Equinor (OSE: EQNR, NYSE: EQNR) delivered adjusted
operating income* of USD 7.48 billion and USD 2.15 billion after
tax in the second quarter of 2024. Equinor reported net operating
income of USD 7.66 billion and net income at USD 1.87 billion.
Adjusted net income* was USD 2.42 billion, leading to adjusted
earnings per share* of USD 0.84.
Financial and operational performance
- Continued strong operational performance
- Solid financial results
- Cash flow impacted by tax payments in Norway and capital
distribution
Strategic progress
- New fields on stream on the NCS
- Continued high grading of oil and gas portfolio
- Three new CO2 license awards in Norway and Denmark
Capital distribution
- Second quarter ordinary cash dividend of USD 0.35 per share,
extraordinary cash dividend of USD 0.35 per share and third tranche
of share buy-back of up to USD 1.6 billion
- Maintain expected total capital distribution for 2024 of around
USD 14 billion
Anders Opedal, President and CEO of Equinor ASA:
“Our operational performance continued to be strong through the
quarter and we delivered 3% production growth. This secured solid
financial results. We maintain a competitive capital distribution,
expecting to deliver a total of 14 billion dollars to our
shareholders in 2024.”
“Field developments and high production contributes to energy
security for Europe. To unlock further long-term value creation, we
continue to optimise our portfolio. We also progressed our
renewables projects and accessed three new licences for CO2
storage, to build a profitable business for a future low carbon
energy system.”
Strong operational performance
Equinor delivered a total equity production of 2,048 mboe per
day in the second quarter, up from 1,994 mboe per day in the same
quarter last year.
On the NCS, strong operational performance and lower impact from
turnarounds, together with new production from the Breidablikk
field contributed to a production growth of 5% compared to the
second quarter last year. High production particularly from the
Troll and Oseberg fields contributed to a 13% increase in gas
production, compared to the same period last year.
Internationally, the Buzzard field in the UK and new wells
contributed with new production but was more than offset by lower
production from the US due to turnarounds offshore and planned
curtailments onshore to capture higher value when demand is
higher.
In the quarter, Equinor completed seven exploration wells
offshore, including the Argerich well in Argentina, with no
commercial discoveries. Seven wells were ongoing at the quarter
end.
In the second quarter, Equinor produced 655 GWh from renewables,
up 90% from the same quarter last year. Production from onshore
power plants contributed with more than half of the production in
the quarter, mainly from the Rio Energy assets and Mendubim solar
plants in Brazil, as well as new production in Poland. The offshore
windfarms contributed to the growth with strong production.
Strategic progress
Equinor’s NCS portfolio progressed in the quarter. Equinor and
its partners made an investment decision for further development of
gas infrastructure in the Troll West gas province, contributing to
energy security to Europe long-term. The Johan Castberg FPSO left
the dock for inshore testing and is on track for sail away to the
Barents Sea later this summer. The production started from the
partner-operated Hanz field in April and from the Kristin South
area in July.
Equinor continued to optimise the portfolio through strategic
business development. This quarter an agreement with Petoro was
announced to harmonise equity interest in the Haltenbanken area to
increase long-term value creation, and a divestment of interests in
the Gina Krog area. The swap transaction to increase profitability
in the US onshore business, exiting the operated position in Ohio
and increasing its position in partner-operated assets in Northern
Marcellus in Pennsylvania was closed.
Equinor accessed CO2 storage capacity opportunities of 17
million tonnes per year with the awarded three new licences Kinna
and Albondigas on the NCS, and the Kalundborg licence onshore
Denmark.
In the UK, construction is progressing on Dogger Bank A offshore
wind farm with 27 turbines either fully or partly installed. The
project targets full commercial operations during the first half of
2025. Based on this the expected growth in power production from
renewables assets in 2024 is now adjusted to be around 70% from the
2023-level.
Solid financial results
Equinor delivered adjusted operating income* of USD 7.48
billion, of which USD 6.13 billion from the E&P Norway, USD 699
million from E&P international and USD 264 million from E&P
USA.
The Marketing, Midstream & Processing (MMP) segment
delivered adjusted operating income* of USD 521 million, mainly
from the Gas and Power business, including strong results from LNG
trading.
Adjusted operating income* from Renewables was negative USD 90
million, as the costs of project development exceeds the earnings
from assets in operations which was USD 41 million in the
quarter.
Cash flow from operating activities before taxes paid and
working capital items amounted to USD 9.75 billion for the second
quarter. Cash flow from operations after taxes paid* was USD 1.90
billion for the quarter, and USD 7.74 billion year to date. Equinor
paid two NCS tax instalments, totalling USD 6.98 billion in the
quarter. Organic capital expenditure* was USD 2.89 billion for the
quarter, and total capital expenditures were USD 4.78 billion.
After taxes, capital distribution to shareholders and investments,
net cash flow* ended at negative USD 4.22 billion in the second
quarter.
Adjusted net debt to capital employed ratio* was negative 3.4%
at the end of the second quarter, compared to negative 19.8% at the
end of the first quarter of 2024. The calculation of net debt ratio
includes the effect of the Norwegian state’s share of the share
buy-back, at USD 4.02 billion paid in July.
Capital distribution
The board of directors has decided an ordinary cash dividend of
USD 0.35 per share, and to continue the extraordinary cash dividend
of USD 0.35 per share for the second quarter of 2024, in line with
communication at the Capital Markets Update in February.
Expected total capital distribution for 2024 is around USD 14
billion, including a share buy-back programme of up to USD 6
billion. The board has decided to initiate a third tranche of the
share buy-back programme of up to USD 1.6 billion. The third
tranche will commence on 25 July and end no later than 22 October
2024.
The second tranche of the share buy-back programme for 2024 was
completed on 19 July 2024 with a total value of USD 1.6
billion.
All share buy-back amounts include shares to be redeemed from
the Norwegian State.
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*For items marked with an asterisk throughout this report, see
Use and reconciliation of non-GAAP financial measures in the
Supplementary disclosures.
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Further information from:
Investor relationsBård Glad Pedersen, Senior vice president
Investor relations,+47 918 01 791 (mobile)
PressSissel Rinde, vice president Media relations,+47 412 60 584
(mobile)
This information is subject to the disclosure requirements
pursuant to Section 5-12 of the Norwegian Securities Trading
Act
- Equinor Second quarter 2024 Financial statements and
review
- CFO presentation - 2nd quarter 2024 results
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