The Norwegian oil giant breaks all previous records, delivering an adjusted profit before tax of $ 18 billion in the first quarter of the year.
In other words: Equinor earned NOK 169 billion during the first months of 2022.
The result is more than three times as high as in the same time period last year. And that’s higher than last quarter’s record profit of $ 15 billion.
– With an energy crisis in Europe, Equinor’s most important priority is to ensure reliable and safe deliveries. Strong operations and good regularity resulted in high production in the quarter. We have optimized gas production to deliver higher volumes, and Hammerfest LNG is on track for safe start-up on 17 May, says CEO Anders Opedal and continues:
– With continued capital discipline and cost focus, we deliver very strong financial results and cash flow, which strengthened our balance sheet.
In advance, analysts expected Equinor to deliver an adjusted pre-tax profit of $ 17.1 billion. Thus, Equinor also shattered the experts’ expectations.
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Tax machine
A principle in Norway is that Norwegian oil companies’ activities should create the greatest possible value for society. Through taxes, fees, cash flow from the SDFI and dividends from Equinor, the state ensures a large share of the values created on the Norwegian shelf.
In total, Equinor pays $ 4.3 billion in taxes. This corresponds to more than NOK 40 billion.
The tax payment is 51 times higher than in the corresponding period last year, when the payment was 84 million dollars – 788 million kroner calculated at the current dollar exchange rate.
In addition, the Norwegian oil giant pays a dividend of $ 0.20 per share to the owners. The Norwegian state owns 67 percent of the shares in Equinor. It provides a dividend to the state worth NOK 436 million for the first quarter.
Extreme prices
Equinor achieved an award on 101.4 dollars a barrel for oil delivered from the Norwegian shelf in the fourth quarter.
In the corresponding period last year, Equinor was paid $ 60.9 per barrel of fuel oil.
Rystad Energy estimates that the average price of one barrel of fuel oil in 2022 will end at 111 dollars.
Equinor received $ 29.77 per million British thermal units (mmbtu)which is more than five times as much as in the corresponding period last year.
Equinor has increased gas production in Norway by ten percent from last year, but production is somewhat lower than was the case at the end of last year.
Lost ten billion kroner in Russia
At the same time, Equinor confirms that the company is writing down values worth ten billion kroner by leaving Russia.
CEO Opedal says that the invasion of Ukraine stands as a dark moment for Europe, and that Equinor’s thoughts go to everyone who suffers from the consequences of the brutal war.
– After operating in Russia for three decades, we considered the situation unsustainable, and quickly decided to stop new investments in the country and start the process of withdrawing from Equinor’s Russian joint ventures. The withdrawal from Russia affects our employees, and leads to write-downs of our assets in the country this quarter, says Opedal.
In addition to disposing of real estate, equipment and other assets in Russia, Equinor has stopped trading in Russian oil. This means that the Norwegian oil giant will not transport oil or buy oil products from Russia.
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