Statoil's 2Q 2014 Results

By Joseph R. Fonseca
Saturday, July 26, 2014
President and CEO Helge Lund

 

Statoil's second quarter 2014 net operating income was NOK 32.0 billion, a decrease of NOK 2.3 billion compared to the second quarter of 2013. Adjusted earnings were NOK 32.3 billion.

“Statoil delivered solid operational performance in the quarter, with continued high production regularity on the Norwegian continental shelf and project execution according to plan. We have deferred gas production to enhance value, but remain on track for delivering on our production guiding for 2014. Our quarterly earnings were impacted by divestments, seasonal effects and lower gas prices. For the first half of the year, earnings were around the same level as in the same period last year," says Helge Lund, Statoil's president and CEO.

Statoil’s net income for the second quarter was NOK 12.0 billion, an increase from NOK 4.3 billion in the same period of 2013. Earnings per share were NOK 3.75, an increase from NOK 1.38.

Adjusted earnings were NOK 32.3 billion, a 15% decrease compared to the second quarter last year. The net adjustments of NOK 0.3 billion are primarily related to gains and impairments. In the second quarter, the company recorded a gain of NOK 3.6 billion from the farm-down in Shah Deniz and the South Caucasus Pipeline.

The gain was offset by impairments of NOK 4.3 billion in the US onshore business, mainly related to sustained local price differentials. Adjusted earnings after tax were NOK 9.9 billion, compared to NOK 11.3 billion in the same period last year.

"Our cash flow from operations before tax is NOK 118 billion so far this year, and we have a strong balance sheet. We will pay a dividend of NOK 1.80 per share for the quarter, in line with our commitment to capital distribution to our shareholders,” says Lund.

Net debt to capital employed at the end of the quarter was 16%. Organic capital expenditure is USD 10 billion year-to-date, and the guidance of USD 20 billion for 2014-2016 remains unchanged.

Statoil’s adjusted earnings from upstream activities in Norway decreased from NOK 31.5 billion to NOK 24.1 billion. Earnings from upstream activities outside Norway increased to NOK 6.3 billion from NOK 5.9 billion, while earnings from the midstream increased to NOK 2.4 billion from NOK 0.8 billion.

In the quarter, Statoil made the high-impact Piri discovery in Tanzania. The discovery brings the total of gas in-place in Block 2 up to approximately 20 tcf, adding volumes for a future large-scale gas infrastructure development. Exploration expenses were NOK 2.7 billion, down NOK 1.4 billion compared to same quarter last year. The decreased expenses were mainly due to increased capitalisation as a result of successful wells.

“We continue progressing our programmes to reduce cost and improve capital efficiency. In the quarter, we have announced a potential to reduce between 1100 and 1400 positions. Reductions of around 1000 positions in our staffs and support services are already implemented. We have also established six specific high-impact projects addressing technical efficiency across the company, and we are now executing the first wave. We are on track, and will provide an updated status when we report our results for the full year,” says Lund.

Statoil delivered production of 1,799 mboe per day in the second quarter, down 9% compared to second quarter in 2013. Starting and ramping up of new fields such as Skarv in Norway, Marcellus and Eagle Ford in the United States together with PSVM and CLOV in Angola contributed positively to the production. This increase was partly offset by divestments and redetermination, expected natural decline, seasonal effects and optimisation of gas production.

Statoil continued its strong progress on project development and execution, including the award of a letter of intent for two steel jackets to the Johan Sverdrup field. This represents a new step forward in planning of the first phase of this important development on the Norwegian continental shelf.

The serious incident frequency (SIF) improved from 0.9 in the second quarter of 2013 to 0.7 in the second quarter of 2014.
 

  • Valemon sail away (Photo Ben Weller APStatoil)

    Valemon sail away (Photo Ben Weller APStatoil)

Maritime Reporter October 2014 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

Finance

New Company Takes Over OW Tanker

OW Tanker, a unit of bankrupt OW Bunker and owner of its marine fuel supply ships, has been taken over by a newly-created company, the fleet manager told Reuters on Wednesday.

WRRDA: Clearing the Channel for P3 Projects

A Creative Combination for Financing Inland Waterways Infrastructure Earlier this year, the U.S. maritime industry in general, and the inland waterways industry in particular,

Choosing the Best Financing Proposal

It isn’t always about the rate. In a robust boatbuilding market – like the one we see now – even the most successful, financially stable operators need to borrow.

Energy

Fourth Rig Delivered to Perforadora Central

Keppel AmFELS LLC, a wholly owned US subsidiary of Keppel Offshore & Marine Ltd (Keppel O&M), has delivered the jackup rig, Coatzacoalcos, to Mexico’s Central Panuco S.

Massive LNG Absorber Shipped to Malaysia

Successful transport of 1,480t absorber for biggest LNG plant worldwide in Malaysia.   1,480 tons and a high center of gravity made the transport of an absorber

EU: Ships Will Measure CO2 Emissions

Shippers to begin monitoring from 2018; Environmental groups say law is weak, shippers favorable. The shipping sector will for the first time have to monitor

News

ClassNK Approves Niigata Dual-fuel Engine Design

Classification society ClassNK has granted approval to the design of the new 28AHX-DF dual-fuel engine developed by Niigata Power Systems Co., Ltd. The new engine

MacGregor Deck Equipment for Intership's Eco-bulkers

MacGregor, part of Cargotec, has secured a deck equipment contract from New Times Shipyard in China for Intership Navigation Co Ltd.'s three new 36,500 dwt laker-class bulk carriers.

W&O, LESER Partner to Deliver Safety Relief Valves

W&O, a global supplier to the marine and upstream oil and gas markets for pipe, valves and fittings, valve automation and engineered solutions, has partnered with

 
 
Naval Architecture Navigation Offshore Oil Pipelines Port Authority Salvage Ship Simulators Shipbuilding / Vessel Construction Sonar Winch
rss | archive | history | articles | privacy | terms and conditions | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1690 sec (6 req/sec)