6-K 1 eqnr3q22_6k.htm EQUINOR THIRD QUARTER 2022 REPORT eqnr3q22_6k
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF THE
SECURITIES EXCHANGE ACT OF 1934
28 October 2022
Commission File Number 1-15200
Equinor ASA
(Translation of registrant’s name into English)
FORUSBEEN 50, N-4035, STAVANGER
 
,
 
NORWAY
(Address of principal executive offices)
Indicate by check mark whether the registrant files or
 
will file annual reports under cover of Form 20-F
 
or Form 40-F:
Form 20-F
X
 
Form 40-F
Indicate by check mark if the registrant is submitting
 
the Form 6-K in paper as permitted by Regulation
 
S-T Rule 101(b)(1):_____
Indicate by check mark if the registrant is submitting
 
the Form 6-K in paper as permitted by Regulation
 
S-T Rule 101(b)(7):_____
This Report on Form 6-K contains a report of
 
the third quarter 2022 results of Equinor ASA.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
2
Equinor third quarter 2022
Equinor delivered adjusted earnings* of USD 24.3 billion and USD 6.72 billion after tax in the
third quarter of 2022. Net operating income was USD 26.1 billion and the net income was
reported at USD 9.37 billion.
Strategic and industrial developments:
●
The Brazilian oil field Peregrino was brought back in production and Peregrino phase 2 on stream
●
Low carbon value chains continue to develop with first commercial agreement on CO
2
 
storage for the Northern Lights JV
●
Project portfolio in execution is maintaining stable cost level
Operational performance:
●
Continued high production, gas to Europe up 11%
●
Strong results from marketing and trading gas and power
Financial performance:
●
Continuing to generate strong earnings mainly from increased gas prices
●
Strong free cash flow year to date of USD 21.7 billion
●
Additional payment of tax of around USD 10 billion and a net debt to capital employed
 
ratio adjusted* of negative 19.1%
●
Cash dividend of USD 0.20 and increased extraordinary cash dividend to USD 0.70 per share for third quarter
 
of 2022 and a
fourth share buy-back tranche of USD 1.83 billion
Anders Opedal, president and CEO of Equinor ASA:
 
“Norway’s and Equinor’s role as a reliable energy provider is more important than ever. I am proud of all our people going to
 
great
lengths to keep the energy production high and secure. Working together with our partners and
 
the authorities, we have taken extra
measures to increase security in this situation.
The Russian war in Ukraine has changed the energy markets, reduced energy availability and increased
 
prices. Equinor continues to
provide stable flow and high production, with record-levels of gas from the Norwegian continental
 
shelf.
High production combined with continued high price levels resulted in very strong financial results with adjusted
 
earnings of more than
24 billion dollars before tax. The earnings enable us to continue investing in the energy transition,
 
while building resilience in uncertain
times. It also increased our tax contributions, in total around 17 billion dollars in tax payments in
 
the quarter”.
 
Quarter
Change
Financial information
First nine months
Q3 2022
Q2 2022
Q3 2021
Q3 on Q3
(unaudited, in USD million)
2022
2021
Change
26,103
17,733
9,567
>100%
Net operating income/(loss)
62,228
20,085
>100%
24,301
17,590
9,771
>100%
Adjusted earnings*
59,881
18,497
>100%
9,371
6,762
1,409
>100%
Net income/(loss)
20,847
5,206
>100%
6,715
5,000
2,777
>100%
Adjusted earnings after tax*
16,895
5,644
>100%
6,578
8,520
8,039
(18%)
Cash flows provided by operating activities
30,869
20,665
49%
2,402
6,628
6,725
(64%)
Free cash flow*
21,719
16,406
32%
Quarter
Change
First nine months
Q3 2022
Q2 2022
Q3 2021
Q3 on Q3
Operational data
2022
2021
Change
92.9
106.9
69.2
34%
Group average liquids price (USD/bbl) [1]
99.0
63.2
56%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
3
2,021
1,984
1,996
1%
Total equity liquids and gas production (mboe per day) [4]
2,037
2,053
(1%)
294
325
304
(3%)
Renewables power generation (GWh) Equinor
 
share
1,131
1,036
9%
Q3 | First nine months
Full year
Health, safety and the environment
2022
2021
Serious incident frequency (SIF) Twelve-month average as at Q3 2022
0.4
0.4
Upstream CO
2
 
intensity (kg
CO
2
/boe)
as at first nine months 2022
6.9
7.0
30 September
31 December
%-point
Net debt to capital employed adjusted*
2022
2021
change
Net debt to capital employed adjusted*
(19.1%)
(0.8%)
(18.2)
Dividend
(USD per share)
Q3 2022
Q2 2022
Q3 2021
Announced dividend per share
0.20
0.20
0.18
Extraordinary dividend per share
0.70
0.50
In the first nine months of 2022 Equinor settled shares in the market under the share buy-back programmes
 
of USD 1.38 billion and
 
USD 1.36 billion for the Norwegian government’s share of the 2021 programme and the first tranche
 
of the 2022 programme.
*
For items marked with an asterisk throughout this report,
 
see Use and reconciliation of non-GAAP financial
 
measures in the Supplementary disclosures.
Equinor third quarter 2022
 
4
High production impacted by seasonal turnarounds contributed to energy security
Solid operational performance and projects on stream resulted in high production despite a larger
 
scope of turnarounds than for the
same quarter previous year.
In third quarter last year, Equinor had already started measures to increase deliveries of gas to Europe. Despite this, E&P
 
Norway still
increased gas production by 11% compared to the same quarter last year, supported by the ramp up of the LNG production at
Hammerfest LNG.
In Brazil, the Peregrino field came back in production and ramped up successfully, while the Peregrino phase 2 came on stream in
October, taking total plateau production level to 110 000 barrels per day.
Production in the E&P USA was at the same level as the third quarter last year, with a higher share of the production from the
 
offshore
assets.
Total power production for the quarter ended at 491 GWh. Of this, 294 GWh is produced from renewable energy assets, down 3%
from the same quarter last year mainly due to lower wind and higher maintenance activity. 197 GWh of the production was gas-to-
power production from Triton Power in UK.
In the third quarter Equinor completed 7 exploration wells offshore and 2 wells were ongoing at quarter end.
Progressing on strategy for the energy transition
Equinor is progressing to grow the Norwegian Continental Shelf (NCS) as a hub for commercial
 
CO
2
 
storage, with Northern Lights JV
signing the first commercial customer and being on track for start-up in 2024. Equinor has entered
 
partnerships to develop solutions
for large-scale commercial CO
2
 
storage with pipes from Europe to the NCS.
In the UK, Equinor has applied to extend the operated Sheringham Shoal and Dudgeon windfarms
 
with additional 719 MW. Equinor
has also sanctioned the Blandford Road battery storage project, which will be the first commercial
 
battery storage asset for the
company and have a 25 MW/50 MWh capacity.
Equinor is executing 20 projects with overall good progress. There is limited impact from the
 
rise in inflation and cost on the
sanctioned portfolio, however some projects are impacted by global supply chain bottlenecks. On the NCS,
 
the floating wind farm
Hywind Tampen is currently being connected and will be completed in 2023. Johan Sverdrup phase 2 and Njord future are on track to
come on stream in the fourth quarter of 2022. In the UK, the wind farm Dogger Bank
 
is expected to bring its first phase into operation
in 2023.
Strong financial results from high prices
Energy prices remained high in the quarter, and significantly higher than for the third quarter last year. Equinor realised a European
gas price which was 60% up from already high levels last quarter, while the realised liquids prices were 13% lower.
Adjusted earnings* for the quarter were USD 24.3 billion, up from USD 9.77 billion
 
in the same quarter last year. Adjusted earnings
after tax* were USD 6.72 billion, up from USD 2.78 billion in the same period last year. The operational and administrative
 
costs
increased due to higher electricity prices, CO
2
-costs, inflationary pressure, and higher field cost, partially offset by significant currency
effects when presenting in US dollar.
Equinor delivered strong results from sales and trading, particularly from gas and power, selling to the markets with the highest
demand. This is reflected in the results of the MMP segment.
Equinor reported net operating income of USD 26.1 billion in the quarter, up from USD 9.57 billion in the same period in 2021. Net
income was USD 9.37 billion in the quarter, up from USD 1.41 billion in the third quarter of 2021. This is including net impairment
reversals of
 
USD 1.09 billion, mainly related to increased expected refinery margins.
Continued strong cash flow and increased tax payments
Cash flow provided by operating activities before taxes and changes in working capital amounted to USD
 
24.5 billion for the third
quarter, compared to USD 10.8 billion for the same period in 2021. Organic capital expenditure* was USD 1.9 billion for the quarter.
Free cash flow* was USD 2.4 billion for the third quarter, impacted by the first NCS tax instalment for 2022 and an additional tax
payment, totalling USD 17 billion due to increased tax estimates for 2022. In the fourth quarter Equinor
 
will pay two ordinary tax
instalments at a total of NOK 140 billion.
Capital distribution paid in third quarter was USD 3.3 billion, including the settlement of the Norwegian
 
government’s share of the
shares purchased in the share buy-back programme in 2021 and the first quarter of 2022 of USD
 
1.36 billion.
Equinor third quarter 2022
 
5
Strong cash flow and capital discipline resulted in a continued strong net debt to capital employed
 
ratio adjusted* of negative 19.1% at
the end of the quarter. This is up from negative 38.6 % in the second quarter of 2022.
Competitive capital distribution
The Board of Directors has decided a cash dividend of USD 0.20 per share. Based
 
on continued strong earnings in the quarter the
Board of Directors has in addition decided to increase the extraordinary cash dividend from
 
USD 0.50 per share to USD 0.70 per
share for third quarter 2022.
Furthermore, based on the strength of the brent price, balance sheet and the outlook for
 
commodity prices, the Board of Directors has
decided to initiate a fourth and final tranche of USD 1.83 billion of the 2022 share buy-back programme
 
of USD 6 billion. The fourth
tranche will commence on 31 October and will end no later than 27 January
 
2023.
All share buy-back amounts include shares to be redeemed by the Norwegian State.
Since the second quarter of 2022, the expected total capital distribution for 2022 is increased from
 
around USD 13 billion to around
USD 13.7 billion.
Emissions and serious incident frequency
Average CO
2
-emissions from Equinor’s operated upstream production, on a
 
100% basis, were 6.9 kg per boe for the first nine months
of 2022. The twelve-month average serious incident frequency (SIF) for the period ending 30 September
 
2022 was 0.4.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
6
GROUP REVIEW
Quarters
Change
Financial information
First nine months
Q3 2022
Q2 2022
Q3 2021
Q3 on Q3
(unaudited, in USD million)
2022
2021
Change
43,633
36,459
23,264
88%
Total revenues and other income
116,486
58,316
100%
43,337
36,315
24,134
80%
Adjusted total revenues and other income*
116,364
57,252
>100%
(17,531)
(18,727)
(13,698)
28%
Total operating expenses
(54,258)
(38,231)
42%
(13,969)
(13,885)
(9,127)
53%
Adjusted purchases*
(41,635)
(23,729)
75%
(2,657)
(2,390)
(2,464)
8%
Adjusted operating and administrative expenses*
(7,497)
(6,924)
8%
(2,118)
(2,149)
(2,565)
(17%)
Adjusted depreciation, amortisation and net impairments*
(6,600)
(7,451)
(11%)
(292)
(301)
(207)
41%
Adjusted exploration expenses*
(751)
(650)
15%
26,103
17,733
9,567
>100%
Net operating income/(loss)
62,228
20,085
>100%
24,301
17,590
9,771
>100%
Adjusted earnings*
59,881
18,497
>100%
2,053
1,713
1,917
7%
Capital expenditures and Investments
5,948
5,814
2%
6,578
8,520
8,039
(18%)
Cash flows provided by operating activities
30,869
20,665
49%
Quarters
Change
First nine months
Q3 2022
Q2 2022
Q3 2021
Q3 on Q3
Operational information
2022
2021
Change
2,021
1,984
1,996
1%
Total equity liquid and gas production (mboe/day)
2,037
2,053
(1%)
1,885
1,842
1,855
2%
Total entitlement liquid and gas production (mboe/day)
1,895
1,904
(0%)
294
325
304
(3%)
Renewables power generation (GWh) Equinor
 
share
1,131
1,036
9%
100.9
113.8
73.5
37%
Average Brent oil price (USD/bbl)
105.4
67.7
56%
92.9
106.9
69.2
34%
Group average liquids price (USD/bbl)
99.0
63.2
56%
42.34
25.53
13.91
>100%
E&P Norway average internal gas price (USD/mmbtu)
32.59
8.84
>100%
7.01
6.25
2.90
>100%
E&P USA average internal gas price (USD/mmbtu)
5.80
2.28
>100%
For items impacting net operating income/(loss), see Use and reconciliation of non-GAAP financial measures
 
in Supplementary
disclosures.
Operations
Equinor continues to deliver consistently high production levels into the third quarter.
 
