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“The outbreak of the Corona virus and the sharp drop in oil prices are impacting
industries and companies around the world and is expected to impact Equinor for
a long time. We are a robust company with a strong balance sheet and we are now
really benefiting from the improvement in recent years. Through those efforts,
we are better prepared to handle volatile markets and unexpected events,” says
Eldar Sætre, President and CEO of Equinor ASA.
In 2019 Equinor proved strong operational capabilities and brought six new
fields on stream, including Johan Sverdrup. The major field was put on stream
ahead of schedule and below cost.
“We are strengthening our portfolio to underpin a competitive and resilient
business model fit for long term value creation, and in line with the Paris
Agreement,” writes Sætre, in his letter to fellow shareholders.
Total equity production ended at 2.074 million barrels of oil equivalent per
day.
2019 saw a decrease in prices and lower margins for the industry.
In 2019, the cash flow from operations before tax ended at USD 21.8 billion.
Equinor delivered a solid result with adjusted earnings of USD 13.5 billion (1)
and USD 4.93 billion after tax.
According to IFRS Equinor’s net operating income was UDS 9.30 billion and net
income was USD 1.85 billion. The results are impacted by lower prices for gas
and liquids, as well as net impairment losses.
Total capital distribution to shareholders increased by 42% to USD 3.78 billion
including a 13% increase in cash dividend, and introduction of the share buy-
back programme in September 2019.
“2019 was also truly a game-changing year for our renewables business. We made
the investment decision for Hywind Tampen in Norway and won the opportunities to
develop Empire Wind offshore New York and Dogger Bank in the UK, the world’s
largest offshore wind development,” writes Sætre.
Equinor is developing as a global offshore wind major with projects under
development adding 2.8 gigawatts of renewables electricity capacity. In 2026 the
production capacity is expected to be 4-6 GW (2), which is around 10 times
current capacity.
Organic capex for 2019 was USD 10 billion (3), around USD 1 billion below the
original guiding, achieved through strong project deliveries and capital
discipline. Equinor completed 42 exploration wells in 2019.
For the full year, total recordable injuries frequency came in at 2.5, an
improvement from 2.8 in the previous year. The serious incident frequency ended
at 0.6, up from 0.5.
“We need to continue our relentless efforts to avoid serious incidents and
further reduce personal injuries,” Sætre says in the letter.
Clear ambitions and improving on sustainability
The 2019 Sustainability Report offers an overview of how Equinor follows up its
ambitious sustainability agenda and performance. Sustainability is embedded in
Equinor’s strategy, and the company is taking actions to develop the business
guided by the United Nations’ Sustainable Development Goals. The commitment to
long-term sustainable value creation is in line with the principles of the
United Nations’ Global Compact.
Equinor recently launched a new climate roadmap and set bold ambitions, both
short term and beyond 2030. The aim is to achieve carbon neutral operations
globally by 2030 and to reduce net carbon intensity of energy produced by at
least 50% by 2050.
“Our efforts do not stop at curtailing our own emissions. We take an active role
in helping society to accelerate decarbonisation through close collaboration
with industry players, customers, and governments,” Sætre continues.
Equinor is working on several collaborative projects aiming at building an
international market and value chains for CCUS and hydrogen.
In 2019 Equinor delivered 303,000 tonnes of CO2 emission reduction, mainly due
to many energy efficiency projects. The average CO2 intensity of Equinor’s
operated portfolio is 9.5 kg per barrel, with an ambition of 8 kg per barrel
moved from 2030 to 2025.
Equinor produced 1.8 TWh of renewable energy in 2019, an increase from 1.3 TWh
the year before. 20% of the R&D expenditure was within low carbon R&D.
Since 2015 Equinor has tested its portfolio against IEA’s energy scenarios in
the World Energy Outlook report. To further assess the potential impact of a low
oil price scenario, a sensitivity towards a long-term oil price of USD 50/bbl in
2040 has been included. Even in such a scenario, our producing assets continue
to generate a positive cash flow, although a few assets will have an earlier
economic cut-off.
Equinor support enhanced transparency on climate-related risk, and our
disclosure practice is in accordance with the recommendations presented in 2017
by the G20 Task Force on Climate-related Financial Disclosures (TCFD).
In accordance with the New York Stock Exchange Listed Company Manual, Equinor
ASA announces that on 20 March 2020 it will file with the Securities and
Exchange Commission its 2019 Annual Report on Form 20-F that included audited
financial statements for the year ended December 31, 2019.
The Equinor 2019 Annual Report and Form 20-F, which includes the 2019 Annual
Report on Form 20-F, and 2019 Sustainability Report may be downloaded from
Equinor’s website at www.equinor.com. References to this document or other
documents on Equinor’s website are included as an aid to their location and are
not incorporated by reference into this document. All SEC filings made available
electronically by Equinor may be obtained from the SEC’s website at www.sec.gov.
Shareholders may also request a hard copy of the annual report free of charge at
www.equinor.com.
(1) See section 5.2 in the 2019 Annual report and Form 20-F for non-GAAP
measures.
(2) Including our 15.2% equity in Scatec Solar ASA
(3) IFRS capital expenditures for 2019 were USD 14,8 billion.
Contacts
Investor relations
Peter Hutton, senior vice president Investor Relations,
+44 7881 918 792 (mobile)
Press
Bård Glad Pedersen, vice president Media Relations,
+47 918 01 791 (mobile)
Cautionary Note regarding Forward Looking Statements
This press release contains forward-looking statements. Forward-looking
statements reflect current views with respect to future events and are, by their
nature, subject to significant risks and uncertainties because they relate to
events and depend on circumstances that will occur in the future. There are a
number of factors that could cause actual results and developments to differ
materially from those expressed or implied by the forward-looking statements.
This information is subject to the disclosure requirements pursuant to section
5 -12 of the Norwegian Securities Trading Act.
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