UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF THE
SECURITIES EXCHANGE ACT OF 1934
For the month of February 2024
Commission File Number 1-15200
Equinor ASA
(Translation of registrant’s name into English)
FORUSBEEN 50, N-4035, STAVANGER,
 
NORWAY
(Address of principal executive offices)
Indicate by check mark whether the registrant files
 
or will file annual reports under cover of Form
 
20-F or Form 40-F:
Form 20-F
X
 
Form 40-F
This Report on Form 6-K contains a report of
 
the fourth quarter 2023 results of Equinor ASA.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
2
Equinor fourth quarter and full year 2023 results
Equinor delivered adjusted earnings* of USD 8.68 billion and USD 1.88 billion
 
after tax in the fourth
quarter of 2023. Net operating income was USD 8.75 billion and net
 
income was USD 2.61 billion.
The fourth quarter and full year were characterised by:
●
 
Strong financial performance
●
 
2.1% production growth in 2023
 
●
 
Continued optimising of oil and gas portfolio, sanctioning projects for future growth
●
 
Growth in onshore renewables power production and portfolio
●
 
Cost focus and capital discipline
Competitive capital distribution
●
 
Proposed increase in ordinary cash dividend to USD 0.35 per share, set ambition to grow
 
quarterly cash dividend by 2 cents per
year
 
●
 
Proposed extraordinary cash dividend of USD 0.35 per share
●
 
Announced two-year share buy-back programme of USD 10-12 billion, with USD
 
6 billion for 2024
 
●
 
Expected total capital distribution in 2024 of USD 14 billion
Equinor is well positioned for profitable growth towards 2035
Key ambitions:
●
 
Stronger cash flow and sustaining competitive returns. Growing cash flow from operations
 
after tax* towards 2030 and 2035 by
adding material contribution from renewables and low carbon solutions on top of stable cash flow
 
from oil, gas and trading.
●
 
Broader energy. Maintaining high oil and gas production, significant profitable growth in renewable power, decarbonised energy
and CO
2
 
storage.
●
Lower emissions. Reducing operated emissions and increasing production of low carbon energy
 
and CCS to reduce carbon
intensity.
Anders Opedal, president and CEO of Equinor ASA:
“In 2023 we continued to contribute to energy security in Europe and delivered 2.1% production
 
growth. Solid operational performance
and cost focus yielded strong financial results and cash flow. We delivered competitive capital distribution, while investing in a
profitable portfolio that will contribute to future growth.”
 
«Equinor is well positioned to deliver profitable growth. We expect to grow our cash flow and sustain competitive
 
returns. We are
extending the outlook for stable contribution from oil and gas to 2035. By 2030 we expect
 
material and rapidly growing cash flow from
our renewables and low carbon business.”
“We will provide a broader energy offering with lower emissions. We aim to grow renewables and decarbonised energy to more
 
than
80 terawatt hours by 2035 and have increased our ambition for carbon storage.”
Financial information
Quarters
Change
Full year
(unaudited, in USD million)
Q4 2023
Q3 2023
Q4 2022
Q4 on Q4
2023
2022
Change
Net operating income/(loss)
8,748
7,453
16,584
(47%)
35,770
78,811
(55%)
Adjusted earnings*
1)
8,681
8,024
17,014
1)
(49%)
36,220
 
76,921
1)
(53%)
Net income/(loss)
2,608
2,501
7,897
(67%)
11,904
28,744
(59%)
Adjusted earnings after tax*
1)
1,879
2,731
4,719
1)
(60%)
10,371
 
22,680
1)
(54%)
Cash flows provided by operating activities
2,736
5,236
4,267
(36%)
24,701
35,136
(30%)
Cash flow from operations after taxes paid*
2,787
7,594
6,800
(59%)
19,741
39,752
(50%)
Net cash flow*
(3,262)
1,479
1,669
N/A
(8,340)
23,388
N/A
Operational information
 
Group average liquids price (USD/bbl) [1]
75.7
80.3
80.4
(6%)
75.0
94.1
(20%)
Total equity liquids and gas production (mboe per day) [4]
2,197
2,007
2,046
7%
2,082
2,039
2%
Total power generation (GWh) Equinor share
1,241
883
1,332
(7%)
4,235
2,661
59%
 
 
 
 
 
Equinor fourth quarter 2023
 
3
Renewable power generation (GWh) Equinor share
694
373
517
34%
1,937
1,649
17%
*
For items marked with an asterisk throughout this report, see
 
Use and reconciliation of non-GAAP financial measures
 
in the Supplementary disclosures
1) Restated. For more information, see Amended principles
 
for Adjusted earnings in the section ‘Use and reconciliation
 
of non-GAAP financial measures’ in the
Supplementary disclosures.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
4
Health, safety and the environment
Full year
Full year
2023
2022
Serious incident frequency (SIF)
0.4
0.4
Full year
Full year
2023
2022
Upstream CO
2
 
intensity (kg CO
2
/boe)
6.7
6.9
Full year
Full year
2023
2022
Absolute scope 1+2 GHG emissions (million tonnes
 
CO
2
e)
11.6
11.4
31 December
 
31 December
%-point
Net debt to capital employed adjusted*
2023
2022
change
Net debt to capital employed adjusted*
(21.6%)
(23.9%)
2.3
Dividend
(USD per share)
Q4 2023
Q3 2023
Q4 2022
Ordinary cash dividend per share
0.35
0.30
0.30
Extraordinary cash dividend per share
0.35
0.60
0.60
In 2023 Equinor settled shares in the market under the share buy-back programmes
 
of USD 1.95 billion and USD 3.64 billion for the
Norwegian government’s share of the 2022 programme and the first tranche of the 2023 programme.
Strong operational performance
Equinor delivered strong production for the fourth quarter of 2,197 mboe per day, up from 2,046 in the same quarter of 2022, driving
production growth for 2023 to 2.1%, above the updated guidance of 1.5%.
Equity liquids and gas production was up 14% and 1% respectively, from the same quarter in 2022. The production increase was
mainly driven by strong production at the Johan Sverdrup field and new wells in
 
production. The production increase was also driven
by contributions from the international portfolio with the Peregrino field reaching plateau
 
production and strong performance from US
offshore assets.
Power production from renewable energy sources reached 694 GWh in the quarter, up 34% from the same quarter last year. This
increase was mainly driven by onshore production from Rio Energy in Brazil and Wento in Poland,
 
along with production from Hywind
Tampen. In the UK, the world's largest offshore windfarm, Dogger Bank, delivered first power in the fourth quarter and is currently
ramping up production. Including the UK gas-to-power, total power production ended at 1,241 GWh for the quarter.
Strong financial results
Equinor delivered strong adjusted earnings* of USD 8.68 billion and USD 1.88 billion after tax in
 
the fourth quarter. Gas prices are
significantly down compared to the extraordinary price levels seen in 2022, and more than offset the contribution from increased
production.
 
In the fourth quarter, Equinor recognised net impairments of USD 328 million, mainly related to the announced sale of assets
 
and exit
from Azerbaijan.
Cash flow provided by operating activities, before taxes paid and working capital items, amounted
 
to USD 10.89 billion for the fourth
quarter. Cash flow from operations after tax*
 
ended at USD 2.79 billion for the fourth quarter, bringing the cash flow from operations
after tax* to USD 19.7 billion for the year.
Equinor paid two ordinary NCS tax instalments in the fourth quarter and an extra instalment
 
in October, totalling at USD 7.9 billion.
One ordinary instalment of USD 3.7 billion
1)
, will be paid in the first quarter of 2024.
Organic capital expenditure* was USD 2.99 billion for the quarter, and USD 10.2 billion for the full year. Total capital expenditure was
USD 3.77 billion for the fourth quarter and USD 14.5 billion for 2023.
 
After taxes, capital distribution to shareholders and investments, net cash flow* ended at negative
 
USD 3.26 billion for the fourth
quarter and at negative USD 8.34 billion for the full year. Equinor retains a strong financial position with adjusted net debt to capital
employed ratio* at negative 21.6% by the end of the fourth quarter, compared to negative 22.9% at the end of the
 
third quarter of
2023.
 
Equinor fourth quarter 2023
 
5
Progressing on strategy and enabling future growth
As the largest energy provider to Europe, Equinor continues to develop its broad portfolio to
 
contribute to energy security.
On the NCS Equinor increased its ownership share to 50% in the Linnorm discovery
 
in the Norwegian Sea, which is the largest
undeveloped gas discovery on the NCS. The Breidablikk field ramped up successfully towards its
 
plateau production of around 60
mboe per day at 100%. In a response to Europe’s need for long-term, reliable energy supply, Germany’s state owned energy
company SEFE entered into a long-term gas sales agreement with Equinor. Under the contract Equinor will deliver 10 bcm of gas
annually at least to 2034 and pursue large scale hydrogen supplies. Equinor made final investment
 
decision on the partner-operated
Sparta field in the US Gulf of Mexico, the third large investment decision in the international
 
upstream business of the year. The
Sparta field has estimated resources above 250 million boe and is designed for a production capacity
 
of 100 mboe per day. Equinor
continued to focus its international oil and gas, with the announced sale of assets in Nigeria
 
and Azerbaijan. These assets have
delivered profitable production to Equinor over the last decades.
In the UK, operations recently started at Blandford Road battery asset, the company’s first commercial power storage asset.
 
Danske
Commodities will provide market access and optimisation, providing further value creation in a power market
 
with a high share of
intermittent renewable power.
Equinor has announced its intention to take full ownership of the Empire Wind projects in the US through
 
a swap transaction with bp,
where bp takes full ownership to the Beacon Wind projects.
Equinor completed 12 exploration wells offshore with 9 commercial discoveries in the quarter. At the quarter end, 4 wells were
ongoing.
In 2023 Equinor added proved reserves mainly through sanctioning of new field developments, resulting
 
in an organic reserve
replacement ratio (RRR) of 104%, and an organic three-year average of 107%, excluding purchase
 
and sales.
Equinor progressed several projects to reduce emissions from production, and the average CO2-emission from the
 
operated
upstream production, on a 100% basis, was 6.7 kg per boe for 2023. Absolute greenhouse gas
 
emissions scope 1 and 2 was 11.6
tonnes CO2 equivalents for the full year.
The twelve-month average serious incident frequency (SIF) for 2023 was 0.4, stable from the
 
previous year.
Competitive capital distribution
The board of directors proposes to the annual general meeting on 14 May 2024 an ordinary
 
cash dividend of USD 0.35 per share for
the fourth quarter 2023, an increase of USD 0.05 per share from the third quarter of 2023, and
 
sets an ambition to grow the quarterly
cash dividend by 2 cents per year. Based on the strong earnings in 2023 and the robust financial position of the company, the board
of directors further proposes an extraordinary cash dividend of USD 0.35 per share for the fourth
 
quarter of 2023. Equinor share will
trade ex-dividend on Oslo Børs and New York Stock Exchange from and including 15 May 2024.
The interim cash dividends for the first, second and third quarter of 2024, to be decided
 
by the board of directors on a quarterly basis
in line with the company’s dividend policy, subject to existing and renewed authorisation from the annual general meeting, are
expected to be at the same level as for the fourth quarter of 2023.
The fourth tranche of the share buy-back programme for 2023 was completed on 19 January
 
2024 with a total value of USD 1.67
billion. Following this, the total share buy-backs under the share buy-back programme for 2023
 
amounts to USD 6 billion.
The board of directors has decided to announce a two-year share buy-back programme for
 
2024-2025 of USD 10-12 billion in total,
with up to USD 6 billion for 2024. The share buy-back programme will be subject to market outlook
 
and balance sheet strength. The
first tranche of up to USD 1.2 billion of the 2024 share buy-back programme will
 
commence on 8 February and end no later than 5
April 2024. Commencement of new share buy-back tranches after the first tranche in
 
2024 will be decided by the board of directors on
a quarterly basis in line with the company’s dividend policy and will be subject to existing and new board
 
authorisations for share buy-
back from the company’s annual general meeting and agreement with the Norwegian State regarding share
 
buy-back.
(1)
 
NOK 37 billion, USD estimate based on a USD/NOK exchange
 
rate assumption of 10.
 
 
 
Equinor fourth quarter 2023
 
6
Capital markets update: Profitable growth towards 2035
With a firm strategy and strong portfolio of projects, Equinor is well positioned for profitable growth with
 
a stronger cash flow, a
broader energy offering and lower emissions towards 2035
1
.
Key ambitions:
●
 
Stronger cash flow:
Grow cash flow from operations after tax* to around USD 23 billion by 2030 and to more than USD
 
26 billion by 2035. Deliver
high returns while transitioning with a ROACE*
 
above 15% towards 2030 and target to sustain a level of around 15% through
2035.
 
●
 
Broader energy:
Produce more than 80 TWh from renewables and decarbonised energy and deliver transport
 
and storage of 30-50 million tonnes
CO
2
 
annually by 2035. Maintain oil and gas production of around 2 million barrels per day through
 
2030 and produce around 1.2
million barrels per day from the Norwegian Continental Shelf in 2035.
 
●
 
Lower emissions:
50% net reduction of operated emissions by 2030, and 40% reduction in net carbon intensity by
 
2035, in line with our Energy
transition plan
2
.
 
Equinor is contributing to energy security, while driving decarbonisation and energy transition.
Stronger cash flow
 
Equinor expects to sustain an annual average cash flow from operations after tax* from oil, gas and trading
 
of around USD 20 billion
through 2035. Renewables and low carbon solutions are expected to deliver a material contribution
 
with around USD 3 billion in 2030
and above USD 6 billion in 2035.
Equinor will continue to optimise the oil and gas portfolio and invest in a profitable project
 
portfolio coming on stream the next ten
years, with an average breakeven price of around USD 35 per boe, 30% internal rate of return,
 
2.5 years payback time and an
upstream operated scope 1 CO
2
 
intensity below 6 kg per boe. Equinor expects to deliver above 5% production growth for
 
oil and gas
from 2023 – 2026 and maintain production of around 2 million barrels per day in 2030.
Broader energy offering
Equinor is set to broaden the energy offering and aims to deliver above 80 TWh from renewables
 
and decarbonised energy by 2035.
Based on extensive experience from CCS and project pipeline progress, Equinor also increases the ambition
 
for annual CO
2
 
storage
to 30-50 million tonnes in 2035.
For the renewables portfolio, Equinor expects real base project returns of 4-8%. CCS projects
 
are also expected to deliver real base
project returns of 4-8%, with potential for higher returns as markets mature.
Lower emissions
Equinor continue to progress according to the Energy transition plan. Gross investments
 
in renewables and low carbon solutions
increased to 20% in 2023 and Equinor is on the path to reach the ambition of above
 
50% by 2030. Equinor’s operated emissions are
30% lower in 2023 compared to 2015. The company is on track to deliver on the
 
2030 ambition of net 50 percent reduction in
operated scope 1 & 2 CO
2
 
emissions. Reduced emissions, growth in renewables, decarbonised energy and CCS, underpins the
ambition to reduce net carbon intensity by 20% by 2030 and 40% by 2035.
Updated outlook for 2024:
●
 
Organic capex* of around USD 13 billion
3
.
●
 
Stable oil and gas production from 2023.
●
 
Doubling of annual power production from renewable sources compared to 2023.
This press release contains Forward Looking Statements. Please see the Forward Looking Statement
 
disclaimer published on
Equinor.com/investors/cmu-2024-forward-looking-statements
1
 
All forward looking financial numbers
 
are based on
Brent blend 75 USD/bbl, Henry
 
Hub 3.5 USD/mmbtu and European gas price
 
2024/25: 13
USD/mmbtu, and 2026 onwards: 9 USD/mmbtu
2
 
See Equinor Energy transition plan at https://www.equinor.com/magazine/our-plan-the-energy-transition
3
 
USD/NOK exchange rate assumption of
 
10.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
7
GROUP REVIEW
Financial information
Quarters
Change
Full year
(unaudited, in USD million)
Q4 2023
Q3 2023
Q4 2022
Q4 on Q4
2023
2022
Change
Total revenues and other income
29,054
26,024
34,321
(15%)
107,174
150,806
(29%)
Adjusted total revenues and other income*
1)
28,483
25,735
 
35,501
1)
(20%)
105,871
 
151,891
1)
(30%)
Total operating expenses
(20,306)
(18,571)
(17,737)
14%
(71,404)
(71,995)
(1%)
Adjusted purchases* [5]
(13,672)
(12,392)
(12,781)
7%
(48,003)
(54,415)
(12%)
Adjusted operating and administrative expenses*
(3,235)
(2,703)
(3,032)
7%
(11,540)
(10,530)
10%
Adjusted depreciation, amortisation and net impairments*
(2,518)
(2,426)
(2,279)
11%
(9,374)
(8,879)
6%
Adjusted exploration expenses*
(377)
(190)
(396)
(5%)
(734)
(1,146)
(36%)
Net operating income/(loss)
8,748
7,453
16,584
(47%)
35,770
78,811
(55%)
Adjusted earnings*
1)
8,681
8,024
 
17,014
1)
(49%)
36,220
 
76,921
1)
(53%)
Capital expenditures and Investments
3,031
2,652
2,376
28%
10,575
8,758
21%
Cash flows provided by operating activities
2,736
5,236
4,267
(36%)
24,701
35,136
(30%)
Cash flows from operations after taxes paid*
2,787
7,594
6,800
(59%)
19,741
39,752
(50%)
Quarters
Change
Full year
Operational information
Q4 2023
Q3 2023
Q4 2022
Q4 on Q4
2023
2022
Change
Total equity liquid and gas production (mboe/day)
2,197
2,007
2,046
7%
2,082
2,039
2%
Total entitlement liquid and gas production (mboe/day)
2,065
1,879
1,919
8%
1,954
1,901
3%
Total Power generation (GWh) Equinor share
1,241
883
1,332
(7%)
4,235
2,661
59%
Renewable power generation (GWh) Equinor share
694
373
517
34%
1,937
1,649
17%
Average Brent oil price (USD/bbl)
84.1
86.8
88.7
(5%)
82.6
101.2
(18%)
Group average liquids price (USD/bbl)
75.7
80.3
80.4
(6%)
75.0
94.1
(20%)
E&P Norway average internal gas price (USD/mmbtu)
11.45
8.83
27.22
(58%)
12.20
31.22
(61%)
E&P USA average internal gas price (USD/mmbtu)
1.76
1.08
4.73
(63%)
1.77
5.55
(68%)
1) Restated. For more information, see Amended principles for Adjusted earnings in the section
 
‘Use and reconciliation of non-GAAP
financial measures’ in the Supplementary disclosures.
Operations and financial results
Equinor delivers strong production increases in the fourth quarter, securing a robust financial performance despite the impact of lower
commodity prices relative to 2022.
Sustained high production levels and efficiency from Johan Sverdrup on the NCS, including phase
 
2 which came onstream in
December 2022, contributed substantially to the increased production within E&P Norway
 
for the fourth quarter and full year of 2023.
The growth in production was also supported by the international portfolio with Peregrino in Brazil
 
reaching plateau during the quarter
and Caesar Tonga in the US making notable contributions following added capacity from the first quarter of 2023.
New volumes from Buzzard in the UK following the Suncor UK acquisition, early start-up of Breidablikk
 
on the NCS in the fourth
quarter and the ramp-up of partner operated Vito in the US in the first half of the year all positively
 
contributed to production growth.
These increases were partially offset by the effects of the divestments from Corrib in early 2023 and in Martin Linge and Ekofisk
 
in the
third quarter of 2022.
Operational challenges, turnarounds and extended maintenance activities, particularly affecting NCS gas assets earlier in 2023,
impacted an otherwise solid full year operational performance for Equinor. The decline in full year production from the NCS, was more
than offset by strong production from the international assets securing a full year increase compared to the high levels reported
 
for
2022.
Power generation from Rio Energy and the continued maturation of both onshore and offshore projects within
 
the Renewable portfolio
contributed well to Equinor’s power generation in the fourth quarter
 
of 2023. The increase from the Brazilian acquisition was offset by
decreased gas-to-power in the fourth quarter, attributed to decreased clean spark spread. Full year 2023 power generation increase is
primarily driven by the acquisition of Triton Power in the second half of 2022 and Rio Energy in 2023.
Equinor fourth quarter 2023
 
8
Solid production growth combined with high realised prices drove strong revenue and results
 
for the fourth quarter and full year 2023.
Realised commodity prices, particularly gas, were markedly reduced from the elevated levels
 
in 2022, and as such more than offset
the production increase, resulting in a decline in revenue relative to the prior year. The Marketing, Midstream and Processing segment
supported the total group results through a sound delivery within Gas and Power trading and optimisation.
 
