote from Yahoo! UK & Ireland: BP.L) is achieving good returns and top competitive financial performance. He said the venture's key achievements in 1998 include outpacing industry in fuels and lubes growth, shedding of uncompetitive assets in refining and marketing, and ''capture of the prize'' by year-end on a run-rate basis. ''We're very pleased with the success of our venture with BP, which has met or exceeded expectations,'' said Pryor. ''We see opportunities for further improvements in efficiency and growth.'' He said Latin American fuel and lubes sales are growing 10 percent per year, reflecting successful market entries in Peru and Ecuador and a recent entry in Venezuela. Mobil has achieved a market share in excess of 25 percent in key retail markets in Colombia, Peru and Ecuador, while positioning for possible privatization in Mexico.