Equinor considers more US asset sales in revamp of global strategy By Reuters

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© Reuters. FILE PHOTO: A view of the Johan Sverdrup oil field in the North Sea

By Dmitry Zhdannikov and Nerijus Adomaitis OSLO (Reuters) – Norway’s Equinor seeks to sell more assets in the United States and exit several other countries as part of a major global reorganization as it tries to return to profit after writing off $ 25 billion in assets Americans. in the last decade. While the company, like other large energy companies, has been affected by last year’s drop in oil and gas prices, Equinor’s new director of international business, Al Cook, said it lacked scale in the US shale market and had underestimated the strength of local competition. Equinor dumped its Eagle Ford-operated shale assets in 2019, and last week said it had agreed to sell its assets in the Bakken shale oil province in the states of North Dakota and Montana for about $ 900 million. . “All of our onshore positions in the United States are under the same type of review that we have done at Bakken,” Cook told Reuters in an interview. “We have a position operated in Utica, we have a position operated in Austin Chalk, those are under very active review at this time,” he added. As of the second quarter of 2020, Equinor had about 232,000 net acres in the Appalachian Basin, including 27,000 acres that it operates, and about 114,000 net acres in Louisiana Austin Chalk, about half of which it operates. Cook said Equinor was slow to realize that US production was unprofitable at low oil prices, as the country essentially assumed the role of OPEC’s swing producer. However, Equinor will maintain and possibly expand its operations in the Gulf of Mexico, its large non-operated position in Appalachian gas and its wind business in the Northeast US, following a strategy similar to that of the UK, where is a major gas supplier. and producer of wind energy. “We believe that it can become a profitable, low-carbon business that will thrive under the kind of measures that President Joe Biden is taking in America … and we will eventually consider turning it into a hydrogen business,” Cook said. “FATTY CHICKEN, SHARP PEAKS” Equinor currently has a presence in more than 20 countries outside of Norway, generating a third of its total production or around 700,000 barrels of oil equivalent per day. Cook, who joined Equinor in 2016 after a decade at BP (NYSE :), including his job as chief of staff to then-CEO Bob Dudley, said that while he expects overseas production to increase, it is likely that come from fewer countries. “With the low price of oil, our chickens came home to sleep, and we found that they were very fat and had very sharp beaks … causing a billion dollar losses.” Equinor has already released or announced that it will be leaving around 10 countries from the end of 2019, including South Africa, Indonesia, New Zealand, Uruguay, Turkey, Australia, and the United Arab Emirates. In a major change, it will no longer seek offshore “material” operated onshore positions, but will instead partner with experienced local operators such as Rosneft in Russia, YPF in Argentina and Chesapeake in Appalachia, Cook said. It will also focus on previously developed areas with a faster return on investment and less on border exploration. “We can’t do exploration where we say this would one day produce oil and gas, because one day the world will not need all the oil and gas,” Cook said. Recently, the company has written the total value of its liquefied natural gas (LNG) development in Tanzania. “We have to see what we are good at. We are good underground, we are very good at finding oil and gas … we are good in marine environments with big waves and strong winds,” he said, adding that it was a good fit for Norway, the Gulf of Mexico of the United States, Brazil and the United Kingdom, as well as with Canada and Azerbaijan. “We want to produce more, at least in the next decade, but we want to produce with less emissions.”