However, reduced refinery
margins and absence of favourable arbitrage opportunities captured in prior quarters resulted in
 
a lower contribution to group results.
Throughout the year Equinor has increased production capacity leading to an increase in
 
operating and maintenance costs in the
quarter and for the full year of 2023. The reduction in energy prices from the
 
highs experienced in 2022 has reduced transportation
tariffs partially offsetting the increase.
The prevailing inflationary pressures and a number of one-off costs have also impacted the upward movement
 
in operating expenses
in the fourth quarter of 2023. The USD remains strong against the NOK thereby limiting
 
the visibility of these increases in the reported
costs.
 
Adjusted depreciation,
 
amortisation and net impairments*
 
increased in the quarter and for the full year compared to 2022 primarily due
to investments in producing fields,
 
and strong production from Peregrino in Brazil, partially offset by a reduced rate of depreciation in
E&P Norway resulting from prior quarter impairments.
Successful near-field exploration activity on the NCS has balanced limited commercial
 
discoveries internationally during 2023. During
the fourth quarter of 2023 exploration expenses included costs related to unsuccessful exploration
 
wells in the Gulf of Mexico.
 
The
prior year fourth quarter included the expense of previously capitalised well costs for
 
the E&P International segment.
In the fourth quarter of 2023 net operating income was negatively impacted by impairments of USD
 
328 million, primarily relating to
the planned exit from Azerbaijan. In comparison, net impairment reversals totalling USD 1,094 million
 
impacted the results in the
fourth quarter of 2022. In the full year of 2023 net impairments of USD 1,320 million were
 
recognised in contrast to net impairment
reversals of USD 2,429 million in the full year 2022, contributing to the relative decrease in net
 
operating income for 2023.
Taxes
The reported effective tax rate was 72.1% for the fourth quarter of 2023 (45.4% for the fourth quarter of 2022) and 68.6% for
 
the full
year 2023 (63.4% for the full year 2022). The change in reported tax rates for the fourth quarter
 
and full year has been influenced by
recognition of previously unrecognised deferred tax assets in the US in the fourth quarter
 
of 2022.
The effective tax rate on adjusted earnings of 78.4% for the fourth quarter of 2023 and 71.4% for the full year increased
 
compared to
72.3% and 70.5% in 2022 due to higher prior period adjustments in 2023 compared with 2022 and by the
 
recognition of the US
deferred tax assets in the fourth quarter of 2022.
Cash flow, net debt and capital distribution
Strong financial results from the business during the fourth quarter of 2023, driven by a strong
 
operational performance, generated
cash flow provided by operating activities before taxes paid and working capital items of
 
USD 10,890 million. The downward
movement in commodity prices drove this decrease of USD 10,098 million from the
 
prior year.
Taxes paid of USD 8,103 million in the fourth quarter have reduced from the
 
prior year outflow of USD 14,188 million. The payment
primarily consists of two Norwegian corporation tax instalments in addition
 
to an extra payment of USD 930 million (NOK 10,000
million) resulting from updated results when compared to previous estimates.
 
The reduction in payment compared to the same period
in the prior year reflects the relatively lower pricing environment of 2023.
 
NCS tax instalments totalling NOK 111 billion are expected
to be paid in the first half of 2024.
A working capital increase of USD 51 million negatively
 
impacted the cash flow in the fourth quarter 2023,
 
compared to an increase of
USD 2,532 million in the fourth quarter of 2022.
Net cash flow* decreased by USD 4,741 million from the prior quarter to an outflow of USD 3,262
 
million primarily reflecting the
increased NCS tax instalments. Full year cash flow from operations after taxes paid* concluded
 
at USD 19,741 million inflow, with net
cash outflow* of USD 8,340 million demonstrating a significant increase in shareholder distribution.
A decrease in liquid assets in the quarter with stable equity caused a slight increase in the net
 
debt to capital employed adjusted ratio*
at the end of 2023 from negative 22.9% at the end of September 2023 to
 
negative 21.6%.
 
The board of directors proposes to the annual general meeting on 14 May 2024
 
an ordinary cash dividend of USD 0.35 per share for
the fourth quarter 2023, an increase of USD 0.05 per share from the third quarter of 2023, and sets
 
an ambition to grow the quarterly
cash dividend by 2 cents per year. Based on the strong earnings in 2023 and the robust financial position of the company, the board
of directors further proposes an extraordinary cash dividend of USD 0.35 per share for the fourth
 
quarter of 2023. Equinor share will
trade ex-dividend on Oslo Børs and New York Stock Exchange from and including 15 May 2024.
 
 
 
 
 
 
Equinor fourth quarter 2023
 
9
The interim cash dividends for the first, second and third quarter of 2024, to be decided
 
by the board of directors on a quarterly basis
in line with the company’s dividend policy, subject to existing and renewed authorisation from the annual general meeting, are
expected to be at the same level as for the fourth quarter of 2023.
The fourth tranche of the share buy-back programme for 2023 was completed on 19 January
 
2024 with a total value of USD 1.67
billion. Following this, the total share buy-backs under the share buy-back programme for 2023
 
amounts to USD 6 billion.
The board of directors has decided to announce a two-year share buy-back programme for
 
2024-2025 of USD 10-12 billion in total,
with USD 6 billion for 2024. The share buy-back programme will be subject to market outlook and
 
balance sheet strength. The first
tranche of up to USD 1.2 billion of the 2024 share buy-back programme will commence on
 
8 February and end no later than 5 April
2024. Commencement of new share buy-back tranches after the first tranche in 2024 will be
 
decided by the board of directors on a
quarterly basis in line with the company’s dividend policy and will be subject to existing and new
 
board authorisations for share buy-
back from the company’s annual general meeting and agreement with the Norwegian State regarding share
 
buy-back.
Based on adjusted earnings after tax and average capital employed, calculated
return on average capital employed (ROACE)
* was
24.9 % for the 12-month period ended 31 December 2023 and 55.1 % for the 12-month period
 
ended 31 December 2022.
 
Organic capital expenditures
* amounted to USD 10.2 billion for the full year 2023. Total capital expenditures were USD 14.5 billion
for the full year 2023.
Estimated
Proved reserves
at the end of 2023 were 5,214 million barrels of oil equivalent (boe), a net increase of 23 million
 
boe
compared to 5,191 million boe at the end of 2022.
The net increase was mainly due to more volumes being added through extensions and
 
discoveries, with a net increase of 507 million
boe in 2023 compared to 278 million boe in 2022. The net increase was mainly due to sanctioning
 
of the Raia field in Brazil, the
Rosebank field in UK and the Sparta field in the USA. Revisions and improved recovery
 
projects added to the increase, with a net
increase of 232 million boe in 2023 compared to a net increase of 344 million boe in
 
2022. The net effect of the purchase and sale of
reserves slightly reduced the proved reserves by 4 million boe in 2023.
The entitlement production in 2023
 
was 711 million boe compared to 695 million boe in 2022.
This results in a reserve replacement ratio (RRR) of
 
103% and an organic RRR excluding purchase and sale of 104% in 2023
compared to 76% and 89% in 2022. The corresponding three-year average replacement
 
ratio was 98%, and the organic three-year
average was 107% at the end of 2023 compared to 62% and 70% at the end of 2022.
The RRR measures the estimated proved reserves added to the reserve base, including the effects of sales and purchases,
 
relative to
the amount of oil and gas produced.
All reserves numbers are preliminary and include equity accounted entities.
Health, safety and the environment
The twelve-month average serious incident frequency (SIF) for the period ending 31 December
 
2023 remained stable with the prior
year at 0.4.
Absolute scope 1+2 GHG emissions for Equinor’s operated production, on a 100% basis, were
 
11.6 million tonnes CO
2
e
for the full
year 2023. This is an increase from the prior year of 0.2 million tonnes CO
2
e. Resumption of activity at the Hammerfest LNG facility in
Norway and the return to normal operations of production at the Peregrino field in Brazil contributed
 
to the increase.
 
Equinor fourth quarter 2023
 
10
OUTLOOK
 
●
Organic capital expenditures*
 
are estimated at around USD 13 billion for 2024
4
.
●
Oil & gas production
 
for 2024 is estimated to be stable compared to the 2023 level [6].
●
Renewable power generation
for 2024 is estimated to double compared to the 2023 level.
●
 
Equinor’s ambition is to keep the
unit of production cost
 
in the top quartile of its peer group.
●
Scheduled maintenance activity
 
is estimated to reduce equity production by around 60 mboe per day for the full year
 
of 2024.
These forward-looking statements reflect current views about future events and are, by their nature, subject
 
to significant risks and
uncertainties because they relate to events and depend on circumstances that will
 
occur in the future. Deferral of production to create
future value, gas off-take, timing of new capacity coming on stream and operational regularity and levels of industry
 
product supply,
demand and pricing represent the most significant risks related to the foregoing production guidance.
 
Our future financial
performance, including cash flow and liquidity, will be affected by the extent and duration of the current market conditions, the
development in realised prices, including price differentials and other factors discussed elsewhere in the report.
 
For further
information, see section Forward-looking statements in the report.
4
 
USD/NOK exchange rate assumption of 10.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
11
SUPPLEMENTARY
 
OPERATIONAL
 
DISCLOSURES
 
Operational information
Quarters
Change
Full year
Operational information
Q4 2023
Q3 2023
Q4 2022
Q4 on Q4
2023
2022
Change
Prices
Average Brent oil price (USD/bbl)
84.1
86.8
88.7
(5%)
82.6
101.2
(18%)
E&P Norway average liquids price (USD/bbl)
79.3
84.3
83.8
(5%)
78.6
97.5
(19%)
E&P International average liquids price (USD/bbl)
73.1
79.1
77.2
(5%)
72.6
92.0
(21%)
E&P USA average liquids price (USD/bbl)
66.0
68.1
68.6
(4%)
64.4
81.0
(20%)
Group average liquids price (USD/bbl) [1]
75.7
80.3
80.4
(6%)
75.0
94.1
(20%)
Group average liquids price (NOK/bbl) [1]
821
842
819
0%
792
905
(12%)
E&P Norway average internal gas price (USD/mmbtu)
 
[8]
11.45
8.83
27.22
(58%)
12.20
31.22
(61%)
E&P USA average internal gas price (USD/mmbtu)
 
[8]
1.76
1.08
4.73
(63%)
1.77
5.55
(68%)
Realised piped gas price Europe (USD/mmbtu)
 
[7]
1)
13.07
10.93
29.84
1)
(56%)
13.86
 
32.84
1)
(58%)
Realised piped gas price US (USD/mmbtu) [7]
2.07
1.57
5.40
(62%)
2.09
5.89
(64%)
Refining reference margin (USD/bbl) [2]
6.1
15.2
15.5
(61%)
10.2
14.5
(30%)
Entitlement production (mboe per day)
E&P Norway entitlement liquids production
658
636
610
8%
645
605
7%
E&P International entitlement liquids production
254
252
228
12%
240
203
18%
E&P USA entitlement liquids production
156
155
100
56%
145
114
27%
Group entitlement liquids production
1,068
1,044
938
14%
1,030
922
12%
E&P Norway entitlement gas production
806
647
791
2%
729
782
(7%)
E&P International entitlement gas production
24
25
31
(21%)
26
32
(18%)
E&P USA entitlement gas production
167
164
160
4%
168
165
2%
Group entitlement gas production
997
836
981
2%
924
980
(6%)
Total entitlement liquids and gas production [3]
2,065
1,879
1,919
8%
1,954
1,901
3%
Equity production (mboe per day)
E&P Norway equity liquids production
658
636
610
8%
645
605
7%
E&P International equity liquids production
323
318
293
10%
304
281
8%
E&P USA equity liquids production
174
174
112
55%
162
127
28%
Group equity liquids production
1,155
1,128
1,015
14%
1,112
1,013
10%
E&P Norway equity gas production
806
647
791
2%
729
782
(7%)
E&P International equity gas production
39
37
50
(23%)
41
47
(13%)
E&P USA equity gas production
197
195
190
4%
200
197
2%
Group equity gas production
1,042
879
1,031
1%
970
1,026
(5%)
Total equity liquids and gas production [4]
2,197
2,007
2,046
7%
2,082
2,039
2%
Power generation
Power generation (GWh) Equinor share
1,241
883
1,332
(7%)
4,235
2,661
59%
Renewable power generation (GWh) Equinor share
2)
694
373
517
34%
1,937
1,649
17%
1) Restated. Restatement due to change in
 
the definition of the price marker. For more information see 'End notes'.
2) Includes Hywind Tampen renewable power generation.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
12
Health, safety and the environment
Full year
Full year
2023
2022
Total recordable injury frequency (TRIF)
2.4
2.5
Serious Incident Frequency (SIF)
0.4
0.4
Oil and gas leakages (number of)
1)
10
8
Full year
Full year
2023
2022
Upstream CO
2
 
intensity (kg CO
2
/boe)
2)
6.7
6.9
Full year
Full year
2023
2022
Absolute scope 1+2 GHG emissions (million tonnes
 
CO
2
e)
3)
11.6
11.4
1)
 
Number of leakages with rate above 0.1 kg/second during
 
the past 12 months.
2)
 
Operational control, total scope 1 emissions of CO
2
 
from exploration and production, divided by total
 
production (boe).
3)
 
Operational control, total scope 1 and 2 emissions
 
of CO
2
 
and CH
4.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
13
EXPLORATION
 
& PRODUCTION NORWAY
Financial information
Quarters
Change
Full year
(unaudited, in USD million)
Q4 2023
Q3 2023
Q4 2022
Q4 on Q4
2023
2022
Change
Total revenues and other income
10,076
7,938
16,729
(40%)
38,340
75,930
(50%)
Adjusted total revenues and other income*
9,871
8,164
16,968
(42%)
38,213
75,443
(49%)
Total operating expenses
(2,339)
(2,604)
(2,343)
(0%)
(9,253)
(8,315)
11%
Adjusted operating and administrative expenses*
(1,018)
(849)
(1,053)
(3%)
(3,730)
(3,836)
(3%)
Adjusted depreciation, amortisation and net impairments*
(1,144)
(1,107)
(1,219)
(6%)
(4,429)
(4,986)
(11%)
Adjusted exploration expenses*
(138)
(120)
(101)
37%
(476)
(361)
32%
Net operating income/(loss)
7,737
5,335
14,386
(46%)
29,087
67,614
(57%)
Adjusted earnings/(loss)*
7,571
6,087
14,594
(48%)
29,577
66,260
(55%)
Additions to PP&E, intangibles and equity accounted
investments
1,577
1,421
1,422
11%
5,939
4,922
21%
Operational information
Quarters
Change
Full year
E&P Norway
Q4 2023
Q3 2023
Q4 2022
Q4 on Q4
2023
2022
Change
E&P entitlement liquid and gas production (mboe/day)
1,464
1,283
1,401
4%
1,374
1,387
(1%)
Average liquids price (USD/bbl)
79.3
84.3
83.8
(5%)
78.6
97.5
(19%)
Average internal gas price (USD/mmbtu)
11.45
8.83
27.22
(58%)
12.20
31.22
(61%)
Production & revenues
 
In the fourth quarter of 2023, E&P Norway delivered strong production performance driven by sustained high
 
production level and
operational efficiency from Johan Sverdrup and the early start-up of Breidablikk field, more than
 
offsetting natural decline on several
fields and unplanned turnaround extension on Troll C. Liquids production rose by 8% and gas production was up by 2%
 
in fourth
quarter this year compared to fourth quarter of 2022.
Despite a robust production performance for the fourth quarter 2023, full year production ended slightly below the 2022
 
level.
 
In the second and third quarters of 2023, unplanned turnaround extensions on Troll and Nyhamna (impacting Aasta Hansteen and
Ormen Lange) contributed to the year-on-year reduction.
 
The strong
 
production in
 
the fourth
 
quarter of
 
2023 helped
 
to offset
 
some of
 
the impact
 
of lower
 
gas prices
 
on revenue.
 
While gas
prices have increased from the prior quarter, realised prices have experienced a sharp decline from 2022 peaks. The movement in the
pricing environment outweighed production
 
increases, resulting in
 
a notable decrease
 
in revenues for
 
both the fourth
 
quarter and the
full year of 2023 compared to 2022.
 
Operating expenses and financial results
 
For the
 
fourth quarter
 
of 2023,
 
updated estimates
 
drove an
 
escalation in
 
Gassled removal
 
costs, impacting
 
adjusted operating
 
and
administrative
 
expenses*.
 
The
 
development
 
in
 
the
 
NOK/USD
 
exchange
 
rate
 
offset
 
this
 
increaseand
 
its
 
visibility
 
in
 
the
 
reported
numbers.
Adding
 
to
 
this,
 
for
 
the
 
year
 
2023,
 
there
 
has
 
been
 
higher
 
operation
 
and
 
maintenance
 
cost,
 
as
 
well
 
as
 
environmental
expenses, compared to the same period last year. In contrast, energy prices have fallen, leading to lower
 
transportation and electricity
cost.
 
Lower asset
 
carrying values
 
due to
 
prior quarter
 
impairments, combined
 
with the
 
effect of
 
the development
 
in NOK/USD
 
exchange
rate,
 
led
 
to
 
a
 
decrease
 
in
 
adjusted
 
depreciation,
 
amortisation and
 
net
 
impairments*
 
in
 
the
 
fourth
 
quarter
 
of
 
2023
 
compared
 
to
 
the
same
 
quarter last
 
year.
 
The decrease
 
was partially
 
offset
 
by higher
 
investment levels
 
for
 
some fields.
 
For the
 
year 2023
 
the
 
main
factor contributing to the decrease compared to 2022 was the NOK/USD exchange rate
 
development.
 
Successful exploration
 
activity resulted
 
in five
 
commercial discoveries
 
for
 
E&P Norway
 
in the
 
fourth
 
quarter 2023.
 
A higher
 
activity
level (eight
 
wells this
 
quarter compared
 
to six
 
wells in
 
fourth quarter
 
last year)
 
with a
 
lower capitalisation
 
rate led
 
to an
 
increase in
exploration expenses in the fourth quarter this year compared to same quarter last
 
year.
Net operating income
 
was positively affected
 
by a gain
 
from sale of
 
ownership shares in
 
the Statfjord area
 
of USD 222
 
million in
 
the
fourth quarter of
 
2023. For the
 
full year 2023,
 
there was a negative
 
impact from impairment of
 
USD 588 million
 
related to an
 
asset in
the North Sea. In 2022 the net
 
operating income was positively impacted by a
 
gain from sale of ownership shares in Martin Linge
 
and
Ekofisk of USD 730 million and net impairment reversals of USD 814 million.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
14
EXPLORATION
 
& PRODUCTION INTERNATIONAL
Financial information
Quarters
Change
Full year
(unaudited, in USD million)
Q4 2023
Q3 2023
Q4 2022
Q4 on Q4
2023
2022
Change
Total revenues and other income
1,889
1,990
2,373
(20%)
7,032
7,431
(5%)
Adjusted total revenues and other income*
1,952
1,849
1,897
3%
6,956
7,616
(9%)
Total operating expenses
(1,553)
(1,152)
(551)
>100%
 
(4,700)
(4,183)
12%
Adjusted purchases*
(45)
58
(85)
(47%)
(70)
(116)
(40%)
Adjusted operating and administrative expenses*
(559)
(458)
(438)
28%
(1,915)
(1,675)
14%
Adjusted depreciation, amortisation and net impairments*
(603)
(594)
(433)
39%
(2,123)
(1,445)
47%
Adjusted exploration expenses*
(55)
(47)
(266)
(79%)
16
(573)
N/A
Net operating income/(loss)
336
838
1,822
(82%)
2,332
3,248
(28%)
Adjusted earnings/(loss)*
690
809
676
2%
2,863
3,806
(25%)
Additions to PP&E, intangibles and equity accounted
investments
923
888
584
58%
4,376
2,623
67%
Operational information
Quarters
Change
Full year
E&P International
Q4 2023
Q3 2023
Q4 2022
Q4 on Q4
2023
2022
Change
E&P equity liquid and gas production (mboe/day)
362
355
343
5%
345
328
5%
E&P entitlement liquid and gas production (mboe/day)
278
277
258
8%
266
235
13%
Production sharing agreements (PSA) effects
83
78
85
(1%)
79
94
(15%)
Average liquids price (USD/bbl)
73.1
79.1
77.2
(5%)
72.6
92.0
(21%)
Production & Revenues
 
In both the fourth quarter and full year
 
of 2023, E&P International achieved a 5%
 
growth in production compared to the corresponding
periods
 
in
 
2022.
 