Production activity on the NCS increased relative
to the same quarter last year primarily driven by the restart of Snøhvit in June, partially offset by a wider scope
 
of turnaround activity
versus the prior year. Gas production on the NCS increased by 11% compared to the same quarter last year providing continued
progress towards maximising Equinor’s efforts on energy security for Europe. In addition to the
 
Snøhvit restart, this increase was
mainly due to positive contributions from Martin Linge and ongoing gas export from Gina Krog. Production
 
levels for E&P International
and E&P USA were stable in the third quarter relative to the third quarter of 2021, benefitting by
 
the restart of production on the
Peregrino field in July, which compensated for the decrease in production from Equinor’s exit from Russia earlier this year.
The realisation of significantly higher gas prices and elevated crude prices, coupled with high production
 
levels, resulted in the
increase in net operating income and adjusted earnings* in the third quarter
 
and in the first nine months of 2022 compared to the
same periods last year. There were strong contributions to the overall business results from gas and power sales and trading in the
third quarter and in the first nine months of 2022. This demonstrates the continued ability
 
of the Marketing, Midstream and Processing
segment to provide solid results in the current volatile market.
Inflationary pressures during the quarter and in the first nine months of 2022 influenced cost across the
 
company, increasing
operational expenditure.
 
Higher energy prices, field costs and environmental costs contributed to the increase in upstream
 
operating
expenditure. The cost increases were partially offset by decreases in estimated non-cash decommissioning
 
costs relative to the prior
quarter. Changes in the cost base were further masked by significant currency effects due to the strengthening of the USD against the
NOK and the EUR in the third quarter.
 
Equinor third quarter 2022
 
7
Net impairment reversals of USD 1,086 million in the quarter and USD 1,334
 
million for the first nine months of 2022 contributed to the
increased net operating income in the respective corresponding periods.
Taxes
The effective reported tax rate was 65.5% for the third quarter of 2022 (84.4% for the third quarter
 
of 2021) and 67.5% for the first nine
months of 2022 (71.8% for the first nine months of 2021). The decrease in reported tax rates
 
was mainly caused by lower share of
NCS earnings, tax exempt gains on divestments in 2022 and currency effects in entities that are taxable in
 
other currencies than the
functional currency. This was partially offset by lower effect of uplift deduction.
The effective tax rate on adjusted earnings* of 72.4% for the third quarter of 2022 and 71.8% for the first
 
nine months increased
compared to 71.6% and 69.5% in 2021 due to lower effect of uplift deduction.
Cash flow, net debt and capital distribution
Cash flow provided by operating activities before taxes paid and working capital items improved by USD
 
13,697 million to USD 24,498
million from the third quarter of 2021 and by USD 38,658 million to USD 62,620 million from
 
the first nine months of 2021. This
improvement was driven by strong financial results due to high production and increased commodity
 
prices across both the NCS and
our international businesses. In addition, the movements in commodity prices have driven an increase
 
in collateral payments due to
increased margin requirements for exchange traded derivatives.
 
Working capital increased by USD 946 million in the third quarter (USD 1,260 million in
 
the third quarter 2021) and by USD 2,083
million for the first nine months 2022 (USD 1,366 million in 2021).
Taxes of USD 16,975 million, paid in the third quarter of 2022, significantly increased relative to the prior quarter. This was due to an
additional instalment payment of Norwegian corporation tax in the quarter of USD 10 billion (NOK
 
105 billion).
 
Free cash flow* remained strong, at USD 21,719 million for the first nine months 2022 compared to USD
 
16,406 million in the same
period of 2021, despite the significant increase in tax payments, increased dividend payments and
 
the share buy-back programme.
The adjusted net debt to capital employed ratio* was negative 19.1% at the end of September
 
2022, an increase from negative 38.6%
at the end of June 2022. The increase is mainly related to an increase in paid collaterals and
 
increased taxes paid in the third quarter.
The Board of Directors has decided a cash dividend of USD 0.20 per share. Based
 
on continued strong earnings in the quarter the
Board of Directors has in addition decided to increase the extraordinary cash dividend from USD
 
0.50 per share to USD 0.70 per
share for third quarter 2022.
Furthermore, based on the strength of the brent price, balance sheet and the outlook for commodity
 
prices, the Board of Directors has
decided to initiate a fourth and final tranche of USD 1,833 million of the 2022 share buy-back
 
programme of USD 6 billion. The fourth
tranche will commence on 31 October and will end no later than 27 January 2023.
All share buy-back amounts include shares to be redeemed by the Norwegian State.
Since 2Q 2022, the expected total capital distribution for 2022 is increased from around USD
 
13 billion to around USD 13.7 billion.
OUTLOOK
 
●
Organic capital expenditures*
 
are estimated at around USD 8.5 billion for 2022, at an annual average of around USD 10
 
billion
for 2022-2023 and at an annual average of around USD 12 billion for 2024-2025
1
.
●
Production
 
for 2022 is estimated to be around 1% above 2021 level [6].
●
 
Equinor’s ambition is to keep the
unit of production cost
 
in the top quartile of its peer group.
●
Scheduled maintenance activity
 
is estimated to reduce
 
equity production by around 40 mboe per day for the full year of 2022.
These forward-looking statements reflect current views about future events and are, by their nature, subject
 
to significant risks and
uncertainties because they relate to events and depend on circumstances that will occur
 
in the future. Deferral of production to create
future value, gas off-take, timing of new capacity coming on stream, operational regularity and the ongoing impact
 
of Covid-19
represent the most significant risks related to the foregoing production guidance. Our future financial
 
performance, including cash flow
and liquidity, will be affected by the extent and duration of the current market conditions, the development in realised prices, including
1
 
USD/NOK exchange rate assumption of 9.
Equinor third quarter 2022
 
8
price differentials and other factors discussed elsewhere in the report. For further information, see section Forward-looking
statements.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
9
SUPPLEMENTARY
 
OPERATIONAL
 
DISCLOSURES
 
Quarters
Change
First nine months
Q3 2022
Q2 2022
Q3 2021
Q3 on Q3
Operational data
2022
2021
Change
Prices
100.9
113.8
73.5
37%
Average Brent oil price (USD/bbl)
105.4
67.7
56%
96.3
109.8
70.5
37%
E&P Norway average liquids price (USD/bbl)
102.2
64.2
59%
92.0
109.2
69.7
32%
E&P International average liquids price (USD/bbl)
98.9
64.6
53%
79.3
91.6
60.5
31%
E&P USA average liquids price (USD/bbl)
84.6
55.3
53%
92.9
106.9
69.2
34%
Group average liquids price (USD/bbl) [1]
99.0
63.2
56%
928
1,009
606
53%
Group average liquids price (NOK/bbl) [1]
933
541
73%
42.34
25.53
13.91
>100%
E&P Norway average internal gas price (USD/mmbtu)
 
[8]
32.59
8.84
>100%
7.01
6.25
2.90
>100%
E&P USA average internal gas price (USD/mmbtu)
 
[8]
5.80
2.28
>100%
43.65
27.18
12.82
>100%
Average invoiced gas prices - Europe (USD/mmbtu)
 
[7]
33.44
8.99
>100%
7.24
6.51
3.23
>100%
Average invoiced gas prices - North America (USD/mmbtu)
 
[7]
6.04
2.77
>100%
14.1
22.8
5.2
>100%
Refining reference margin (USD/bbl) [2]
14.2
3.4
>100%
Entitlement production (mboe per day)
595
576
650
(8%)
E&P Norway entitlement liquids production
603
639
(6%)
208
174
203
3%
E&P International entitlement liquids production
194
209
(7%)
119
123
98
21%
E&P USA entitlement liquids production
119
129
(8%)
922
873
951
(3%)
Group entitlement liquids production
916
976
(6%)
773
767
695
11%
E&P Norway entitlement gas production
779
690
13%
25
36
27
(8%)
E&P International entitlement gas production
33
40
(19%)
166
166
182
(9%)
E&P USA entitlement gas production
167
198
(16%)
963
969
904
7%
Group entitlement gas production
979
928
5%
1,885
1,842
1,855
2%
Total entitlement liquids and gas production [3]
1,895
1,904
(0%)
Equity production (mboe per day)
595
576
650
(8%)
E&P Norway equity liquids production
603
639
(6%)
285
260
289
(2%)
E&P International equity liquids production
277
295
(6%)
132
137
109
21%
E&P USA equity liquids production
132
143
(8%)
1,012
973
1,048
(3%)
Group equity liquids production
1,012
1,076
(6%)
773
767
695
11%
E&P Norway equity gas production
779
690
13%
 
 
 
 
 
Equinor third quarter 2022
 
10
39
46
33
20%
E&P International equity gas production
46
49
(6%)
197
198
220
(10%)
E&P USA equity gas production
199
237
(16%)
1,009
1,011
948
6%
Group equity gas production
1,025
976
5%
2,021
1,984
1,996
1%
Total equity liquids and gas production [4]
2,037
2,053
(1%)
Renewables power generation
294
325
304
(3%)
Renewables power generation (GWh) Equinor
 
share
1,131
1,036
9%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
11
Health, safety and the environment
Twelve months
average per
Full year
Health, safety and the environment
Q3 2022
2021
Total recordable injury frequency (TRIF)
2.4
2.4
Serious Incident Frequency (SIF)
3)
0.4
0.4
Oil and gas leakages (number of)
1)
8
12
First nine
months
Full year
Climate
2022
2021
Upstream CO
2
 
intensity (kg CO
2
/boe)
2)
6.9
7.0
1)
 
Number of leakages with rate above 0.1 kg/second
 
during the past 12 months.
2)
 
Total scope 1 emissions of CO
2
 
(kg CO
2
) from exploration and production, divided by
 
total production (boe).
 
3)
 
As of the second quarter of 2022, work-related
 
illness is excluded from SIF
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
12
EXPLORATION
 
& PRODUCTION NORWAY
Quarter
Change
Financial information
First nine months
Q3 2022
Q2 2022
Q3 2021
Q3 on Q3
(unaudited, in USD million)
2022
2021
Change
24,034
16,712
9,618
>100%
Total revenues and other income
59,200
21,678
>100%
23,321
16,491
9,524
>100%
Adjusted total revenues and other income*
58,475
21,419
>100%
(2,220)
(2,231)
(1,769)
26%
Total operating expenses
(5,972)
(6,062)
(1%)
(984)
(914)
(1,081)
(9%)
Adjusted operating and administrative expenses*
(2,782)
(2,625)
6%
(1,143)
(1,203)
(1,512)
(24%)
Adjusted depreciation, amortisation and net impairments*
(3,767)
(4,218)
(11%)
(114)
(44)
(168)
(32%)
Adjusted exploration expenses*
(260)
(286)
(9%)
21,813
14,482
7,849
>100%
Net operating income/(loss)
53,228
15,617
>100%
21,079
14,330
6,762
>100%
Adjusted earnings/(loss)*
51,665
14,290
>100%
1,089
1,339
1,149
(5%)
Additions to PP&E, intangibles and equity accounted
investments
3,500
3,737
(6%)
Quarters
Change
Operational information
First nine months
Q3 2022
Q2 2022
Q3 2021
Q3 on Q3
E&P Norway
2022
2021
Change
1,368
1,343
1,345
2%
E&P entitlement liquid and gas production (mboe/day)
1,382
1,329
4%
96.3
109.8
70.5
37%
Average liquids price (USD/bbl)
102.2
64.2
59%
42.34
25.53
13.91
>100%
Average internal gas price (USD/mmbtu)
32.59
8.84
>100%
For items impacting net operating income/(loss),
 
see Use and reconciliation of non-GAAP financial measures
 
in the Supplementary
disclosures.
Production & Revenues
The increase in production in the third quarter of 2022 compared to the same period last
 
year was mainly due to Snøhvit being back in
production and Martin Linge producing at a stable rate compared to ramp-up in the third quarter
 
of 2021. In addition, the change in
short-term strategy from gas injection to gas export for Gina Krog continued this quarter. The increase was partially offset by a
broader scope of planned turnarounds in the third quarter of 2022 combined with operational performance
 
and natural decline.
 
Production of gas volumes increased 11% and liquids decreased by 8% compared to the third quarter of 2021. For the first nine
months of 2022 there was an increase in gas volumes of 13% and a reduction in liquids
 
of 6% compared to the same period last year.
Operating expenses and financial results
The increase in net operating income was mainly driven by the significant increase in gas
 
prices. The sale of Equinor’s non-operated
share in the Greater Ekofisk Area and a minority share in Martin Linge also positively impacted net operating income
 
by a post-tax
gain of USD 655 million in the third quarter of 2022.
 
