Equinor ASA reported adjusted earnings of $3.55 billion tax in fourth-quarter 2019, down from the $4.4 billion reported in fourth-quarter 2018. Adjusted earnings after tax were $1.19 billion, down from $1.54 billion in the same period last year. Lower prices for both liquids and gas impacted the earnings for the quarter.
For the full year, adjusted earnings were $13.5 billion, down from $18 billion in 2018.
“Record high production, reduced costs and continued strong capital discipline contributed to solid results in a quarter with lower commodity prices,” said Eldar Sætre, president and chief executive officer of Equinor.
“Going forward, we expect to grow production, returns and cash flow from a world-class project portfolio, representing 6 billion barrels to Equinor with an average break-even oil price below 35 dollars per barrel,” he said. “In addition, Johan Sverdrup phase 1 will contribute to strong growth at the Norwegian continental shelf. High quality projects like Bay du Nord in Canada, Rosebank in the UK and BM-C-33 and Bacalhau in Brazil will deliver high profitable growth internationally," he said.
Equinor delivered record high total equity production of 2.198 million boe/d in the fourth quarter, up 1% from the same period in 2018. The flexibility in the gas fields was used to defer production into periods with higher expected gas prices, the company said. Start-up and ramp-up of new fields as well as new well capacity, contributed to growth in production. Johan Sverdrup field was put in production in early October 2019 and is currently producing more than 350,000 b/d from eight wells. The field is expected to reach plateau this summer.
As of the end of fourth-quarter 2019, Equinor completed 42 exploration wells with 18 commercial discoveries. Adjusted exploration expenses in the quarter were $440 million, compared to $420 million in the same quarter of 2018.
Cash flows provided by operating activities before taxes paid and changes in working capital amounted to $21.8 billion in 2019, compared to $27.6 billion in 2018. Organic capital expenditure was $10 billion for 2019.
Equinor expects average annual organic capex of $10-11 billion in 2020 and 2021, and around $12 billion for 2022 and 2023. For 2020 exploration activity, the company expects to spend $1.4 billion. Production growth for 2020 is expected to grow by 7% with an average annual production growth of around 3% from 2019 to 2026.