These
 
strong
 
production
 
results
 
can
 
primarily
 
be
 
attributed
 
to
 
the
 
Peregrino
 
field
 
achieving
 
plateau
 
in
 
the
 
fourth
quarter,
 
coupled with
 
the full-year
 
production in
 
2023. Additionally,
 
positive contributions
 
from the
 
Buzzard field
 
in the
 
UK, following
the Suncor
 
acquisition in
 
July 2023,
 
and a
 
notable decrease
 
in turnaround
 
effects
 
in the
 
fourth quarter
 
further increased
 
the overall
production
 
level.
 
The natural
 
decline experienced
 
in various
 
fields,
 
the
 
divestment of
 
the
 
Corrib asset
 
which closed
 
on
 
March 31,
2023, and higher turnaround activities throughout 2023 partially offset this increase.
The decrease in the effects of
 
production sharing agreements (PSA) in the fourth quarter and
 
full year of 2023, was mainly caused
 
by
lower oil and gas prices, in combination with a decrease in production from several fields with
 
PSAs.
 
Despite
 
the
 
less
 
favourable
 
market
 
prices
 
compared
 
to
 
2022,
 
E&P
 
International
 
achieved
 
strong
 
financial
 
results
 
in
 
2023.
 
The
increase
 
in
 
adjusted
 
total
 
revenues
 
and
 
other
 
income*
 
in
 
the
 
fourth
 
quarter
 
compared
 
to
 
last
 
year
 
is
 
primarily
 
attributed
 
to
 
higher
production levels. The fair value of derivatives positively impacted total revenue and other income for
 
the full year by USD 96 million.
Operating expenses and financial results
Higher
 
operation
 
and
 
maintenance
 
expenses
 
associated
 
with
 
turnarounds
 
across
 
various
 
fields,
 
drove
 
an
 
increase
 
in
 
adjusted
operating and
 
administrative expenses*
 
in both
 
the fourth
 
quarter and
 
the full
 
year of
 
2023. Increased
 
royalties and
 
production fees
linked
 
to
 
higher
 
production
 
at
 
the
 
Peregrino
 
field
 
contributed
 
to
 
the
 
overall
 
rise
 
in
 
costs.
 
P&L
 
impacts
 
from
 
the
 
reassessment
 
of
retirement obligations,
 
along with
 
a one-off
 
R&D expenditure
 
associated with
 
internal reallocation
 
to the
 
business also
 
impacted the
operating expenses in the quarter.
 
The inclusion of Buzzard,
 
strong production from Peregrino
 
and Bandurria Sur in
 
Argentina,
 
in addition to several
 
new investments in
producing fields resulted
 
in an increase
 
in adjusted depreciation,
 
amortisation and net
 
impairments* compared to
 
the prior year.
 
Well
costs
 
from
 
the
 
prior
 
year
 
relating
 
to
 
Azerbaijan,
 
Karabagh,
 
and
 
drilling
 
costs
 
in
 
Canada
 
were
 
expensed
 
causing
 
the
 
reduction
 
in
exploration expenses
 
year on
 
year.
 
The capitalisation of
 
previously expensed
 
exploration wells
 
in Brazil
 
also positively
 
impacted the
2023 numbers.
 
In the fourth quarter of 2023 net operating income was negatively impacted by net impairments
 
of USD 310 million, primarily relating
to the planned exit from Azerbaijan. In comparison, net impairment reversals totalling USD 744 million impacted the results
 
in the
fourth quarter of 2022. In the full year of 2023 impairments of USD 346 million were recognised in
 
contrast to net impairments of USD
351 million in the full year 2022, contributing to the relative decrease in net operating income for
 
2023.
Additions to PP&E, intangibles and equity accounted investments increased year-on-year primarily
 
driven by the development of
Bacalhau and Raia in Brazil, combined with the acquisition of Suncor Energy UK
 
Limited finalised in the second quarter of 2023.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
15
EXPLORATION
 
& PRODUCTION USA
Financial information
Quarters
Change
Full year
(unaudited, in USD million)
Q4 2023
Q3 2023
Q4 2022
Q4 on Q4
2023
2022
Change
Total revenues and other income
1,165
1,162
1,083
8%
4,319
5,523
(22%)
Adjusted total revenues and other income*
1,165
1,130
1,083
8%
4,286
5,523
(22%)
Total operating expenses
(1,022)
(496)
(262)
>100%
 
(2,966)
(1,501)
98%
Adjusted operating and administrative expenses*
(308)
(293)
(217)
41%
(1,156)
(933)
24%
Adjusted depreciation, amortisation and net impairments*
(506)
(472)
(363)
40%
(1,779)
(1,422)
25%
Adjusted exploration expenses*
(184)
(23)
(29)
>100%
(274)
(212)
30%
Net operating income/(loss)
143
666
821
(83%)
1,353
4,022
(66%)
Adjusted earnings/(loss)*
168
343
474
(65%)
1,076
2,957
(64%)
Additions to PP&E, intangibles and equity accounted
investments
332
338
281
18%
1,206
764
58%
Operational information
Quarters
Change
Full year
E&P USA
Q4 2023
Q3 2023
Q4 2022
Q4 on Q4
2023
2022
Change
E&P equity liquid and gas production (mboe/day)
372
369
302
23%
363
324
12%
E&P entitlement liquid and gas production (mboe/day)
323
319
260
24%
314
279
12%
Royalties
49
50
42
16%
49
44
10%
Average liquids price (USD/bbl)
66.0
68.1
68.6
(4%)
64.4
81.0
(20%)
Average internal gas price (USD/mmbtu)
1.76
1.08
4.73
(63%)
1.77
5.55
(68%)
Production & Revenues
 
In the fourth quarter of 2023, E&P USA delivered a strong operational performance due to the
 
ramp-up of the Vito field which started
production earlier in the year. The Caesar Tonga field increased its production following the installation of new flowlines placed in
service late 2022. The addition of new wells in the Appalachia also resulted in a further
 
production increase from this basin. While
natural decline impacted several assets in the portfolio, consistent and high production regularity
 
more than offset these effects.
Increased entitlement production helped to mitigate some of the downward impacts on revenue
 
caused by the significantly lower price
environment, in particular for gas, this quarter and the full year of 2023 compared to the
 
same periods last year.
 
Operating expenses and financial results
Operating expenditures and depreciation and amortisation increased due to the higher production
 
and the addition of new assets. The
Vito ramp-up, Caesar Tonga and Appalachia increases resulted in higher transportation expenses and production cost. Furthermore,
the fourth quarter of 2023 saw increased maintenance in the Appalachian Basin and
 
on several mature fields in the Gulf of Mexico. In
the fourth quarter, E&P USA concluded on drilling activity for three exploration prospects in the Gulf of Mexico. All the three prospects
were dry or non-commercial and were expensed accordingly, resulting in a significant increase in exploration cost for the quarter.
Net operating income for the full year of 2023 included net impairment reversals amounting to
 
USD 266 million, compared to USD
1,071 million in net impairment reversals for the same period of 2022, which were primarily
 
related to the assets in the Gulf of Mexico.
 
In the fourth quarter of 2022, the net operating income included impairment reversals amounting
 
to USD 350 million.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
16
MARKETING, MIDSTREAM & PROCESSING
Financial information
Quarters
Change
Full year
(unaudited, in USD million)
Q4 2023
Q3 2023
Q4 2022
Q4 on Q4
2023
2022
Change
Total revenues and other income
28,668
25,712
33,591
(15%)
105,908
148,105
(28%)
Adjusted total revenues and other income*
1)
28,257
25,371
 
35,010
1)
(19%)
104,860
 
149,580
1)
(30%)
Total operating expenses
(27,934)
(24,730)
(33,842)
(17%)
(101,925)
(144,493)
(29%)
Adjusted purchases* [5]
(26,241)
(23,083)
(31,969)
(18%)
(95,733)
(139,949)
(32%)
Adjusted operating and administrative expenses*
(1,365)
(1,195)
(1,389)
(2%)
(4,988)
(4,516)
10%
Adjusted depreciation, amortisation and net
impairments*
(227)
(217)
(236)
(4%)
(897)
(881)
2%
Net operating income/(loss)
734
982
(251)
N/A
3,984
3,612
10%
Adjusted earnings*
1)
424
876
 
1,416
1)
(70%)
3,242
 
4,234
1)
(23%)
- Gas and Power
2)
472
371
1,212
(61%)
2)
2,038
3,942
(48%)
- Crude, Products and Liquids
2)
84
466
210
(60%)
2)
1,359
683
99%
- Other
2)
(132)
38
(6)
>100%
2)
(155)
(391)
(60%)
Additions to PP&E, intangibles and equity
accounted investments
218
342
349
(38%)
844
1,212
(30%)
Operational information
Quarters
Change
Full year
Q4 2023
Q3 2023
Q4 2022
Q4 on Q4
2023
2022
Change
Liquids sales volumes (mmbl)
3)
245.6
260.0
212.1
3)
16%
956.3
815.9
3)
17%
Natural gas sales Equinor (bcm)
16.1
13.0
15.8
2%
58.9
63.3
(7%)
Natural gas entitlement sales Equinor (bcm)
14.5
12.0
14.2
2%
53.2
56.1
(5%)
Power generation (GWh) Equinor share
547
510
815
(33%)
2,298
1,012
>100%
 
Realised piped gas price Europe (USD/mmbtu)
3)
13.07
10.93
29.84
3)
(56%)
13.86
32.84
3)
(58%)
Realised piped gas price US (USD/mmbtu)
2.07
1.57
5.40
(62%)
2.09
5.89
(64%)
1) Restated. For more information, see Amended principles
 
for Adjusted earnings in the section ‘Use and reconciliation
 
of non-
GAAP financial measures’ in the Supplementary disclosures.
2) From Q1 2023, the presentation of MMP’s adjusted
 
earnings has been changed to align with organisational
 
structure and
management’s review of performance, with retrospective effect.
3) Restated. Restatement due to a change in
 
definition of the price marker for realised gas
 
price and improved methodology for
calculating liquids sales volumes. For more information,
 
see 'End notes'.
Volumes, Pricing & Revenues
Liquids sales volumes increased in the fourth quarter and year to date in 2023 compared to
 
the same periods in 2022, due to higher
sales of equity and third-party volumes.
 
Gas sales slightly increased compared to the fourth quarter of 2022, primarily because of higher NCS
 
piped gas sales.
Power generation has decreased compared to the fourth quarter of last year, primarily due to a decrease in the clean spark spread.
Year to date, power generation was higher compared to last year, primarily driven by the acquisition of conventional combined cycle
gas turbine (CCGT) activity in the second half of 2022.
 
The realised European piped gas price decreased compared to the fourth quarter of last year, attributed to lower demand, increased
LNG imports and high storage levels.
The realised piped gas price in the US decreased compared to the fourth quarter of last
 
year due to the drop in market prices driven
by a storage surplus and mild weather.
Financial Results
During the fourth quarter of 2023 Gas and Power substantially contributed to adjusted earnings* capturing value
 
from geographical
optimisation of piped gas in Europe, gas price volatility and LNG sales.
 
Crude, Products, and Liquids reported modest adjusted
earnings* due to weaker margins and optimisation gains
 
compared to previous quarters in 2023
.
. Additionally, adjusted earnings* in
Equinor fourth quarter 2023
 
17
the Other subsegment were adversely affected by a low refining margin and costs associated with the development
 
of low-carbon
projects.
 
Adjusted earnings* for all subsegments in the fourth quarter of this year show a decrease
 
compared to the same period last year. Gas
and Power experienced the effects of diminished gas market volatility and narrower geographical spreads,
 
limiting the opportunity to
capitalise on favourable events from the previous year. Similarly, Crude, Products, and Liquids reported lower results, primarily
influenced by reduced crude trading margins. In the Other subsegment, adjusted earnings* were
 
affected by a decrease in refining
margins.
Adjusted earnings* for the full year of 2023 were lower than previous year. The result from Crude, Product and Liquids has doubled by
effectively capturing financial and physical market opportunities and optimising the shipping portfolio. Contrasting to the
 
extraordinary
market conditions in the prior year, opportunities to capture value in 2023 reduced. A reduction in gas market volatility
 
and declined
geographical spreads limited favourable opportunities in Gas and Power trading, giving rise to
 
a lower result year on year.
Net operating income includes net effects from changes in fair value related to storage and commodity derivatives
 
utilised to manage
price risk exposure. During 2023, the net operating income included impairments
 
amounting to USD 343 million, in contrast to USD
895 million in net impairment reversals in the prior year.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
18
RENEWABLES
Financial information
Quarters
Change
Full year
(unaudited, in USD million)
Q4 2023
Q3 2023
Q4 2022
Q4 on Q4
2023
2022
Change
Revenues third party, other revenue and other
income
25
10
31
(17%)
50
127
(61%)
Net income/(loss) from equity accounted
investments
(6)
(16)
8
N/A
(33)
58
N/A
Total revenues and other income
20
(5)
38
(49%)
17
185
(91%)
Adjusted total revenues and other income*
2
(5)
15
(84%)
(0)
75
N/A
Total operating expenses
(185)
(406)
(102)
82%
(774)
(269)
>100%
Adjusted operating and administrative expenses*
(176)
(100)
(101)
74%
(442)
(255)
73%
Adjusted depreciation, amortisation and net
impairments*
(6)
(3)
(1)
>100%
(12)
(4)
>100%
Net operating income/(loss)
(166)
(412)
(63)
>(100%)
(757)
(84)
>(100%)
Adjusted earnings*
(179)
(108)
(87)
>(100%)
(454)
(184)
>(100%)
Additions to PP&E, intangibles and equity
accounted investments
696
193
103
>100%
 
2,007
298
>100%
 
Operational information
Quarters
Change
Full year
Q4 2023
Q3 2023
Q4 2022
Q4 on Q4
2023
2022
Change
Renewables power generation (GWh) Equinor
 
share
661
352
509
30%
1,859
1,641
13%
Power generation
 
In the
 
fourth quarter
 
of 2023,
 
offshore wind
 
farms produced
 
453 GWh,
 
with the
 
majority coming
 
from Dudgeon,
 
Sheringham Shoal
and Arkona. Onshore renewables contributed another 208 GWh. This substantial increase in
 
production was driven by the ramp-up of
new onshore power plants in Poland and Brazil compared to both the fourth quarter and
 
the full year of 2022.
Total revenues and other income
European
 
offshore
 
wind
 
assets
 
in
 
operation
 
within
 
our
 
equity
 
accounted
 
investment
 
portfolio
 
increased
 
their
 
positive
 
revenue
contribution by
 
24% within
 
net income/(loss)
 
from equity
 
accounted investments
 
in the
 
fourth quarter.
 
This increase
 
was more
 
than
offset by
 
higher expenditures
 
associated with
 
early phase
 
projects. Following
 
the decision
 
to reset
 
the Empire
 
Wind 2
 
project in
 
the
US, criteria for
 
capitalisation is no
 
longer met.
 
Accordingly, ongoing
 
costs related to
 
this project have
 
been expensed from
 
the fourth
quarter of
 
2023, also
 
contributing to
 
the overall
 
decline in
 
the net
 
result from
 
equity accounted
 
investments from
 
the fourth
 
quarter
2022. A lower pricing environment in 2023 compared to the prior year contributed to the full
 
year decline.
Added revenue
 
from the
 
newly acquired
 
onshore wind farm
 
in Brazil
 
contributed positively to
 
total revenues and
 
other income
 
in the
fourth
 
quarter.
 
Combined
 
with
 
the
 
lower
 
results
 
from
 
equity
 
accounted
 
investments
 
in
 
the
 
fourth
 
quarter
 
and
 
full
 
year
 
2023,
 
total
revenues
 
and
 
other
 
income
 
decreased
 
relative
 
to
 
the
 
same
 
periods
 
in
 
2022.
 
Favourable effects
 
of
 
divestments
 
early
 
in
 
2022 also
significantly impacted the full year decline.
Operating expenses and financial results
The
 
notable
 
decrease
 
in
 
net
 
operating
 
income
 
for
 
the
 
full
 
year
 
of
 
2023
 
was
 
primarily
 
due
 
to
 
the
 
recognition
 
of
 
a
 
USD
 
300
 
million
impairment
 
in
 
the
 
third
 
quarter for
 
offshore
 
wind
 
projects
 
in
 
the
 
US
 
Northeast
 
following
 
the
 
rejection
 
of
 
petitions
 
related
 
to
 
offtake
agreements. In addition,
 
increased business development
 
expenditures and higher
 
operating activity levels
 
contributed to an
 
upward
trend in
 
operating and
 
administrative expenses
 
in the
 
fourth quarter
 
and the
 
full year
 
of 2023.
 
The increased
 
costs associated
 
with
maturing
 
projects
 
predominantly
 
originated
 
from
 
offshore
 
wind
 
activities
 
in
 
the
 
UK
 
and
 
Asia.
 
Project
 
costs
 
were
 
also
 
negatively
impacted by one-off events in the fourth quarter of 2023.
 
Additions to
 
PP&E, intangibles,
 
and equity-accounted
 
investments for
 
both the
 
fourth quarter
 
and the
 
full year
 
of 2023
 
were higher
than the corresponding periods
 
last year.
 
