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Norway’s Equinor (NYSE: EQNR) reported on Thursday better-than-forecast earnings for the fourth quarter, as the start-up of the massive Johan Sverdrup oilfield partially offset lower oil and gas prices.
Similarly to other oil majors, Equinor’s profit in Q4 declined from a year earlier, but the drop was less than a consensus estimate had expected.
Equinor reported adjusted earnings at $3.55 billion for the fourth quarter, down from $4.39 billion for the same period in 2018, but higher than the $3.37-billion consensus of 25 equity analysts whose input Equinor had collected.
The October start-up of the North Sea oilfield Johan Sverdrup, which currently produces 350,000 bpd, boosted Equinor’s production to a record high in Q4, the Norwegian giant said today.
“We expect the entire phase 1 investment to be paid back already by the end of this year, less than 15 months after the first well was put in production,” Equinor’s president and CEO Eldar Sætre said, commenting on the Johan Sverdrup development.
Alongside its Q4 and full-year results, Equinor updated the market on its goals going forward and unveiled a plan to significantly cut emissions, not only from its oil and gas production, but also from the products it sells, joining other majors such as Shell, which has set short-term targets for reducing the net carbon footprint of the energy products it sells.
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Equinor expects around 7-percent production growth this year and average annual production growth of around 3 percent from 2019 to 2026.
In its plan to cut carbon intensity, Equinor looks to reduce the net carbon intensity, from initial production to final consumption, of energy produced by at least 50 percent by 2050. The firm—which dropped Statoil as its name aiming to be associated more with a ‘broad energy company’—also plans to grow profitably within its renewables business and become a global offshore wind major. Equinor targets to grow its renewable energy capacity tenfold by 2026, when it expects production capacity from renewable projects of 4 GW to 6 GW. By 2035, Equinor expects to further boost its installed renewables capacity, to 12 GW-16 GW.
“We are developing as a broad energy company, leveraging the strong synergies between oil, gas, renewables, CCUS and hydrogen,” Sætre said.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.