Equinor Extends Hammerfest LNG Plant Maintenance Outage to July 29

Equinor ASA has extended the maintenance outage at its Hammerfest LNG plant to July 29. The Norwegian oil and gas company is Scandinavia's largest oil group, with a primary focus on refining and distributing oil products. The outage is expected to impact the plant's operations, but the exact impact on production is not specified.

Equinor ASA, the Norwegian energy giant, has extended the maintenance outage at its Hammerfest LNG plant until July 29. This development comes as the company continues to grapple with operational challenges and lower-than-expected prices for its core business units. The extended outage is expected to impact the plant's operations, but the exact impact on production remains unspecified.

The maintenance outage at Hammerfest LNG is part of a broader set of operational events that have affected Equinor's second-quarter performance. The company reported a disappointing trading update, with adjusted post-tax operating income coming in roughly 5% below consensus estimates [1]. This underperformance was driven by declining production and softer prices across key business units, including the Exploration and Production Norway division and the International E&P segment [1].

In its core Exploration and Production Norway division, Equinor posted realized liquids prices in the range of $64.8–$66.8 per barrel, down from $73.8 in Q1 and slightly trailing the consensus of $65.8. Gas prices also dropped to $10.6 per MMBtu, from $12.6 in the prior quarter—though slightly ahead of the $10.3 market forecast [1]. Production trends also showed weakness, with liquids falling 0.8% and gas production slumping 12.6% compared to the previous quarter [1].

The International E&P segment also underperformed, with realized liquids pricing sliding to $58–$62 per barrel, down from $68.3 last quarter and slightly under the $62.1 consensus. Output is expected to come in lower, at 233,000 barrels of oil equivalent per day, versus 244,000 in Q1 [1].

The company also classified its Peregrino field in Brazil and UK operations as “held for sale,” exempting them from depreciation. These assets had accounted for $355 million in depreciation during Q1 [1].

In the U.S. E&P division, realized liquid prices ranged from $55 to $57 per barrel, slipping from $61.2 in Q1 and closely matching the consensus of $55.9. Gas prices also saw a decline [1]. Offshore production rose, while onshore volumes held steady. Overall, total production is estimated at 357,000 boe/day, a dip from 366,000 in the first quarter [1].

Equinor’s Marketing, Midstream & Processing unit is expected to post adjusted earnings between $400 million and $800 million, up from $253 million in Q1 but still shy of the $659 million consensus. The company cited underperformance in crude trading and the extended Hammerfest LNG maintenance, which cut into profits by about $80 million [1].

The extended maintenance outage at Hammerfest LNG is a significant factor that could further impact Equinor's financial performance in the coming quarters. Analysts will be closely monitoring the company's ability to manage these operational challenges and the broader market conditions that are affecting its core business units.

References:
[1] https://ih.advfn.com/market-news/article/12210/equinor-falls-short-of-q2-earnings-forecast-as-output-and-energy-prices-decline