In the fourth quarter
 
of 2023, USD 192
 
million was allocated for
 
offshore wind projects,
 
and
USD 504
 
million for onshore
 
renewables, primarily related
 
to the acquisition
 
of Rio
 
Energy, an
 
onshore wind farm
 
in Brazil. Over
 
the
course of 2023, the acquisition of BeGreen, a
 
commercial-scale offshore wind lease in California, Rio Energy and
 
investments
 
related
to
 
projects
 
in
 
the
 
US
 
and
 
the
 
UK
 
significantly
 
contributed
 
to
 
the
 
overall
 
increase
 
in
 
PP&E,
 
intangibles
 
and
 
equity-accounted
investments compared to the prior year.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
19
CONDENSED INTERIM FINANCIAL STATEMENTS
Fourth quarter 2023
CONSOLIDATED STATEMENT
 
OF INCOME
Quarters
Full year
(unaudited, in USD million)
Note
Q4 2023
Q3 2023
Q4 2022
2023
2022
Revenues
4
28,843
25,924
33,841
106,848
149,004
Net income/(loss) from equity accounted investments
(31)
(25)
395
(1)
620
Other income
242
124
84
327
1,182
Total revenues and other income
2
29,054
26,024
34,321
107,174
150,806
Purchases [net of inventory variation]
(13,804)
(12,269)
(12,853)
(48,175)
(53,806)
Operating expenses
3
(2,875)
(2,420)
(3,026)
(10,582)
(9,608)
Selling, general and administrative expenses
(403)
(295)
(278)
(1,218)
(986)
Depreciation, amortisation and net impairments
(2,821)
(3,369)
(1,184)
(10,634)
(6,391)
Exploration expenses
(402)
(218)
(396)
(795)
(1,205)
Total operating expenses
2
(20,306)
(18,571)
(17,737)
(71,404)
(71,995)
Net operating income/(loss)
2
8,748
7,453
16,584
35,770
78,811
Interest income and other financial income
661
580
482
2,449
1,222
Interest expenses and other financial expenses
 
(368)
(412)
(450)
(1,660)
(1,379)
Other financial items
 
296
(155)
(2,147)
1,325
(50)
Net financial items
5
589
13
(2,115)
2,114
(207)
Income/(loss) before tax
 
9,337
7,466
14,469
37,884
78,604
Income tax
6
(6,729)
(4,965)
(6,572)
(25,980)
(49,861)
Net income/(loss)
2,608
2,501
7,897
11,904
28,744
Attributable to equity holders of the company
2,603
2,497
7,895
11,885
28,746
Attributable to non-controlling interests
5
4
2
19
(3)
Basic earnings per share (in USD)
0.88
0.84
2.52
3.93
9.06
Diluted earnings per share (in USD)
0.88
0.84
2.51
3.93
9.03
Weighted average number of ordinary shares outstanding
 
(in millions)
2,954
2,971
3,131
3,021
3,174
Weighted average number of ordinary shares outstanding
 
diluted (in millions)
2,961
2,978
3,141
3,027
3,183
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
20
CONSOLIDATED STATEMENT
 
OF COMPREHENSIVE INCOME
Quarters
Full year
(unaudited, in USD million)
Q4 2023
Q3 2023
Q4 2022
2023
2022
Net income/(loss)
2,608
2,501
7,897
11,904
28,744
Actuarial gains/(losses) on defined benefit pension
 
plans
(894)
20
895
(276)
461
Income tax effect on income and expenses recognised
 
in OCI
1)
211
(8)
(208)
66
(105)
Items that will not be reclassified to the Consolidated
 
statement of income
(683)
12
687
(211)
356
Foreign currency translation effects
1,169
(284)
4,116
(587)
(3,609)
Share of OCI from equity accounted investments
(124)
(17)
424
(113)
424
Items that may be subsequently reclassified to the Consolidated
 
statement of income
1,045
(301)
4,540
(701)
(3,186)
Other comprehensive income/(loss)
362
(289)
5,228
(911)
(2,829)
Total comprehensive income/(loss)
2,969
2,212
13,125
10,992
25,914
Attributable to the equity holders of the company
2,965
2,207
13,123
10,974
25,917
Attributable to non-controlling interests
5
4
2
19
(3)
1) Other comprehensive income (OCI).
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
21
CONSOLIDATED BALANCE SHEET
At 31 December
 
At 31 December
(unaudited, in USD million)
Note
2023
2022
1)
ASSETS
Property, plant and equipment
2
58,822
56,498
Intangible assets
3
5,709
5,158
Equity accounted investments
2,508
2,758
Deferred tax assets
7,936
8,732
Pension assets
1,260
1,219
Derivative financial instruments
559
691
Financial investments
3,441
2,733
Prepayments and financial receivables
7
1,291
2,063
 
Total non-current assets
81,525
79,851
 
Inventories
3,814
5,205
Trade and other receivables
2
16,933
22,452
Derivative financial instruments
1,378
4,039
Financial investments
29,224
29,876
Cash and cash equivalents
3
9,641
15,579
 
Total current assets
60,990
77,152
 
Assets classified as held for sale
3
1,064
1,018
 
Total assets
143,580
158,021
 
EQUITY AND LIABILITIES
Shareholders' equity
48,490
53,988
Non-controlling interests
10
1
 
Total equity
48,500
53,989
 
Finance debt
5
22,230
24,141
Lease liabilities
2,290
2,410
Deferred tax liabilities
13,345
11,996
Pension liabilities
3,925
3,671
Provisions and other liabilities
7
15,304
15,633
Derivative financial instruments
1,795
2,376
 
Total non-current liabilities
58,890
60,226
 
Trade, other payables and provisions
11,870
13,352
Current tax payable
6
12,306
17,655
Finance debt
5, 7
5,996
4,359
Lease liabilities
1,279
1,258
Dividends payable
2,649
2,808
Derivative financial instruments
1,619
4,106
 
Total current liabilities
35,719
43,539
 
Liabilities directly associated with the assets classified
 
as held for sale
 
3
471
268
 
Total liabilities
95,080
104,032
 
Total equity and liabilities
143,580
158,021
1) Audited
2) Of which Trade receivables of USD 13.0 billion at 31 December
 
2023 and USD 17.3 billion at 31 December
 
2022.
3) Includes collateral deposits of USD 1.6 billion
 
for 31 December 2023 related to certain requirements
 
set out by exchanges where Equinor
is participating. The corresponding figure for 31 December
 
2022 is USD 6.1 billion.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
22
CONSOLIDATED STATEMENT
 
OF CHANGES IN EQUITY
(unaudited, in USD million)
Share
capital
Additional
paid-in
capital
Retained
earnings
Foreign
currency
translation
reserve
OCI from
equity
accounted
investments
Share-
holders'
equity
Non-
controlling
interests
Total equity
At 1 January 2022
1,164
6,408
36,683
(5,245)
0
39,010
14
39,024
Net income/(loss)
28,746
28,746
(3)
28,744
Other comprehensive
income/(loss)
356
(3,609)
424
(2,829)
(2,829)
Total comprehensive
income/(loss)
25,914
Dividends
(7,549)
(7,549)
(7,549)
Share buy-back
(22)
(3,358)
(3,380)
(3,380)
Other equity transactions
(10)
(10)
(10)
(20)
At 31 December
 
2022
 
1,142
3,041
58,236
(8,855)
424
53,988
1
53,989
At 1 January 2023
1,142
3,041
58,236
(8,855)
424
53,988
1
53,989
Net income/(loss)
11,885
11,885
19
11,904
Other comprehensive
income/(loss)
(211)
(587)
(113)
(911)
(911)
Total comprehensive
income/(loss)
10,992
Dividends
(10,783)
(10,783)
(10,783)
Share buy-back
1)
(42)
(3,037)
(2,606)
(5,685)
(5,685)
Other equity transactions
(3)
(3)
(10)
(13)
At 31 December
 
2023
1,101
0
56,521
(9,442)
310
48,490
10
48,500
1) For more information see note 8 Capital distribution.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
23
CONSOLIDATED STATEMENT
 
OF CASH FLOWS
Quarters
Full year
Full year
(unaudited, in USD million)
Note
Q4 2023
Q3 2023
Q4 2022
2023
2022
Income/(loss) before tax
9,337
7,466
14,469
37,884
78,604
Depreciation, amortisation and net impairments
2,821
3,369
1,184
10,634
6,391
Exploration expenditures written off (net)
28
52
183
(53)
342
(Gains)/losses on foreign currency transactions and
 
balances
5
289
12
2,140
(852)
(2,088)
(Gains)/losses on sale of assets and businesses
3
(253)
0
(87)
8
(823)
(Increase)/decrease in other items related to operating
 
activities
1)
(734)
21
2,923
(1,313)
468
(Increase)/decrease in net derivative financial instruments
(694)
195
217
1,041
1,062
Interest received
399
407
216
1,710
399
Interest paid
(302)
(186)
(258)
(1,042)
(747)
Cash flows provided by operating activities before
 
taxes paid and working
capital items
10,890
11,336
20,988
48,016
83,608
Taxes paid
(8,103)
(3,743)
(14,188)
(28,276)
(43,856)
(Increase)/decrease in working capital
(51)
(2,357)
(2,532)
4,960
(4,616)
Cash flows provided by operating activities
 
2,736
5,236
4,267
24,701
35,136
Cash (used)/received in business combinations
(40)
(100)
(0)
(1,195)
147
Capital expenditures and investments
2)
3
(3,031)
(2,652)
(2,376)
(10,575)
(8,758)
(Increase)/decrease in financial investments
(3,010)
(2,679)
(6,990)
443
(10,089)
(Increase)/decrease in derivative financial instruments
261
14
(374)
(1,266)
1,894
(Increase)/decrease in other interest-bearing items
92
(219)
7
(87)
(23)
Proceeds from sale of assets and businesses
3)
3
154
(0)
47
272
966
Cash flows provided by/(used in) investing activities
(5,574)
(5,636)
(9,687)
(12,409)
(15,863)
Repayment of finance debt
(342)
0
(250)
(2,818)
(250)
Repayment of lease liabilities
(418)
(336)
(365)
(1,422)
(1,366)
Dividends paid
(2,706)
(2,613)
(2,231)
(10,906)
(5,380)
Share buy-back
(518)
(531)
(577)
(5,589)
(3,315)
Net current finance debt and other financing activities
1,813
(1,195)
230
2,593
(5,102)
Cash flows provided by/(used in) financing activities
(2,171)
(4,675)
(3,193)
(18,142)
(15,414)
Net increase/(decrease) in cash and cash equivalents
(5,009)
(5,074)
(8,612)
(5,850)
3,860
Effect of exchange rate changes on cash and cash equivalents
230
(156)
844
(87)
(2,268)
Cash and cash equivalents at the beginning
 
of the period (net of overdraft)
14,420
19,650
23,348
15,579
13,987
Cash and cash equivalents at the end of the
 
period (net of overdraft)
4)
9,641
14,420
15,580
9,641
15,579
1)
 
The line item includes a fair value loss related
 
to inventory of USD 2 408 million in the fourth
 
quarter 2022. The corresponding amount in
the fourth quarter 2023 was a fair value gain
 
of USD 204 million.
2)
 
Cash inflow of USD 433 million received in
 
the first quarter 2022 related to the disposal
 
of parts of the interests in the Bacalhau field in
2018 (contingent consideration) has been reclassified
 
from Capital expenditures and investments to
 
Proceeds from sale of assets and
businesses.
3)
 
The line item includes cash consideration net of
 
cash disposed,
 
related to the disposal of Equinor Energy Ireland
 
Limited at closing date
31 March 2023. See note 3 Acquisitions and disposals
 
for more information.
 
4)
 
At 31 December 2023 and 31 December 2022
 
cash and cash equivalents net overdraft
 
were zero.
 
 
Equinor fourth quarter 2023
 
24
Notes to the Condensed interim financial statements
1 Organisation and basis of preparation
Organisation and principal activities
Equinor Group (Equinor) consists of Equinor ASA and its subsidiaries. Equinor ASA is incorporated
 
and domiciled in Norway and
listed on the Oslo Børs (Norway) and the New York Stock Exchange (USA). The registered office address is Forusbeen 50, N-4035,
Stavanger, Norway.
The objective of Equinor is to develop, produce and market various forms of energy and derived
 
products and services, as well as
other businesses. The activities may also be carried out through participation in or cooperation with
 
other companies. Equinor Energy
AS, a 100% owned operating subsidiary of Equinor ASA and owner of all of Equinor's
 
oil and gas activities and net assets on the
Norwegian continental shelf, is a co-obligor or guarantor of certain debt obligations of Equinor ASA.
Equinor's condensed interim financial statements for the fourth quarter of 2023 were authorised
 
for issue by the board of directors on
6 February 2024.
Basis of preparation
These condensed interim financial statements are prepared in accordance with IAS 34 Interim Financial
 
Reporting as issued by the
International Accounting Standards Board (IASB) and as adopted by the European Union (EU).
 
The condensed interim financial
statements do not include all the information and disclosures required by IFRS® Accounting Standards for a
 
complete set of financial
statements and should be read in conjunction with the Consolidated annual financial statements for
 
2022. IFRS Accounting Standards
as adopted by the EU differs in certain respects from IFRS Accounting Standards as issued by the IASB,
 
however the differences do
not impact Equinor's financial statements for the periods presented.
As a result of rounding differences, numbers or percentages may not add up to the total.
 
The condensed interim financial statements are unaudited.
Accounting policies
The accounting policies applied in the preparation of the condensed interim financial statements are consistent with
 
those used in the
preparation of Equinor’s consolidated annual financial statements for 2022. A description
 
of the material accounting policies is
included in Equinor’s consolidated annual financial statements for 2022. When determining
 
fair value, there have been no changes to
the valuation techniques or models and Equinor applies the same sources of input and the
 
same criteria for categorization in the fair
value hierarchy as disclosed in the consolidated annual financial statements for 2022.
For information about standards, amendments to standards and interpretations effective from 1 January 2023, that
 
could affect the
consolidated financial statements, please refer to note 2 in Equinor’s consolidated financial
 
statements for 2022. None of the
amendments effective from 1 January 2023 has had a significant impact on the condensed interim financial statements.
 
Equinor has
not early adopted any standard, interpretation or amendment that has been issued but is
 
not yet effective.
Equinor has adopted amendments to IAS 12 – International Tax Reform – Pillar Two Model Rules (top-up tax) with effect from 1
January 2023. Equinor has applied the mandatory exception and does not recognise or disclose
 
information about deferred tax assets
and liabilities related to Pillar Two income taxes. The mandatory exception applies retrospectively. However, since no new legislation
to implement the top-up tax was enacted or substantively enacted on 31 December 2022
 
in any jurisdiction in which Equinor operates,
and no related deferred tax was recognised at that date, the retrospective application has
 
no impact on the Consolidated financial
statements.
Use of judgements and estimates
The preparation of financial statements in conformity with IFRS Accounting Standards requires management
 
to make judgments,
estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities,
 
income
and expenses. The estimates and associated assumptions are reviewed on an on-going basis and are
 
based on historical experience
and various other factors that are believed to be reasonable under the circumstances. These estimates and
 
assumptions form the
basis for making the judgments about carrying values of assets and liabilities that are not readily
 
apparent from other sources. Actual
results may differ from these estimates. Please refer to note 2 in Equinor’s consolidated financial
 
statements for 2022 for more
information about accounting judgement and key sources of estimation uncertainty. Refer to note 2 Segments in this report for further
information about management’s future commodity price assumptions.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
25
2 Segments
Equinor’s operations are managed through operating segments identified on the
 
basis of those components of Equinor that are
regularly reviewed by the chief operating decision maker, Equinor's Corporate Executive Officer (CEO). The reportable segments
Exploration & Production Norway (E&P Norway), Exploration & Production International (E&P
 
International), Exploration & Production
USA (E&P USA), Marketing, Midstream & Processing (MMP) and Renewables (REN)
 
correspond to the operating segments. The
operating segments Projects, Drilling & Procurement (PDP), Technology, Digital & Innovation (TDI) and Corporate staff and functions
are aggregated into the reportable segment Other based on materiality. The majority of the costs in PDP and TDI is allocated to the
three Exploration & Production segments, MMP and REN.
The accounting policies of the reporting segments equal those applied in these condensed interim financial
 
statements, except for the
line-item Additions to PP&E, intangibles and equity accounted investments in which movements
 
related to changes in asset retirement
obligations are excluded as well as provisions for onerous contracts which reflect only obligations
 
towards group external parties. The
measurement basis of segment profit is net operating income/(loss). Deferred tax assets, pension
 
assets, non-current financial assets,
total current assets and total liabilities are not allocated to the segments. Transactions between the segments, mainly from the
 
sale of
crude oil, gas, and related products, are performed at defined internal prices which have been derived from market
 
prices. The
transactions are eliminated upon consolidation.
Fourth quarter 2023
E&P
Norway
 
E&P
International
E&P
 
USA
MMP
REN
Other
Eliminations
 
Total Group
(in USD million)
Revenues third party
72
297
76
28,372
5
21
0
28,843
Revenues inter-segment
9,780
1,597
1,089
309
4
8
(12,787)
0
Net income/(loss) from equity accounted
investments
0
(5)
0
(13)
(6)
(8)
0
(31)
Other income
224
(0)
0
(0)
17
0
0
242
Total revenues and other income
 
10,076
1,889
1,165
28,668
20
22
(12,787)
29,054
Purchases [net of inventory variation]
0
(45)
0
(26,330)
0
(0)
12,570
(13,804)
Operating, selling, general and
administrative expenses
(1,057)
(540)
(308)
(1,384)
(180)
17
173
(3,279)
Depreciation and amortisation
(1,144)
(603)
(506)
(227)
(6)
(31)
0
(2,518)
Net impairment (losses)/reversals
0
(310)
(0)
7
(0)
0
0
(303)
Exploration expenses
(138)
(55)
(208)
0
0
0
0
(402)
Total operating expenses
(2,339)
(1,553)
(1,022)
(27,934)
(185)
(15)
12,743
(20,306)
Net operating income/(loss)
7,737
336
143
734
(166)
7
(43)
8,748
Additions to PP&E, intangibles and equity
accounted investments
1,577
923
332
218
696
25
(0)
3,770
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
26
Third quarter 2023
E&P
Norway
 
E&P
International
E&P
 
USA
MMP
REN
Other
Eliminations
 
Total Group
(in USD million)
Revenues third party
42
183
65
25,611
2
20
0
25,924
Revenues inter-segment
7,904
1,809
1,064
107
8
8
(10,902)
0
Net income/(loss) from equity accounted
investments
0
(2)
0
(6)
(16)
0
0
(25)
Other income
(9)
0
32
(0)
0
101
0
124
Total revenues and other income
 
7,938
1,990
1,162
25,712
(5)
129
(10,902)
26,024
Purchases [net of inventory variation]
(1)
58
0
(22,987)
0
(0)
10,661
(12,269)
Operating, selling, general and
administrative expenses
(788)
(541)
(293)
(1,181)
(103)
(76)
267
(2,715)
Depreciation and amortisation
(1,107)
(594)
(472)
(217)
(3)
(34)
0
(2,426)
Net impairment (losses)/reversals
(588)
0
290
(346)
(300)
0
0
(943)
Exploration expenses
(120)
(75)
(23)
0
0
0
0
(218)
Total operating expenses
(2,604)
(1,152)
(496)
(24,730)
(406)
(110)
10,928
(18,571)
Net operating income/(loss)
5,335
838
666
982
(412)
18
27
7,453
Additions to PP&E, intangibles and equity
accounted investments
1,421
888
338
342
193
24
0
3,206
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
27
Fourth quarter 2022
E&P
Norway
 
E&P
International
E&P
 
USA
MMP
REN
Other
Eliminations
 
Total Group
(in USD million)
Revenues third party
59
695
69
32,965
7
46
0
33,841
Revenues inter-segment
16,652
1,623
1,014
254
0
27
(19,570)
0
Net income/(loss) from equity accounted
investments
(0)
31
0
372
8
(16)
0
395
Other income
18
24
0
0
23
19
0
84
Total revenues and other income
16,729
2,373
1,083
33,591
38
76
(19,570)
34,321
Purchases [net of inventory variation]
(0)
(85)
(0)
(31,996)
0
(0)
19,228
(12,853)
Operating, selling, general and
administrative expenses
(1,020)
(511)
(220)
(1,614)
(101)
(153)
314
(3,304)
Depreciation and amortisation
(1,219)
(436)
(363)
(236)
(1)
(26)
0
(2,281)
Net impairment (losses)/reversals
(3)
747
350
3
0
(0)
0
1,097
Exploration expenses
(101)
(266)
(29)
0
0
0
0
(396)
Total operating expenses
(2,343)
(551)
(262)
(33,842)
(102)
(179)
19,542
(17,737)
Net operating income/(loss)
14,386
1,822
821
(251)
(63)
(103)
(29)
16,584
Additions to PP&E, intangibles and equity
accounted investments
1,422
584
281
349
103
88
0
2,828
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
28
Full year 2023
E&P
Norway
 
E&P
Internationa
l
E&P
 
USA
MMP
REN
Other
Eliminations
 
Total Group
(in USD million)
Revenues third party
230
993
277
105,242
20
85
0
106,848
Revenues inter-segment
37,999
6,009
4,009
633
12
33
(48,695)
0
Net income/(loss) from equity accounted
investments
0
28
0
12
(33)
(8)
0
(1)
Other income
111
1
32
23
18
142
0
327
Total revenues and other income
 
38,340
7,032
4,319
105,908
17
253
(48,695)
107,174
Purchases [net of inventory variation]
(0)
(70)
0
(95,769)
0
(1)
47,665
(48,175)
Operating, selling, general and
administrative expenses
(3,759)
(2,176)
(1,178)
(4,916)
(462)
(201)
893
(11,800)
Depreciation and amortisation
(4,429)
(2,123)
(1,779)
(897)
(12)
(133)
0
(9,373)
Net impairment (losses)/reversals
(588)
(310)
290
(343)
(300)
(10)
0
(1,260)
Exploration expenses
(476)
(20)
(299)
0
0
0
0
(795)
Total operating expenses
(9,253)
(4,700)
(2,966)
(101,925)
(774)
(345)
48,558
(71,404)
Net operating income/(loss)
29,087
2,332
1,353
3,984
(757)
(92)
(137)
35,770
Additions to PP&E, intangibles and equity
accounted investments
5,939
4,376
1,206
844
2,007
128
0
14,500
Balance sheet information
Equity accounted investments
 
3
0
0
783
1,665
57
0
2,508
Non-current segment assets
 
28,915
17,977
11,049
3,997
1,575
1,018
0
64,530
Non-current assets not allocated to
segments
 