Operational expenditure, in relation to transportation, processing and electricity costs, increased in the
 
quarter relative to the prior year
primarily due to ramp up of new fields. Environmental taxes also increased due to an elevation in
 
CO
2
 
prices and Snøhvit restarting
Equinor third quarter 2022
 
13
production. Partially offsetting this was a decrease in Gassled removal costs for the third quarter 2022 compared to
 
the same period in
the prior year. The overall cost increase trend is masked by the significant strengthening of the USD against the NOK.
The adjusted depreciation, amortisation and net impairments* decreased mainly due to new estimates on removal
 
obligations and
increased proved reserves. The decrease was partially offset by ramp-up of new fields.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
14
EXPLORATION
 
& PRODUCTION INTERNATIONAL
Quarters
Change
Financial information
First nine months
Q3 2022
Q2 2022
Q3 2021
Q3 on Q3
(unaudited, in USD million)
2022
2021
Change
1,767
1,838
1,283
38%
Total revenues and other income
5,057
3,814
33%
1,911
1,956
1,388
38%
Adjusted total revenues and other income*
5,719
3,907
46%
(955)
(856)
(749)
27%
Total operating expenses
(3,632)
(2,425)
50%
(22)
(36)
(6)
>100%
Adjusted purchases*
(31)
(21)
47%
(442)
(373)
(381)
16%
Adjusted operating and administrative expenses*
(1,238)
(1,064)
16%
(349)
(324)
(436)
(20%)
Adjusted depreciation, amortisation and net impairments*
(1,011)
(1,235)
(18%)
(157)
(111)
(9)
>100%
Adjusted exploration expenses*
(308)
(248)
24%
813
982
535
52%
Net operating income/(loss)
1,425
1,389
3%
942
1,111
556
69%
Adjusted earnings/(loss)*
3,131
1,339
>100%
841
573
445
89%
Additions to PP&E, intangibles and equity accounted
investments
2,039
1,264
61%
Quarters
Change
Operational information
First nine months
Q3 2022
Q2 2022
Q3 2021
Q3 on Q3
E&P International
2022
2021
Change
324
306
322
1%
E&P equity liquid and gas production (mboe/day)
324
344
(6%)
232
210
229
1%
E&P entitlement liquid and gas production (mboe/day)
227
249
(9%)
92.0
109.2
69.7
32%
Average liquids price (USD/bbl)
98.9
64.6
53%
For items impacting net operating income/(loss),
 
see Use and reconciliation of non-GAAP financial measures
 
in the Supplementary
disclosures.
Production & Revenues
 
The slight increase in production this quarter compared to same quarter last year was primarily
 
driven by the restart of the Peregrino
field in Brazil in the third quarter of 2022. This was partially offset by Equinor’s exit from Russia,
 
and natural decline in several mature
fields, which also drove the decrease in production in the first nine months of 2022 compared
 
to the same period last year. The net
effects from production sharing agreements (PSA) were 92 mboe per day in the third quarter of 2022, compared to 93 mboe
 
per day
in the third quarter of 2021.
 
The main driver for the increase in revenues for the third quarter and the first nine months of 2022
 
relative to the same periods last
year was higher realised liquids and gas prices. The increase in the first nine months of 2022 was
 
partially offset by lower entitlement
production. In the third quarter of 2022, total revenues and other income was negatively impacted
 
by a change in fair value of
derivatives of USD 229 million. The negative impact from change in fair value of derivatives in the
 
first nine months
 
of 2022 was
 
USD 583 million.
Operating expenses and financial results
Adjusted operating and administrative expenses* increased in the third quarter and the first nine
 
months of 2022 compared to the
same periods last year, mainly due to higher operations and maintenance expenses, and increased royalties and production fees
Equinor third quarter 2022
 
15
driven by higher prices and field specific volumes. Adjusted exploration expenses* increased in the
 
third quarter and first nine months
of 2022 compared to the same periods last year mainly due to higher expensed drilling costs.
In the first nine months of 2022, net operating income was negatively impacted by impairments of
 
USD 1,096 million, primarily related
to Equinor’s exit from Russia.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
16
EXPLORATION
 
& PRODUCTION USA
Quarters
Change
Financial information
First nine months
Q3 2022
Q2 2022
Q3 2021
Q3 on Q3
(unaudited, in USD million)
2022
2021
Change
1,541
1,629
886
74%
Total revenues and other income
4,440
2,847
56%
1,541
1,629
886
74%
Adjusted total revenues and other income*
4,440
2,847
56%
(457)
(757)
(642)
(29%)
Total operating expenses
(1,239)
(2,247)
(45%)
(254)
(240)
(205)
24%
Adjusted operating and administrative expenses*
(715)
(812)
(12%)
(377)
(362)
(363)
4%
Adjusted depreciation, amortisation and net impairments*
(1,059)
(1,209)
(12%)
(21)
(146)
(30)
(29%)
Adjusted exploration expenses*
(183)
(116)
58%
1,084
872
244
>100%
Net operating income/(loss)
3,201
600
>100%
889
881
288
>100%
Adjusted earnings/(loss)*
2,483
710
>100%
186
170
174
7%
Additions to PP&E, intangibles and equity accounted
investments
482
511
(6%)
Quarters
Change
Operational information
First nine months
Q3 2022
Q2 2022
Q3 2021
Q3 on Q3
E&P USA
2022
2021
Change
329
335
328
0%
E&P equity liquid and gas production (mboe/day)
331
381
(13%)
285
289
281
1%
E&P entitlement liquid and gas production (mboe/day)
286
326
(12%)
79.3
91.6
60.5
31%
Average liquids price (USD/bbl)
84.6
55.3
53%
7.01
6.25
2.90
>100%
Average internal gas price (USD/mmbtu)
5.80
2.28
>100%
For items impacting net operating income/(loss),
 
see Use and reconciliation of non-GAAP financial measures
 
in the Supplementary
Production & Revenues
The slight increase in production in the third quarter compared to the same period last year was
 
primarily due to hurricane related
downtime in the prior year in the Gulf of Mexico partially offset by natural decline and downtime from the Appalachia
 
Basin assets. The
decrease in production in the first nine months of 2022 compared to the same
 
period last year was primarily due to the Bakken
divestment in 2021.
The increase in realised liquids and gas prices for the third quarter and the first nine months
 
of 2022 relative to the same periods last
year has been the main driver for the increase in revenues and royalties.
Operating expenses and financial results
Adjusted operating expenses* increased in the third quarter compared to the same period last year mainly
 
due to higher operations
and maintenance expenses, in addition to increased depreciation due to higher Gulf of Mexico
 
production partially offset by improved
reserves. Adjusted operating expenses* decreased the first nine months of 2022 compared to the
 
same period last year mainly due to
lower operations and maintenance expenses, in addition to decreased depreciation due to lower
 
Gulf of Mexico Production and
improved reserves.
 
Adjusted exploration expenses* increased in the first nine months of 2022
 
compared to the same periods last year
mainly due to an increase in expensing of previously capitalised well costs.
Equinor third quarter 2022
 
17
Net operating income for the first nine months of 2022 was positively impacted by net impairment
 
reversals of USD 721 million,
compared to impairment and losses recognised on the divestment of the Bakken asset of USD
 
110 million in the same period last
year.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
18
MARKETING, MIDSTREAM & PROCESSING
Quarters
Change
Financial information
First nine months
Q3 2022
Q2 2022
Q3 2021
Q3 on Q3
(unaudited, in USD million)
2022
2021
Change
42,585
36,012
22,794
87%
Total revenues and other income
114,514
55,574
>100%
42,858
35,971
23,658
81%
Adjusted total revenues and other income*
114,544
56,060
>100%
(40,669)
(34,556)
(21,859)
86%
Total operating expenses
(110,650)
(54,095)
>100%
(40,081)
(33,429)
(20,332)
97%
Adjusted purchases*
(107,980)
(50,148)
>100%
(1,114)
(1,012)
(918)
21%
Adjusted operating and administrative expenses*
(3,127)
(2,836)
10%
(211)
(221)
(211)
0%
Adjusted depreciation, amortisation and net impairments*
(644)
(655)
(2%)
1,916
1,456
935
>100%
Net operating income/(loss)
3,864
1,479
>100%
1,452
1,310
2,197
(34%)
Adjusted earnings*
2,792
2,421
15%
147
91
159
(8%)
- Liquids
473
374
26%
761
972
1,972
(61%)
- Natural Gas Europe
1,351
2,023
(33%)
51
19
111
(54%)
- Natural Gas US
193
149
29%
492
228
(55)
N/A
- Other
776
(153)
N/A
345
253
152
>100%
Additions to PP&E, intangibles and equity accounted
investments
863
343
>100%
Quarters
Change
Operational information
First nine months
Q3 2022
Q2 2022
Q3 2021
Q3 on Q3
2022
2021
Change
182.9
180.5
184.4
(1%)
Liquids sales volumes (mmbl)
548.9
562.4
(2%)
15.6
15.4
14.5
8%
Natural gas sales Equinor (bcm)
47.6
44.3
7%
14.2
13.7
13.1
8%
Natural gas entitlement sales Equinor (bcm)
41.9
39.2
7%
43.65
27.18
12.82
>100%
Average invoice gas price - Europe (USD/mmbtu)
33.44
8.99
>100%
7.24
6.51
3.23
>100%
Average invoice gas price - North America (USD/mmbtu)
6.04
2.77
>100%
For items impacting net operating income/(loss),
 
see Use and reconciliation of non-GAAP financial measures
 
in the Supplementary
disclosures.
Volumes, Pricing & Revenues
Natural gas sales volumes
were up compared to third quarter of 2021 due to restarted gas deliveries from Hammerfest
 
LNG and
higher export of piped gas volumes from NCS.
Equinor third quarter 2022
 
19
Average invoiced European natural gas price in the quarter was significantly higher compared to the third
 
quarter of 2021 due to
increased market prices driven by low gas stocks in Europe, high demand and tight supply
 
impacted by reduced import from Russia.
Average invoiced North American gas price increased significantly compared to third quarter last year driven by weak
 
production
growth, low storage levels and strong demand, especially from power generation.
Financial Results
In the third quarter of 2022 adjusted earnings* were positively influenced by strong results from
 
gas and power sales and trading.
Further, there is a net positive effect from derivatives used to manage price exposure related to bilateral gas sales contracts,
geographical optimisation of future physical flows and LNG deliveries. Adjusted earnings* were negatively
 
affected by losses on
methanol production from natural gas at Tjeldbergodden and a low refining result due to unplanned
 
shutdowns. Adjusted earnings* in
Natural Gas US and in Liquids were primarily driven by trading effects. Compared to the third quarter last year, adjusted earnings*
decreased due to significant lower mark to market effects within Natural Gas Europe.
Net operating income in the third quarter of 2022 includes a net positive effect from reversal of impairments
 
of USD 891 million and
timing effects related to inventory.
The increase in adjusted earnings* in the first nine months of 2022 compared to
 
same period last year is mainly explained by stronger
results from European gas and power trading.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
20
RENEWABLES
Quarters
Change
Financial information
First nine months
Q3 2022
Q2 2022
Q3 2021
Q3 on Q3
(unaudited, in USD million)
2022
2021
Change
3
3
1
>100%
Revenues third party, other revenue and other income
96
1,390
(93%)
9
12
6
64%
Net income/(loss) from equity accounted investments
50
(1)
N/A
12
15
7
82%
Total revenues and other income
146
1,390
(89%)
13
16
6
>100%
Adjusted total revenues and other income*
60
9
>100%
(69)
(57)
(34)
>100%
Total operating expenses
(167)
(107)
(56%)
(58)
(56)
(33)
75%
Adjusted operating and administrative expenses*
(155)
(105)
48%
(1)
(1)
(1)
(14%)
Adjusted depreciation, amortisation and net impairments*
(3)
(2)
20%
(56)
(42)
(27)
>(100%)
Net operating income/(loss)
(21)
1,283
N/A
(46)
(42)
(28)
(63%)
Adjusted earnings*
(98)
(98)
0%
95
57
74
27%
Additions to PP&E, intangibles and equity accounted
investments
195
361
(46%)
Quarters
Change
Operational information
First nine months
Q3 2022
Q2 2022
Q3 2021
Q3 on Q3
2022
2021
Change
294
325
304
(3%)
Renewables power generation (GWh) Equinor
 
share
1,131
1,036
9%
For items impacting net operating income/(loss),
 
see Use and reconciliation of non-GAAP financial measures
 
in the Supplementary disclosures.
Power generation
Power generation was 294 GWh in the third quarter of 2022, a decrease from 304 GWh in
 
the same period last year mainly due to
lower wind and higher maintenance activity. The increase in the first nine months of 2022 compared to the same period last year was
mainly due to start-up of production from Guanizuil IIA solar plant in the third quarter of 2021.
Results from equity accounted investments
Net income from equity accounted investments increased to USD 9 million in the
 
third quarter of 2022 compared to USD 6 million in
the same period last year driven by increased results from producing assets.
Operating expenses and financial results
In the third quarter 2022 the decrease in net operating income and adjusted earnings* compared
 
to the same period last year was
driven by increased business development costs due to higher activity levels in the US, the UK
 
and in Asia, partially offset by
increased net results from equity accounted investments.
Net operating income in the first nine months of 2022 decreased significantly compared to last year
 
due to lower divestment gains of
USD 87 million in 2022 compared to USD 1,385 million last year.
Increase in additions to PP&E, intangibles and equity accounted investments in the third quarter
 
of 2022 is mainly related to the
acquisition of East Point Energy.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
21
CONDENSED INTERIM FINANCIAL STATEMENTS
Third quarter 2022
CONSOLIDATED STATEMENT
 
