Eldar Sætre, President and CEO of Statoil ASA explainrd:"Our financial results were affected by low oil and gas prices in the quarter. We delivered strong operational performance across all business areas, high production efficiency and results in line with expectations from liquids trading and refining. The guidance for 2016 is maintained”
"The industry is facing challenges. However, I am pleased to see progress consistent with the priorities we presented in February. We have a firm plan to improve efficiency and make faster and deeper cost reductions. We are radically improving our project break evens and we are on track to re-set costs and thereby impact the parameters that we can control", says Sætre.
Adjusted earnings were US$857 million in the first quarter compared to US$2945 million over the same period in 2015. The reduction was primarily a consequence of significantly lower liquids and gas prices, partially offset by good operational performance and reduced underlying operating costs. Adjusted earnings after tax were US$122 million in the first quarter, down from USD$902 million in the same period last year.
IFRS net income was US$611 million in the first quarter compared to a net loss of US$4571 million in the same period of 2015. Net impairment reversals of US$308 million before tax in the first quarter of 2016 positively impacted the IFRS results compared to net impairment charges of US$5935 million before tax in the same period last year.
Statoil delivered equity production of 2054 million boe /d in the first quarter. The underlying production growth in the quarter, after adjusting for divestments, was 2% compared to the first quarter last year. Production from the Norwegian continental shelf (NCS) grew 2% in the first quarter of 2016 compared to last year, adjusted for divestments. Equity production outside of Norway was 734 million boe /d, in line with the first quarter last year, adjusted for transactions. In the first quarter Statoil made two small discoveries on the NCS. As of 31 March 2016, Statoil had completed seven wells, with four wells on-going. Adjusted exploration expenses in the quarter were US$280 million, down from USD 351 million in the first quarter of 2015.
Cash flow from operations amounted to US$2205 million in the first quarter compared to US$3740 million in the same period last year. In light of the low liquids and gas prices in the quarter, Statoil maintained a strong capital structure, and net debt to capital employed at the end of the quarter was 28.1%. Organic capital expenditure was US$2.4 billion in the first three months of 2016.
The board of directors has decided to pay a dividend of US$0.2201 per ordinary share for the first quarter. Subject to approval of the proposed scrip dividend programme at the annual general meeting on 11 May 2016, shareholders will get the option to receive the dividend for the first quarter in newly issued shares in Statoil at a 5% discount. Further information on the scrip dividend programme for the first quarter will be published in due course.
The serious incidents frequency indicator was revised as from 2016, and caters now for Safety and Security incidents with an actual serious consequence. The twelve month average Actual Serious incident frequency (Actual SIF) was 0.21 per 31 March 2016, compared to 0.20 in the same period last year. As from the first quarter 2016, Statoil changed its presentation currency to US$. For information purposes certain key figures are available in NOK in the Supplementary section to the total quarterly report.
Key events since fourth quarter 2015:
Adapted from a press release by Louise Mulhall
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