Equinor ASA (EQNR) Earnings

Management highlights

### Strategic Capital Markets Day Update - Confirmed long-term targets to 2030: 150,000 barrels per day net production growth, 30% growth in operating cash flow, 15% industry-leading return on capital employed, and over $40 billion in cumulative free cash flow - Reduced break-even price after dividends to $50 per barrel, a $10 per barrel reduction from prior levels - Doubled the 2026 annual share buyback program from $1.5 billion to $3 billion ### Operational Progress on Long-Term Plans - Awarded first-wave contracts for tieback projects on the Norwegian Continental Shelf (NCS) as part of the new NCS 2035 operating model, which targets doubling development speed and cutting project costs in half - Completed a series of ownership swap transactions with DNO, Aker BP, and Vår Energi to harmonize license ownership and progress the Ringvei Vest project - Took final investment decision on the Greater Parsh project in Angola, which is expected to generate over $50 per barrel in operating cash flow and grow international E&P operating cash flow by 80% by 2030 ### Q2 2026 Core Results - Total production of 2,165,000 barrels per day, 3% year-over-year growth; first half 2026 production growth reached 6% year-over-year - Pre-tax adjusted operating income of $11.5 billion; IFRS net income of $4.8 billion; adjusted earnings per share of $1.33 - Year-to-date after-tax operating cash flow of $13.7 billion; Q2 pre-tax operating cash flow of $14.8 billion - Organic capital expenditure of $3.4 billion; net cash flow before capital distribution of $5.5 billion; $24 billion in cash and cash equivalents, with net debt ratio falling to 10.4% (expected to fall below 10% by year-end at current forward prices) - Board approved a 39 cent per share ordinary cash dividend and a $1.125 billion third tranche of share buybacks (including the Norwegian state's participation) - Cash proceeds of $558 million from the divestment of Argentina onshore assets (plus $88 million received in Q1) with a $467 million recorded gain; partial divestment of the Skatek position for $171 million with a $61 million accumulated gain ### Safety - Serious incident frequency and personal injury rate remained stable quarter-over-quarter, with a slight year-to-date increase compared to 2025. Management is implementing learnings from recent incidents to further improve safety performance.

Guidance

- Full year 2026 production guidance of 3% year-over-year growth is maintained and is now more robust than at the start of the year, despite the Johan Kastberg unplanned shutdown impacting Q3 output, with no upward adjustment made at this time - No changes to full year capital expenditure or capital distribution guidance; M&P maintains a long-term average guidance of $400 million pre-tax per quarter, with a target to increase this to $500 million over time - Management continues to target a 10% reduction in SG&A operating and administrative costs compared to 2025, and remains on track to deliver this target after adjusting for transportation, royalty, and currency impacts - Long-term 2030 targets for production growth, cash flow growth, return on capital employed, and break-even price are all unchanged from the Capital Markets Day update five weeks prior to the call

Segment performance

1. Exploration and Production Norway (EMP Norway): Pre-tax adjusted operating income of $9.2 billion, after-tax adjusted operating income of $2.1 billion. Production grew 4% year-over-year, driven by new fields including Johan Kastberg, Halten East, Verdande, Eirin, and Symra. This segment contributed 80% of Equinor's total pre-tax adjusted operating income this quarter. 2. International Exploration and Production: Pre-tax operating income nearly doubled year-over-year on 4% production growth and 50% higher prices, supported by portfolio quality improvements. Production growth was driven by Aduara (UK) and Bacalao (Brazil), offsetting reduced ownership in Peregrino and divestment of onshore Argentina assets. 3. Exploration and Production US: Results were driven by high offshore production and higher liquids prices, partially offset by lower domestic US gas prices. Average realized US gas price came in at $2.3 per MMBtu, a $0.6 discount to Henry Hub, but the basin position remains low-cost and profitable. 4. Marketing & Processing (M&P): Pre-tax adjusted operating income of $777 million, far exceeding the $400 million per quarter guidance. Strong performance was driven by robust crude trading and high-margin operations at the Mongstad refinery, supported by high European product market tightness. 5. Power: Adjusted operating income benefited from strong second consecutive quarter of positive contributions from power trading, with 1.2 terawatt-hours of production driven by growth from the UK Dogger Bank project and new onshore assets.

