Norway's Equinor Q2 profit surges; exit Venezuela oil JV
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Equinor Q2 profit surges while company exits Venezuela oil JV

29 Jul 2021 (Last Updated July 29th, 2021 11:45)

The Norwegian company’s net income surged to $1.94bn as global oil and gas prices rose.

Equinor Q2 profit surges while company exits Venezuela oil JV
The Oseberg field centre in the North Sea. Credit: Manfred Jarisch/Equinor ASA.

Equinor has posted a net income of $1.94bn for the second quarter of 2021 as against a loss of $251m a year ago.

The Norwegian energy giant, which also announced $300m share buyback programme, attributed the surge in profit to higher oil and gas prices.

Adjusted earnings surged to $4.64bn from $354m in the second quarter of 2020 while adjusted earnings after tax increased to $1.58bn from $646m in the same period last year.

During the quarter, Equinor recorded average daily production of liquids and gas of 1,997 million barrels of oil equivalent per day (boepd), a 2% drop from 2,011 million boepd in the same period a year ago.

The decrease was mainly attributed to the planned turnarounds, expected natural decline and the Hammerfest LNG plant shutdown. This was partially offset by higher flexible gas off-take and Johan Sverdrup project production ramp-up, the company said.

Equinor, which decided to pay a dividend of $0.18 per share for the quarter, said that net operating income was affected by higher gas and liquids prices.

Equinor president and CEO Anders Opedal said: “Strict capital discipline and a net cash flow of more than $4.5bn, reduce our net debt ratio to 16.4% and make us robust for volatility in commodity prices going forward.

“Systematic and sustained improvements on the NCS enable us to capture additional value in the quarter.

“We progressed our project portfolio with the Norwegian government’s approval of the development plan for Breidablikk, start-up of Martin Linge on NCS and the final investment decision on Bacalhau Phase 1 in Brazil. Projects in execution are progressing despite the impact of Covid-19.”

Separately, Equinor and French oil company TotalEnergies have reportedly transferred their stakes in a key venture in Venezuela.

The firms have transferred the stakes to the other JV partner, Venezuela’s state-run Petroleos de Venezuela (PDVSA), Bloomberg reported citing two people with direct knowledge of the decision.

Since the 1990s, Total and Equinor held 30% and 10% stakes respectively in the Petrocedeno oil production joint venture.

In recent years, several foreign oil and gas firms have exited the country citing its declining energy industry.