STATOIL, NORWAY’S largest oil and natural gas producer, said first-quarter production rose 11 per cent, boosted by greater output at the company’s fields in Norway, Azerbaijan and Africa.
Equity output rose to 2.19 million barrels of oil equivalent a day, the company said. Statoil increased its recovery rate off Norway beyond 50 per cent.
“Production has been good, almost 2.2 million barrels per day,” said chief executive officer Helge Lund. “We have said that we would increase production by 3 per cent a year, and that guiding stands.”
Statoil plans to raise output to 2.5 million barrels of oil equivalent a day in 2020 as it expands abroad and maintains production at home. Output from fields in Azerbaijan, Angola and Algeria “surprised on the upside”, as did oil production in Norway, Carl Christian Bachke, an analyst at RS Platou Markets in Oslo, said in a note to investors.
Statoil’s international production reached 662,000 barrels of oil equivalent a day in the quarter, a record for the company.
Plans to boost output are going “according to plan”, Mr Lund said. Seasonal swings in gas prices and past delays at BP’s Norwegian Skarv field are among factors that could hold back production this year, he said.
“This is why we are keeping our guiding for the year and saying that there might be more downside than upside risk,” he said.
Net income fell to 15.11 billion kroner (€2 billion) from 15.98 billion kroner a year earlier, Statoil said. That beat the 15 billion-krone median estimate of 11 analysts surveyed by Bloomberg.
Sales increased 34 per cent to 195 billion kroner.
“A very strong report with solid earnings and cash flow,” Mr Bachke said. “Investors will take note of the strong performance upstream.”
Statoil rose as much as 2.4 per cent and traded at 152 kroner as of 12.22pm in Oslo. The stock has retreated 2 per cent this year, valuing Statoil at 484 billion kroner.
A “change of mood” has boosted momentum on the Norwegian continental shelf, Mr Lund said.
Norway’s oil output has fallen by half since 2000 and Statoil has struggled to replace reserves. – (Bloomberg)