14,487
Total non-current assets
 
81,525
Assets held for sale
0
1,064
0
0
0
0
0
1,064
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
29
Full year 2022
E&P
Norway
 
E&P
International
E&P
 
USA
MMP
REN
Other
Eliminations
 
Total Group
(in USD million)
Revenues third party
304
1,099
305
147,164
16
115
0
149,004
Revenues inter-segment
74,631
6,124
5,217
527
0
55
(86,554)
0
Net income/(loss) from equity accounted
investments
(0)
172
0
406
58
(16)
0
620
Other income
994
35
0
9
111
33
0
1,182
Total revenues and other income
75,930
7,431
5,523
148,105
185
187
(86,554)
150,806
Purchases [net of inventory variation]
0
(116)
(0)
(139,916)
0
(0)
86,227
(53,806)
Operating, selling, general and
administrative expenses
(3,782)
(1,698)
(938)
(4,591)
(265)
(223)
904
(10,593)
Depreciation and amortisation
(4,986)
(1,445)
(1,422)
(881)
(4)
(142)
0
(8,878)
Net impairment (losses)/reversals
819
(286)
1,060
895
0
(0)
0
2,487
Exploration expenses
(366)
(638)
(201)
0
0
0
0
(1,205)
Total operating expenses
(8,315)
(4,183)
(1,501)
(144,493)
(269)
(365)
87,131
(71,995)
Net operating income/(loss)
67,614
3,248
4,022
3,612
(84)
(178)
577
78,811
Additions to PP&E, intangibles and equity
accounted investments
4,922
2,623
764
1,212
298
176
0
9,994
Balance sheet information
Equity accounted investments
 
3
550
0
688
1,452
65
0
2,758
Non-current segment assets
28,510
15,868
11,311
4,619
316
1,031
0
61,656
Non-current assets not allocated to
segments
 
15,437
Total non-current assets
 
79,851
Assets held for sale
0
1,018
0
0
0
0
0
1,018
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
30
Net impairments/reversal of impairments and changes to accounting assumptions
Management’s future commodity price assumptions are used for value in use impairment testing. While
 
there are inherent
uncertainties in the assumptions, the commodity price assumptions reflect management’s best estimate of the price
 
development over
the life of the Group’s assets based on its view of relevant current circumstances and the likely
 
future development of such
circumstances, including energy demand development, energy and climate change policies as well
 
as the speed of the energy
transition, population and economic growth, geopolitical risks, technology and cost development
 
and other factors. Management’s
best estimate also takes into consideration a range of external forecasts.
Equinor has performed a thorough and broad analysis of the expected development in drivers for
 
the different commodity markets.
Significant uncertainty exists regarding future commodity price development due to the transition to a lower
 
carbon economy, future
supply actions by OPEC+ and other factors. Such analysis resulted in changes in the long-term price
 
assumptions with effect from the
second quarter of 2023. The main price assumptions applied in impairment and impairment
 
reversal assessments are disclosed in the
table below as price-points on price curves. Previous price-points applied from the third quarter
 
of 2022 up to and including the first
quarter of 2023 are provided in brackets.
Year
 
Prices in real terms
1)
2025
2030
2040
2050
Brent Blend (USD/bbl)
79
(78)
78
(78)
73
(73)
68
(68)
European gas (USD/mmBtu) - TTF
15.5
(20.9)
9.1
(9.9)
9.5
(9.4)
9.5
(9.4)
Henry Hub (USD/mmBtu)
3.6
(4.2)
4.3
(3.9)
4.3
(3.9)
4.3
(3.9)
Electricity Germany (EUR/MWh)
106
(122)
78
(74)
71
(60)
71
(60)
EU ETS (EUR/tonne)
90
(84)
105
(84)
128
(111)
150
(137)
1) Basis year 2023.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
31
For the full year of 2023, Equinor recognised net impairments of USD 1,260 million, excluding impairments
 
related to capitalized
exploration and evaluation expenditures.
In the fourth quarter of 2023, Equinor recognised impairments in the E&P International segment to
 
an amount of USD 310 million,
following the held for sale classification of its interest in Azerbaijan assets. Refer to note 3 for
 
additional details.
In the third quarter of 2023, Equinor recognised impairments in the REN segment to an amount
 
of USD 300 million, due to inflation
and supply chain constraints on the US North East Coast offshore wind projects.
 
Impairments
 
in the E&P Norway segment amounted
to USD 588 million and mainly relate to reduced expected reserves on a producing
 
asset. Impairments
 
in the MMP segment
amounted to USD 346 million and mainly relate to expectations of stabilizing refinery margins at a lower
 
level than the margins
consumed in the recent quarterly periods. Impairment reversals in the E&P USA segment amounted
 
to USD 290 million and mainly
relate to increased expected reserves on a producing asset.
Non-current assets by country
At 31 December
 
At 31 December
(in USD million)
2023
2022
Norway
32,977
33,242
USA
12,587
12,343
Brazil
10,871
9,400
UK
5,535
3,688
Canada
1,157
1,171
Angola
1,103
895
Denmark
973
497
Argentina
648
615
Algeria
474
622
Poland
447
270
Other
265
1,672
Total non-current assets
1)
67,038
64,414
1) Excluding deferred tax assets, pension assets
 
and non-current financial assets. Non-current assets
 
are attributed to country of operations.
3 Acquisitions and disposals
 
Acquisitions
 
Swap of US Offshore Wind assets
In
 
January
 
2024,
 
Equinor
 
entered
 
into
 
a
 
swap
 
agreement
 
with
 
bp.
 
Equinor
 
will acquire
 
bp’s
 
50% share
 
and
 
take
 
full
 
ownership
 
of
Empire Offshore
 
Wind Holdings
 
LLC, including
 
the Empire
 
Wind lease
 
and projects,
 
while bp
 
will acquire
 
Equinor’s 50%
 
share and
take full
 
ownership of
 
Beacon Wind
 
Holdings LLC,
 
including the
 
Beacon Wind
 
lease and
 
projects. It
 
is anticipated
 
that Equinor
 
will
consolidate Empire
 
Wind and
 
derecognise its
 
50% share
 
of Beacon
 
Wind in
 
the first
 
quarter of
 
2024. Subject
 
to certain
 
conditions,
Equinor will also acquire
 
bp's 50% interest in
 
the South Brooklyn Marine
 
Terminal
 
(SBMT) lease. The
 
transaction, pending regulatory
approvals,
 
is
 
anticipated
 
to
 
be
 
cash
 
neutral,
 
with
 
the
 
exception
 
of
 
standard
 
cash
 
and
 
working
 
capital
 
settlements
 
and
 
will
 
be
recognised in the REN segment.
Acquisition of Rio Energy
On 3 November 2023,
 
Equinor closed a transaction with
 
Denham Capital to acquire 100%
 
of the shares in
 
Horus Investimentos S.A.,
the parent
 
company of
 
Rio Energy,
 
a leading
 
onshore renewables
 
company in
 
Brazil. The
 
cash consideration
 
amounted to
 
USD 82
million in addition to USD
 
268 million in capital contribution
 
to settle Rio Energy’s external
 
financing. The acquired portfolio includes a
producing onshore wind farm
 
in the north-eastern state
 
of Bahia, a pre-construction
 
solar photovoltaic (PV) portfolio
 
and a pipeline of
1.2
 
GW of
 
onshore wind
 
and solar
 
projects.
 
This transaction
 
resulted in
 
an increase
 
in Equinor’s
 
property,
 
plant and
 
equipment
 
of
USD 350
 
million. The
 
transaction has
 
been accounted
 
for as
 
a business
 
combination within
 
the REN
 
segment. The
 
purchase price
and the purchase price allocation are preliminary.
Acquisition of Suncor Energy UK Limited
On 30 June 2023, Equinor closed
 
a transaction with Suncor Energy UK
 
Holdings Ltd to acquire 100% of the
 
shares in Suncor Energy
UK Limited
 
for a
 
total consideration
 
of USD
 
847 million
 
after customary
 
adjustments for
 
working capital.
 
The transaction
 
includes a
non-operated interest
 
in the
 
producing Buzzard
 
oil field
 
(29.89%) and
 
an additional
 
interest in
 
the operated
 
Rosebank development
(40%).
 
The
 
transaction
 
has
 
been
 
accounted
 
for
 
within
 
the
 
E&P
 
International
 
segment
 
as
 
a
 
business
 
combination,
 
resulting
 
in
 
an
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
32
increase in Equinor’s property, plant and equipment of
 
USD 1,490 million and deferred tax liabilities of USD 672 million. The purchase
price allocation remains preliminary.
Acquisition of BeGreen
On 26 January 2023, Equinor closed a
 
transaction with the Bregentved Group and members of
 
the executive board of BeGreen Solar
Aps to acquire
 
100% of the shares
 
in the Danish solar
 
developer BeGreen Solar Aps.
 
The cash consideration amounted
 
to USD 252
million (EUR 235 million), in addition
 
to a consideration contingent on the
 
successful delivery of future solar projects above
 
an agreed
megawatt
 
threshold.
 
The
 
transaction
 
has
 
been
 
accounted
 
for
 
within
 
the
 
REN
 
segment
 
as
 
a
 
business
 
combination,
 
resulting
 
in
 
an
increase of Equinor’s intangible assets of USD 423 million.
Disposals
Equinor Energy Ireland Limited
On
 
31
 
March
 
2023,
 
Equinor
 
closed
 
the
 
transaction
 
with
 
Vermilion
 
Energy
 
Inc
 
(Vermillion)
 
to
 
sell
 
Equinor’s
 
non-operated
 
equity
position in
 
the Corrib
 
gas project
 
in Ireland,
 
covering 100%
 
of the
 
shares in
 
Equinor Energy
 
Ireland Limited
 
(EEIL). Prior
 
to closing,
Equinor received an extraordinary dividend of USD 371 million from EEIL. Total
 
consideration amounted to USD 362 million, including
cash settlement of contingent consideration. A loss of USD 258 million has been recognised within the E&P International segment and
presented in the line item Operating expenses in the Consolidated statement of income.
Held for sale
Divestment of interest in Azerbaijan
On 22 December 2023, Equinor entered into an agreement with
 
the State Oil Company of the Republic of Azerbaijan
 
(SOCAR)
 
to sell
its interest in its Azerbaijan assets. The assets comprise a 7.27% non-operated interest in the Azeri Chirag
 
Gunashli (ACG) oil fields in
the
 
Azerbaijan
 
sector
 
of
 
the
 
Caspian
 
Sea,
 
8.71%
 
interest
 
in
 
the
 
Baku-Tbilisi-Ceyhan (BTC)
 
pipeline
 
and
 
50%
 
in
 
the
 
Karabagh
 
oil
field. Closing is
 
expected during
 
2024 subject
 
to regulatory
 
and contractual
 
approvals. The
 
assets have
 
been classified
 
as held
 
for
sale
 
resulting
 
in
 
a
 
USD
 
310
 
million
 
impairment
 
within
 
the
 
E&P
 
International
 
segment,
 
presented
 
in
 
the
 
line
 
item
 
Depreciation,
amortisation and net impairments in the Consolidated statement of income.
4 Revenues
 
Revenues from contracts with customers by geographical areas
When attributing the line item Revenues from contracts with customers for the fourth quarter of 2023 to the
 
country of the legal entity
executing the sale, Norway constitutes 77%, and the USA constitutes 19% of such revenues (78% and 20%,
 
respectively, for the third
quarter of 2023; 79% and 18%, respectively, for the full year of 2023). For the fourth quarter of 2022, Norway and the USA constituted
81% and 14% of such revenues, respectively (84% and 13%, respectively, for the full year of 2022). Revenues from contracts with
customers are mainly reflecting such revenues from the reporting segment MMP.
Revenues from contracts with customers and other revenues
Quarters
Full year
(in USD million)
Q4 2023
Q3 2023
Q4 2022
2023
2022
Crude oil
15,695
15,999
12,994
56,861
58,524
Natural gas
6,597
4,292
15,479
26,386
65,232
 
- European gas
5,796
3,728
13,326
23,174
58,239
 
- North American gas
298
217
651
1,111
2,884
 
- Other incl. Liquefied natural gas
503
347
1,502
2,102
4,109
Refined products
2,710
2,528
2,892
10,083
11,093
Natural gas liquids
2,087
2,095
1,896
8,345
9,240
Transportation
305
272
480
1,425
1,470
Other sales
951
465
1,469
3,032
4,702
Revenues from contracts with customers
28,345
25,650
35,209
106,132
150,262
Total other revenues
1)
498
274
(1,368)
716
(1,258)
Revenues
28,843
25,924
33,841
106,848
149,004
1) Principally relates to commodity derivatives and
 
change in fair value less cost to sell for commodity
 
inventories held for trading purposes.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
33
5 Financial items
 
Quarters
Full year
(in USD million)
Q4 2023
Q3 2023
Q4 2022
2023
2022
Net foreign currency exchange gains/(losses)
(289)
(12)
(2,140)
852
2,088
Interest income and other financial income
661
580
482
2,449
1,222
Gains/(losses) on financial investments
139
(54)
8
123
(394)
Gains/(losses) other derivative financial instruments
 
445
(89)
(15)
351
(1,745)
Interest and other finance expenses
(368)
(412)
(450)
(1,660)
(1,379)
Net financial items
589
13
(2,115)
2,114
(207)
Equinor reports foreign currency losses in the fourth quarter and the fourth quarter last
 
year, mainly related to weakening of USD
versus NOK. For the full year 2023, and 2022, there have been significant foreign currency gains,
 
mainly related to the strengthening
of USD versus NOK. These currency effects are mainly due to a large part of Equinor’s operations
 
having NOK as functional currency,
and the effects are offset within equity as OCI effects arising on translation from functional currency to presentation currency USD.
The gains are lower in 2023 compared to 2022 due to reduced balances and a lesser change in currency
 
rates.
The increase in Interest income and other financial income in 2023 compared to previous year mainly
 
relates to higher interest rates.
Equinor has a US Commercial paper programme available with a limit of USD 5 billion. As
 
of 31 December 2023, USD 1.9 billion were
utilised compared to USD 0.2 billion utilised as of 31 December 2022.
6 Income taxes
Quarters
Full year
(in USD million)
Q4 2023
Q3 2023
Q4 2022
2023
2022
Income/(loss) before tax
9,337
7,466
14,469
37,884
78,604
Income tax
(6,729)
(4,965)
(6,572)
(25,980)
(49,861)
Effective tax rate
 
72.1%
 
66.5%
 
45.4%
68.6 %
63.4 %
The effective tax rate for the full year 2023 was significantly influenced by lower share of income from the Norwegian
 
continental shelf
and currency effect in entities that are taxable in other currencies than the functional currency.
 
The effective tax rate for the fourth quarter of 2022 and for the full year 2022 was significantly influenced
 
by recognition of previously
unrecognised deferred tax assets in the US. The effective tax rate for the fourth quarter of 2022 was also influenced
 
by low share of
income from the Norwegian continental shelf due to derivative losses.
 
 
 
 
 
Equinor fourth quarter 2023
 
34
7 Provisions, commitments, contingent items and related parties
Asset retirement obligation
Equinor's estimated asset retirement obligations (ARO) have increased by USD 0.6 billion to USD 12.4 billion
 
at 31 December 2023
compared to year-end 2022, mainly due to net increase in underlying cost estimate. Changes in
 
ARO are reflected within Property,
plant and equipment and Provisions and other liabilities in the Consolidated balance sheet.
Litigation and claims
During the normal course of its business, Equinor is involved in legal and other proceedings,
 
and several unresolved claims are
currently outstanding. The ultimate liability or asset in respect of such litigation and claims
 
cannot be determined at this time. Equinor
has provided in its Condensed interim financial statements for probable liabilities related to
 
litigation and claims based on the
company’s best judgement. Equinor does not expect that its financial position, results of operations or cash
 
flows will be materially
affected by the resolution of these legal proceedings.
Related parties
The line-item Trade and other receivables include a receivable from the Norwegian state under the Marketing Instruction in
 
relation to
the state’s (SDFI) participation in the gas sales activities of a foreign subsidiary of Equinor, estimated at USD 0.1 billion. At year-end
2022, the corresponding estimated amount of USD 1.5 billion was classified as a non-current item
 
and included in the line-item
Prepayments and financial receivables. The decrease is mainly related to reduced cost price for
 
gas storage volume. A corresponding
non-current liability of USD 0.1 billion has been recognised, representing SDFI's estimated
 
interest in the gas sales activities in the
foreign subsidiary. The estimated total non-current liabilities to SDFI amounts to USD 0.8 billion at 31 December 2023 (USD 2.1 billion
at year-end 2022). In addition, the line-item Finance debt, which form part of the sub-total Total current liabilities, includes a liability of
USD 0.9 billion to SDFI due to cash received for collateral deposits requirement (0 at year-end 2022).
8 Capital distribution
Dividend for the fourth quarter 2023 and share buy-back programme 2024 - 2025
On 6 February 2024, the Board of Directors proposed to the annual general meeting on 14 May
 
2024 an ordinary cash dividend for
the fourth quarter of 2023 of USD 0.35 per share and an extraordinary cash
 
dividend of USD 0.35
per share. The Equinor shares will
be traded ex-dividend 15 May 2024 on the Oslo Børs and for ADR holders on the New York Stock Exchange. Record date will be 16
May 2024, and payment date will be 28 May 2024.
On 6 February 2024, the Board of Directors further decided to announce a two-year
 
share buy-back programme for 2024-2025 of
USD 10-12 billion in total, with USD 6 billion for 2024. The share buy-back programme will
 
be subject to market outlook and balance
sheet strength. The first tranche of up to USD 1.2 billion of the 2024 share buy-back programme
 
will commence on 8 February and
end no later than 5 April 2024. The first tranche of the 2024 share buy-back programme
 
is based on the authorisation from the annual
general meeting in May 2023, valid until the next annual general meeting, but no later than
 
30 June 2024. Commencement of new
share buy-back tranches after the first tranche in 2024 will be decided by the board of directors
 
on a quarterly basis in line with the
company’s dividend policy and will be subject to existing and new board authorisations for share buy-back from the company’s annual
general meeting and agreement with the Norwegian State regarding share buy-back.
Share buy- back programme 2023
Based on the authorisation from the annual general meeting on 10 May 2023, the Board
 
of directors has, on a quarterly basis,
decided on share buy-back tranches. The 2023 programme was up to USD 6,000 million,
 
including shares to be redeemed from the
Norwegian State.
During the first nine months of 2023, Equinor launched three tranches totaling USD 4,333 million,
 
of which USD 1,430 million was
acquired in the open market. In October 2023, Equinor launched the fourth and final tranche of
 
USD 1,667 billion, of which USD 550
million has been recognised as a reduction in equity due to an irrevocable agreement with
 
a third party. Of the fourth tranche, USD
388 million has been acquired in the open market and settled at 31 December 2023.
In order to maintain the Norwegian State’s ownership share in Equinor, a proportionate share of the second, third and fourth tranche
of the 2022 programme as well as the first tranche of the 2023 programme was redeemed and annulled
 
after approval by the annual
general meeting on 10 May 2023. The liability to the Norwegian State of USD 3,705 million
 
(NOK 39,071 million) was settled in June
2023.
Full year
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
35
Equity impact of share buy-back programmes (in USD million)
2023
2022
First tranche
330
330
Second tranche
550
440
Third tranche
550
605
Fourth tranche
550
605
Norwegian state share 1)
3,705
1,399
Total
5,685
3,380
1) Relates to second to fourth tranche of previous
 
year programme and first tranche of current year
programme
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
36
SUPPLEMENTARY
 
DISCLOSURES
 
Exchange rates
Quarters
Change
Full year
Exchange rates
Q4 2023
Q3 2023
Q4 2022
Q4 on Q4
2023
2022
Change
USD/NOK average daily exchange rate
10.8474
10.4818
10.1925
6%
10.5647
9.6245
10%
USD/NOK period-end exchange rate
10.1724
10.6225
9.8573
3%
10.1724
9.8573
3%
EUR/USD average daily exchange rate
1.0747
1.0880
1.0195
5%
1.0810
1.0498
3%
EUR/USD period-end exchange rate
1.1050
1.0594
1.0666
4%
1.1050
1.0666
4%
USE AND RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
Non-GAAP financial measures are defined as numerical measures that either exclude
 
or include amounts that are not excluded or
included in the comparable measures calculated and presented in accordance with GAAP (i.e.,
 
IFRS Accounting Standards in the
case of Equinor). The following financial measures included in this report may be considered
 
non-GAAP financial measures:
Adjusted earnings
are based on net operating income/(loss) and adjusts for certain items affecting the income for the period
 
to
separate out effects that management considers may not be well correlated to Equinor’s underlying
 
operational performance in the
individual reporting period. Management believes adjusted earnings provides an indication
 
of Equinor’s underlying operational
performance in the period and facilitates comparison of operational trends between periods
 
The calculation of Adjusted earnings was
changed in 2023, as detailed below.
Adjusted earnings after tax
 
– equals the sum of net operating income/(loss) less income tax in reporting segments and includes
adjustments to operating income to take the applicable marginal tax into consideration.
 
