Monday, 20 April 2020

Norway's Equinor plans to build floating offshore wind turbines


Equinor ASA (formerly Statoil and StatoilHydro) is a Norwegian multinational energy company. The name Equinor is formed by combining "equi" (the root for words such as equal) and "nor" (indicates Norwegian origin). It is headquartered in Stavanger, Norway. It is primarily a petroleum company. It operates in 36 countries with some investments in renewable energy. The company has about 20,200 employees. The current company was formed by the 2007 merger of Statoil with the oil and gas division of Norsk Hydro. As of 2017, the Government of Norway is the largest shareholder with 67% of the shares. The rest is public stock.

Equinor is the largest operator on the Norwegian continental shelf. It has 60% of the total production. The fields operated are Brage, Heimdal, Grane, Glitne, Gullfaks, Heidrun, Huldra, Kristin, Kvitebjørn, Mikkel, Njord, Norne, Ormen Lange, Oseberg, Sleipner, Snorre, Snøhvit, Statfjord, Sygna, Tordis, Troll, Veslefrikk, Vigdis, Visund, Volve, and Åsgard. The company also has processing plants at Kolsnes, Kårstø, Mongstad, Tjeldbergodden, and Melkøya.

Equinor also operates oil and gas fields in Australia, Algeria, Angola, Azerbaijan, Brazil, Canada, China, Libya, Nigeria, Russia, United States, and Venezuela.

There is certainly an oil crash happening in the world right now. Oil prices collapsed to more than 2-decade lows Monday. Traders are increasingly concerned that storage facilities are reaching their limits. The huge collapse in oil markets is showing no signs of easing. Some oil storage facilities are at risk of overflowing. Some oil producers may start paying customers to take crude off their hands. Global stocks struggle to find direction amid oil crashes. Oil plunged to the lowest level since 1986 as the deadly pandemic threatens global economies. An entire decade of demand growth could be erased. Thousands of jobs could be lost. Hundreds of billions of dollars could be wiped out from company valuations.

Investors got some relief after seeing signs of a peak (not going higher on the graph) of the Coronavirus Covid-19 cases in Europe and North America. Norway is starting to gradually re-open. Norwegians are slowly starting to get more access to day care centers, shops, businesses and their own holiday homes. Several municipalities are also re-opening part of their borders. Hair salons, dental offices. physiotherapists, skin care clinics and some other places are reopening. Most are due to be back in business by the end of the month.

Equinor is going forward with its plans to build floating offshore wind turbines. Norway approved on Wednesday Equinor’s 4.8 billion Norwegian crowns ($466 million) plan to build the turbines that will provide electricity to North Sea oil and gas platforms.

The project is going ahead despite Equinor’s decision to cut investment following a plunge in oil prices that has reduced the company’s cash flow. The company has decided to cut its 2020 capital spending to $8.5 billion from an original plan of $10-11 billion. This is after oil prices fell because the Coronavirus COVID-19 pandemic.

The Norwegian government has agreed to provide 2.3 billion crowns in financial support. This in addition to 566 million crowns from the industry’s NOx fund, set up to reduce emissions from ships.

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