Norwegian oil and gas company Equinor, in its first financial report since the name change, saw its second quarter 2018 net profit drop by 15% despite an increase in revenues.
According to its statement released on Thursday, Equnior’s adjusted earnings were $4.3 billion in the second quarter 2018, up 43% from $3 billion in the same period in 2017.
The company’s net income however dropped by 15% to $1.22 billion from $1.44 billion in the second quarter of 2017.
Adjusted earnings after tax were $1.7 billion in the second quarter, up 31% from $1.3 billion in the same period last year, which included a reversal of a provision in Angola of $0.7 billion.
The company said that higher prices for both liquids and gas, coupled with high production, contributed to the increase. Due to increased maintenance and some quarter and field specific items, underlying operating costs and administrative expenses per barrel are slightly up compared to same quarter last year, adjusted for new fields in production.
Equnior saw its revenues increase during the second quarter 2018 to $18.07 billion from $14.86 billion in the prior-year period.
Eldar Sætre, President and CEO of Equinor, said: “This quarter we deliver very strong results from our international operations, while new fields, increased maintenance and some quarter specific items contribute to somewhat higher costs at the NCS. This underlines the importance of continued cost focus across the organization. We are on track to deliver on our guiding to the capital market.”
Equinor delivered equity production of 2,028 mboe per day in the second quarter, an increase from 1,996 mboe per day in the same period in 2017. The increase was primarily due to higher production in the US. The production growth was 2% compared to the second quarter of 2017.
Equinor’s organic capital expenditures for 2018 are estimated at around $11 billion.
Equinor said it intends to continue to mature its large portfolio of exploration assets and estimates a total exploration activity level of around $1.5 billion for 2018, excluding signature bonuses.
The company’s production for 2018 is estimated to be 1-2% above the 2017 level.
Offshore Energy Today Staff