Equinor — Earnings Release 2015

Oct 28, 2015

Statoil ASA: 2015 third quarter results

Statoil ASA: 2015 third quarter results

Statoil (OSE:STL, NYSE:STO) delivered adjusted earnings of NOK 16.7 billion and

adjusted earnings after tax of NOK 3.7 billion in the third quarter. Statoil

reported net income in accordance with IFRS of negative NOK 2.8 billion, mainly

due to net impairment charges and provisions.

"We continue to reduce underlying operational costs and deliver a quarter with

strong operational performance and solid results from marketing and trading. In

the third quarter, our financial results continued to be affected by low liquids

prices. The results enable us to increase our guided production growth to above

3% for 2015, as well as reduce the guided capital expenditure level with USD 1

billion to around USD 16.5 billion. We have generated a strong cash flow in the

current environment and have a solid balance sheet with a net debt ratio of

24%," says president and CEO of Statoil ASA, Eldar Sætre.

Adjusted earnings were NOK 16.7 billion in the third quarter compared to NOK

30.9 billion in the same period in 2014. The reduction was primarily a

consequence of lower liquids prices and increased depreciation, partially offset

by stronger refining margins, good operational performance and reduced

underlying operating costs. Realised average liquids prices in the quarter were

down 37% measured in NOK compared to the third quarter last year. Adjusted

earnings after tax were NOK 3.7 billion, compared to NOK 9.1 billion in the same

period last year.

Statoil's net operating income according to IFRS for the quarter was NOK 7.3

billion, compared to NOK 17.0 billion in the same period in 2014. Net impairment

charges of NOK 4.8 billion related to exploration assets and various other asset

impairments and reversals, provisions for disputes of NOK 3.3 billion and net

other adjustments of NOK 1.3 billon impacted the IFRS results. Earnings per

share were negative NOK 0.89 in the quarter, an improvement compared to negative

NOK 1.48 in the same period last year.

"We are progressing our efficiency programs according to the plan we

communicated in February, and continue to reduce the underlying operational

cost. I am pleased with the way we are taking costs down, but the continued low

prices in the third quarter demonstrates that we must continue to chase further

cost efficiencies," says Sætre.

Statoil delivered production of 1,909 mboe per day in the third quarter, up 4%

compared to the same period in 2014. The underlying production growth, after

adjusting for divestments, was 7% compared to the third quarter last year. The

production from the Norwegian continental shelf (NCS) grew 10% in the third

quarter of 2015 compared to last year, adjusted for divestments. Equity

production outside of Norway was 735 mboe per day, a 4% increase compared to the

same period last year, adjusted for divestments.

Statoil is pleased with the development of Johan Sverdrup with cost estimates

coming down by 7%. However, Statoil and its partners have decided to accept a

delayed timetable for the commencement of production from the Aasta Hansteen and

Mariner fields from 2017 to the second half of 2018. The updated cost estimate

for Aasta Hansteen has been increased by around 9% since the plan for

development and operation (PDO). In addition, a currency effect of NOK 2.4

billion brings the total cost estimate to around NOK 37 billion. For Mariner,

the cost increase is slightly above 10% as compared to the original plan.

In the third quarter Statoil made two discoveries on the NCS, as well as one on

the UK Continental Shelf. As of 30 September, Statoil had completed 33 wells,

with five wells on-going. Adjusted exploration expenses in the quarter were NOK

3.4 billion, marginally down from NOK 3.6 billion in the third quarter of 2014.

Cash flow from operations amounted to NOK 90.2 billion in the first nine months

compared to NOK 99.1 billion last year. Statoil maintained a strong capital

structure, and net debt to capital employed at the end of the quarter was 24%.

Organic capital expenditure was USD 11.6 billion in the first nine months.

The board of directors has decided to pay a dividend of USD 0.2201 per ordinary

share for the third quarter and Statoil shares will trade ex-dividend on Oslo

Børs commencing 17 February 2016. From and including the third quarter,

dividends will be declared in USD, with the NOK dividend calculated and

communicated four business days after the record date for the Oslo Børs

shareholders.

The serious incident frequency (SIF) for the 12 months period ending 30

September 2015 was 0.5 compared to 0.6 the same period last year.

Key events since second quarter 2015:

* The plan for development and operation (PDO) for Johan Sverdrup, Phase One,

was approved by the Ministry of Petroleum and Energy in August

* The Peregrino field offshore Brazil passed a significant milestone, with

100 million barrels of oil produced since April 2011

* Statoil and its partners put the first subsea gas compression facility on

line at Åsgard in the Norwegian Sea, adding more than 300 million barrels of

oil over the field's life

* The final pipe in the 482 kilometer long Polarled Pipeline was laid at the

Aasta Hansteen field at a depth of 1,260 meters in the Norwegian Sea.

Polarled was delivered under budget and is the first pipeline on the NCS to

cross the Arctic Circle

* In October Statoil acquired a 24% equity share in the UK part of Alfa

Sentral, a gas and condensate field planned to be developed as a tie-back to

the existing infrastructure for Sleipner on the NCS

* Two new compressors on the Troll A platform were started up, increasing the

gas recovery from the field by 83 billion cubic meters

* Wenche Agerup was elected as new member of the board of directors, replacing

Catherine Hughes who withdrew from the board in April

Further information from:

Investor relations

Peter Hutton, Senior vice president Investor relations,

+44 7881 918 792 (mobile)

Press

Knut Rostad, Media relations,

+47 9054 8990 (mobile)

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

(Norwegian Securities Trading Act)

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