OSLO (Reuters) - Norwegian oil firm Equinor (EQNR.OL) is reviewing its capital and exploration spending plans with the oil industry hit by the fallout from the coronavirus pandemic and the oil price crash, it said on Tuesday.
The company said in February it planned for capital spending of between $10 billion (8 billion pounds) and $11 billion in 2020 and 2021, rising to around $12 billion in 2022 and 2023, allowing it to significantly increase spending on renewable energy projects.
“We are assessing capital and exploration spending, and costs across all business areas to see what we can do to remain robust in the short- and the long-term,” Equinor spokesman Baard Glad Pedersen told Reuters.
Europe’s second-largest natural gas supplier after Russia’s Gazprom (GAZP.MM), and the largest oil producer on the Norwegian continental shelf, last Wednesday reported the industry’s first coronavirus infection on an offshore installation.
The company said it would reduce non-critical activity offshore and has asked employees who are currently working offshore to extend their rotation to reduce the risk of spreading the coronavirus. Confirmed cases in Norway have risen to more than 1,300.
“We are doing all we can to reduce the risk of the coronavirus spread and to maintain our production,” Pedersen said.
Equinor and other oil producers around the world have also been hit by a price war between Saudi Arabia and Russia, which pushed Brent crude LCOc1 to below $30 a barrel on Monday for the first time since January 2016.
Thanks to cost-cutting efforts during the market’s downturn in 2014-2016, Equinor managed to boost its cash flows significantly when prices recovered, raising its dividend and launching a $5 billion share buyback programme last year.
The programme’s second tranche - worth $675 million when including the Norwegian state’s share and scheduled to run from May 18 to Oct. 28 - was still on the table, pending approval by the annual shareholders’ meeting, the spokesman said.
Reporting by Nerijus Adomaitis, editing by Gwladys Fouche, Kirsten Donovan