Adjusted earnings after tax excludes net
financial items and the associated tax effects on net financial items. It is based on adjusted earnings less the
 
tax effects on all
elements included in adjusted earnings (or calculated tax on operating income and
 
on each of the adjusting items using an estimated
marginal tax rate). In addition, tax effect related to tax exposure items not related to the individual reporting
 
period is excluded from
adjusted earnings after tax. Management believes adjusted earnings after tax provides an indication
 
of Equinor’s underlying
operational performance and facilitates comparisons of operational trends between periods as it reflects
 
the tax charge associated
with operational performance excluding the impact of financing. Certain net USD denominated
 
financial positions are held by group
companies that have a USD functional currency that is different from the currency in which the taxable income
 
is measured. As
currency exchange rates change between periods, the basis for measuring net financial
 
items for IFRS Accounting Standards will
change disproportionally with taxable income which includes exchange gains and losses
 
from translating the net USD denominated
financial positions into the currency of the applicable tax return. Therefore, the effective tax rate may be significantly
 
higher or lower
than the statutory tax rate for any given period. Adjusted taxes included in adjusted
 
earnings after tax should not be considered
indicative of the amount of current or total tax expense (or taxes payable) for the period.
Adjusted earnings and adjusted earnings after tax are supplementary measures and should not
 
be viewed in isolation or as
substitutes for net operating income/(loss) and net income/(loss), which are the most directly
 
comparable IFRS Accounting Standards
measures. The tables presented under Reconciliation of adjusted earnings and Reconciliation
 
of adjusted earnings after tax to net
income later in this report reconcile adjusted earnings and adjusted earnings after tax with the
 
most directly comparable IFRS
Accounting Standards financial measure or measures. There are material limitations associated
 
with the use of adjusted earnings and
adjusted earnings after tax compared with the IFRS Accounting Standards measures as these non-GAAP
 
measures do not include all
the items of revenues/gains or expenses/losses of Equinor that are needed to evaluate its profitability
 
on an overall basis. Adjusted
earnings and adjusted earnings after tax are only intended to be indicative of the underlying developments
 
in trends of our on-going
operations for the production, manufacturing and marketing of our products and exclude pre-and
 
post-tax impacts of net financial
items. Equinor reflects such underlying developments in our operations by eliminating the effects of certain
 
items that may not be
directly associated with the period's operations or financing. However, for that reason, adjusted earnings and adjusted earnings after
tax are not complete measures of profitability and should therefore not be used in isolation.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
37
Amended principles for Adjusted earnings with effect from the first quarter of 2023:
Equinor has made the following changes to the items adjusted for within Adjusted earnings:
●
 
With effect from the first quarter of 2023, movements in the fair value of commodity derivatives used to manage
 
price risk
exposure of future sale and purchase contracts are excluded from adjusted earnings and
 
deferred until the time of the physical
delivery. This change minimises the effects of timing differences and presents a measure more indicative of underlying economic
performance.
●
 
With effect from the first quarter of 2023, the principle used to adjust the valuation of commercial storages is based
 
on the
forward price at the expected realisation date. Prior to this amendment, the valuation adjustment
 
was based on short-term
forward prices which, for some storages, did not correspond to the forward price at the expected
 
realisation date. This change
brings the valuation principle in line with how the corresponding derivative contract used to manage
 
price exposure is valued.
These changes have been applied retrospectively to the comparative figures. The majority of the
 
impact is due to the revised
treatment of commodity derivatives. These changes only affect the MMP reporting segment and currently do not
 
have an impact on
other segments. Equinor deems that these changes lead to a better representation of
 
performance in each period by appropriately
reflecting the economic impact of its risk management activities.
Impact of change
Q4 2022
Full year 2022
MMP segment
As reported
Impact
Restated
As reported
Impact
Restated
Changes in fair value of derivatives
(142)
2,207
2,065
(149)
1,801
1,651
Periodisation of inventory hedging effect
(395)
(251)
(646)
(349)
181
(168)
Adjusted total revenues and other income
33,055
1,955
35,010
147,599
1,981
149,580
Adjusted earnings/(loss)
(540)
1,955
1,416
2,253
1,981
4,234
Adjusted earnings/(loss) after tax
1,907
(1,077)
831
2,727
(10)
2,717
Impact of change
Q4 2022
Full year 2022
Equinor group
As reported
 
 
Impact
 
 
Restated
 
 
As reported
 
 
Impact
 
 
Restated
 
Changes in fair value of derivatives
(462)
2,207
1,744
(207)
1,801
1,593
Periodisation of inventory hedging effect
(395)
(251)
(646)
(349)
181
(168)
Adjusted total revenues and other income
33,546
1,955
35,501
149,910
1,981
151,891
Adjusted earnings/(loss)
15,059
1,955
17,014
74,940
1,981
76,921
Adjusted earnings/(loss) after tax
5,796
(1,077)
4,719
22,691
(10)
22,680
Effective tax rates on adjusted earnings
61.5%
10.8%
72.3%
69.7%
0.8%
70.5%
No other line items or segments were affected by the
 
change.
Adjusted earnings adjust for the following items:
●
Changes in fair
 
value of derivatives:
 
In the ordinary
 
course of business,
 
Equinor enters into commodity
 
derivative contracts to
manage the price risk exposure relating to future sale and purchase contracts. These commodity derivatives are
 
measured at fair
value
 
at each
 
reporting date,
 
with the
 
movements in
 
fair value
 
recognised in
 
the
 
income statement.
 
By
 
contrast, the
 
sale and
purchase contracts are
 
not recognised until
 
the transaction occurs
 
resulting in timing
 
differences. Therefore, with
 
effect from
 
the
first
 
quarter
 
of
 
2023,
 
the
 
unrealised
 
movements
 
in
 
the
 
fair
 
value
 
of
 
these
 
commodity
 
derivative
 
contracts
 
are
 
excluded
 
from
adjusted earnings
 
and deferred
 
until the
 
time of
 
the physical
 
delivery to
 
minimise the
 
effect of
 
these timing
 
differences. Further,
embedded derivatives
 
within certain
 
gas contracts
 
and contingent
 
consideration related
 
to historical
 
divestments are
 
carried at
fair value. Any
 
accounting impacts resulting
 
from such changes
 
in fair value
 
are also excluded
 
from adjusted earnings,
 
as these
fluctuations are not indicative of the underlying performance of the business.
●
Periodisation of inventory hedging effect:
 
Equinor enters into derivative contracts to manage price risk exposure relating to its
commercial storage.
 
These derivative
 
contracts are
 
carried at
 
fair value
 
while the
 
inventories are
 
accounted for
 
at the
 
lower of
cost or market price.
 
An adjustment is made to align the valuation
 
principles of inventories with related derivative contracts.
 
With
effect from the first quarter of 2023, the adjusted valuation of
 
inventories is based on the forward price at the expected realisation
date. This is so that the valuation principles between commercial storages and derivative contracts are
 
better aligned.
●
Over/underlift:
Over/underlift is
 
accounted
 
for
 
using
 
the
 
sales
 
method
 
and
 
therefore revenues
 
are
 
reflected
 
in
 
the
 
period
 
the
product is sold rather than
 
in the period it is produced.
 
The over/underlift position depends on several factors
 
related to our lifting
programme and
 
the way
 
it corresponds
 
to our
 
entitlement share
 
of production.
 
The effect
 
on income
 
for the
 
period is
 
therefore
adjusted,
 
to
 
show
 
estimated
 
revenues
 
and
 
associated
 
costs
 
based
 
upon
 
the
 
production
 
for
 
the
 
period
 
to
 
reflect
 
operational
performance.
 
Equinor fourth quarter 2023
 
38
●
The
operational storage
 
is not
 
hedged and
 
is not
 
part of
 
the trading
 
portfolio. Cost
 
of goods
 
sold is
 
measured based
 
on the
FIFO (first-in, first-out)
 
method, and includes realised
 
gains or losses
 
that arise due to
 
changes in market prices.
 
These gains or
losses will fluctuate from one period to another and are not considered part of the underlying
 
operations for the period.
●
Impairment and
 
reversal of
 
impairment
 
are excluded
 
from adjusted
 
earnings since
 
they affect
 
the economics
 
of an
 
asset for
the lifetime
 
of that
 
asset, not
 
only the
 
period in
 
which it
 
is impaired,
 
or the
 
impairment is
 
reversed. Impairment
 
and reversal
 
of
impairment can impact both the exploration expenses and the depreciation, amortisation and net
 
impairment line items.
●
Gain or
 
loss from
 
sales of
 
assets
 
is eliminated
 
from the
 
measure since
 
the gain
 
or loss
 
does not
 
give an
 
indication of
 
future
performance or
 
periodic performance;
 
such a
 
gain or
 
loss is
 
related to
 
the cumulative
 
value creation
 
from the
 
time the
 
asset is
acquired until it is sold.
●
Eliminations (Internal unrealised profit
 
on inventories):
 
Volumes derived
 
from equity oil inventory
 
vary depending on several
factors and
 
inventory strategies,
 
i.e., level
 
of crude
 
oil in
 
inventory,
 
equity oil
 
used in
 
the refining
 
process and
 
level of
 
in-transit
cargoes. Internal profit related to volumes sold between entities within the group, and
 
still in inventory at period end, is eliminated
according
 
to
 
IFRS
 
Accounting
 
Standards
 
(write
 
down
 
to
 
production
 
cost).
 
The
 
proportion
 
of
 
realised
 
versus
 
unrealised
 
gain
fluctuates
 
from one
 
period
 
to another
 
due
 
to
 
inventory strategies
 
and
 
consequently impact
 
net
 
operating income/(loss).
 
Write-
down to production
 
cost is not
 
assessed to be
 
a part of
 
the underlying operational performance,
 
and elimination of
 
internal profit
related to equity volumes is excluded in adjusted earnings.
●
Other
 
items
 
of income
 
and
 
expense
 
are
 
adjusted
 
when
 
the
 
impacts
 
on
 
income
 
in
 
the
 
period
 
are
 
not
 
reflective of
 
Equinor’s
underlying operational performance in
 
the reporting period.
 
Such items may be
 
unusual or infrequent
 
transactions, but they
 
may
also include transactions
 
that are significant
 
which would not
 
necessarily qualify as
 
either unusual or
 
infrequent. However,
 
other
items
 
adjusted do
 
not
 
constitute normal,
 
recurring income
 
and operating
 
expenses
 
for the
 
company.
 
Other items
 
are
 
carefully
assessed and can include transactions such as provisions related to reorganisation, early retirement,
 
etc.
●
Change
 
in
 
accounting
 
policy
 
are
 
adjusted
 
when
 
the
 
impacts
 
on
 
income
 
in
 
the
 
period
 
are
 
unusual
 
or
 
infrequent,
 
and
 
not
reflective of Equinor’s underlying operational performance in the reporting
 
period.
Net
 
debt
 
to
 
capital
 
employed
 
ratio
–
 
In
 
Equinor’s view,
 
net
 
debt
 
ratios
 
provide
 
a
 
more
 
informative picture
 
of
 
Equinor’s financial
strength than gross interest-bearing financial
 
debt. Three different net
 
debt to capital ratios
 
are presented in this
 
report: 1) net debt
 
to
capital employed,
 
2) net
 
debt to
 
capital employed
 
adjusted, including
 
lease liabilities,
 
and 3)
 
net debt
 
to capital
 
employed adjusted.
These calculations are all based on Equinor’s gross interest-bearing
 
financial liabilities as recorded in the Consolidated balance
 
sheet
and exclude cash, cash equivalents and current financial investments.
The following
 
adjustments are
 
made in
 
calculating the
 
net debt
 
to capital
 
employed adjusted,
 
including lease
 
liabilities ratio
 
and the
net debt
 
to capital employed
 
adjusted ratio: collateral
 
deposits (classified as
 
Cash and cash
 
equivalents in the
 
Consolidated balance
sheet),
 
and
 
financial
 
investments
 
held
 
in
 
Equinor
 
Insurance
 
AS
 
(classified
 
as
 
Current
 
financial
 
investments
 
in
 
the
 
Consolidated
balance
 
sheet)
 
are
 
treated
 
as
 
non-cash
 
and
 
excluded
 
from
 
the
 
calculation
 
of
 
these
 
non-GAAP
 
measures.
 
Collateral
 
deposits
 
are
excluded since they relate
 
to certain requirements of exchanges
 
where Equinor is trading
 
and presented as restricted
 
cash. Financial
investments
 
in
 
Equinor
 
Insurance
 
are
 
excluded
 
as
 
these
 
investments
 
are
 
not
 
readily
 
available
 
for
 
the
 
group
 
to
 
meet
 
short
 
term
commitments. These adjustments result in a
 
higher net debt figure and
 
in Equinor’s view provides a more
 
prudent measure of the net
debt to
 
capital employed
 
ratio than
 
would be
 
the case
 
without such
 
exclusions.
 
Additionally,
 
lease liabilities
 
are further
 
excluded in
calculating the net debt to capital employed adjusted ratio. The table
 
Calculation of capital employed and net debt to capital employed
ratio later in
 
this report details the
 
calculations for these non-GAAP
 
measures and reconciles
 
them with the
 
most directly comparable
IFRS Accounting Standards financial measure or measures.
Organic capital
 
expenditures
 
(organic
 
investments/capex) –
 
Capital expenditures,
 
defined
 
as
 
Additions to
 
PP&E, intangibles
 
and
equity accounted investments as presented in
 
note 2 Segments to the Condensed
 
interim financial statements, amounted to USD 3.8
billion
 
in
 
Q4
 
2023
 
(Q4
 
2022:
 
USD
 
2.8
 
billion)
 
and
 
USD
 
14.5
 
billion
 
for
 
YTD
 
2023
 
(2022:
 
USD
 
10.0
 
billion).
 
Organic
 
capital
expenditures
 
are
 
capital
 
expenditures
 
excluding
 
expenditures
 
related
 
to
 
acquisitions,
 
leased
 
assets
 
and
 
other
 
investments
 
with
significantly different
 
cash flow
 
patterns. In
 
Q4 2023,
 
a total
 
of USD
 
0.8 billion
 
(Q4 2022:
 
USD 0.5
 
billion) is
 
excluded in
 
the organic
capital
 
expenditures
 
(YTD
 
2023:
 
USD
 
4.3
 
billion;
 
YTD
 
2022:
 
USD
 
1.9
 
billion).
 
Equinor
 
believes
 
this
 
measure
 
gives
 
stakeholders
relevant
 
information
 
to
 
understand
 
the
 
company’s
 
investments
 
in
 
maintaining
 
and
 
developing
 
its
 
assets.
 
Forward-looking
 
organic
capital expenditures
 
included in this
 
report are
 
not reconcilable to
 
its most
 
directly comparable IFRS
 
Accounting Standards
 
measure
without unreasonable
 
efforts,
 
because the
 
amounts excluded
 
from such
 
IFRS Accounting
 
Standards measure
 
to determine
 
organic
capital expenditures cannot be predicted with reasonable certainty.
Gross
 
capital
 
expenditures
 
(gross
 
capex)
–
 
Gross
 
capital
 
expenditures
 
represent
 
capital
 
expenditures,
 
defined
 
as
 
Additions
 
to
PP&E,
 
intangibles
 
and
 
equity
 
accounted
 
investments
 
as
 
presented
 
in
 
the
 
financial
 
statements,
 
excluding
 
additions
 
to
 
right
 
of
 
use
assets related to leases and capital expenditures financed through government grants. Equinor adds the proportionate share of capital
expenditures
 
in
 
equity
 
accounted
 
investments
 
not
 
included
 
in
 
Additions
 
to
 
PP&E,
 
intangibles
 
and
 
equity
 
accounted
 
investments.
Equinor
 
believes
 
that
 
by
 
excluding
 
additions
 
to
 
right
 
of
 
use
 
assets
 
related
 
to
 
leases,
 
this
 
measure
 
better
 
reflects
 
the
 
company's
investments in the business
 
to drive growth. Forward-looking
 
gross capital expenditures included
 
in this report are
 
not reconcilable to
its most directly comparable
 
IFRS measure without unreasonable efforts,
 
because the amounts included
 
or excluded from such
 
IFRS
measure to determine gross capital expenditures cannot be predicted with reasonable certainty.
Equinor fourth quarter 2023
 
39
Return on average capital employed (ROACE)
 
– ROACE is the ratio of
 
adjusted earnings after tax to the average capital
 
employed
adjusted. For a reconciliation for adjusted earnings after tax, see Reconciliation of
 
net operating income/(loss) to adjusted earnings as
presented later in
 
this report. Average
 
capital employed adjusted
 
refers to the
 
average of the
 
capital employed adjusted
 
values as of
31 December
 
for both
 
the current
 
and the
 
preceding year,
 
as presented
 
in the
 
table Calculation of
 
capital employed
 
and net
 
debt to
capital employed
 
ratio later in
 
this report.
 
Equinor uses
 
ROACE to
 
evaluate performance by
 
measuring how
 
effectively the
 
company
employs its
 
capital, whether
 
financed through
 
equity or
 
debt. An
 
IFRS Accounting
 
Standards measure
 
most directly
 
comparable to
ROACE would
 
be calculated
 
as the
 
ratio of net
 
income/(loss) to average
 
capital employed
 
that is
 
based on
 
Equinor’s gross interest-
bearing
 
financial
 
liabilities
 
as
 
recorded
 
in
 
the
 
Consolidated
 
balance
 
sheet,
 
excluding
 
cash,
 
cash
 
equivalents
 
and
 
current
 
financial
investments. ROACE
 
is used
 
as a
 
supplementary measure
 
and should
 
not be
 
viewed in
 
isolation or
 
as an
 
alternative to
 
measures
calculated
 
in
 
accordance
 
with
 
IFRS
 
Accounting
 
Standards,
 
including
 
income
 
before
 
financial
 
items,
 
income
 
taxes
 
and
 
minority
interest, or net income, or ratios based
 
on these figures. Forward-looking ROACE included in this report
 
is not reconcilable to its most
directly comparable
 
IFRS Accounting
 
Standards measure
 
without unreasonable
 
efforts,
 
because the
 
amounts
 
included or
 
excluded
from IFRS Accounting Standards measures used to determine ROACE cannot be predicted with reasonable
 
certainty.
Cash flows
 
from operations
 
after taxes
 
paid (CFFO after
 
taxes paid)
represents, and
 
is used
 
by management,
 
to evaluate cash
generated
 
from
 
operating
 
activities
 
after
 
taxes
 
paid,
 
which
 
is
 
available
 
for
 
investing
 
activities,
 
debt
 
servicing
 
and
 
distribution
 
to
shareholders. Cash
 
flows from
 
operations after
 
taxes paid
 
is not
 
a
 
measure of
 
our
 
liquidity under
 
IFRS Accounting
 
Standards and
should not be
 
considered in isolation
 
or as a
 
substitute for an
 
analysis of our
 
results as reported
 
in this report.
 
Our definition of
 
Cash
flows from
 
operations after
 
taxes paid
 
is limited
 
and does
 
not represent
 
residual cash
 
flows available
 
for discretionary
 
expenditures.
The
 
table
 
Calculation
 
of
 
CFFO
 
after
 
taxes
 
paid
 
and
 
net
 
cash
 
flow
 
later
 
in
 
this
 
report
 
provides
 
a
 
reconciliation
 
of
 
Cash
 
flows
 
from
operations after
 
taxes paid
 
to its
 
most directly
 
comparable IFRS
 
Accounting Standards
 
measure, Cash
 
flows provided
 
by operating
activities
 
before
 
taxes
 
paid
 
and
 
working
 
capital
 
items,
 
as
 
of
 
the
 
specified
 
dates.
 
