Norway’s Equinor pledges stable oil and gas output to 2035 after Q4 surge

Norway’s Equinor on Feb. 7 pledged to maintain stable oil and gas production up to 2035 after a 14% jump in its Q4 oil output year on year, propelled by projects at home and in the Americas. In a results statement, the company, which operates Europe’s highest-producing oil field, Johan Sverdrup, reported 8% year-on-year growth in its Norwegian oil production in Q4 to 658,000 b/d, and 8% growth in its global oil and gas production to 2.07 million b/d of oil equivalent. Its US oil production jumped 56% to 156,000 b/d, belying its earlier disappointments with onshore shale. “Equinor is well positioned to deliver profitable growth. We are extending the outlook for stable contribution from oil and gas to 2035,” CEO Anders Opedal said, adding the company expects “material and rapidly growing” cash flow from its low-carbon businesses by 2030.

The state-controlled company has found itself in the vanguard of European energy security following the collapse of Russian oil and gas supplies to the continent since the 2022 invasion of Ukraine, with the Sverdrup field bucking an otherwise declining trend in European oil production, while in the UK, Equinor is developing the contentious Rosebank oil field.

It noted, however, a decline in arbitrage opportunities for its oil in the fourth quarter, reflecting how much of its production now stays in Europe. The Platts Dated Brent benchmark averaged $84.34/b over the fourth quarter, down from $88.87/b for the year-earlier period, data from S&P Global Commodity Insights showed.

Production growth was driven by the second phase of the Sverdrup development, which came on stream in December 2022, by the Peregrino heavy oil field reaching plateau levels offshore Brazil, by strong performance from a non-operated stake in Argentina’s Vaca Muerta shale, by US Gulf of Mexico production following the startup of the Shell-operated Vito project earlier in the year, and by an expansion of the Caesar Tonga project, with Occidental Petroleum.

Equinor highlighted the early startup of the Breidablikk oil field offshore Norway in October 2023 and, in the UK, the purchase of a stake in the Buzzard field from Canada’s Suncor. It also noted the December 2023 final investment decision taken on the 250 million boe Sparta field in the Gulf of Mexico with Shell.

Offsetting factors were sales of stakes in the Ekofisk and Martin Linge projects offshore Norway. The company pledged to maintain stable oil and gas production levels in 2024; the major Johan Castberg project is expected on stream later in the year. It highlighted it had made five commercially viable Norwegian oil and gas discoveries just in the fourth quarter. Its reserves replacement ratio for the year was 104%, up from 89% in 2022, with reserves lifted by a recent final investment decision on the Raia field offshore Brazil.