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Equinor (EQNR) Shuts Down North Sea Fields Amid Worker Strike
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Equinor ASA (EQNR - Free Report) started shutting down three of its operated North Sea oilfields after Norwegian offshore workers called for a strike for higher wages to cover the rising inflation.
The decision to call a strike was made amid high commodity prices, with global supply extremely tight after Russia cut natural gas exports to Europe. The continuing effects of supply-chain disruptions were responsible for the price surge.
As a result of the strike, Equinor started the shutdown of three fields in the North Sea — Gudrun, Oseberg South and Oseberg East fields. Total production from these fields is estimated to be 89,000 barrels of oil equivalent per day (boe/d). Of the total, 27,500 boe/d comprise natural gas. This represents around 2% of Norway’s daily oil and gas production.
Equinor warned of a further extension to the strike for the Heidrun, Kristin and Aasta Hansteen fields, which implies that the installations will carry out a controlled shutdown of production. This includes the Tyrihans field, tied to the Kristin platform.
Total production from the Heidrun, Kristin and Aasta Hansteen fields is estimated to be 333,000 boe/d, of which 264,000 boe/d is natural gas. The Norwegian offshore workers’ strike will reduce oil and gas production as the negotiating parties have not made any progress.
According to the Norwegian Oil and Gas Association, the strike would result in a daily loss of 130,000 barrels of oil production, while gas production is expected to decline by 292,000 boe/d. This represents 13% of the overall production in the Norwegian Continental Shelf.
Higher inflation implies that the purchasing capacity of the workers’ income is declining. Hence, the workers’ expectations for higher wages are increasing. It is to be seen whether inflation will continue to rise or begin to shrink.
Antero Resources has positioned itself among the fast-growing natural gas producers in the United States. The leading natural gas producer is expecting a free cash flow yield of 25% for 2022, which could be the highest among Appalachian players.
Antero Resources is targeting a capital return program of 25-50% of free cash flow annually, beginning with the implementation of the share repurchase program. The company’s board authorized a share repurchase program of up to $1 billion of outstanding common stock.
Valero is the largest independent refiner and marketer of petroleum products in the United States. VLO currently has a Zacks Style Score of A for Growth and Momentum, and B for Value.
The majority of Valero’s refining plants are located in the Gulf coast area, from where there is easy access to the export facilities. This Gulf coast presence helped the company expand its export volumes over the last few years and gain from high distillate margins. The Gulf Coast contributed 60.5% to total throughput volume in the first quarter of 2022.
PBF Energy has one of the most complex refining systems in the United States. The company’s daily processing capacity of 1,000,000 barrels of crude oil is higher than most peers.
In 2021, PBF Energy’s crude oil and feedstocks throughput volumes were 834.5 thousand barrels per day (bpd), higher than the year-ago figure of 727.7 thousand bpd. Moreover, it expects total throughput volumes of 865-925 thousand bpd in 2022. This is expected to cause positive effects on the company’s profits and revenues.
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Equinor (EQNR) Shuts Down North Sea Fields Amid Worker Strike
Equinor ASA (EQNR - Free Report) started shutting down three of its operated North Sea oilfields after Norwegian offshore workers called for a strike for higher wages to cover the rising inflation.
The decision to call a strike was made amid high commodity prices, with global supply extremely tight after Russia cut natural gas exports to Europe. The continuing effects of supply-chain disruptions were responsible for the price surge.
As a result of the strike, Equinor started the shutdown of three fields in the North Sea — Gudrun, Oseberg South and Oseberg East fields. Total production from these fields is estimated to be 89,000 barrels of oil equivalent per day (boe/d). Of the total, 27,500 boe/d comprise natural gas. This represents around 2% of Norway’s daily oil and gas production.
Equinor warned of a further extension to the strike for the Heidrun, Kristin and Aasta Hansteen fields, which implies that the installations will carry out a controlled shutdown of production. This includes the Tyrihans field, tied to the Kristin platform.
Total production from the Heidrun, Kristin and Aasta Hansteen fields is estimated to be 333,000 boe/d, of which 264,000 boe/d is natural gas. The Norwegian offshore workers’ strike will reduce oil and gas production as the negotiating parties have not made any progress.
According to the Norwegian Oil and Gas Association, the strike would result in a daily loss of 130,000 barrels of oil production, while gas production is expected to decline by 292,000 boe/d. This represents 13% of the overall production in the Norwegian Continental Shelf.
Higher inflation implies that the purchasing capacity of the workers’ income is declining. Hence, the workers’ expectations for higher wages are increasing. It is to be seen whether inflation will continue to rise or begin to shrink.
Equinor ASA Price
Equinor ASA price | Equinor ASA Quote
Currently, it carries a Zacks Rank #3 (Hold). Some better-ranked players in the energy space are Antero Resources (AR - Free Report) , Valero Energy Corporation (VLO - Free Report) and PBF Energy Inc. (PBF - Free Report) . All companies currently sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Antero Resources has positioned itself among the fast-growing natural gas producers in the United States. The leading natural gas producer is expecting a free cash flow yield of 25% for 2022, which could be the highest among Appalachian players.
Antero Resources is targeting a capital return program of 25-50% of free cash flow annually, beginning with the implementation of the share repurchase program. The company’s board authorized a share repurchase program of up to $1 billion of outstanding common stock.
Valero is the largest independent refiner and marketer of petroleum products in the United States. VLO currently has a Zacks Style Score of A for Growth and Momentum, and B for Value.
The majority of Valero’s refining plants are located in the Gulf coast area, from where there is easy access to the export facilities. This Gulf coast presence helped the company expand its export volumes over the last few years and gain from high distillate margins. The Gulf Coast contributed 60.5% to total throughput volume in the first quarter of 2022.
PBF Energy has one of the most complex refining systems in the United States. The company’s daily processing capacity of 1,000,000 barrels of crude oil is higher than most peers.
In 2021, PBF Energy’s crude oil and feedstocks throughput volumes were 834.5 thousand barrels per day (bpd), higher than the year-ago figure of 727.7 thousand bpd. Moreover, it expects total throughput volumes of 865-925 thousand bpd in 2022. This is expected to cause positive effects on the company’s profits and revenues.