OF INCOME
Quarters
First nine months
Q3 2022
Q2 2022
Q3 2021
(unaudited, in USD million)
Note
2022
2021
42,726
36,387
23,111
Revenues
2
115,163
56,619
75
51
75
Net income/(loss) from equity accounted investments
225
121
833
21
79
Other income
3
1,098
1,576
43,633
36,459
23,264
Total revenues and other income
2
116,486
58,316
(13,592)
(13,851)
(9,052)
Purchases [net of inventory variation]
(40,953)
(23,617)
(2,393)
(2,200)
(2,241)
Operating expenses
(6,581)
(6,317)
(221)
(205)
(145)
Selling, general and administrative expenses
(708)
(558)
(1,049)
(2,140)
(2,034)
Depreciation, amortisation and net impairments
2
(5,207)
(6,942)
(275)
(331)
(226)
Exploration expenses
(809)
(798)
(17,531)
(18,727)
(13,698)
Total operating expenses
2
(54,258)
(38,231)
26,103
17,733
9,567
Net operating income/(loss)
2
62,228
20,085
(336)
(327)
(308)
Interest expenses and other financial expenses
(929)
(924)
1,389
2,351
(228)
Other financial items
2,836
(713)
1,053
2,023
(536)
Net financial items
4
1,907
(1,637)
27,156
19,756
9,031
Income/(loss) before tax
64,135
18,448
(17,785)
(12,995)
(7,622)
Income tax
5
(43,289)
(13,242)
9,371
6,762
1,409
Net income/(loss)
20,847
5,206
9,384
6,757
1,406
Attributable to equity holders of the company
20,851
5,195
 
 
 
Equinor third quarter 2022
 
22
(13)
5
3
Attributable to non-controlling interests
(5)
11
2.98
2.12
0.43
Basic earnings per share (in USD)
6.54
1.60
2.97
2.11
0.43
Diluted earnings per share (in USD)
6.52
1.60
3,148
3,188
3,245
Weighted average number of ordinary shares outstanding
 
(in millions)
3,187
3,247
3,157
3,197
3,255
Weighted average number of ordinary shares outstanding
 
diluted (in millions)
3,196
3,256
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
23
CONSOLIDATED STATEMENT
 
OF COMPREHENSIVE INCOME
Quarters
First nine months
Q3 2022
Q2 2022
Q3 2021
(unaudited, in USD million)
2022
2021
9,371
6,762
1,409
Net income/(loss)
20,847
5,206
(42)
27
37
Actuarial gains/(losses) on defined benefit pension
 
plans
(434)
260
15
(6)
(11)
Income tax effect on income and expenses recognised
 
in OCI
1)
103
(61)
(26)
21
26
Items that will not be reclassified to the Consolidated
 
statement of income
(331)
200
(3,488)
(4,410)
(751)
Foreign currency translation effects
(7,726)
(678)
(3,488)
(4,410)
(751)
Items that may be subsequently reclassified to
 
the Consolidated statement of
income
(7,726)
(678)
(3,515)
(4,389)
(725)
Other comprehensive income/(loss)
(8,057)
(478)
5,856
2,372
684
Total comprehensive income/(loss)
12,789
4,728
5,869
2,368
681
Attributable to the equity holders of the company
12,794
4,717
(13)
5
3
Attributable to non-controlling interests
(5)
11
1) Other comprehensive income (OCI).
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
24
CONSOLIDATED BALANCE SHEET
At 30 September
At 31 December
(unaudited, in USD million)
Note
2022
2021
1)
ASSETS
Property, plant and equipment
2
52,467
62,075
Intangible assets
5,110
6,452
Equity accounted investments
1,777
2,686
Deferred tax assets
6,134
6,259
Pension assets
651
1,449
Derivative financial instruments
715
1,265
Financial investments
2,552
3,346
Prepayments and financial receivables
6
2,392
1,087
 
Total non-current assets
71,797
84,618
 
Inventories
6,395
3,395
Trade and other receivables
21,204
17,927
Derivative financial instruments
7,986
5,131
Financial investments
20,995
21,246
Cash and cash equivalents
23,348
14,126
 
Total current assets
79,927
61,826
 
Assets classified as held for sale
3
853
676
 
Total assets
152,577
147,120
 
EQUITY AND LIABILITIES
Shareholders' equity
42,706
39,010
Non-controlling interests
8
14
 
Total equity
42,714
39,024
 
Finance debt
4
23,500
27,404
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
25
Lease liabilities
2,293
2,449
Deferred tax liabilities
13,408
14,037
Pension liabilities
3,923
4,403
Provisions and other liabilities
6
14,772
19,899
Derivative financial instruments
3,076
767
 
Total non-current liabilities
60,972
68,959
 
Trade, other payables and provisions
12,589
14,310
Current tax payable
5
18,381
13,119
Finance debt
4
5,045
5,273
Lease liabilities
1,190
1,113
Dividends payable
3,766
582
Derivative financial instruments
7,289
4,609
 
Total current liabilities
48,261
39,005
 
Liabilities directly associated with the assets classified
 
as held for sale
 
3
630
132
 
Total liabilities
109,863
108,096
 
Total equity and liabilities
152,577
147,120
1) Audited
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
26
CONSOLIDATED STATEMENT
 
OF CHANGES IN EQUITY
(unaudited, in USD million)
Share
capital
Additional
paid-in
capital
Retained
earnings
Foreign
currency
translation
reserve
Share-
holders'
equity
Non-
controlling
interests
Total equity
At 1 January 2021
1)
1,164
6,852
30,050
(4,194)
33,873
19
33,892
Net income/(loss)
5,195
5,195
11
5,206
Other comprehensive income/(loss)
200
(678)
(478)
(478)
Total comprehensive income/(loss)
4,728
Dividends
(1,460)
(1,460)
(1,460)
Share buy-back
0
(99)
(99)
(99)
Other equity transactions
(12)
(0)
(12)
(14)
(26)
At 30 September 2021
 
1,164
6,741
33,984
(4,871)
37,018
16
37,034
At 1 January 2022
1)
1,164
6,408
36,683
(5,245)
39,010
14
39,024
Net income/(loss)
20,851
20,851
(5)
20,847
Other comprehensive income/(loss)
(331)
(7,726)
(8,057)
(8,057)
Total comprehensive income/(loss)
12,789
Dividends
(6,314)
(6,314)
(6,314)
Share buy-back
2)
(22)
(2,753)
(2,775)
(2,775)
Other equity transactions
(9)
(0)
(9)
(1)
(10)
At 30 September 2022
1,142
3,647
50,889
(12,971)
42,706
8
42,714
1) Audited
2) For more information see note 7 Capital distribution.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
27
CONSOLIDATED STATEMENT
 
OF CASH FLOWS
Quarters
First nine
months
First nine
months
Q3 2022
Q2 2022
Q3 2021
(unaudited, in USD million)
Note
2022
2021
27,156
19,756
9,031
Income/(loss) before tax
64,135
18,448
1,049
2,140
2,034
Depreciation, amortisation and net impairment
2
5,207
6,942
(2)
87
81
Exploration expenditures written off
159
170
(1,691)
(2,821)
(88)
(Gains)/losses on foreign currency transactions and
 
balances
4
(4,228)
(115)
(642)
(6)
5
(Gains)/losses on sale of assets and businesses
3
(736)
(1,362)
(1,235)
(920)
(235)
(Increase)/decrease in other items related to operating
 
activities
1)
(2,455)
(578)
(111)
3
107
(Increase)/decrease in net derivative financial instruments
845
853
113
59
13
Interest received
183
90
(138)
(233)
(146)
Interest paid
(490)
(486)
24,498
18,066
10,801
Cash flows provided by operating activities before
 
taxes paid and working
capital items
62,620
23,962
(16,975)
(8,386)
(1,503)
Taxes paid
(29,668)
(1,931)
(946)
(1,160)
(1,260)
(Increase)/decrease in working capital
(2,083)
(1,366)
6,578
8,520
8,039
Cash flows provided by operating activities
 
30,869
20,665
(21)
168
0
Cash used/received in business combinations
2)
3
147
(111)
(2,053)
(1,713)
(1,917)
Capital expenditures and investments
3)
(5,948)
(5,814)
2,821
(3,069)
(39)
(Increase)/decrease in financial investments
(3,098)
(3,564)
904
940
218
(Increase)/decrease in derivatives financial instruments
2,268
(152)
(63)
29
(24)
(Increase)/decrease in other interest-bearing items
(30)
(161)
269
77
(47)
Proceeds from sale of assets and businesses
3
486
1,792
1,856
(3,567)
(1,808)
Cash flows provided by/(used in) investing activities
(6,176)
(8,011)
0
0
0
Repayment of finance debt
0
(1,425)
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
28
(341)
(344)
(309)
Repayment of lease liabilities
(1,002)
(919)
(1,256)
(1,310)
(488)
Dividends paid
(3,149)
(1,232)
(1,996)
(304)
(99)
Share buy-back
(2,738)
(99)
(278)
(2,250)
(1,191)
Net current finance debt and other financing activities
(5,332)
(1,518)
(3,871)
(4,208)
(2,087)
Cash flows provided by/(used in) financing activities
(12,221)
(5,193)
4,563
745
4,143
Net increase/(decrease) in cash and cash equivalents
12,472
7,461
(1,778)
(1,064)
(262)
Effect of exchange rate changes on cash and cash equivalents
(3,111)
(433)
20,562
20,882
9,904
Cash and cash equivalents at the beginning
 
of the period (net of overdraft)
13,987
6,757
23,348
20,562
13,785
Cash and cash equivalents at the end of the
 
period (net of overdraft)
4)
23,348
13,785
 
1) The line item mainly consists
 
of provisions, unrealised gains and losses
 
and items of income or expense for which
 
the cash effects are
included in increase/(decrease)
 
in working capital within operating cash flow and
 
investing cash flows. In the first nine months
 
of 2022 the
line item includes
 
payment of USD 189 million which represent
 
the accretion related to the payment of
 
the acquisition and disposal of the
interests in the Bacalhau field as described in footnote 3
 
below.
 
 
2) Net after cash and cash equivalents acquired. The
 
line item includes cash consideration received related
 
to the acquisition of Statfjord
licences in second quarter of 2022 as described in
 
note 3 Acquisitions and disposals.
 
3) The line Capital expenditures and investments for
 
the first nine months of 2022 includes USD 336 million
 
which represents the net of an
USD 769 million payment of a contingent consideration
 
related to the acquisition of interests in the
 
Bacalhau field in 2016 and 2017, and
a corresponding receipt of USD 433 million for
 
the simultaneous payment of contingent consideration
 
related to disposal of parts of the
acquired interests in 2018.
 
