Norwegian energy company Statoil keeps production guidance in place despite weak results for the latest quarter. Photo by James Jones Jr./Shutterstock
STAVANGER, Norway, July 27 (UPI) -- Even though low oil prices resulted in weak earnings, Norwegian energy company Statoil said it was keeping its production expectations unchanged for the year.
The company said Wednesday its adjusted operating profit for the second quarter was $913 million, down from the $2.9 billion reported one year ago. Spending plans for 2016 were revised lower by $1 billion to $12 billion.
"Our financial results were affected by low oil and gas prices in the quarter," President and CEO Eldar Saetre said in a statement.
Statoil in January spent $538 million to acquire an 11.9 percent stake in Lundin Petroleum. The Norwegian company at the time said the acquisition would increase its exposure to the Edvard Grieg and the giant Johan Sverdrup field, a field that should generate $200 billion in revenues over the next 50 years. Both sides have spent most of the year coordinating their efforts in emerging opportunities in regional waters.
Net equity production, meanwhile, was 6 percent higher than the second quarter of 2015 in part because of discoveries off the coast of Norway, as well as one in Canada. As of June 30, the company said it completed only about a dozen or so wells, however, and spending on exploration and production for the quarter was down almost 20 percent year-on-year.
The CEO countered the weak results by noting the decision to lower spending on exploration and production was more of a reflection of improved efficiency than market pressures.
"We delivered solid operational performance with strong production growth and progress on project development and execution," he said. "We maintain our production guidance, expecting annual organic production growth of around 1 percent from 2014 to 2017."