Risks & headwinds

- Geopolitical unrest continues to impact global energy markets, particularly disruptions to LNG flows through the Strait of Hormuz that reduce available LNG supplies to Europe, creating market tightness and price volatility - Europe entered the 2026 autumn/winter heating season with average natural gas storage inventories at just 53% capacity, more than 15 percentage points below the 5-year average; management expects storage will not reach 80% capacity even if Hormuz Strait flows normalize, leaving the market vulnerable to further shocks - New fields such as Johan Kastberg are still in their run-in period, meaning unplanned operational issues leading to production shutdowns are more likely than at mature fields - General cost inflation for capital projects on the NCS persists, with peer companies reporting 6-7% CapEx inflation for large projects, though Equinor has offset this through standardization, long-term frame contracts, and the NCS 2035 efficiency program - M&P results are highly sensitive to market volatility and geopolitical dislocations, so strong Q2 results are not expected to be sustained at the same level in all future quarters - The remaining 20% stake sale in the Peregrino field is subject to third-party regulatory and process delays, so closing may slip to early 2027 rather than late 2026

Analyst Q&A

• Q: What will Johan Kastberg's net production impact be in Q3 after its July shutdown, and how is the Mongstad refinery performing so far in Q3 amid strong European refinery margins? /

  A: The three-week shutdown from mid-June to mid-July will lead to a net 14,000 barrels per day production impact for Equinor in Q3. Johan Kastberg is a new field still in its run-in period, so minor operational issues are expected; it has now returned to full plateau production. Mongstad continues to deliver strong results at current high margins, with very high operational regularity, and its profitability tracks overall European refinery margins closely. The Q2 FCC margin hit $25 per barrel, and Mongstad operates well above break-even at current price levels.

• Q: After BP surrendered its stake in the B2Nord project in Canada, will Equinor move forward at 100% or farm it down, and what is the status of Canadian government support for the project? /

  A: BP will transfer full ownership to Equinor for a minimal pending payment, and the 2027 final investment decision timeline remains unchanged. Equinor is actively seeking to bring in a new partner for the project, which remains attractive and fully supported by the Canadian government, as energy security is a high policy priority in Canada.

• Q: European gas markets are currently tight, with high prices and low storage; is there any flexibility for Equinor to increase gas production for Europe in H2 2026? /

  A: Equinor is already producing at maximum sustainable output, so no additional overall volumes can be brought to market in the short term. The company does have flexibility in its production and transportation network to redirect gas to the highest-priced regions where it is most needed, such as shifting volumes to Germany when German prices exceed UK prices. Equinor keeps 70% of its gas exposure to day-ahead prices and 30% to month-ahead prices, so it captures full value from current market volatility.

• Q: With strong cash flow and net debt set to fall below 10% by year end, will Equinor increase 2026 share buybacks above the guided $3 billion? /

  A: Management has no plans to increase 2026 share buybacks beyond the current $3 billion target. Extra cash from higher-than-expected prices has been allocated to three priorities: an incremental $1 billion in new oil and gas investment that adds to 2030 production targets, strengthening the balance sheet (which avoids the need to lean on leverage as originally planned this year), and the already announced doubling of the 2026 buyback program. A new capital allocation framework will be discussed alongside 2026 full year results in February 2027.

• Q: What is driving Johan Sverdrup's production outperformance, and is further upside possible for H2 2026? /

  A: Johan Sverdrup continues to outperform original plans because of two key operational improvements: very effective water management that reduces early water breakthrough and maintains higher oil production rates, and successful multi-lateral retrofits of existing wells that increase recovery. The field's expected 2026 production decline is now set to land at the low end of the 10-20% guided range, and management will continue to optimize operations to deliver the best possible performance in H2.