4) At 30 September 2022 cash and cash equivalents included
 
a net overdraft were zero compared to a
 
net overdraft of USD 30 million at
 
30 September 2021 and USD 140 million at 31
 
December 2021.
Equinor third quarter 2022
 
29
Notes to the Condensed interim financial statements
1 Organisation and basis of preparation
Organisation and principal activities
Equinor Group (Equinor) consists of Equinor ASA and its subsidiaries. Equinor ASA is incorporated
 
and domiciled in Norway and
listed on the Oslo Børs (Norway) and the New York Stock Exchange (USA). The address of its registered office is Forusbeen 50, N-
4035 Stavanger, Norway.
Equinor’s business consists principally of the exploration, production, transportation, refining
 
and marketing of petroleum and
petroleum-derived products, and other forms of energy. Equinor Energy AS, a 100% owned operating subsidiary of Equinor ASA and
owner of all of Equinor's oil and gas activities and net assets on the Norwegian continental shelf,
 
is co-obligor or guarantor of certain
debt obligations of Equinor ASA.
Equinor's condensed interim financial statements for the third quarter of 2022 were authorised for
 
issue by the board of directors on
 
27 October 2022.
Basis of preparation
These condensed interim financial statements are prepared in accordance with International Accounting
 
Standard 34 Interim Financial
Reporting as issued by the International Accounting Standards Board (IASB) and as adopted by the European
 
Union (EU). The
condensed interim financial statements do not include all the information and disclosures required
 
by International Financial Reporting
Standards (IFRS) for a complete set of financial statements, and these condensed interim financial statements
 
should be read in
conjunction with the Consolidated annual financial statements for 2021. IFRS as adopted by the EU
 
differs
 
in certain respects from
IFRS as issued by the IASB, however the differences do not impact Equinor's financial statements for the periods
 
presented. A
description of the significant accounting policies applied in preparing these condensed interim financial statements
 
is included in
Equinor's Consolidated annual financial statements for 2021.
There have been no changes to the significant accounting policies during 2022 compared to the Consolidated annual
 
financial
statements for 2021. With effect from the second quarter 2022, due to the evolving trading business in the
 
Group, Equinor has
determined that fair value less cost to sell (FV) is an appropriate measurement basis for
 
commodity inventories held for trading
purposes with subsequent changes in FV recognised in the Consolidated statement
 
of income. Comparative numbers have not been
restated due to materiality.
Certain amounts in the comparable periods in the note disclosures have been reclassified
 
to conform to current period presentation.
The subtotals and totals in some of the tables may not equal the sum of the amounts shown due
 
to rounding. When determining fair
value, there have been no changes to the valuation techniques or models and Equinor applies the
 
same sources of input and the
same criteria for categorisation in the fair value hierarchy as disclosed in the Consolidated
 
annual financial statements for 2021.
The Condensed interim financial statements are unaudited.
Use of estimates
The preparation of financial statements in conformity with IFRS requires management to make
 
judgments, estimates and assumptions
that affect the application of policies and reported amounts of assets, liabilities, income and expenses. The estimates
 
and associated
assumptions are reviewed on an on-going basis and are based on historical experience and various other
 
factors that are believed to
be reasonable under the circumstances, the results of which form the basis for making the judgments
 
about carrying values of assets
and liabilities that are not readily apparent from other sources. Actual results may
 
differ from these estimates.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
30
2 Segments
Equinor’s operations are managed through operating segments (business areas). The
 
reportable segments Exploration & Production
Norway (E&P Norway), Exploration & Production International (E&P International), Exploration &
 
Production USA (E&P USA),
Marketing, Midstream & Processing (MMP) and Renewables (REN) correspond to the operating
 
segments. The operating segments
Projects, Drilling & Procurement (PDP), Technology,
 
Digital & Innovation (TDI) and Corporate staff and functions are aggregated into
the reportable segment Other based on materiality. The majority of the costs in PDP and TDI are allocated to the three Exploration &
Production segments, MMP and REN.
Inter-segment sales and related unrealised profits, mainly from the sale of crude oil and products,
 
are eliminated in the Eliminations
column below. Inter-segment revenues are based upon estimated market prices.
 
The reported measure of segment profit is net operating income/(loss)
.
 
Deferred tax assets, pension assets and non-current financial
assets are not allocated to the segments.
The measurement basis for the segments is IFRS as applied by the group,
 
except for the line-item Additions to PP&E, intangibles and
equity accounted investments in which movements related to changes in asset retirement obligations
 
are excluded. With effect from
the second quarter 2022, Equinor changed the measurement basis for the segments related
 
to leases. Since the implementation of
IFRS 16 Leases in 2019, all leases were presented within the Other segment and lease costs
 
have been allocated to the operating
segments based on underlying lease payments with a corresponding credit in the Other segment.
 
As from the second quarter 2022,
lease contracts are accounted for in accordance with IFRS 16 in all segments. This change does
 
not affect Equinor’s consolidated
financial statements. Comparative numbers in the segments have been restated.
Third quarter 2022
E&P
Norway
E&P
International
E&P
 
USA
MMP
REN
Other
Eliminations
Total
(in USD million)
Revenues third party, other revenue and
other income
880
116
77
42,462
3
20
0
43,559
Revenues inter-segment
23,154
1,618
1,465
91
0
9
(26,336)
0
Net income/(loss) from equity accounted
investments
0
33
0
33
9
0
0
75
Total revenues and other income
 
24,034
1,767
1,541
42,585
12
29
(26,336)
43,633
Purchases [net of inventory variation]
(0)
(22)
0
(40,253)
0
0
26,683
(13,592)
Operating, selling, general and
administrative expenses
(963)
(427)
(254)
(1,097)
(68)
11
183
(2,614)
Depreciation, amortisation and net
impairment losses
(1,143)
(349)
(199)
680
(1)
(38)
0
(1,049)
Exploration expenses
(114)
(157)
(4)
0
0
0
0
(275)
Total operating expenses
(2,220)
(955)
(457)
(40,669)
(69)
(27)
26,866
(17,531)
Net operating income/(loss)
21,813
813
1,084
1,916
(56)
2
531
26,103
Additions to PP&E, intangibles and equity
accounted investments
1,089
841
186
345
95
17
0
2,574
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
31
Second quarter 2022
E&P
Norway
E&P
International
E&P
 
USA
MMP
REN
Other
Eliminations
Total
(in USD million)
Revenues third party, other revenue and
other income
132
237
82
35,921
3
33
0
36,408
Revenues inter-segment
16,580
1,559
1,548
93
0
9
(19,789)
0
Net income/(loss) from equity accounted
investments
0
42
0
(2)
12
0
0
51
Total revenues and other income
 
16,712
1,838
1,629
36,012
15
42
(19,789)
36,459
Purchases [net of inventory variation]
0
(36)
(0)
(33,379)
0
(1)
19,564
(13,851)
Operating, selling, general and
administrative expenses
(984)
(370)
(244)
(956)
(56)
(3)
209
(2,404)
Depreciation, amortisation and net
impairment losses
(1,202)
(315)
(362)
(221)
(1)
(39)
0
(2,140)
Exploration expenses
(45)
(135)
(151)
0
0
0
0
(331)
Total operating expenses
(2,231)
(856)
(757)
(34,556)
(57)
(43)
19,774
(18,727)
Net operating income/(loss)
14,482
982
872
1,456
(42)
(1)
(16)
17,733
Additions to PP&E, intangibles and equity
accounted investments
1,339
573
170
253
57
14
(0)
2,405
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
32
Third quarter 2021
E&P
Norway
1)
E&P
International
1)
E&P
 
USA
MMP
1)
REN
Other
1)
Eliminations
1)
Total
(in USD million)
Revenues third party, other revenue and
other income
1)
108
247
78
22,708
1
48
0
23,190
Revenues inter-segment
1)
9,511
975
808
83
0
10
(11,388)
0
Net income/(loss) from equity accounted
investments
(1)
61
0
3
6
5
0
75
Total revenues and other income
1)
9,618
1,283
886
22,794
7
64
(11,388)
23,264
Purchases [net of inventory variation]
0
(6)
(0)
(20,290)
0
(1)
11,245
(9,052)
Operating, selling, general and
administrative expenses
1)
(1,064)
(349)
(221)
(874)
(33)
(22)
176
(2,386)
Depreciation, amortisation and net
impairment losses
1)
(537)
(383)
(374)
(696)
(1)
(43)
0
(2,034)
Exploration expenses
(169)
(11)
(46)
0
0
0
0
(226)
Total operating expenses
1)
(1,769)
(749)
(642)
(21,859)
(34)
(65)
11,421
(13,698)
Net operating income/(loss)
1)
7,849
535
244
935
(27)
(1)
33
9,567
Additions to PP&E, intangibles and equity
accounted investments
1)
1,149
445
174
152
74
11
(0)
2,005
1) Restated due to implementation of IFRS 16 in
 
the segments, mainly affecting the line item Operating,
 
selling, general and administrative
expenses in MMP (reduction of USD 129 million) and
 
Other (increase of USD 178 million) and the
 
line item Depreciation, amortisation and net
impairments in MMP (increase of USD 126 million) and
 
Other (reduction of USD 201 million).
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
33
First nine months 2022
E&P
Norway
E&P
Internationa
l
E&P
 
USA
MMP
REN
Other
Eliminations
Total
(in USD million)
Revenues third party, other revenue and
other income
1,222
415
236
114,208
96
84
0
116,261
Revenues inter-segment
57,979
4,501
4,204
272
0
28
(66,984)
0
Net income/(loss) from equity accounted
investments
0
141
0
33
50
0
0
225
Total revenues and other income
 
59,200
5,057
4,440
114,514
146
111
(66,984)
116,486
Purchases [net of inventory variation]
0
(31)
(0)
(107,920)
0
(0)
66,999
(40,953)
Operating, selling, general and
administrative expenses
(2,762)
(1,187)
(719)
(2,976)
(165)
(70)
590
(7,289)
Depreciation, amortisation and net
impairment losses
(2,945)
(2,041)
(348)
247
(3)
(116)
0
(5,207)
Exploration expenses
(265)
(373)
(172)
0
0
0
0
(809)
Total operating expenses
(5,972)
(3,632)
(1,239)
(110,650)
(167)
(186)
67,589
(54,258)
Net operating income/(loss)
53,228
1,425
3,201
3,864
(21)
(75)
605
62,228
Additions to PP&E, intangibles and equity
accounted investments
3,500
2,039
482
863
195
87
(0)
7,166
Balance sheet information
Equity accounted investments
 
3
521
0
278
924
52
(0)
1,777
Non-current segment assets
 
25,973
15,081
11,071
4,219
254
979
0
57,577
Non-current assets not allocated to
segments
 
12,443
Total non-current assets
 
71,797
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
34
First nine months 2021
E&P
Norway
1)
E&P
International
1)
E&P
 
USA
1)
MMP
1)
REN
1)
Other
1)
Eliminations
1)
Total
(in USD million)
Revenues third party, other revenue and
other income
1)
245
761
300
55,307
1,390
192
0
58,195
Revenues inter-segment
1)
21,433
2,950
2,547
249
0
31
(27,211)
0
Net income/(loss) from equity accounted
investments
(0)
103
0
18
(1)
1
0
121
Total revenues and other income
1)
21,678
3,814
2,847
55,574
1,390
224
(27,211)
58,316
Purchases [net of inventory variation]
0
(21)
(0)
(49,914)
0
(1)
26,321
(23,617)
Operating, selling, general and
administrative expenses
1)
(2,652)
(1,010)
(842)
(2,782)
(105)
(252)
769
(6,875)
Depreciation, amortisation and net
impairment losses
1)
(3,116)
(1,044)
(1,248)
(1,399)
(2)
(132)
0
(6,942)
Exploration expenses
(294)
(349)
(156)
0
0
0
0
(798)
Total operating expenses
1)
(6,062)
(2,425)
(2,247)
(54,095)
(107)
(385)
27,089
(38,231)
Net operating income/(loss)
1)
15,617
1,389
600
1,479
1,283
(161)
(121)
20,085
Additions to PP&E, intangibles and equity
accounted investments
1)
3,737
1,264
511
343
361
48
(0)
6,263
Balance sheet information
Equity accounted investments
 
3
1,265
0
96
1,061
31
0
2,456
Non-current segment assets
1)
37,847
17,703
11,695
4,123
159
1,049
0
72,576
Non-current assets not allocated to
segments
 
13,144
Total non-current assets
 
88,176
1) Restated due to implementation of IFRS 16 in
 
the segments, mainly affecting the line item Operating,
 
selling, general and administrative
expenses in MMP (reduction of USD 387 million),
 
EPN (reduction of USD 57 million) and Other
 
(increase of USD 518 million) and the line
 
item
Depreciation, amortisation and net impairments
 
in MMP (increase of USD 394 million), EPN
 
(increase of USD 160 million) and Other (reduction
of USD 604 million).
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
35
Net impairments/reversal of impairments and changes to accounting assumptions
Management’s future commodity price assumptions and currency assumptions are used for value in use impairment testing.
 
