Equinor delivered adjusted earnings of USD 15.1 billion and USD 5.80 billion after tax in the fourth quarter of 2022. Net operating income was USD 16.6 billion and net income was USD 7.90 billion.

The fourth quarter and full year were characterised by:

• Solid operational performance, contributing to energy security.
• Strong adjusted earnings.
• High value creation from marketing and trading.
• Strong cash flow, further strengthening of balance sheet.
• Cost focus and capital discipline to address inflation.
• Proposed 50% increase in ordinary cash dividend to
• USD 0.30 per share.
• Expected capital distribution in 2023 of USD 17 billion.

Going forward, Equinor is:

• Well positioned to deliver strong returns through the energy transition, expecting above 15% return on average capital employed to 2030.
• Expecting around USD 20 billion in average annual cash flow from operations after tax towards 2030.
• Investing in a profitable and robust project portfolio, contributing to energy security and decarbonisation.
• Progressing on the energy transition plan.

Anders Opedal, president and CEO of Equinor ASA:
“Equinor is uniquely positioned to provide energy and contribute to decarbonisation, while delivering strong returns. Strong earnings and cash flow will enable continued competitive capital distribution and investments in high-value, resilient projects within oil and gas, renewables, and low carbon solutions.”

“In 2022, we responded to the energy crisis and contributed to energy security. With strong operational performance, we delivered record results and cash flow from operations. We stepped up capital distribution to shareholders, while continuing to invest in a balanced energy transition and contributing to society with high tax payments. On the back of strong earnings, outlook, and balance sheet, we step up capital distribution to expected 17 billion dollars in 2023.”

“Our ambition is to be a leading company in the energy transition.”

Strong operational performance with new fields on stream

Equinor delivered a total equity production of 2,046 mboe per day for the fourth quarter, down from 2,158 mboe per day in the same quarter of 2021, impacted by turnarounds in the US offshore, the exit from Russian assets and deferral of gas production from the Norwegian continental shelf (NCS) to periods with higher demand.

During the quarter, Equinor brought on stream the Peregrino phase 2 project in Brazil and Askeladd, Johan Sverdrup Phase 2 and Njord Future on the NCS.

The floating offshore windfarm Hywind Tampen on the NCS generated its first power in the fourth quarter and will be completed in 2023. Production from renewable energy sources was 517 GWh in the quarter, down 2% from the same quarter in 2021. Including gas-to-power, total power production for the quarter ended at 1,332 GWh.

Equinor completed five exploration wells offshore with one commercial discovery in the quarter and four wells were ongoing at the quarter end.

Financial results

Equinor realised a European gas price of USD 29 per mmbtu and realised liquids prices where USD 80.4 per bbl in the fourth quarter. Although prices are comparatively higher than the corresponding quarter in 2021, European gas price weakened through the fourth quarter of 2022.

Equinor delivered strong sales and trading results, particularly from gas and power, selling to the markets with the highest demand. However, the Marketing, Midstream & Processing segment results were negative due to the timing impact of derivative contracts. In the Exploration & Production USA segment deferred tax asset has been recognised at USD 2.7 billion, with a corresponding decrease in income taxes of USD 2.8 billion resulting in a low reported effective tax rate this quarter compared to last year.

Cash flow provided by operating activities before taxes and changes in working capital amounted to USD 21.0 billion for the fourth quarter, compared to USD 18.0 billion for the same period in 2021. Organic capital expenditure was USD 2.36 billion for the quarter.

Delivering on high value, low carbon through 2022

For 2022 the adjusted earnings were USD 74.9 billion, up from USD 33.5 billion last year. Adjusted earnings after tax were USD 22.7 billion, up from USD 10.0 billion in 2021. Equinor reports a net operating income for 2022 of USD 78.8 billion, and a net income of USD 28.7 billion. Strong earnings and firm capital discipline resulted in a free cash flow of USD 23.4 billion after capital distribution and a return on average capital employed of 55% for 2022. In 2022 Equinor paid USD 42.8 billion in tax related to operations on NCS.

In 2022, seven new fields were brought on stream, adding a total capacity of around 200 mboe per day when fully ramped up. Equinor is progressing on a highly competitive project portfolio and 13 plans for development and operations were submitted in 2022.

The operational and administrative costs increased through 2022 due to higher electricity prices, CO2-costs, inflationary pressure, and higher field cost, partially offset by significant currency effects when presenting in the US dollar and mitigating actions.

As a result of long-term improvement efforts and cost control, Equinor has already realised the ambition set for 2025 to achieve improvements with a cash flow effect of USD 4 billion.

Equinor progressed several projects to reduce emissions from production, and the average CO2-emission from the operated upstream production, on a 100% basis, was 6.9 kg per boe for 2022.

The twelve-month average serious incident frequency (SIF) for 2022 was 0.4, stable from the previous year.

Renewables

With the first power from the world’s largest floating wind farm Hywind Tampen in 2022 and the world’s largest offshore wind farm, Dogger Bank in the UK, to start production in 2023, Equinor is demonstrating leadership within offshore wind. The portfolio of projects within renewables and acreage is progressing well towards the ambition of 12-16 GW of installed capacity accessed by 2030. The strategy remains focused on profitable growth, demonstrating discipline and capturing value through market cycles. Equinor expects project base returns of 4-8 %.

Low carbon solutions

In 2022, Equinor was awarded the Smeaheia CO2 licence on the NCS and had in total accessed storage capacity of 30 million tonnes CO2 per year with current equity. Equinor is well positioned as the CO2 transport and storage market develops, and policies for low carbon projects progresses. Several projects with industrial partners are in maturation, and Equinor is progressing on its ambitions to offer decarbonisation to industrial customers. The combined portfolio of projects for CO2 storage, hydrogen, energy storage and natural gas, provides flexibility and optionality, as well as a broad energy offering to industrial customers.

Outlook

• Equinor expects organic capex of USD 10-11 billion in 2023, and an annual average of around USD 13 billion for 2024-20262.
• In 2023 Equinor expects a production growth of around 3% in oil and gas, compared to 2022.

KeyFacts Energy: Equinor Norway country profile