Forward-looking
 
cash
 
flows
 
from
 
operations
 
after
taxes
 
paid
 
included
 
in
 
this
 
report
 
are
 
not
 
reconcilable
 
to
 
its
 
most
 
directly
 
comparable
 
IFRS
 
measure
 
without unreasonable
 
efforts,
because the amounts included or
 
excluded from such IFRS measure
 
to determine cash flows from operations
 
after taxes paid cannot
be predicted with reasonable certainty.
Net
 
cash
 
flow
 
(previously
 
named
 
free
 
cash
 
flow)
-
 
Net
 
cash
 
flow
 
represents,
 
and
 
is
 
used
 
by
 
management
 
to
 
evaluate,
 
cash
generated
 
from
 
operational
 
and
 
investing
 
activities
 
available
 
for
 
debt
 
servicing
 
and
 
distribution
 
to
 
shareholders.
 
The
 
name
 
of
 
the
measure was updated in the first quarter of 2023, but no changes have been made to
 
the definition. Net cash flow is not a measure of
our
 
liquidity
 
under
 
IFRS
 
Accounting
 
Standards
 
and
 
should
 
not
 
be
 
considered
 
in
 
isolation
 
or
 
as
 
a
 
substitute
 
for
 
an
 
analysis
 
of
 
our
results as
 
reported in
 
this report.
 
Our definition
 
of Net
 
cash flow
 
is limited
 
and does
 
not represent
 
residual cash
 
flows available
 
for
discretionary
 
expenditures.
 
The
 
table
 
Calculation
 
of
 
CFFO
 
after
 
taxes
 
paid
 
and
 
net
 
cash
 
flow
 
later
 
in
 
this
 
report
 
provides
 
a
reconciliation of Net cash flow to its most directly comparable IFRS Accounting Standards measure, Cash flows provided by operating
activities before taxes paid and working capital items, as of the specified dates.
For more information on our definitions and use of non-GAAP financial measures, see section 5.8
 
Use and reconciliation of non-
GAAP financial measures in Equinor's 2022 Integrated Annual Report.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
40
Reconciliation of adjusted earnings
The table specifies the adjustments made to each of the profit and loss line item included
 
in the net operating income/(loss) subtotal.
Items impacting net operating income/(loss) in the
fourth quarter of 2023
Equinor
group
Exploration
&
Production
Norway
 
Exploration
&
Production
Internationa
l
Exploration
&
Production
USA
Marketing,
Midstream
&
Processing
Rene-
wables
Other
 
(in USD million)
Total revenues and other income
29,054
10,076
1,889
1,165
28,668
20
(12,764)
Adjusting items
(571)
(205)
63
-
(412)
(17)
(0)
Changes in fair value of derivatives
(65)
-
3
-
(67)
-
-
Periodisation of inventory hedging effect
(344)
-
-
-
(344)
-
-
Over-/underlift
102
16
86
-
-
-
-
Gain/loss on sale of assets
(264)
(222)
(25)
-
-
(17)
(0)
Adjusted total revenues and other income
28,483
9,871
1,952
1,165
28,257
2
(12,765)
Purchases [net of inventory variation]
(13,804)
0
(45)
-
(26,330)
0
12,570
Adjusting items
132
-
-
-
89
-
43
Operational storage effects
89
-
-
-
89
-
-
Eliminations
43
-
-
-
-
-
43
Adjusted purchases [net of inventory variation]
(13,672)
0
(45)
-
(26,241)
0
12,613
Operating and administrative expenses
 
(3,279)
(1,057)
(540)
(308)
(1,384)
(180)
190
Adjusting items
44
40
(19)
(0)
19
4
-
Over-/underlift
21
40
(19)
-
-
-
-
Other adjustments
4
-
-
(0)
-
4
-
Provisions
19
-
-
-
19
-
-
Adjusted operating and administrative expenses
 
(3,235)
(1,018)
(559)
(308)
(1,365)
(176)
190
Depreciation, amortisation and net impairments
(2,821)
(1,144)
(913)
(506)
(220)
(6)
(31)
Adjusting items
303
-
310
-
(7)
-
-
Impairment
303
-
310
-
(7)
-
-
Adjusted depreciation, amortisation and net
impairments
(2,518)
(1,144)
(603)
(506)
(227)
(6)
(31)
Exploration expenses
(402)
(138)
(55)
(208)
-
-
-
Adjusting items
25
-
-
25
-
-
-
Impairment
25
-
-
25
-
-
-
Adjusted exploration expenses
(377)
(138)
(55)
(184)
-
-
-
Net operating income/(loss)
8,748
7,737
336
143
734
(166)
(36)
Sum of adjusting items
(67)
(166)
354
25
(310)
(13)
43
Adjusted earnings/(loss)
8,681
7,571
690
168
424
(179)
7
Tax on adjusted earnings
(6,802)
(6,001)
(435)
(90)
(281)
33
(29)
Adjusted earnings/(loss) after tax
1,879
1,570
255
78
143
(146)
(22)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
41
Items impacting net operating income/(loss) in the
fourth quarter of 2022
Equinor
group
Exploration
&
Production
Norway
Exploration
&
Production
Internationa
l
Exploration
&
Production
USA
Marketing,
Midstream
&
Processing
Rene-
wables
Other
(in USD million)
Total revenues and other income
34,321
16,729
2,373
1,083
33,591
38
(19,495)
Adjusting items
1,181
239
(476)
-
1,419
(23)
23
Changes in fair value of derivatives
 
1,744
1)
58
(378)
-
 
2,065
1)
-
-
Periodisation of inventory hedging effect
 
(646)
1)
-
-
-
 
(646)
1)
-
-
Over-/underlift
181
257
(75)
-
-
-
-
Other adjustments
(0)
-
(22)
-
-
-
22
Gain/loss on sale of assets
(98)
(75)
-
-
-
(23)
0
Adjusted total revenues and other income
 
35,501
1)
16,968
1,897
1,083
 
35,010
1)
15
(19,472)
Purchases [net of inventory variation]
(12,853)
(0)
(85)
(0)
(31,996)
-
19,228
Adjusting items
72
-
-
-
27
-
46
Operational storage effects
27
-
-
-
27
-
-
Eliminations
46
-
-
-
-
-
46
Adjusted purchases [net of inventory variation]
(12,781)
(0)
(85)
(0)
(31,969)
-
19,273
Operating and administrative expenses
(3,304)
(1,020)
(511)
(220)
(1,614)
(101)
161
Adjusting items
272
(34)
73
2
225
-
5
Over-/underlift
36
(34)
70
-
-
-
-
Other adjustments
1
-
(4)
-
-
-
5
Gain/loss on sale of assets
9
-
7
2
-
-
-
Provisions
225
-
-
-
225
-
-
Adjusted operating and administrative expenses
(3,032)
(1,053)
(438)
(217)
(1,389)
(101)
166
Depreciation, amortisation and net impairments
(1,184)
(1,222)
310
(13)
(233)
(1)
(26)
Adjusting items
(1,094)
3
(744)
(350)
(3)
-
-
Impairment
2
3
3
-
(3)
-
-
Reversal of impairment
(1,097)
-
(747)
(350)
-
-
-
Adjusted depreciation, amortisation and net
impairments
(2,279)
(1,219)
(433)
(363)
(236)
(1)
(26)
Exploration expenses
(396)
(101)
(266)
(29)
-
-
0
Adjusted exploration expenses
(396)
(101)
(266)
(29)
-
-
0
Net operating income/(loss)
16,584
14,386
1,822
821
(251)
(63)
(132)
Sum of adjusting items
 
430
1)
208
(1,147)
(348)
 
1,667
1)
(23)
73
Adjusted earnings/(loss)
 
17,014
1)
14,594
676
474
 
1,416
1)
(87)
(59)
Tax on adjusted earnings
 
(12,295)
1)
(11,294)
(308)
(24)
 
(585)
1)
(10)
(73)
Adjusted earnings/(loss) after tax
 
4,719
1)
3,300
367
450
 
831
1)
(97)
(132)
1) MMP segment and Equinor group are restated due
 
to amended principles for adjusting items; 'changes
 
in fair value of derivatives' and
'periodisation of inventory hedging effect'. For further information
 
see Amended principles for Adjusted earnings in
 
the section ‘Use and
reconciliation of non-GAAP financial measures’ in
 
the Supplementary disclosures.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
42
Items impacting net operating income/(loss) in the
third quarter of 2023
Equinor
group
Exploration
&
Production
Norway
 
Exploration
&
Production
Internationa
l
Exploration
&
Production
USA
Marketing,
Midstream
&
Processing
Rene-
wables
Other
(in USD million)
Total revenues and other income
26,024
7,938
1,990
1,162
25,712
(5)
(10,773)
Adjusting Items
(289)
226
(140)
(32)
(341)
-
(1)
Changes in fair value of derivatives
(206)
20
(6)
-
(219)
-
-
Periodisation of inventory hedging effect
(22)
-
-
-
(22)
-
-
Over-/underlift
72
206
(134)
-
-
-
-
Other adjustments
(100)
-
-
-
(100)
-
-
Gain/loss on sale of assets
(33)
-
-
(32)
-
-
(1)
Adjusted total revenues and other income
25,735
8,164
1,849
1,130
25,371
(5)
(10,773)
Purchases [net of inventory variation]
(12,269)
(1)
58
-
(22,987)
-
10,661
Adjusting Items
(123)
-
-
-
(97)
-
(27)
Operational storage effects
(92)
-
-
-
(92)
-
-
Provisions
(5)
-
-
-
(5)
-
-
Eliminations
(27)
-
-
-
-
-
(27)
Adjusted purchases [net of inventory variation]
(12,392)
(1)
58
-
(23,083)
-
10,634
Operating and administrative expenses
(2,715)
(788)
(541)
(293)
(1,181)
(103)
191
Adjusting Items
12
(61)
83
-
(13)
4
-
Over-/underlift
21
(61)
83
-
-
-
-
Other adjustments
4
-
-
-
-
4
-
Provisions
(13)
-
-
-
(13)
-
-
Adjusted operating and administrative expenses
(2,703)
(849)
(458)
(293)
(1,195)
(100)
191
Depreciation, amortisation and net impairments
(3,369)
(1,695)
(594)
(181)
(562)
(303)
(34)
Adjusting Items
943
588
-
(290)
346
300
-
Impairment
1,234
588
-
-
346
300
-
Reversal of Impairment
(290)
-
-
(290)
-
-
-
Adjusted depreciation, amortisation and net
impairments
(2,426)
(1,107)
(594)
(472)
(217)
(3)
(34)
Exploration expenses
(218)
(120)
(75)
(23)
-
-
-
Adjusting Items
28
-
28
-
-
-
-
Impairment
28
-
28
-
-
-
-
Adjusted exploration expenses
(190)
(120)
(47)
(23)
-
-
-
Net operating income/(loss)
7,453
5,335
838
666
982
(412)
45
Sum of adjusting items
571
752
(29)
(323)
(106)
304
(27)
Adjusted earnings/(loss)
8,024
6,087
809
343
876
(108)
18
Tax on adjusted earnings
(5,292)
(4,743)
(163)
(82)
(333)
11
17
Adjusted earnings/(loss) after tax
2,731
1,343
646
261
543
(97)
35
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
43
Items impacting net operating income/(loss) in the
full year of 2023
Equinor
group
Exploration
&
Production
Norway
Exploration
&
Production
Internationa
l
Exploration
&
Production
USA
Marketing,
Midstream
&
Processing
Rene-
wables
Other
(in USD million)
Total revenues and other income
107,174
38,340
7,032
4,319
105,908
17
(48,442)
Adjusting items
(1,303)
(128)
(76)
(32)
(1,049)
(17)
(1)
Changes in fair value of derivatives
(711)
128
(96)
-
(743)
-
-
Periodisation of inventory hedging effect
(183)
-
-
-
(183)
-
-
Impairment from associated companies
1
-
-
-
-
1
-
Over-/underlift
10
(35)
45
-
-
-
-
Other adjustments
(100)
-
-
-
(100)
-
-
Gain/loss on sale of assets
(319)
(221)
(25)
(32)
(23)
(17)
(1)
Adjusted total revenues and other income
105,871
38,213
6,956
4,286
104,860
(0)
(48,443)
Purchases [net of inventory variation]
(48,175)
(0)
(70)
-
(95,769)
0
47,664
Adjusting items
173
-
-
-
36
-
137
Operational storage effects
41
-
-
-
41
-
-
Provisions
(5)
-
-
-
(5)
-
-
Eliminations
137
-
-
-
-
-
137
Adjusted purchases [net of inventory variation]
(48,003)
(0)
(70)
-
(95,733)
0
47,801
Operating and administrative expenses
 
(11,800)
(3,759)
(2,176)
(1,178)
(4,916)
(462)
692
Adjusting items
260
29
261
22
(72)
20
-
Over-/underlift
7
29
(22)
-
-
-
-
Other adjustments
36
-
-
22
-
14
-
Gain/loss on sale of assets
289
-
283
-
-
6
-
Provisions
(72)
-
-
-
(72)
-
-
Adjusted operating and administrative expenses
 
(11,540)
(3,730)
(1,915)
(1,156)
(4,988)
(442)
692
Depreciation, amortisation and net impairments
(10,634)
(5,017)
(2,433)
(1,489)
(1,239)
(312)
(143)
Adjusting items
1,259
588
310
(290)
343
300
9
Impairment
1,550
588
310
-
343
300
9
Reversal of impairment
(290)
-
-
(290)
-
-
-
Adjusted depreciation, amortisation and net
impairments
(9,374)
(4,429)
(2,123)
(1,779)
(897)
(12)
(134)
Exploration expenses
(795)
(476)
(20)
(299)
-
-
-
Adjusting items
61
-
36
25
-
-
-
Impairment
61
-
36
25
-
-
-
Adjusted exploration expenses
(734)
(476)
16
(274)
-
-
-
Net operating income/(loss)
35,770
29,087
2,332
1,353
3,984
(757)
(229)
Sum of adjusting items
451
490
532
(277)
(742)
303
145
Adjusted earnings/(loss)
36,220
29,577
2,863
1,076
3,242
(454)
(84)
Tax on adjusted earnings
(25,850)
(23,083)
(1,213)
(304)
(1,364)
63
51
Adjusted earnings/(loss) after tax
10,371
6,494
1,650
773
1,877
(391)
(33)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
44
Items impacting net operating income/(loss) in the
full year of 2022
Equinor
group
Exploration
&
Production
Norway
Exploration
&
Production
Internationa
l
Exploration
&
Production
USA
Marketing,
Midstream
&
Processing
Rene-
wables
Other
(in USD million)
Total revenues and other income
150,806
75,930
7,431
5,523
148,105
185
(86,367)
Adjusting Items
1,085
(487)
185
-
1,475
(110)
22
Changes in fair value of derivatives
 
1,593
1)
(263)
205
-
 
1,651
1)
-
-
Periodisation of inventory hedging effect
 
(168)
1)
-
-
-
 
(168)
1)
-
-
Impairment from associated companies
1
-
-
-
-
1
-
Over-/underlift
510
507
3
-
-
-
-
Other adjustments
(0)
-
(22)
-
-
-
22
Gain/loss on sale of assets
(850)
(731)
-
-
(9)
(111)
(0)
Adjusted total revenues and other income
 
151,891
1)
75,443
7,616
5,523
 
149,580
1)
75
(86,345)
Purchases [net of inventory variation]
(53,806)
0
(116)
(0)
(139,916)
-
86,227
Adjusting Items
(610)
-
-
-
(33)
-
(577)
Operational storage effects
(33)
-
-
-
(33)
-
-
Eliminations
(577)
-
-
-
-
-
(577)
Adjusted purchases [net of inventory variation]
(54,415)
0
(116)
(0)
(139,949)
-
85,650
Operating and administrative expenses
(10,593)
(3,782)
(1,698)
(938)
(4,591)
(265)
681
Adjusting Items
64
(54)
22
6
75
10
5
Over-/underlift
(41)
(54)
13
-
-
-
-
Change in accounting policy
7
-
2
-
-
-
5
Gain/loss on sale of assets
23
-
7
6
-
10
-
Provisions
75
-
-
-
75
-
-
Adjusted operating and administrative expenses
(10,530)
(3,836)
(1,675)
(933)
(4,516)
(255)
686
Depreciation, amortisation and net impairments
(6,391)
(4,167)
(1,731)
(361)
14
(4)
(142)
Adjusting Items
(2,488)
(819)
286
(1,060)
(895)
-
-
Impairment
1,111
3
1,033
-
75
-
-
Reversal of impairment
(3,598)
(821)
(747)
(1,060)
(970)
-
-
Adjusted depreciation, amortisation and net
impairments
(8,879)
(4,986)
(1,445)
(1,422)
(881)
(4)
(142)
Exploration expenses
(1,205)
(366)
(638)
(201)
-
-
0
Adjusting Items
59
4
65
(11)
-
-
-
Impairment
85
4
65
15
-
-
-
Reversal of impairment
(26)
-
-
(26)
-
-
-
Adjusted exploration expenses
(1,146)
(361)
(573)
(212)
-
-
0
Net operating income/(loss)
78,811
67,614
3,248
4,022
3,612
(84)
399
Sum of adjusting items
 
(1,890)
1)
(1,355)
559
(1,065)
 
621
1)
(100)
(550)
Adjusted earnings/(loss)
 
76,921
1)
66,260
3,806
2,957
 
4,234
1)
(184)
(151)
Tax on adjusted earnings
 
(54,241)
1)
(51,373)
(1,248)
(79)
 
(1,517)
1)
14
(38)
Adjusted earnings/(loss) after tax
 
22,680
1)
14,887
2,558
2,878
 
2,717
1)
(171)
(189)
1) MMP segment and Equinor group are restated due
 
to amended principles for adjusting items; 'changes
 
in fair value of derivatives' and
'periodisation of inventory hedging effect'. For further information
 
see Amended principles for Adjusted earnings in
 
the section 'Use and
reconciliation of non-GAAP financial measures' in
 
the Supplementary disclosures.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
45
Adjusted earnings after tax by reporting segment
Quarters
Q4 2023
Q3 2023
Q4 2022
1)
(in USD million)
Adjusted
earnings
Tax on
adjusted
earnings
Adjusted
earnings
after tax
Adjusted
earnings
Tax on
adjusted
earnings
Adjusted
earnings
after tax
Adjusted
earnings
Tax on
adjusted
earnings
Adjusted
earnings
after tax
E&P Norway
7,571
(6,001)
1,570
6,087
(4,743)
1,343
14,594
(11,294)
3,300
E&P International
690
(435)
255
809
(163)
646
676
(308)
367
E&P USA
168
(90)
78
343
(82)
261
474
(24)
450
MMP
424
(281)
143
876
(333)
543
1,416
(585)
831
REN
(179)
33
(146)
(108)
11
(97)
(87)
(10)
(97)
Other
7
(29)
(22)
18
17
35
(59)
(73)
(132)
Equinor group
8,681
(6,802)
1,879
8,024
(5,292)
2,731
17,014
(12,295)
4,719
Effective tax rates on adjusted
earnings
78.4%
66.0%
72.3%
1)
1) MMP segment and Equinor group have been restated
 
due to amended principles for adjusting items;
 
'changes in fair value of derivatives'
and 'periodisation of inventory hedging effect'. For
 
further information see Amended principles for Adjusted
 
earnings in the section ‘Use and
reconciliation of non-GAAP financial measures’ in
 
the Supplementary disclosures.
Full year
2023
2022
1)
(in USD million)
Adjusted
earnings
Tax on
adjusted
earnings
Adjusted
earnings
after tax
Adjusted
earnings
Tax on
adjusted
earnings
Adjusted
earnings
after tax
E&P Norway
29,577
(23,083)
6,494
66,260
(51,373)
14,887
E&P International
2,863
(1,213)
1,650
3,806
(1,248)
2,558
E&P USA
1,076
(304)
773
2,957
(79)
2,878
MMP
3,242
(1,364)
1,877
4,234
(1,517)
2,717
REN
(454)
63
(391)
(184)
14
(171)
Other
(84)
51
(33)
(151)
(38)
(189)
Equinor group
36,220
(25,850)
10,371
76,921
(54,241)
22,680
Effective tax rates on adjusted earnings
71.4%
70.5%
1)
1) MMP segment and Equinor group are restated due
 
to amended principles for adjusting items; 'changes
 
in fair value of derivatives' and
'periodisation of inventory hedging effect'. For further information
 
see Amended principles for Adjusted earnings in
 
the section ‘Use and
reconciliation of non-GAAP financial measures’ in
 
the Supplementary disclosures.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
46
Reconciliation of adjusted earnings after tax to net income
 
Reconciliation of adjusted earnings after tax to net income
 
Quarters
Full year
(in USD million)
Q4 2023
Q3 2023
Q4 2022
2023
2022
Net operating income/(loss)
A
8,748
7,453
16,584
35,770
78,811
Income tax less tax on net financial items
B
6,574
5,003
6,544
25,724
50,098
Net operating income after tax
C = A-B
2,174
2,450
10,039
10,046
28,713
Items impacting net operating income/(loss)
1) 2)
D
(67)
571
 
430
2)
451
 
(1,890)
2)
Tax on items impacting net operating income/(loss)
2)
E
228
289
 
5,750
2)
126
 
4,143
2)
Adjusted earnings after tax*
2)
F = C+D-E
1,879
2,731
 
4,719
2)
10,371
 
22,680
2)
Net financial items
G
589
13
(2,115)
2,114
(207)
Tax on net financial items
H
(155)
39
(28)
(256)
237
Net income/(loss)
I = C+G+H
2,608
2,501
7,897
11,904
28,744
1) For items impacting net operating income/(loss),
 
see Reconciliation of adjusted earnings in the Supplementary
 
disclosures.
2) Restated.
 
