Equinor ASA Q4 FY2024 earnings call

• Safety & Security: Strong integration in leadership and culture. Serious incident frequency reduced by 73% since 2011, with 2024 having best safety results ever, but continuous improvement needed after a tragic helicopter accident. - Industry-leading Returns: Positioned to deliver above 15% return on capital employed, doubling production growth, increasing free cash flow, and announcing $9 billion capital distribution in 2025. Expect $23 billion in free cash flow from 2024-2027. - Energy Market Trends: Energy demand growing, geopolitical tension, and uneven energy transition pace impact strategies. Retired gross CapEx ambition, focusing on financially sustainable energy transition. - Norwegian Continental Shelf: Johan Sverdrup delivered record oil production, with plans to maintain high production through projects and recovery efforts. Troll had record production, and plans to maintain Norway production at 1.2 million bbl/day till 2035. - Renewables and Low-Carbon Solutions: Reduced renewables CapEx by 50% by 2027, Empire Wind project progressing, carbon capture and storage projects waiting for long-term customer commitments.

No detailed financial performance by product segments with absolute revenue and contribution % provided in the transcript.

• 2025 capital distribution: Board proposes $0.37 per share quarterly cash dividend, $5 billion share buyback, total $9 billion. - Production growth: Expect over 10% production growth by 2027, with 2.2 million bbl/day by 2030. - Free cash flow: Expect $23 billion from 2024-2027, with over 50% growth.

• Political risks: Uncertainty in energy policies in countries like the U.K. and U.S. affecting projects like Rosebank and Empire Wind. - Commodity market volatility: Impact on cash flow and capital distribution. - Offshore wind industry challenges: Including cost and market fluctuations.

Q: Story behind changes in renewables strategy?

A: Deliberate non-winning of bids, high-grading portfolio, stopping unprofitable early phase projects.

Q: Balance sheet trajectory?

A: Expect net debt to be lower by end of first quarter, aiming for lower end of guided range.

Q: Sverdrup production plateau?

A: Result of well performance, separation process improvements, and retrofitting.

Q: Rosebank and Empire Wind risks?

A: Political risks, but projects progressing with robust balance sheet.

Q: Production growth sources?

A: Organic growth from projects like Bacalhau, Raya, Sparta, and transactions in U.S. and U.K.

Q: Empire Wind returns?

A: Close to 10% nominal equity returns, derisked with project financing and tax credits.

Q: Cost management?

A: Flat cost with growing production through scale, technology, and high-grading projects.

Q: Capital allocation?

A: Prioritize growing cash dividend, then competitive share buybacks.

Q: Exploration and U.K. joint venture?

A: Increased exploration wells in Norway, deconsolidated joint venture with Shell, improving free cash flow.

Q: Gas market outlook?

A: Tight market with high LNG competition between Europe and Asia, storage levels and demand driving prices.