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February 9, 2022updated 11 Feb 2022 11:15am

Equinor joins European energy groups in bumper profits

As demand recovers from the pandemic European energy majors are seeing a significant spike in earnings, while energy prices for consumers rise.

By Scarlett Evans

Norwegian energy major Equinor has announced record fourth-quarter profits, hot on the heels of similar announcements from other European groups BP and Shell as demands for a tax on energy companies begin to stack up. 

On the back of its announcement, Equinor has said that its shareholders will receive $10bn this year. The company’s earnings before tax were at $15bn between the months of October and December, as compared to $756m in the same period the previous year.  

“We are capturing value from high prices for gas and liquids with excellent performance and increased production. This resulted in very strong adjusted earnings after tax for the quarter and the full year. In addition, continued improvements and capital discipline contributes to the strong free cash flow of $25bn and a significant strengthening of our balance sheet, “says Anders Opedal, president and CEO of Equinor ASA. 

Soaring oil and gas prices have created an influx of earnings for energy firms, turning the tide on the prolonged slump as a result of the pandemic. 

“In 2021, there was still operational impact from the pandemic, but the markets recovered with high prices, especially in the second half of the year,” says Opedal. “In Europe the energy prices reached record levels impacting industries and societies…together with partners and regulators, we took steps to increase the production of piped gas to Europe significantly.” 

While rising energy prices are good news for oil and gas majors, it has also left consumers with inflated household energy bills, and the news of yet another firm seeing significant earnings will likely add to calls for the imposition of a tax on these companies to help ease prices. 

Equinor, similarly to BP, has said that it will use part of its earnings to progress its climate ambitions over the next decade. The Norwegian major has a target of curbing net emissions from operations by 50% by 2030, aiming for “90% of this to be delivered as absolute reductions”.  

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