While
there are inherent uncertainties in the assumptions, the commodity price assumptions as well as
 
currency assumptions reflect
management’s best estimate of the price and currency development over the life of the Group’s assets based on its view of relevant
current circumstances and the likely future development of such circumstances, including energy demand
 
development, energy and
climate change policies as well as the speed of the energy transition, population and economic growth,
 
geopolitical risks, technology
and cost development and other factors. Management’s best estimate also takes into consideration a range of external
 
forecasts.
Equinor has performed a thorough and broad analysis of the expected development in drivers for the
 
different commodity markets and
exchange rates. Significant uncertainty exists regarding future commodity price development due to the
 
transition to a lower carbon
economy, future supply actions by OPEC+ and other factors. The management’s analysis of the expected development in drivers for
the different commodity markets and exchange rates resulted in changes in the long-term price assumptions with effect from the third
quarter of 2022. The main changes with effect for impairment and impairment reversal assessments are disclosed
 
in the table below
as price-points on price-curves. Previously applied price-points are given in brackets.
Year
 
Prices in real terms 1)
2025
2030
2040
2050
Brent Blend (USD/bbl)
75
(70)
75
(75)
70
(69)
65
(64)
European gas (USD/mmBtu) - TTF
 
2)
20.0
(7.3)
9.5
(6.8)
9.0
(8.2)
9.0
(7.5)
Henry Hub (USD/mmBtu)
4.0
(3.3)
3.7
(3.4)
3.7
(3.6)
3.7
(3.6)
Electricity Germany (EUR/MWh)
115
(65)
70
(62)
57
(64)
57
(64)
EU ETS (EUR/tonne)
80
(61)
80
(70)
105
(89)
130
(108)
1) Basis year 2022. The prices in the table are
 
price-points on price-curves.
2) As from the third quarter 2022, TTF is applied
 
as the main reference price for European
 
gas. Updated price-points for the previously applied
NBP correspond to the disclosed updated price-points
 
for TTF. Previously applied comparable prices for NBP are 7.4, 6.9, 8.3 and 7.6
 
for 2025,
2030, 2040 and 2050 respectively.
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
36
The refinery margin assumptions increased, especially in the short- and mid-term. Long-term it is
 
anticipated that the energy transition
will be the main driver of refinery margins. Weighted average cost of capital (WACC) and the long-term currency rates are unchanged.
In the third quarter, Equinor recognised net impairment reversals of USD 1,086 million. Net impairment reversals in the MMP segment
amounted to USD 891 million mainly caused by increased refinery margin assumptions. In
 
the E&P USA segment the net impairments
reversal was USD 195 million.
In the third quarter of 2021, Equinor recognised net impairment reversals of USD
 
513 million. Impairment reversals of USD 975 million
were recognised in the E&P Norway segment, and in the MMP segment impairments amounted
 
to USD 485 million.
Net impairment reversals recognised in the first nine months of 2022 are USD
 
1,332 million (USD 361 million in the first nine months
of 2021), of which USD 832 million is related to impairment of equity accounted investments
 
in the first quarter.
Recoverable amounts in the impairment assessments are normally based on value in use. Estimates of discounted
 
cash flows used to
determine the recoverable amounts are based on internal forecasts on cost, production profiles
 
and commodity prices.
Non-current assets by country
At 30 September
At 31 December
(in USD million)
2022
2021
Norway
30,274
40,564
USA
12,091
12,323
Brazil
9,299
8,751
UK
1,849
2,096
Azerbaijan
1,597
1,654
Canada
1,185
1,403
Angola
922
948
Algeria
640
708
Argentina
586
474
Denmark
454
536
Other
455
1,757
Total non-current assets
1)
59,353
71,213
1) Excluding deferred tax assets, pension assets
 
and non-current financial assets.
Equinor’s non-current assets in Norway have decreased by USD 10.290 billion to USD
 
30.274 billion at 30 September 2022 compared
to year-end 2021, mainly due to increased discount rates and strengthening of USD versus NOK.
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
37
Revenues from contracts with customers by geographical areas
When attributing the line item Revenues from contracts with customers for the third quarter of 2022 to the
 
country of the legal entity
executing the sale, Norway constitutes 84% and USA constitutes 12% of such revenues (84%
 
and 12% respectively for the first nine
months of 2022). For the third quarter of 2021, Norway and USA constituted 78% and 13%
 
of such revenues, respectively (78% and
15% for the first nine months of 2021).
Revenues from contracts with customers and other revenues
Quarters
First nine months
Q3 2022
Q2 2022
Q3 2021
(in USD million)
2022
2021
14,098
16,397
9,749
Crude oil
45,530
27,523
21,293
12,923
6,111
Natural gas
49,753
12,851
19,106
11,457
5,341
 
- European gas
44,913
10,910
846
766
431
 
- North American gas
2,233
1,172
1,341
699
339
 
- Other incl. Liquefied natural gas
2,607
770
2,766
2,531
2,911
Refined products
8,201
7,966
2,239
2,529
2,233
Natural gas liquids
7,345
5,815
399
310
221
Transportation
991
682
1,465
651
128
Other sales
3,233
581
42,259
35,342
21,352
Revenues from contracts with customers
115,053
55,419
466
1,045
1,759
Total other revenues
1)
110
1,200
42,726
36,387
23,111
Revenues
115,163
56,619
1) Principally relates to commodity derivatives and
 
change in fair value less cost to sell for commodity
 
inventories held for trading purposes.
3 Acquisitions and disposals
 
Acquisition
Acquisition of Triton Power
On 1 September 2022, Equinor and SSE Thermal Generation Holdings Limited (SSE Thermal)
 
closed a transaction to acquire the UK
power company Triton Power Holdings Ltd (Triton Power) from Triton Power Partners LP owned by Energy Capital Partners (ECP).
Equinor’s share of the consideration is USD 141 million (GBP 120 million), after adjustments that
 
mainly relate to net debt and working
capital. The key plant included in the purchase of Triton Power is the Saltend Power Station with an installed
 
capacity of 1.2
GW. Equinor and SSE Thermal own 50% each of Trition Power, and Equinor will account for the investment under the equity method
as a joint venture in the MMP segment.
Acquisition of Statfjord
On 31 May 2022, Equinor closed a transaction to acquire all of Spirit Energy’s interests in production
 
licenses in the Statfjord area
which covers the Norwegian and UK Continental Shelves and consists of three integrated
 
production platforms and satellite subsea
installations. All licenses are operated by Equinor. Spirit Energy’s ownership shares in the licenses
 
covered by the transaction range
from 11.56% to 48.78%. The cash consideration received was USD 193 million, whereof USD 25 million related to Spirit’s lifting of
volumes on Equinor’s behalf in June 2022. The assets and liabilities acquired have been reflected
 
in accordance with the principles in
IFRS 3 Business Combinations. The transaction is reflected in the E&P Norway and E&P International segments
 
with a cash
consideration of USD 96 million and USD 72 million respectively.
In the segment E&P Norway, the acquisition resulted in an increase of USD 98 million in property, plant and equipment, an increase of
USD 390 million in asset retirement obligation, a reduction of deferred tax liability of USD 298 million
 
and an increase in taxes payable
of USD 98 million. In the segment E&P International, the acquisition resulted in an increase of USD
 
98 million in property, plant and
equipment, an increase of USD 241 million in asset retirement obligation and an increase of deferred
 
tax asset of USD 86 million.
Both the consideration and the purchase price allocation are preliminary.
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
38
Disposals
Ekofisk and Martin Linge on the Norwegian Continental Shelf
On 30 September 2022, Equinor closed a transaction with Sval Energi AS to divest Equinor’s
 
entire ownership share in the Greater
Ekofisk Area including its share in Norpipe Oil AS, and a 19% ownership share in Martin Linge. The
 
total cash consideration
amounted to USD 293 million after interim period settlement in addition to an estimated contingent
 
consideration of USD 169 million
linked to realised oil and gas prices for 2022 and 2023. Equinor will retain a 51% ownership
 
share in Martin Linge and continue as
operator of the field. Transactions on the NCS are made on a post-tax basis where gains include the release of tax liabilities
previously computed and recognised. The disposal resulted in a decrease in property, plant and equipment of USD 1.493 million, a
decrease in asset retirement obligation of USD 376 million, a decrease in deferred tax liability
 
of USD 597 million and a decrease in
taxes payable of USD 686 million. A post-tax gain of USD 655 million is presented in the line
 
item Other income in the Consolidated
statement of income in the EPN segment.
Exit Russia
Following Russia’s invasion of Ukraine, Equinor announced that it had decided to stop new investments in
 
Russia and start the
process of exiting Equinor’s joint arrangements. Based on this decision, Equinor
 
evaluated its assets in Russia and recognised net
impairments of USD 1.083 billion in the first quarter, of which USD 251 million was related to property, plant and equipment and
intangible assets and USD 832 million was related to investments accounted for using the equity
 
method. The impairments were net
of contingent consideration from the time of acquiring the assets. The impairments were recognised
 
in the line items Depreciation,
amortisation and net impairment losses and Exploration expenses in the Consolidated statement
 
of income based on the nature of the
impaired assets and reflected in the E&P International segment. During the second quarter, Equinor transferred its participating
interests in four Russian entities to Rosneft and was released from all future commitments
 
and obligations with no material impact on
the financial statements. The ownership interests in Kharyaga were transferred to the operator.
Equinor has stopped trading in Russian oil. This means that Equinor will not enter into any new
 
trades or engage in new transport of
oil and oil products from Russia. Equinor has assessed the accounting impact of certain commitments
 
arising from such contracts
entered into prior to the invasion and deem the impact to be immaterial.
10% of Dogger Bank C
On 10 February 2022, Equinor closed the transaction with Eni to sell a 10% equity interest in the
 
Dogger Bank C project in the UK for
a total consideration of USD 91 million (GBP 68 million), resulting in a gain of USD 87 million
 
(GBP 65 million).
 
After closing, Equinor’s
ownership share is 40%. Equinor continues
 
to equity account for the remaining investment as a joint venture. The gain is presented
 
in
the line item Other income in the Consolidated statement of income in the REN segment.
Held for sale
Equinor Energy Ireland Limited
In the fourth quarter of 2021, Equinor entered into an agreement with Vermilion Energy Inc (Vermilion) to sell Equinor’s non-operated
equity position in the Corrib gas project in Ireland. The transaction covers a sale of 100% of
 
the shares in Equinor Energy Ireland
Limited (EEIL). EEIL owns 36.5% of the Corrib field alongside the operator Vermilion (20%) and Nephin Energy (43.5%). Equinor
 
and
Vermilion have agreed a consideration of USD 434 million before closing adjustments and contingent consideration linked to 2022
production level and gas prices. The effective date for the transaction is 1 January 2022. Closing is dependent
 
on governmental
approval and is expected to take place within 6 months.
4 Financial items
 
Quarters
First nine months
Q3 2022
Q2 2022
Q3 2021
(in USD million)
2022
2021
1,691
2,821
88
Net foreign currency exchange gains/(losses)
4,228
115
346
280
43
Interest income and other financial items
740
115
(44)
(224)
(209)
Gains/(losses) on financial investments
(402)
(332)
(604)
(526)
(149)
Gains/(losses) other derivative financial instruments
 
(1,730)
(611)
(336)
(327)
(308)
Interest and other finance expenses
(929)
(924)
1,053
2,023
(536)
Net financial items
1,907
(1,637)
Equinor reports significant unrealised foreign currency gains in the third quarter and the first nine months of 2022, mainly
 
related to
strengthening of USD versus NOK.
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
39
Losses on derivative financial instruments in the third quarter and first nine months of 2022
 
are mainly due to increased discount
rates.
Equinor has a US Commercial paper programme available with a limit of USD 5 billion. As of
 
30 September 2022, no amounts were
utilised compared to USD 2,600 million utilised as of 31 December 2021.
Included in Cash and cash equivalents are collateral deposits of USD 8.552 million related
 
to certain requirements set out by
exchanges where Equinor is participating.
5 Income taxes
Quarters
First nine months
Q3 2022
Q2 2022
Q3 2021
(in USD million)
2022
2021
27,156
19,756
9,031
Income/(loss) before tax
64,135
18,448
(17,785)
(12,995)
(7,622)
Income tax
(43,289)
(13,242)
 
65.5%
 
65.8%
 
84.4%
Effective tax rate
 
67.5%
 
71.8%
The effective tax rate for the third quarter of 2022 and for the first nine months of 2022 was primarily
 
influenced by positive income in
countries with lower tax rates and with unrecognised deferred tax assets and by tax exempted gains
 
on divestment as described in
note 3 Acquisitions and disposals. The effective tax for the third quarter and first nine months was also influenced
 
by currency effects
in entities that are taxable in other currencies than the functional currency.
The effective tax rate for the third quarter of 2021 and for the first nine months of 2021 was primarily
 
influenced by high share of
operating income from the Norwegian continental shelf and losses recognised in countries with lower
 
tax rates, partially offset by
positive income in countries with unrecognised deferred tax assets. The effective tax rate was also influenced by currency
 
effects in
entities that are taxable in other currencies than the functional currency.
6 Provisions, commitments, contingent items and related parties
Asset retirement obligation
Equinor's estimated asset retirement obligations (ARO) have decreased by USD 6.185 billion to USD
 
11.231 billion at 30 September
2022 compared to year-end 2021, mainly due to increased discount rates and strengthening of USD
 
versus NOK. Changes in ARO
are reflected within Property, plant and equipment and Provisions and other liabilities in the Consolidated balance sheet.
Agbami dispute settlement agreement and licence extension
In the third quarter of 2022, an agreement was reached in a three-year long
 
negotiation between the parties Nigerian National
Petroleum Company Limited (NNPC), Chevron and Equinor. The parties have agreed to an extension of the operating licence period
and the related Production Sharing Contract (PSC) for Oil Mining Lease (OML) 128 of the unitised
 