For more information, see Amended principles for
 
Adjusted earnings in the section ‘Use and
 
reconciliation of non-GAAP
financial measures’ in the Supplementary disclosures.
Adjusted exploration expenses
Quarters
Change
Full year
(in USD million)
Q4 2023
Q3 2023
Q4 2022
Q4 on Q4
2023
2022
Change
E&P Norway exploration expenditures
213
179
144
48%
662
493
34%
E&P International exploration expenditures
125
52
114
10%
301
445
(32%)
E&P USA exploration expenditures
86
110
50
71%
312
149
>100%
Group exploration expenditures
423
341
307
38%
1,275
1,087
17%
Expensed, previously capitalised exploration expenditures
3
24
183
(98%)
(114)
283
N/A
Capitalised share of current period's exploration activity
(49)
(175)
(95)
(48%)
(427)
(224)
91%
Impairment (reversal of impairment)
25
28
0
>100%
61
59
4%
Exploration expenses according to IFRS Accounting
 
Standards
402
218
396
1%
795
1,205
(34%)
Items impacting net operating income/(loss)
1)
(25)
(28)
(0)
>100%
(61)
(59)
4%
Adjusted exploration expenses*
377
190
396
(5%)
734
1,146
(36%)
1) For items impacting net operating income/(loss),
 
see Reconciliation of adjusted earnings in the Supplementary
 
disclosures.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
47
Calculated ROACE
Calculated ROACE based on IFRS Accounting Standards
31 December
 
(in USD million, except percentages)
2023
2022
Net income/(loss)
A
11,904
28,744
Average total equity
1
51,244
46,506
Average current finance debt and lease liabilities
6,446
6,001
Average non-current finance debt and lease liabilities
25,536
28,202
- Average cash and cash equivalents
(12,610)
(14,853)
- Average current financial investments
(29,550)
(25,561)
Average net-interest bearing debt
2
(10,178)
(6,210)
Average capital employed
B = 1+2
41,066
40,296
Calculated ROACE based on Net income/loss and
 
capital employed
A/B
29.0%
71.3%
Calculated ROACE based on Adjusted earnings after
 
tax and capital employed adjusted
31 December
 
(in USD million, except percentages)
2023
2022
Adjusted earnings after tax
A
10,371
 
22,680
1)
Average capital employed adjusted
B
41,731
41,134
Calculated ROACE based on Adjusted earnings
 
after tax and capital employed
A/B
24.9%
55.1%
1)
1) Restated.
 
For more information, see Amended principles for
 
Adjusted earnings in the section ‘Use and
 
reconciliation of non-GAAP financial
measures’ in the Supplementary disclosures.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
48
Calculation of CFFO after taxes paid and net cash flow
CFFO information
Quarters
Change
Full year
(in USD million)
Q4 2023
Q3 2023
Q4 2022
Q4 on Q4
2023
2022
Change
Cash flows provided by operating activities before
 
taxes paid and
working capital items
10,890
11,336
20,988
(48%)
48,016
83,608
(43%)
Taxes Paid
(8,103)
(3,743)
(14,188)
(43%)
(28,276)
(43,856)
(36%)
Cash flow from operations after taxes
 
paid (CFFO after taxes
paid)
2,787
7,594
6,800
(59%)
19,741
39,752
(50%)
Net Cash Flow Information
Quarters
Change
Full year
(in USD million)
Q4 2023
Q3 2023
Q4 2022
Q4 on Q4
2023
2022
Change
Cash flow from operations after taxes paid (CFFO
 
after taxes paid)
2,787
7,594
6,800
(59%)
19,741
39,752
(50%)
(Cash used)/received in business combinations
(40)
(100)
(0)
>100%
(1,195)
147
N/A
Capital expenditures and investments
 
(3,031)
(2,652)
(2,376)
28%
(10,575)
(8,758)
21%
(Increase)/decrease in other interest-bearing items
92
(219)
7
>100%
(87)
(23)
>100%
Proceeds from sale of assets and businesses
 
154
(0)
47
>100%
272
966
(72%)
Dividend paid
 
(2,706)
(2,613)
(2,231)
21%
(10,906)
(5,380)
>100%
Share buy-back
 
(518)
(531)
(577)
(10%)
(5,589)
(3,315)
69%
Net Cash Flow
(3,262)
1,479
1,669
N/A
(8,340)
23,388
N/A
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
49
Calculation of capital employed and net debt to capital employed ratio
Calculation of capital employed and net debt to capital
 
employed ratio
At 31 December
 
At 31 December
(in USD million)
2023
2022
Shareholders' equity
48,490
53,988
Non-controlling interests
10
1
Total equity
 
A
48,500
53,989
Current finance debt and lease liabilities
7,275
5,617
Non-current finance debt and lease liabilities
24,521
26,551
Gross interest-bearing debt
B
31,796
32,168
Cash and cash equivalents
9,641
15,579
Current financial investments
29,224
29,876
Cash and cash equivalents and financial investment
 
C
38,865
45,455
Net interest-bearing debt [9]
B1 = B-C
(7,069)
(13,288)
Other interest-bearing elements
 
1)
2,030
6,538
Net interest-bearing debt adjusted normalised for
 
tax payment, including lease liabilities*
B2
(5,040)
(6,750)
Lease liabilities
3,570
3,668
Net interest-bearing debt adjusted*
B3
(8,610)
(10,417)
Calculation of capital employed*
Capital employed
A+B1
41,431
40,701
Capital employed adjusted, including lease liabilities
A+B2
43,460
47,239
Capital employed adjusted
A+B3
39,890
43,571
Calculated net debt to capital employed*
Net debt to capital employed
(B1)/(A+B1)
(17.1%)
(32.6%)
Net debt to capital employed adjusted, including
 
lease liabilities
(B2)/(A+B2)
(11.6%)
(14.3%)
Net debt to capital employed adjusted
(B3)/(A+B3)
(21.6%)
(23.9%)
1)
Other interest-bearing elements are cash and
 
cash equivalents adjustments regarding collateral
 
deposits classified as cash and cash
equivalents in the Consolidated balance sheet but
 
considered as non-cash in the non-GAAP calculations
 
as well as financial investments
in Equinor Insurance AS classified as current financial
 
investments.
Equinor fourth quarter 2023
 
50
FORWARD
 
-LOOKING STATEMENTS
 
This report
 
contains certain
 
forward-looking statements
 
that involve
 
risks and
 
uncertainties. In
 
some cases,
 
we use
 
words such
 
as
"ambition", "continue",
 
"could", "estimate",
 
"intend", "expect",
 
"believe", "likely",
 
"may", "outlook",
 
"plan", "strategy",
 
"will", "guidance",
"targets", and similar expressions to identify forward-looking statements. Forward-looking statements include all statements other than
statements
 
of
 
historical
 
fact,
 
including,
 
among
 
others,
 
statements
 
regarding
 
Equinor's
 
plans,
 
intentions,
 
aims,
 
ambitions
 
and
expectations;
 
the
 
commitment
 
to
 
develop
 
as
 
a
 
broad
 
energy
 
company
 
and
 
diversify
 
its
 
energy
 
mix;
 
the
 
ambition
 
to
 
be
 
a
 
leading
company in
 
the energy
 
transition and
 
reduce net
 
group-wide greenhouse
 
gas emissions;
 
our ambitions
 
and expectations
 
regarding
decarbonisation; future financial
 
performance, including earnings,
 
cash flow and
 
liquidity; the
 
ambition to
 
grow cash
 
flow and
 
returns
and improve
 
ROACE*; expectations
 
regarding progress
 
on the
 
energy transition
 
plan; expectations
 
regarding cash
 
flow and
 
returns
from Equinor’s oil and gas
 
portfolio, CCS projects and
 
renewables and low carbon solutions
 
portfolio; our expectations and ambitions
regarding operated emissions, annual Co2 storage and carbon intensity; plans to develop fields; expectations, plans and ambitions for
renewables production capacity and Co2 transport and storage and investments in renewables and low carbon solutions; expectations
and plans regarding
 
development of renewables projects,
 
CCUS and hydrogen businesses
 
and production of
 
low carbon energy and
CCS;
 
our
 
intention
 
to
 
optimise
 
our
 
portfolio;
 
break-even
 
considerations,
 
targets
 
and
 
other
 
metrics
 
for
 
investment
 
decisions;
 
future
worldwide economic
 
trends, market
 
outlook and
 
future economic
 
projections and
 
assumptions, including
 
commodity price,
 
currency
and
 
refinery
 
assumptions;
 
estimates
 
of
 
proved
 
reserves;
 
organic
 
capital
 
expenditures
 
through
 
2024;
 
expectations
 
and
 
estimates
regarding
 
production
 
and
 
development
 
and
 
execution
 
of
 
projects;
 
expectations
 
regarding
 
oil
 
and
 
gas
 
and
 
renewable
 
power
production;
 
estimates
 
regarding
 
tax
 
payments;
 
the
 
ambition
 
to
 
keep
 
unit
 
of
 
production
 
cost
 
in
 
the
 
top
 
quartile
 
of
 
our
 
peer
 
group;
scheduled maintenance
 
activity and
 
the effects
 
thereof on
 
equity production;
 
completion and
 
results of
 
acquisitions and
 
disposals;
expected amount
 
and
 
timing of
 
dividend payments
 
and
 
the
 
implementation of
 
our
 
share
 
buy-back programme;
 
and
 
provisions and
contingent
 
liabilities.
 
You
 
should
 
not
 
place
 
undue
 
reliance
 
on
 
these
 
forward-looking
 
statements.
 
Our
 
actual
 
results
 
could
 
differ
materially from those anticipated in the forward-looking statements for many reasons.
These
 
forward-looking statements
 
reflect
 
current views
 
about future
 
events,
 
are based
 
on management’s
 
current expectations
 
and
assumptions
 
and
 
are,
 
by
 
their
 
nature,
 
subject
 
to
 
significant
 
risks
 
and
 
uncertainties
 
because
 
they
 
relate
 
to
 
events
 
and
 
depend
 
on
circumstances that
 
will occur
 
in the
 
future. There
 
are a
 
number of
 
factors that could
 
cause actual
 
results and
 
developments to
 
differ
materially from
 
those expressed or
 
implied by
 
these forward-looking
 
statements, including levels
 
of industry
 
product supply,
 
demand
and pricing,
 
in particular
 
in light
 
of significant
 
oil price
 
volatility; unfavourable
 
macroeconomic conditions
 
and inflationary
 
pressures;
exchange
 
rate
 
and
 
interest
 
rate
 
fluctuations;
 
levels
 
and
 
calculations
 
of
 
reserves
 
and
 
material differences
 
from
 
reserves
 
estimates;
regulatory stability and
 
access to resources,
 
including attractive low
 
carbon opportunities; the
 
effects of
 
climate change and
 
changes
in
 
stakeholder
 
sentiment
 
and
 
regulatory
 
requirements
 
regarding
 
climate
 
change;
 
changes
 
in
 
market
 
demand
 
and
 
supply
 
for
renewables;
 
inability
 
to
 
meet
 
strategic
 
objectives;
 
the
 
development
 
and
 
use
 
of
 
new
 
technology;
 
social
 
and/or
 
political
 
instability,
including as a result of
 
Russia’s invasion of Ukraine and
 
the conflict in the
 
Middle East; failure to prevent or
 
manage digital and cyber
disruptions to our
 
information and operational
 
technology systems and
 
those of
 
third parties on
 
which we rely;
 
operational problems,
including
 
cost
 
inflation
 
in
 
capital
 
and
 
operational
 
expenditures;
 
unsuccessful
 
drilling;
 
availability
 
of
 
adequate
 
infrastructure
 
at
commercially viable
 
prices; the
 
actions of
 
field partners
 
and other
 
third-parties; reputational
 
damage; the
 
actions of
 
competitors; the
actions of
 
the Norwegian state
 
as majority shareholder
 
and exercise of
 
ownership by the
 
Norwegian state; changes
 
or uncertainty
 
in
or non-compliance
 
with laws
 
and
 
governmental regulations;
 
adverse changes
 
in tax
 
regimes; the
 
political and
 
economic policies
 
of
Norway
 
and
 
other
 
oil-producing
 
countries;
 
regulations
 
on
 
hydraulic
 
fracturing
 
and
 
low-carbon
 
value
 
chains;
 
liquidity,
 
interest
 
rate,
equity and
 
credit risks;
 
risk of
 
losses relating
 
to trading
 
and commercial
 
supply activities;
 
an inability
 
to attract
 
and retain
 
personnel;
ineffectiveness
 
of
 
crisis
 
management
 
systems;
 
inadequate
 
insurance
 
coverage;
 
health,
 
safety
 
and
 
environmental
 
risks;
 
physical
security risks
 
to personnel,
 
assets, infrastructure and
 
operations from
 
hostile or
 
malicious acts; failure
 
to meet
 
our ethical
 
and social
standards; non-compliance
 
with international
 
trade sanctions;
 
and other
 
factors discussed
 
elsewhere in
 
this report
 
and in
 
Equinor's
Integrated
 
Annual
 
Report
 
for
 
the
 
year
 
ended
 
December
 
31,
 
2022
 
(including
 
section
 
5.2
 
-
 
Risk
 
factors
 
thereof).
 
Equinor's
 
2022
Integrated Annual Report is available at Equinor's website www.equinor.com.
Although we believe
 
that the expectations
 
reflected in the
 
forward-looking statements are reasonable,
 
we cannot assure
 
you that our
future results, level of activity,
 
performance or achievements will meet these
 
expectations. Moreover, neither we
 
nor any other person
assumes responsibility
 
for the accuracy
 
and completeness of
 
the forward-looking statements.
 
Any forward-looking statement
 
speaks
only as of the date on which such statement is made, and, except as required by applicable law,
 
we undertake no obligation to update
any of these statements after the date of this report, either to make them conform to actual results
 
or changes in our expectations.
We
 
use
 
certain terms
 
in
 
this document,
 
such as
 
"resource" and
 
"resources", that
 
the
 
SEC's rules
 
prohibit
 
us
 
from including
 
in
 
our
filings
 
with the
 
SEC.
 
U.S.
 
investors are
 
urged
 
to closely
 
consider
 
the
 
disclosures in
 
our
 
Annual Report
 
on
 
Form 20-F
 
for
 
the
 
year
ended December 31,
 
2022, SEC File
 
No. 1-15200. This
 
form is available on
 
our website or
 
by calling 1-800-SEC-0330 or
 
logging on
to www.sec.gov
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor fourth quarter 2023
 
51
END NOTES
1.
The group's
average liquids price
 
is a volume-weighted average of the segment prices of crude oil, condensate and natural gas
liquids (NGL).
2.
The
refining reference margin
 
is a typical gross margin and will differ from the actual margin, due to variations in type of crude
and other feedstock, throughput, product yields, freight cost, inventory, etc
3.
Liquids volumes
 
include oil, condensate and NGL, exclusive of royalty oil. The 2022 liquid volumes were
 
restated in the first
quarter 2023 due to a change in the calculation methodology. See table below for further information.
4.
Equity volumes
 
represent produced volumes under a
production sharing agreement (PSA)
 
that correspond to Equinor’s
ownership share in a field.
Entitlement volumes
, on the other hand, represent Equinor’s share of the volumes distributed to the
partners in the field, which are subject to deductions for, among other things, royalty and the host government's share of profit oil.
Under the terms of a PSA, the amount of profit oil deducted from equity volumes will
 
normally increase with the cumulative return
on investment to the partners and/or production from the licence. Consequently, the gap between entitlement and equity volumes
will likely increase in times of high liquids prices. The distinction between equity and entitlement
 
is relevant to most PSA regimes,
whereas it is not applicable in most concessionary regimes such as those in Norway, the UK, the US, Canada and Brazil.
 
5.
Transactions with the
Norwegian State.
 
The Norwegian State, represented by the Ministry of Trade, Industry and Fisheries, is
the majority shareholder of Equinor and it also holds major investments in other entities. This ownership
 
structure means that
Equinor participates in transactions with many parties that are under a common ownership structure
 
and therefore meet the
definition of a related party. Equinor purchases liquids and natural gas from the Norwegian State, represented by SDFI (the
State's Direct Financial Interest). In addition, Equinor sells the State's natural gas
 
production in its own name, but for the
Norwegian State's account and risk, and related expenditures are refunded by the State.
6.
The production guidance reflects our estimates of
proved reserves
 
calculated in accordance with US Securities and Exchange
Commission (SEC) guidelines and additional production from other reserves not included in
 
proved reserves estimates.
 
7.
The group's
average realised piped gas prices
 
include all realised piped gas sales, including both physical sales and related
paper positions. The realised piped gas price Europe for 2022 was restated in the first quarter
 
of 2023 due to a change in the
definition and exclusion of LNG. This was done to report a realised European gas price
 
that is comparable to relevant European
piped gas references/market prices. See table below for further information.
8.
The internal
transfer price
 
paid from the MMP segment to the E&P Norway and E&P USA segments.
9.
Since different legal entities in the group lend to projects and others borrow from banks, project financing through
 
external bank
or similar institutions is not netted in the balance sheet and results in over-reporting of the debt
 
stated in the balance sheet
compared to the underlying exposure in the group. Similarly, certain net interest-bearing debt incurred from activities pursuant to
the Marketing Instruction of the Norwegian government are offset against receivables on the SDFI. Some
 
interest-bearing
elements are classified together with non-interest bearing elements and are therefore included when
 
calculating the net interest-
bearing debt.
Liquid sales volume restatement (mmbl)
Q1 2022
Q2 2022
Q3 2022
Q4 2022
Full year
2022
Liquid sales volume (old)
185.5
180.5
182.9
191.2
740.1
Liquid sales volume (new)
211.6
195.4
196.8
212.1
815.9
Average invoiced gas price restatement (mmbtu)
Q1 2022
Q2 2022
Q3 2022
Q4 2022
Full year
2022
Average invoice gas price - Europe (old)
29.60
27.18
43.65
29.80
32.46
Realised piped gas price Europe (new)
30.25
27.43
44.37
29.84
32.84
Equinor fourth quarter 2023
 
52
Signatures
Pursuant to the requirements of the Securities
 
Exchange Act of 1934, the registrant has duly
 
caused this report to be signed on its behalf
 
by
the undersigned, thereunto duly authorised.
EQUINOR ASA
(Registrant)
Dated: 7 February, 2024
By: ___/s/ Torgrim Reitan
Name: Torgrim Reitan
Title:
 
Chief Financial Officer
Equinor ASA (PK) (USOTC:STOHF)
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