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Banking

Mol moves upstream in quest for supply

MOL, Hungary's expansive oil major, has become a leading downstream force in neighbouring markets. Now it is seeking new production sources to feed these regional markets.

Mosonyi: by the end of 2004 had
met a cost-saving target of more
than $200 million

HUNGARIAN OIL AND gas company MOL is going from strength to strength. It has all but completed the process of expanding into surrounding markets by consolidating its downstream operations and is now turning to the next phase. This focuses on its upstream business and involves exploration and exploitation projects in Russia, Kazakhstan and Pakistan. The first round of reforms is already paying dividends. The group's income soared by more than 200% last year, which has sent its stock flying on the Budapest stock exchange. Market capitalization has doubled over the past two years and it joined Hungarian bank OTP in the elite $10 billion market capitalization club in March.

"In 1999 we started on a new strategy to consolidate the downstream assets as we were anticipating a wave of privatization and acquisitions across the region," says György Mosonyi, MOL's CEO. "The restructuring of the company began with cost-cutting and by the end of last year we were pleased to announce we had met our target of shaving more than $200 million off overheads."

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