Continued strong cash flow despite lower gas prices and maintenance

[07.11.2023] - Press release - Third quarter 2023
-Our number one job at all times is to ensure that the values in our oil and gas portfolio are realised. Our goal is also to create additional values through pro-active and strategic work in our partnerships on the Norwegian shelf. Petoro plays a key role here,- Kragseth says. Photo: Elisabeth Tønnesen
"Our number one job at all times is to ensure that the values in our oil and gas portfolio are realised. Our goal is also to create additional values through pro-active and strategic work in our partnerships on the Norwegian shelf. Petoro plays a key role here," Kragseth says. Photo: Elisabeth Tønnesen

Petoro has delivered a net cash flow from the State's Direct Financial Interest (SDFI) of NOK 219 billion as of the third quarter of 2023. Cash flow in the third quarter alone came to NOK 39 billion. The cash flow will be transferred to the Norwegian state in its entirety

"Our cash flow is still at historically high levels, despite the gas price for the first nine months this year being 52 per cent lower than for the same period last year," says Petoro CEO Kristin F. Kragseth.
 
2023 has seen the implementation of an extensive maintenance programme on the Norwegian shelf, with time-critical work on everything from field installations and onshore plants to pipeline systems and delivery points. This maintenance work helps ensure stable deliveries of gas from Norway to Europe for many years to come.
 
"Combined with a few field-specific incidents, this has led to the delivery of around five billion fewer cubic metres of natural gas from the Norwegian shelf so far this year, compared with the same period last year," Kragseth says.
 
Petoro's strong cash flow over the last two years is characterised by the market impact from the ongoing war in Ukraine, but this is not the sole reason.
 
"Our number one job at all times is to ensure that the values in our oil and gas portfolio are realised. Our goal is also to create additional values through pro-active and strategic work in our partnerships on the Norwegian shelf. Petoro plays a key role here," Kragseth says.
 
Dvalin came on stream in the third quarter, and Snøhvit is back to stable deliveries following the unforeseen downtime on Melkøya earlier this year. Breidablikk also came on stream in October, and will contribute new and crucial barrels in Petoro's portfolio.
 
"Breidablikk is one of the largest remaining oil discoveries on the Norwegian shelf and the operator Equinor with its partners has delivered the project ahead of schedule and within the estimated cost framework. Breidablikk is part of Petoro's strategy to develop fields by using existing infrastructure, in this instance via the Grane platform. We'll be seeing more investments in mature fields in the years to come," Kragseth says.
 
As we approach the upcoming winter season, Europe has never had more gas in storage than it does now. Norway has played a key role here as a secure and stable supplier of gas.
 
"Norway is the largest and most important supplier of gas to the European market and we've been instrumental in the effort to re-establish energy security for households and industry on the Continent. The job being done by players on the Norwegian shelf has been and continues to be exceptional. We need to maintain these efforts. Norwegian gas to Europe will be important for many years to come, and it will serve as a bridge-builder in the ongoing energy transition," Kragseth says.
 
Results as of the third quarter
Twelve serious incidents have been registered so far this year, compared with 11 during the same period last year. This yields a serious incident frequency of 0.55 for the last 12 months, which is a reduction from 0.6 in the 3rd quarter of last year.
 
Net cash flow from the State's Direct Financial Interest (SDFI) in the oil and gas activities totalled NOK 219 billion as of the 3rd quarter, a reduction of 182 billion from the same period last year. The decline was mainly caused by lower oil and gas prices and maintenance on certain fields and onshore plants. Net cash flow during the third quarter came to NOK 39 billion.
 
Overall oil and gas production totalled 955 thousand barrels of oil equivalent per day (kboed), 77 kboed lower than the same period last year.
 
Gas production amounted to 96 million standard cubic metres (mill. scm) per day, a reduction of ten per cent compared with the same period last year. The decline was mainly caused by maintenance on Troll and Oseberg, as well as the temporary shutdown of fields tied back to the process plant at Nyhamna.
 
Liquids production totalled 349 kboed, a reduction of 9 kboed compared with the same period last year. The decline in liquids production was primarily caused by natural production decline on several mature fields, partly offset by increased production from Johan Sverdrup phase 2.
 
 
Press contact
Head of Communications
Ørjan Heradstveit
+47 917 78 161
orjan.heradstveit@petoro.no
 

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