Equinor Swings to Net Loss on Impairments, Lower Energy Prices

   By Dominic Chopping 
 

Equinor ASA (EQNR.OS) Thursday swung to a third-quarter net loss as it posted extensive impairments and provisions while also being hit by lower prices and production.

In response, the Norwegian oil-and-gas major said it will now defer gas production to periods with higher expected prices.

Equinor posted a net loss of $1.11 billion, down from a profit of $1.67 billion a year earlier. Revenue fell 23% to $14.7 billion.

Analysts polled by FactSet had expected net profit of $1.06 billion on revenue of $16.04 billion.

Adjusted earnings fell 46% to $2.59 billion against expectations of $2.68 billion.

The company, which is 67%-owned by the Norwegian state, proposed a maintained dividend of 26 cents for the third quarter.

Equinor said its earnings were weighed by lower average prices and lower volumes for both liquids and gas, in addition to impairment losses, mainly related to unconventional onshore assets in North America.

It posted net impairments of $2.79 billion, provisions of $560 million and changes in fair value of derivatives and inventory hedge contracts of $444 million, with a positive gain from sale of assets of $849 million.

Provisions and impairments were related to damage at its South Riding Point oil terminal in the Bahamas, in addition to onerous contract provisions in North America, it said.

Equinor delivered total equity production of 1.909 million barrels of oil equivalent a day in the third quarter, down from 2.066 million barrels a day in 2018.

The company still expects exploration spending of around $1.7 billion and production around the 2018 level.

For the 2019 to 2025 period, production growth is still expected from new projects, resulting in a compound annual growth rate of around 3%.

Write to Dominic Chopping at [e-mail]

(END) Dow Jones Newswires

October 24, 2019 01:55 ET (05:55 GMT)

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