Equinor ASA Q3 FY2025 earnings call

• Bacalhau came on stream in October, reserving over 1 billion barrels and 220,000 bpd production capacity, contributing to international growth.
• Production was up 7% from Q3 last year; NCS production up 9%, US onshore gas up 40%, US offshore up 9%.
• Strong cash flow from operations after tax YTD was $14.7 billion. Solid balance sheet, robust portfolio; managed costs, with costs stable YTD.
• Impairments of $754 million due to lower long-term oil price outlook; main driver for E&P International was $650 million impairment tied to assets in Adura IJV.
• Participated in Ørsted's rights issue, plan to be more active shareholder with a Board seat, aiming for industrial and strategic collaboration to create value.
• Empire Wind in New York had all 54 monopiles installed, but faced an issue with Maersk's wind turbine installation vessel planned for 2026.

Liquids prices were lower than the same quarter last year, while average gas prices were higher, particularly in the U.S. Adjusted operating income from E&P Norway totaled $5.6 billion before tax and $1.3 billion after tax, impacted by production roles and new fields coming on stream. E&P International results reflected lower production but also lower depreciation, with an impairment of $650 million tied to assets transferred to the Adura IJV due to lower price assumptions. E&P U.S. results were driven by increased production but impacted by a one-off $268 million effect related to decommissioning of the U.S. offshore Titan field. M&P changed guidance to an average adjusted operating income of around $400 million per quarter, with a reversal at Mongstad of $300 million due to higher expected refinery margins. Renewables results reflected high project activities but significantly lower business development and early phase costs.

• Production and CapEx guided from Capital Markets Update in February maintained.
• Net debt ratio expected to be in the lower end of the 15%-30% range by year-end.
• Capital distribution includes cash dividend and share buyback; total capital distribution for the year around $9 billion.
• MMP guidance changed to average adjusted operating income of around $400 million per quarter, with upside potential larger than downside risk.

• Energy markets volatile due to geopolitical unrest, tariffs, and trade tensions impacting pricing and trading conditions.
• Empire Wind faces risk related to the issue with Maersk's wind turbine installation vessel; working to resolve or find alternative solutions.
• Uncertainties around Ørsted collaboration and potential significant further capital commitments in Offshore Wind in the current environment.
• Risks related to Peregrino disposal timing and U.K. fiscal outlook affecting the business.

Q: On unit depreciation charge in Norway and Ørsted participation A: Torgrim Reitan states unit depreciation charge in Norway is driven by new assets onstream, expected to gradually reduce; on Ørsted, participation is to be more active shareholder for industrial and strategic collaboration, with caution on further Offshore Wind capital commitments Q: On MMP guidance change and Ørsted Board seat A: Torgrim Reitan explains MMP guidance change due to market changes, broader range not useful now; on Ørsted, Board seat offers long-term industrial perspective and complementing Ørsted's competence Q: On Ørsted projects equity spend and global gas market A: Torgrim Reitan gives insight on Empire Wind, Dogger Bank, Baltic projects' equity injections; on global gas market, short-term tightness depending on weather, long-term LNG supply and U.S. political impact on exports Q: On net working capital and Norwegian business discount to Brent A: Torgrim Reitan states working capital down $1 billion this quarter, fair level given market structures; Johan Castberg's $5 premium to Brent impacts NCS discount to Brent Q: On Peregrino disposal timing and Johan Sverdrup outlook A: Torgrim Reitan says Peregrino divestment legs to close in 4Q and 1Q next year; Johan Sverdrup will start to decline in 2026 but efforts to maintain high production Q: On Offshore Wind capital reallocation A: Torgrim Reitan mentions new Power business area but remains capital disciplined, seeking profitable opportunities with significant returns before committing capital Q: On cash tax paid and MMP guidance divestment impact A: Torgrim Reitan explains cash tax timing effect due to lower prices and international tax offsets; MMP guidance divestment of gas infrastructure assets has ~$40M per quarter impact Q: On 2026 distribution program A: Torgrim Reitan says capital distribution priority, cash dividend bankable, share buyback regular; consider 2-year perspective for Empire Wind equity investments Q: On impairment charge interpretation A: Torgrim Reitan explains impairments in U.K. and U.S. due to lower oil price assumptions, with specific details on assets in Adura IJV and U.S. Gulf of Mexico Q: On Empire Wind vessel issue A: Torgrim Reitan states Empire Wind is back on track, working to resolve Maersk issue or find other opportunities in the market Q: On UK Rosebank approval and fiscal outlook A: Torgrim Reitan says Rosebank permit issue due to Scope 3 emissions, response submitted, consultation ongoing; advocates for stable U.K. fiscal framework Q: On NCS supply chain and cost inflation A: Torgrim Reitan mentions NCS 2035 project, focusing on quicker developments, lower costs, and maintaining high activity level for domestic supply chain Q: On US tax credit milestone for Empire Wind A: Torgrim Reitan states tax credit for Empire Wind expected in 2027, tied to production start