Equinor — Earnings Release 2009

Feb 11, 2010

Statoil's strategy update, fourth quarter 2009 and preliminary results for 2009

Continued deliveries in turbulent markets

Statoil today presents its fourth quarter results and its Strategy Update.

Statoil's fourth quarter 2009 net operating income was NOK 33.5 billion,

compared to NOK 37.8 billion in the fourth quarter of 2008. In 2009, net

operating income was NOK 121.6 billion compared to NOK 198.8 billion in 2008.

Statoil's growth strategy remains firm.

"Statoil continues to deliver solid economic and operational results in a

demanding market. The activity level is high, and our production is growing

according to plans," says Statoil's CEO Helge Lund.

Fourth quarter and annual results 2009

The quarterly operating income was NOK 33.5 billion, compared to NOK 37.8

billion in the same quarter last year. It was mainly affected by a 48% drop in

natural gas prices and a 55% reduction in refining margins. This was only partly

compensated by a 17% increase in the average prices for liquids measured in NOK,

and a 4% growth in lifted volumes of oil and gas.

Adjusted earnings in the fourth quarter 2009 were NOK 34.4 billion, compared to

NOK 43.4 billion in the fourth quarter of 2008.

Net income in the fourth quarter of 2009 was NOK 7.1 billion compared to NOK

2.0 billion in 2008. This result reflects higher oil prices and increased

lifting, lower net financial losses and lower tax rates compared to 2008, partly

offset by lower gas prices and refining margins. In 2009, net income was NOK

17.7 billion, compared to NOK 43.3 billion in 2008.

Adjusted earnings after tax was NOK 9.7 billion in the fourth quarter of 2009.

Adjusted earnings after tax excludes the effect of tax on net financial items,

and represents an effective adjusted tax rate of 72% in the fourth quarter of

2009. In 2009, adjusted earnings after tax was NOK 38.3 billion and the

effective adjusted tax rate was 71%.

The board of directors is proposing a dividend of NOK 6.00 per share for 2009.

Statoil's equity production in 2009 was 1,962 mboe per day, a 2% increase from

last year. During 2009, the equity production outside Norway reached 500 mboe

per day, and continues to grow.

"The reserve replacement ratio of 73% for 2009 is improving from a low level,

and based on our continued exploration success and growth portfolio, I am

confident that we will improve this ratio going forward. Statoil has a high

quality portfolio of non-sanctioned projects that will create attractive returns

for our shareholders," says Lund.

Strategy Update

"During the latter part of 2009, the global economy showed signs of recovery.

However, we will still see uncertainty in the global markets," says Lund.

In 2010, Statoil estimates an equity production between 1,925-1,975 mboe per

day. The range reflects the continued uncertainty regarding the demand for gas,

and our value driven gas business. During 2010 several new projects are planned

to come on stream, with start-ups scheduled towards the latter part of the year.

Morvin, Gjøa, Vega, Vega South and Leismer Demo are all scheduled to start in

the fourth quarter. Statoil's gas and oil production capacity is therefore

expected to be significantly higher towards the end of the year, compared to the

full year production guiding.

Statoil's Chief Executive confirms that the strategy as a technology driven

upstream company remains firm.

"We are positioned to continue our production growth towards 2012 despite the

current weakness in the gas markets. Statoil also has projects and resource

potential to underpin profitable growth beyond 2012," says Lund.

In 2012, Statoil estimates an equity production between 2.1-2.2 million boe per

day. There is an area of uncertainty related to the 2012 production mainly due

to the weak gas market conditions.

Statoil maintains its positive long-term view on the future competitiveness of

gas. Statoil's objective is to maximise the value of the gas portfolio, rather

than the volumes produced in any given year.

"Statoil is now taking steps towards more industrialisation and standardisation

on the NCS to reduce cost and lead time, and thereby move resources into

reserves in the most time and cost efficient way. Our ambition is to maintain

the current level of production on the NCS for the next ten years," says Lund.

Around 80% of the Hydro merger synergies have been achieved, and the remainder

will be completed during 2010. In addition, the administrative cost reduction

program has led to a current spend level which is around 15% lower than the

2008 average. Significant cost reductions have secured Statoil's highly

competitive operating unit cost position.

The Board of Directors has decided to make adjustments to the company's dividend

policy in order to create a more predictable dividend level going forward:

"It is Statoil's ambition to grow the annual cash dividend, measured in NOK per

share in line with long term underlying earnings. When deciding the annual

dividend level, the Board will take into consideration expected cash flow,

capital expenditure plans, financing requirements and appropriate financial

flexibility.

In addition to cash dividend, Statoil might buy back shares as part of total

distribution of capital to the shareholders"

The direct link to the highly volatile IFRS net income has been removed, and the

focus will be on growing the annual cash dividend per share in line with long-

term underlying earnings. The new policy does not imply a change in the

long-term dividend level, including potential share buy-backs, compared to the

previous policy. The Board emphasises the importance of maintaining an

attractive dividend level also in the future.

Statoil also announces the following guidance for 2010:

* Capital expenditure - USD 13 billion

* Unit production cost - NOK 35-36 per boe

* Exploration activity - USD 2.3 billion, and approximately 50 wells

Highlights since third quarter 2009:

* Equity production is up 2% from fourth quarter 2008 to 2,057 mboe per day.

For the full year 2009, equity production is up 2% to 1,962 mboe per day

* Entitlement production is 1,852 mboe per day, largely unchanged from fourth

quarter last year

* Average liquids prices measured in NOK are up 17%, gas prices are down 48%,

and refining margins in USD are down 55% from fourth quarter last year

* The 2009 reserve replacement rate is 73%, up from 34% in 2008. The three

year average reserve replacement ratio is 64%

* On 25 January 2010 Statoil signed the West Qurna 2 field contract with

Lukoil and the Iraqi government in which Statoil will have a 18.75% share

* On 31 January 2010 Statoil announced a swap arrangement with ConocoPhillips

involving leases in GoM and the Chukchi Sea in Alaska

* On 3 February 2010 Statoil announced that it is considering a new ownership

structure for the Energy and Retail business

References

To see end notes referenced in tables and text please download our complete

report from our website:

http://www.statoil.com/en/InvestorCentre/QuarterlyResults/Pages/default.aspx

Further information from:

Investor relations

Lars Troen Sørensen, senior vice president investor relations,

+ 47 90 64 91 44 (mobile)

Geir Bjørnstad, vice president, US investor relations,

+ 1 203 978 6950

Press

Ola Morten Aanestad, vice president for media relations,

+ 47 480 80 212 (mobile)

Kai Nielsen, public affairs manager ,

+44 (0) 78 2432 6893 (mobile)

This information is subject of the disclosure requirements acc. to §5-12 vphl

(Norwegian Securities Trading Act)

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