Monday, 27 July 2020 11:24

ACG participant suffering losses

Equinor's net loss in the 2nd quarter of 2020 was $ 254 million compared to a net profit of $1.475 billion for the 2nd quarter of 2019.

Equinor reported this news on July 24, 2020.

Adjusted profits fell 89%, down to $354 million.

Revenues decreased by 55%  and totaled $7.56 billion.

Equinor's financial results in Q2 2020 were affected by low oil and gas prices caused by the COVID-19 pandemic and high market volatility.

In addition, Equinor reduced its production of hydrocarbons as a result of Norway's support for the OPEC+ agreement on oil production cuts.

As the result, Equinor reduced its hydrocarbon production in the 2nd quarter of 2020, albeit slightly - from 2.012 million boe / day in the 2nd quarter of 2019 down to 2.011 million boe / day in the 2nd quarter of 2020.

For the 1st half of 2020, Equinor's net loss was $956 million compared to a profit of $3.188 billion in the 1st half of 2019.

Revenues decreased by 32% and totaled $22.733 billion.

Equinor's hydrocarbon production increased by 1% and totaled 2,122 million boe/day.

In the future, Equinor expects market volatility to continue.

The long-term effects of COVID-19 on the market, including a possible decline in demand and investment in the industry, remain uncertain.

At the same time, the Company expects an average annual production growth of 3% from 2019 to 2026.

Equinor also confirmed the capex estimate of about $8.5 billion in 2020, $10 billion in 2021, and $12 billion/year in 2022-2023.

It should be noted that Norwegian Equinor (known as Statoil before the brand change) is one of the participants in the PSA contract for the development of the ACG contract area. Equity participation in the project is as follows: BP (operator) – 30.37 percent, AzACG (SOCAR) – 25 percent, MOL (Hungary) – 9.57 percent, INPEX – 9.31 percent, Equinor – 7.27 percent, ExxonMobil – 6.79 percent, TP – 5.73 percent, ITOCHU – 3.65 percent, ONGC Videsh Limited (OVL) - 2.31 percent. The contract for the development of the ACG block was signed in 1994. A new agreement on the development of the ACG block until 2050 was signed in Baku on September 14, 2017.

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