Statoil reported net operating income of $180 million and adjusted earnings of $913 million in the second quarter of 2016.
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Net operating income was $180 million in the second quarter compared to $3,635 million in the same period of 2015. The reduction was primarily due to the drop in prices for oil and gas and lower refinery margins.
Cost reductions contributed positively to the results. Net operating income for the second quarter in 2015 was impacted by a significant sales transaction.
Adjusted earnings were $913 million in the second quarter compared to $2,883 million in the same period in 2015. In addition to the continued low prices, the result reflects reduced overall operating costs mainly as a result of the on-going cost improvement initiatives.
Adjusted earnings after tax were negative $28 million in the second quarter, down from $929 million in the same period last year.
Statoil delivered equity production of 1,959 mboe per day in the second quarter. The underlying production growth in the quarter, after adjusting for divestments, was 6% compared to the second quarter of last year.
In the second quarter Statoil made two discoveries on the Norwegian continental shelf (NCS) and one in Canada. As of 30 June 2016, Statoil had completed 15 wells. Adjusted exploration expenses in the quarter were $423 million, down from $524 million in the second quarter of 2015.
Cash flow from operations amounted to $3,349 million in the first half of 2016 compared to $6,278 million in the same period last year.
Organic capital expenditure was $5.3 billion in the first six months of 2016, and net debt to capital employed at the end of the quarter was 31.2%.
Statoil is lowering its capex guidance for 2016 from $13 billion to $12 billion and its exploration guidance for 2016 from $2 billion to $1.8 billion. Production guidance remains unchanged, and expected annual organic production growth is 1% from 2014 to 2017.
The board of directors has decided to pay a dividend of $0.2201 per ordinary share for the second quarter.
Pursuant to the scrip dividend programme approved at the annual general meeting on 11 May 2016, shareholders will have the option to receive the dividend for the second quarter in cash or newly issued shares in Statoil at a 5% discount. ■