Agbami field until 2042. At the
same time, the parties agreed outstanding legal disputes related to the allocation between the
 
parties of cost oil, tax oil and profit oil
volumes. The settlement agreement awards Equinor with an amicable compensation for overlifted volumes, which will
 
be payable over
the 20-year licence extension. The amounts and timing of payments to be received depend
 
on a number of factors related to
operation of the field, as well as future oil prices and production volumes. Equinor will consequently recognise
 
settlement payments
when received, and no amounts have been recognised in the Consolidated statement of income
 
or Balance sheet for 2022. The
parties are currently undertaking necessary legal actions in order to formally close the legal disputes.
Resolved dispute with Norwegian tax authorities related to Equinor Service Center Belgium
 
N.V
In the fourth quarter of 2020, Equinor received a decision from the Norwegian tax authorities
 
related to the capital structure of the
subsidiary Equinor Service Center Belgium N.V., concluding that the capital structure had to be based on the arm length’s principle,
affecting the fiscal years 2012 to 2016. Equinor received a claim of USD 182 million that was paid in
 
2021. During the second quarter
of 2022, the tax authorities reversed their position and accepted Equinor’s initial position. During
 
the third quarter, the tax payment has
been reimbursed to Equinor adjusted for changes in tax rates. The adjustment, which has
 
been recognised as tax expense in the
Consolidated statement of income in 2022, is considered immaterial.
Dispute with Norwegian tax authorities regarding R&D costs in the offshore tax regime
Equinor has an ongoing dispute regarding the level of Research & Development cost to be allocated
 
to the offshore tax regime.
During the second quarter of 2022, the Oil Taxation Office informed Equinor that it had decided to accept Equinor’s position regarding
Equinor third quarter 2022
 
40
certain disputed items, resulting in a reduction in Equinor’s maximum exposure
 
to approximately USD 143 million. Equinor has
provided for its best estimate in the matter.
During the normal course of its business, Equinor is involved in legal and other proceedings,
 
and several unresolved claims are
currently outstanding. The ultimate liability or asset in respect of such litigation and claims cannot be
 
determined at this time. Equinor
has provided in its Condensed interim financial statements for probable liabilities related to
 
litigation and claims based on the
company’s best judgement. Equinor does not expect that its financial position, results of operations or cash
 
flows will be materially
affected by the resolution of these legal proceedings.
Related parties
The line item Prepayments and Financial Receivables includes USD 1,934 million which represent a
 
gross receivable from the
Norwegian state under the Marketing Instruction in relation to the state’s (SDFI) expected participation in the gas
 
sales activities of a
foreign subsidiary of Equinor. At year-end 2021, the corresponding amount was USD 435 million. The increase is mainly related to
increased volumes as well as higher cost price on the gas storage.
7 Capital distribution
In February 2022 Equinor launched a share buy-back programme for 2022 of up to USD 5,000
 
million, where the first tranche of
around USD 1,000 million was finalised in March 2022. USD 330 million of the first tranche
 
was acquired in the open market and
recognised as a reduction in equity as treasury shares in the first quarter 2022. The treatment of
 
the proportionate share of 67% from
the Norwegian State is described below.
The purpose of the share buy-back programme is to reduce the issued share capital of the
 
company. All shares repurchased as part
of the programme will be cancelled. According to an agreement between Equinor and the Norwegian State,
 
the Norwegian State will
participate in share buy-backs on a proportionate basis, ensuring that its ownership interest
 
in Equinor remains unchanged at 67%.
After having finalized the 2021 share buy-back programme as well as the first tranche of the 2022
 
share buy-back programme in the
market in the period 28 July 2021 to 25 March 2022, a proportionate share of 67% from the Norwegian
 
State was redeemed in
accordance with an agreement with the Ministry of Trade, Industry and Fisheries for the Norwegian State to maintain their
 
ownership
percentage in Equinor. The redemption was approved by the annual general meeting held on 11 May 2022, and subsequently the
State’s share including interest and dividends was recognised as a short-term liability and as a reduction in equity
 
as treasury shares
in the second quarter 2022. The shares were cancelled on 29 June 2022 and the liability
 
of USD 1,399 million (NOK 13,496 million) to
the Norwegian State was settled on 20 July 2022.
In May 2022, Equinor launched the second tranche of USD 1,333 million of the 2022 share
 
buy-back programme of which USD 440
million was purchased in the open market and recognised as a reduction in equity as treasury shares in
 
the second quarter 2022,
while around USD 893 million of shares from the Norwegian State will, in accordance with an
 
agreement with the Ministry of Trade,
Industry and Fisheries, be redeemed at the annual general meeting in May 2023 in order for
 
the Norwegian State to maintain its
ownership share of 67% in Equinor. The acquisition of the second tranche in the open market was finalised in July 2022.
In July 2022, Equinor increased the target level of share buy-back for 2022 from USD 5,000
 
million up to USD 6,000 million and
launched the third tranche of USD 1,833 million. Also, for the third tranche Equinor entered into
 
an irrevocable agreement with a third
party for up to USD 605 million of shares to be purchased in the open market, while up to USD
 
1,228 million of shares from the
Norwegian State will be redeemed at the annual general meeting in May 2023
 
in order for the Norwegian State to maintain its
ownership percentage in Equinor. As of 30 September 2022, USD 526
million of the third tranche has been purchased in the open
market, of which USD 502 million has been settled.
The third tranche of USD 605 million (both acquired and remaining order) has been recognised
 
as a reduction in equity as treasury
shares due to the irrevocable agreement with the third party. The remaining order of the third tranche is accrued for and classified as
Trade, other payables and provisions.
 
The tranche was completed on 11 October 2022.
On 27 October 2022, the board of directors resolved to declare a cash dividend for the
 
third quarter of 2022 of USD 0.20 per share,
 
in
addition to an extraordinary cash dividend of USD 0.20 per share for third quarter of 2022. This
 
is in addition to the extraordinary cash
dividend of USD 0.50 per share for the third quarter 2022 already approved by the Board
 
on 26 July 2022. In total the cash dividend
for the third quarter 2022 will be USD 0.90 per share, consisting of a regular cash dividend of USD
 
0.20 and extraordinary dividend of
USD 0.70. The Equinor shares will be traded ex-dividend 9 January 2023 on the Oslo Børs
 
and for ADR holders on the New York
Stock Exchange. Record date will be 10 January 2023 and payment date will be 25 January 2023.
On 27 October 2022, the board of directors decided to initiate the fourth and final tranche of the
 
share buy-back programme for 2022
of around USD 1,833 million, including shares to be redeemed from the Norwegian State
 
(subject to annual general meeting approval
in May 2023). The fourth tranche will commence on 31 October 2022 and will end
 
no later than 27 January 2023.
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
41
SUPPLEMENTARY
 
DISCLOSURES
 
Exchange rates
Quarters
Change
First nine months
Q3 2022
Q2 2022
Q3 2021
Q3 on Q3
Exchange rates
2022
2021
Change
0.1001
0.1059
0.1141
(12%)
NOK/USD average daily exchange rate
0.1060
0.1169
(9%)
0.0921
0.1004
0.1139
(19%)
NOK/USD period-end exchange rate
0.0921
0.1139
(19%)
9.9903
9.4411
8.7612
14%
USD/NOK average daily exchange rate
9.4322
8.5557
10%
10.8574
9.9629
8.7788
24%
USD/NOK period-end exchange rate
10.8574
8.7788
24%
1.0065
1.0636
1.1788
(15%)
EUR/USD average daily exchange rate
1.0609
1.1958
(11%)
0.9748
1.0387
1.1579
(16%)
EUR/USD period-end exchange rate
0.9748
1.1579
(16%)
USE AND RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
Non-GAAP financial measures are defined as numerical measures that either exclude
 
or include amounts or certain accounting items
that are not excluded or included in the comparable measures calculated and presented in
 
accordance with GAAP (i.e., IFRS).
Management considers adjusted earnings and adjusted earnings after tax together with other non-GAAP
 
financial measures as
defined below, to provide a better indication of the underlying operational and financial performance in the period (excluding
financing), and therefore better facilitate comparisons between periods.
The following financial measures may be considered non-GAAP financial measures:
●
Adjusted earnings
 
are based on net operating income/(loss) and adjusts for certain items affecting the income for the period in
order to separate out effects that management considers may not be well correlated to Equinor’s
 
underlying operational
performance in the individual reporting period. Management considers adjusted earnings to be
 
a supplemental measure to
Equinor’s IFRS measures, which provides an indication of Equinor’s underlying
 
operational performance in the period and
facilitates an alternative understanding of operational trends between the periods. Adjusted earnings
 
include adjusted revenues
and other income, adjusted purchases, adjusted operating expenses and selling, general and administrative
 
expenses, adjusted
depreciation expenses and adjusted exploration expenses.
●
Adjusted earnings after tax
 
– equals the sum of net operating income/(loss) less income tax in business areas and adjustments
to operating income taking the applicable marginal tax into consideration. Adjusted earnings after
 
tax excludes net financial items
and the associated tax effects on net financial items. It is based on adjusted earnings less the tax
 
effects on all elements included
in adjusted earnings (or calculated tax on operating income and on each of the adjusting items
 
using an estimated marginal tax
rate). In addition, tax effect related to tax exposure items not related to the individual reporting period is
 
excluded from adjusted
earnings after tax. Management considers adjusted earnings after tax, which reflects a normalised tax
 
charge associated with its
operational performance excluding the impact of financing, to be a supplemental measure to Equinor’s
 
net income. Certain net
USD denominated financial positions are held by group companies that have a USD functional
 
currency that is different from the
currency in which the taxable income is measured. As currency exchange rates change between
 
periods, the basis for measuring
net financial items for IFRS will change disproportionally with taxable income which includes
 
exchange gains and losses from
translating the net USD denominated financial positions into the currency of the applicable tax return. Therefore,
 
the effective tax
rate may be significantly higher or lower than the statutory tax rate for any given period. Adjusted
 
taxes included in adjusted
earnings after tax should not be considered indicative of the amount of current or total tax expense
 
(or taxes payable) for the
period.
Adjusted earnings and adjusted earnings after tax should be considered additional measures rather
 
than substitutes for net operating
income/(loss) and net income/(loss), which are the most directly comparable IFRS measures. There
 
are material limitations
associated with the use of adjusted earnings and adjusted earnings after tax compared with the
 
IFRS measures as such non-GAAP
measures do not include all the items of revenues/gains or expenses/losses of Equinor that
 
are needed to evaluate its profitability on
an overall basis. Adjusted earnings and adjusted earnings after tax are only intended to be
 
indicative of the underlying developments
in trends of our on-going operations for the production, manufacturing and marketing of our
 
products and exclude pre-and post-tax
impacts of net financial items. Equinor reflects such underlying development in our operations by eliminating
 
the effects of certain
items that may not be directly associated with the period's operations or financing. However, for that reason, adjusted earnings and
adjusted earnings after tax are not complete measures of profitability. These measures should therefore not be used in isolation.
Equinor third quarter 2022
 
42
●
Capital employed adjusted –
this measure is defined as Equinor's total equity (including non-controlling interests) and
 
net
interest-bearing debt adjusted.
●
Net interest-bearing debt adjusted
 
– this measure is defined as Equinor's interest bearing financial liabilities less cash
 
and cash
equivalents and current financial investments, adjusted for collateral deposits and balances held
 
by Equinor's captive insurance
company and balances related to the SDFI.
●
Net debt to capital employed
,
Net debt to capital employed adjusted, including lease liabilities
and
 
Net debt to capital
employed ratio adjusted
– Following implementation of IFRS 16 Equinor presents a “net debt to capital employed
 
adjusted”
excluding lease liabilities from the gross interest-bearing debt. Comparable numbers are presented
 
in the table Calculation of
capital employed and net debt to capital employed ratio in the report include Finance lease
 
according to IAS17, adjusted for
marketing instruction agreement.
In Equinor’s view, net debt ratio provides useful information about Equinor’s capital structure
 
and
financial strength.
●
Organic capital expenditures
– Capital expenditures, defined as Additions to PP&E, intangibles and equity accounted
investments in note 2 Segments to the Condensed interim financial statements, amounted to USD
 
2.6 billion in the third quarter of
2022 (third quarter of 2021: USD 2.0 billion). Organic capital expenditures are capital expenditures
 
excluding acquisitions,
recognised lease assets (RoU assets) and other investments with significant different cash flow pattern. In the third
 
quarter of
2022, a total of USD 0.6 billion (third quarter of 2021: USD 0.1 billion) is excluded in the organic capital expenditures. Forward-
looking organic capital expenditures included in this report are not reconcilable to its most
 
directly comparable IFRS measure
without unreasonable efforts, because the amounts excluded from such IFRS measure to determine organic capital
 
expenditures
cannot be predicted with reasonable certainty. Organic capital expenditure is a measure which Equinor believes gives relevant
information about Equinor’s investments in maintenance and development of the company’s assets.
●
Gross capital expenditures
 
