By Dominic Chopping
Equinor ASA (EQNR.OS) on Thursday launched a new share buyback program of up to $5 billion and said it is preparing to start production at the giant Johan Sverdrup field west of Norway in October this year, one month ahead of schedule.
The Norwegian oil major said the upcoming start-up of the Johan Sverdrup field, combined with several other new fields in production, provides confidence in its outlook for production growth and increased cash generation capacity.
"We are therefore in a good position to increase capital distribution, while continuing to invest in our high-quality project portfolio," Chief Executive Eldar Saetre said.
The share buyback program of up to $5 billion will run from now until the end of 2022. The first tranche of the program of around $1.5 billion is commencing today and will end no later than Feb. 25, 2020.
"Around this time last year, we accelerated the expected schedule for production start-up of Johan Sverdrup to November 2019," said Anders Opedal, executive vice president for technology, projects and drilling at Equinor.
"Now, as we enter the final stretch of the project, we believe it is possible to start production up to one month earlier."
Equinor expects operating costs at the field below $2 a barrel during the summer of 2020. It also expects cash flow from operations of around $50 a barrel in 2020, based on a real oil price of $70 a barrel, partly as a result of the phasing of tax payments in the ramp-up phase.
Write to Dominic Chopping at email@example.com; @domchopping @WSJNordics