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Investing.com -- Equinor’s stock fell 5.6% on Wednesday following a first-quarter trading update that signaled weaker-than-expected results across key business segments.
The Norwegian energy company flagged lower income from liquids and LNG trading, while additional costs tied to its carbon capture and storage (CCS) operations further pressured expectations.
Analysts at Jefferies now see a 5–10% downside to consensus for adjusted operating income, currently forecast at $2.5 billion. Full Q1 results are due on April 30.
This underperformance, paired with a $100 million cost hit from CCS appraisal well drilling, is expected to weigh on adjusted earnings for the Marketing, Midstream & Processing (MMP) segment.
Equinor now guides for MMP adjusted earnings of $400–800 million, down from $659 million in Q4 and in line with consensus at the lower end.
In Exploration & Production Norway, realized liquids prices ranged between $72.8–74.8 per barrel, up from $71.4 in Q4 and close to the consensus of $72.7.
Realized gas prices improved to $13.23/mmbtu, ahead of both the $12.1 posted in Q4 and the $12.6 market expectation.
However, production trends were softer. February production data from the Norwegian Offshore Directorate showed a 2.4% quarter-on-quarter decline in liquids and a 1.3% drop in gas, diverging from consensus expectations of a 4.1% increase in liquids and a 1.2% gas decline.
In the E&P International division, realized liquid prices stood at $66–70 per barrel (vs. $66.6 in Q4 and $68.5 consensus).
Production is expected to decline due to the divestments of stakes in the ACG and Agbami fields.
These assets contributed to Q4 output of 338,000 barrels of oil equivalent per day on a working interest basis.
Equinor’s U.S. E&P unit posted higher liquids prices of $60–62 per barrel, an increase from $58.8 in Q4 but slightly under the $62 consensus.
Gas prices improved quarter-on-quarter, and production is expected to rise due to an increased stake in the Appalachia North asset. That said, this was offset by higher operating costs. Q4 production was 335,000 boe/d.
Equinor paid NOK 35.2 billion in tax for the quarter related to the Norwegian Continental Shelf. Two additional tax payments of the same amount are expected in Q2.
The company also drew $1.5 billion in project financing for the Empire Wind offshore wind project and redeemed $1.25 billion in bonds.