Equinor ASA (EQNR - Free Report) has commenced selling crude from its two new operated oilfields in the North Sea, namely Mariner in British waters and Johan Sverdrup in the Norwegian territory. The joint production from these oilfields is anticipated to be around 500K barrels per day in 2020.
It is believed that the medium and heavy crude oil grades from the fields with higher sulphur content will compensate the loss of similar grades from the OPEC supply cuts and the U.S. sanctions on Iran and Venezuela.
The Norwegian company’s production from the Mariner field, which started in August, saw its first crude oil cargo being lifted on Sep 4.
Per Simon James, vice president of crude trading and refinery optimisation at Equinor, the 320,000-barrel Mariner Blend crude was sold at a discounted rate to current Brent prices. Moreover, the production is expected to reach a mark of 70,000 barrels per day (bpd) in the short run while the production on average is estimated to be around 55,000 bpd. Apart from Europe, the crude oil is expected to be sold at the refineries in India and China.
James further added that Equinor is also selling the first two Johan Sverdrup crude cargoes via a tender process. Further, Johan Sverdrup, the Norwegian oil field operated by Equinor is projected to come online ahead of schedule. The field production start-up is likely to commence operations in October, a month earlier than planned.
It is believed, the start-up of Johan Sverdrup’s first phase will help Equinor revive output from its Norwegian fields that witnessed a massive plunge over the past year and a half due to natural decline and technical issues.
Equinor holds a 42.6% stake in the Johan Sverdrup development while Swedish oil producer Lundin Petroleum AB (who discovered the field in 2010) owns 20%. The remaining interests are held by European supermajors TOTAL SA and BP plc.
Zacks Rank & Key Picks
Equinor carries a Zacks Rank #3 (Hold). Better-ranked players in the energy space include BP Midstream Partners (BPMP - Free Report) , Dril-Quip, Inc. (DRQ - Free Report) and World Fuel Services Corp. (INT - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
BP Midstream’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters.
Dril-Quip earnings beat the Zacks Consensus Estimate in three of the previous four quarters.
World Fuel Services earnings beat the Zacks Consensus Estimate in all the last four quarters.
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