Equinor — Earnings Release 2016

Apr 27, 2016

Statoil ASA: 2016 first quarter results

Statoil ASA: 2016 first quarter results

Statoil (OSE:STL, NYSE:STO) reports adjusted earnings of USD 857 million in the

first quarter of 2016.

* Strong operational performance - financial results affected by low price

environment

* Continuing to capture cost reductions and efficiency gains

* Maintaining competitive capital distribution of USD 0.2201 per share

"Our financial results were affected by low oil and gas prices in the quarter.

We delivered strong operational performance across all business areas, high

production efficiency and results in line with expectations from liquids trading

and refining. The guidance for 2016 is maintained," says Eldar Sætre, President

and CEO of Statoil ASA.

"The industry is facing challenges. However, I am pleased to see progress

consistent with the priorities we presented in February. We have a firm plan to

improve efficiency and make faster and deeper cost reductions. We are radically

improving our project break evens and we are on track to re-set costs and

thereby impact the parameters that we can control", says Sætre.

Adjusted earnings were USD 857 million in the first quarter compared to USD

2,945 million in the same period in 2015. The reduction was primarily a

consequence of significantly lower liquids and gas prices, partially offset by

good operational performance and reduced underlying operating costs. Adjusted

earnings after tax were USD 122 million in the first quarter, down from USD 902

million in the same period last year.

IFRS net income was USD 611 million in the first quarter compared to a net loss

of USD 4,571 million in the same period of 2015. Net impairment reversals of USD

308 million before tax in the first quarter of 2016 positively impacted the IFRS

results compared to net impairment charges of USD 5,935 million before tax in

the same period last year.

Statoil delivered equity production of 2,054 mboe per day in the first quarter.

The underlying production growth in the quarter, after adjusting for

divestments, was 2% compared to the first quarter last year. Production from the

Norwegian continental shelf (NCS) grew 2% in the first quarter of 2016 compared

to last year, adjusted for divestments. Equity production outside of Norway was

734 mboe per day, in line with the first quarter last year, adjusted for

transactions. In the first quarter Statoil made two small discoveries on the

NCS. As of 31 March 2016, Statoil had completed seven wells, with four wells on-

going. Adjusted exploration expenses in the quarter were USD 280 million, down

from USD 351 million in the first quarter of 2015.

Cash flow from operations amounted to USD 2,205 million in the first quarter

compared to USD 3,740 million in the same period last year. In light of the low

liquids and gas prices in the quarter, Statoil maintained a strong capital

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

28.1%. Organic capital expenditure was USD 2.4 billion in the first three months

of 2016.

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

share for the first quarter. Subject to approval of the proposed scrip dividend

programme at the annual general meeting on 11 May 2016, shareholders will get

the option to receive the dividend for the first quarter in newly issued shares

in Statoil at a 5% discount. Further information on the scrip dividend programme

for the first quarter will be published in due course.

The serious incidents frequency indicator was revised as from 2016, and caters

now for Safety and Security incidents with an actual serious consequence. The

twelve month average Actual Serious incident frequency (Actual SIF) was 0.21 per

31 March 2016, compared to 0.20 in the same period last year.

As from the first quarter 2016, Statoil changed its presentation currency to

USD. For information purposes certain key figures are available in NOK in the

Supplementary section to the total quarterly report.

Key events since fourth quarter 2015:

* Drilling of the first of a total of 35 wells for the first phase of the

Johan Sverdrup field development commenced early March

* Statoil announced the acquisition of 11.93% of the shares and votes in

Lundin Petroleum, increasing Statoil's exposure to core field development

projects and growth assets on NCS, including Johan Sverdrup and Edvard Grieg

* In the Awards in Predefined Areas (APA) round 2015, Statoil was awarded

interest in 24 licences on the NCS, the highest number of licences since

2005

* In April, Statoil entered the German offshore wind market, through a 50%

acquisition of the Arkona offshore wind farm, providing renewable energy for

up to 400,000 households in Germany

Further information from:

Investor relations

Peter Hutton, Senior vice president Investor relations,

+44 7881 918 792 (mobile)

Morten Sven Johannessen, vice president Investor relations US,

+1 713 485 2276 (mobile)

Press

Knut Rostad, leader Media relations,

+47 905 48 990 (mobile)

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

(Norwegian Securities Trading Act)

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