Amid Production Concerns, Equinor Pledges Steady Output

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Written by Daniel Graeber for Industrial Info Resources (Sugar Land, Texas)--Norwegian energy company Equinor (NYSE:EQNR) (Stavanger) said it would keep oil and gas production above 1 million barrels of oil equivalent per day through 2035, even as the nation frets over declining output.

Norway's offshore regulator reported total crude oil production averaged 1.8 million barrels per day in July, about 6% above expectations. Natural gas production averaged 12.7 billion cubic feet per day, around 12% above forecast.

An August report from the Norwegian Offshore Directorate (NOD), however, warned that production from existing fields is expected to decline by 2025 due largely to maturation.

"Based on current knowledge, production from operating fields is expected to drop by more than half during the period through and including 2033," the report read.

Norway is a main oil and gas supplier to the European economy, replacing Russia as the top gas exporter after sanctions imposed in response to the war in Ukraine diminished Moscow's market share in the bloc.

Equinor added in a late August report that it aimed to keep its own domestic production at around 1.2 million barrels of oil equivalent per day (Boe/d) through 2035.

The company reported average production at 2.05 million Boe/d during the second quarter, a 2.7% increase over the same period last year. The company said that its gas performance in particular was strong, with high production from the Troll and Oseberg fields supporting a 13% year-on-year increase.

"The level of activity and value creation is high," said Kjetil Hove, Equinor's executive vice president for upstream operations in Norway. "We have plans to further develop our operations in Norway so that this will continue in the future."

More oil will come onstream later this year when operations begin at the Johan Castberg field. Using a floating production vessel, Equinor aims to tap the field with its expected 460-650 million barrels of oil equivalent by the fourth quarter. Production should last about 30 years.

Elsewhere, Equinor said it expected to keep production levels stable through the middle of the next decade while at the same time working to lower its environmental footprint. Production offshore is already low carbon relative to other basins and companies are starting to use electricity instead of diesel to power some of the offshore rigs.

"We also see significant ripple effects in Norway from the electrification portfolio and projects tied back to existing infrastructure," added Trond Bokn, Equinor's senior vice president for project development.

Given its dominance in the Norwegian energy sector, Equinor said it's among the largest customers. Installation and project development upstream is a multi-billion-dollar industry.

Equinor is not alone. Aker BP (Lysaker, Norway) said that it, along with its license partners, aims to invest some US$19 billion on projects on the Norwegian continental shelf. The company said it would use the investments to boost production by around 20%, to around 525,000 Boe/d, by 2028. Aker BP during the second quarter reported production at 444,000 Boe/d and put its full-year guidance at between 420,000 and 440,000 Boe/d. Guidance marked a 2.5% increase from previous goals.

Aker BP added that all of its projects are on schedule, supporting some 250 Norwegian suppliers.

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