– Capital expenditures, defined as Additions to PP&E, intangibles and equity accounted investments
in the financial statements, including Equinor’s proportionate share of capital expenditures
 
in equity accounted investments not
included in additions to equity accounted investments. Forward-looking gross capital expenditures
 
included in this report are not
reconcilable to its most directly comparable IFRS measure without unreasonable efforts, because the amounts
 
excluded from
such IFRS measure to determine gross capital expenditures cannot be predicted with reasonable
 
certainty.
●
Free cash flow for the third quarter of 2022 and 2021
 
includes the following line items in the Consolidated statement of cash
flows: Cash flows provided by operating activities before taxes paid and working capital items (2022: USD
 
24.5 billion | 2021: USD
10.8 billion), taxes paid (2022: negative USD 17.0 billion | 2021: negative USD 1.5 billion), cash used/received
 
in business
combinations (2022: negative USD 0.0 billion | 2021: USD 0.0 billion), capital expenditures and
 
investments (2022: negative USD
2.1 billion | 2021: negative USD 1.9 billion), increase/decrease in other items interest-bearing (2022: negative
 
USD 0.1 billion |
2021: negative USD 0.0 billion), proceeds from sale of assets and businesses (2022: USD 0.3 billion |
 
2021: negative USD 0.0
billion), dividend paid (2022: negative USD 1.3 billion | 2021: negative USD 0.5 billion) and share buy-back (2022:
 
negative USD
2.0 billion | 2021: negative USD 0.1 billion), resulting in a free cash flow of USD 2.4 billion in
 
the third quarter of 2022 (2021: 6.7
billion). Free cash flow represents, and is used by management to evaluate, cash generated from
 
operational and investing
activities available for debt servicing and distribution to shareholders.
●
Free cash flow for the first nine months of 2022 and 2021
 
includes the following line items in the Consolidated statement of
cash flows: Cash flows provided by operating activities before taxes paid and working capital
 
items (2022: USD 62.6 billion | 2021:
USD 24.0 billion), taxes paid (2022: negative USD 29.7 billion | 2021: negative USD 1.9 billion), cash
 
used/received in business
combinations (2022: USD 0.1 billion | 2021: negative USD 0.1 billion), capital expenditures and investments (2022:
 
negative USD
5.9 billion | 2021: negative USD 5.8 billion), increase/decrease in other items interest-bearing (2022: negative USD
 
0.0 billion |
2021: negative USD 0.2 billion), proceeds from sale of assets and businesses (2022: USD 0.5 billion |
 
2021: USD 1.8 billion),
dividend paid (2022: negative USD 3.1 billion | 2021: negative USD 1.2 billion) and share
 
buy-back (2022: negative USD 2.7 billion
| 2021: negative USD 0.1 billion), resulting in a free cash flow of USD 21.7 billion in the first nine
 
months
of 2022 (2021: USD 16.4
billion).
Adjusted earnings
adjust for the following items:
●
Changes in fair value of derivatives:
 
Certain gas contracts are, due to pricing or delivery conditions, deemed to contain
embedded derivatives, required to be carried at fair value. Also, certain transactions related
 
to historical divestments include
contingent consideration, are carried at fair value. The accounting impacts of changes in fair
 
value of the aforementioned are
excluded from adjusted earnings. In addition, adjustments are also made for changes in the unrealised
 
fair value of derivatives
related to some natural gas trading contracts. Due to the nature of these gas sales contracts, these
 
are classified as financial
derivatives to be measured at fair value at the balance sheet date. Unrealised gains and losses
 
on these contracts reflect the
value of the difference between current market gas prices and the actual prices to be realised under the gas sales
 
contracts. Only
realised gains and losses on these contracts are reflected in adjusted earnings. This presentation best reflects
 
the underlying
performance of the business as it replaces the effect of temporary timing differences associated with the re-measurements of the
derivatives to fair value at the balance sheet date with actual realised gains and losses for
 
the period.
●
Periodisation of inventory hedging effect:
Commercial storage is hedged in the derivatives market and is accounted for using
the lower of cost or market price. If market prices increase above cost price, the inventory will
 
not reflect this increase in value.
There will be a loss on the derivative hedging the inventory since the derivatives
 
always reflect changes in the market price. An
adjustment is made to reflect the unrealised market increase of the commercial storage. As
 
a result, loss on derivatives is
matched by a similar adjustment for the exposure being managed. If market prices decrease
 
below cost price, the write-down of
the inventory and the derivative effect in the IFRS income statement will offset each other and no adjustment is made.
Equinor third quarter 2022
 
43
●
Over/underlift
: Over/underlift is accounted for using the sales method and therefore revenues were reflected
 
in the period the
product was sold rather than in the period it was produced. The over/underlift position
 
depended on several factors related to our
lifting programme and the way it corresponded to our entitlement share of production. The effect on income for the
 
period is
therefore adjusted, to show estimated revenues and associated costs based upon the production
 
for the period to reflect
operational performance and comparability with peers.
 
●
The
operational storage
is not hedged and is not part of the trading portfolio. Cost of goods sold is measured
 
based on the
FIFO (first-in, first-out) method, and includes realised gains or losses that arise due to
 
changes in market prices. These gains or
losses will fluctuate from one period to another and are not considered part of the underlying
 
operations for the period.
●
Impairment and reversal of impairment
are excluded from adjusted earnings since they affect the economics of an asset for
the lifetime of that asset, not only the period in which it is impaired, or the impairment
 
is reversed. Impairment and reversal of
impairment can impact both the exploration expenses and the depreciation, amortisation and impairment
 
line items.
●
Gain or loss from sales of assets
is eliminated from the measure since the gain or loss does not give an indication
 
of future
performance or periodic performance; such a gain or loss is related to the cumulative value creation from the
 
time the asset is
acquired until it is sold.
●
Eliminations (Internal unrealised profit on inventories)
:
Volumes derived from equity oil inventory will vary depending on
several factors and inventory strategies, i.e., level of crude oil in inventory, equity oil used in the refining process and level of in-
transit cargoes. Internal profit related to volumes sold between entities within the group, and still
 
in inventory at period end, is
eliminated according to IFRS (write down to production cost). The proportion of realised versus unrealised
 
gain will fluctuate from
one period to another due to inventory strategies and consequently impact net
 
operating income/(loss). Write-down to production
cost is not assessed to be a part of the underlying operational performance, and elimination
 
of internal profit related to equity
volumes is excluded in adjusted earnings.
●
Other items of income and expense
are adjusted when the impacts on income in the period are not reflective of Equinor’s
underlying operational performance in the reporting period. Such items may be unusual or infrequent
 
transactions, but they may
also include transactions that are significant which would not necessarily qualify as either
 
unusual or infrequent. Other items are
carefully assessed and can include transactions such as provisions related to reorganisation, early retirement,
 
etc.
●
Change in accounting policy
 
are adjusted when the impacts on income in the period are unusual or infrequent,
 
and not
reflective of Equinor’s underlying operational performance in the reporting
 
period.
For more information on our use of non-GAAP financial measures, see section 5.2 Use and reconciliation
 
of non-GAAP financial
measures in Equinor's 2021 Annual Report and Form 20-F.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
44
Reconciliation of adjusted earnings
The table specifies the adjustments made to each of the profit and loss line item included
 
in the net operating income/(loss) subtotal.
Items impacting net operating income/(loss) in the
third quarter of 2022
Equinor
group
Exploration
&
Production
Norway
Exploration
&
Production
Internationa
l
Exploration
&
Production
USA
Marketing,
Midstream
&
Processing
Rene-
wables
Other
(in USD million)
Total revenues and other income
43,633
24,034
1,767
1,541
42,585
12
(26,307)
Adjusting items
(296)
(713)
144
-
273
0
(0)
Changes in fair value of derivatives
85
(167)
229
-
22
-
-
Periodisation of inventory hedging effect
251
-
-
-
251
-
-
Over-/underlift
24
109
(85)
-
-
-
-
Gain/loss on sale of assets
(655)
(655)
-
-
-
-
(0)
Adjusted total revenues and other income
43,337
23,321
1,911
1,541
42,858
13
(26,307)
Purchases [net of inventory variation]
(13,592)
(0)
(22)
-
(40,253)
-
26,683
Adjusting items
(377)
-
-
-
171
-
(548)
Operational storage effects
171
-
-
-
171
-
-
Eliminations
(548)
-
-
-
-
-
(548)
Adjusted purchases [net of inventory variation]
(13,969)
(0)
(22)
-
(40,081)
-
26,135
Operating and administrative expenses
 
(2,614)
(963)
(427)
(254)
(1,097)
(68)
194
Adjusting items
(43)
(22)
(15)
(0)
(17)
10
-
Over-/underlift
(36)
(22)
(15)
-
-
-
-
Gain/loss on sale of assets
10
-
-
(0)
-
10
-
Provisions
(17)
-
-
-
(17)
-
-
Adjusted operating and administrative expenses
 
(2,657)
(984)
(442)
(254)
(1,114)
(58)
194
Depreciation, amortisation and net impairments
(1,049)
(1,143)
(349)
(199)
680
(1)
(38)
Adjusting items
(1,069)
-
(0)
(178)
(891)
-
-
Impairment
79
-
(0)
-
79
-
-
Reversal of Impairment
(1,148)
-
-
(178)
(970)
-
-
Adjusted depreciation, amortisation and net
impairments
(2,118)
(1,143)
(349)
(377)
(211)
(1)
(38)
Exploration expenses
(275)
(114)
(157)
(4)
-
-
-
Adjusting items
(17)
-
(0)
(17)
-
-
-
Impairment
9
-
(0)
9
-
-
-
Reversal of Impairment
(26)
-
-
(26)
-
-
-
Adjusted exploration expenses
(292)
(114)
(157)
(21)
-
-
-
Net operating income/(loss)
26,103
21,813
813
1,084
1,916
(56)
533
Sum of adjusting items
(1,802)
(735)
129
(195)
(464)
10
(548)
Adjusted earnings/(loss)
24,301
21,079
942
889
1,452
(46)
(15)
Tax on adjusted earnings
(17,585)
(16,356)
(301)
(21)
(929)
14
9
Adjusted earnings/(loss) after tax
6,715
4,723
641
868
523
(32)
(6)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
45
Items impacting net operating income/(loss) in the
third quarter of 2021
Equinor
group
Exploration
&
Production
Norway
Exploration
&
Production
Internationa
l
Exploration
&
Production
USA
Marketing,
Midstream
&
Processing
Rene-
wables
Other
(in USD million)
Total revenues and other income
1)
23,264
9,618
1,283
886
22,794
7
(11,324
Adjusting items
869
(95)
105
-
864
(1)
(3)
Changes in fair value of derivatives
71
(44)
-
-
115
-
-
Periodisation of inventory hedging effect
748
-
-
-
748
-
-
Operating and administrative expenses
1
-
-
-
-
1
-
Over-/underlift
60
(50)
110
-
-
-
-
Gain/loss on sale of assets
(11)
-
(5)
-
-
(2)
(3)
Adjusted total revenues and other income
1)
24,134
9,524
1,388
886
23,658
6
(11,327
Purchases [net of inventory variation]
(9,052)
0
(6)
(0)
(20,290)
-
11,244
Adjusting items
(75)
-
-
-
(42)
-
(33)
Operational storage effects
(42)
-
-
-
(42)
-
-
Eliminations
(33)
-
-
-
-
-
(33)
Adjusted purchases [net of inventory variation]
(9,127)
0
(6)
(0)
(20,332)
-
11,211
Operating and administrative expenses
1)
(2,386)
(1,064)
(349)
(221)
(874)
(33)
154
Adjusting items
(78)
(18)
(32)
16
(44)
-
-
Over-/underlift
(50)
(18)
(32)
-
-
-
-
Gain/loss on sale of assets
16
-
-
16
-
-
-
Provisions
(44)
-
-
-
(44)
-
-
Adjusted operating and administrative expenses
1)
(2,464)
(1,081)
(381)
(205)
(918)
(33)
154
Depreciation, amortisation and net impairments
1)
(2,034)
(537)
(383)
(374)
(696)
(1)
(43)
Adjusting items
(531)
(975)
(53)
11
485
-
-
Impairment
543
-
-
58
485
-
-
Reversal of impairment
(1,075)
(975)
(53)
(47)
-
-
-
Adjusted depreciation, amortisation and net
impairments
1)
(2,565)
(1,512)
(436)
(363)
(211)
(1)
(43)
Exploration expenses
(226)
(169)
(11)
(46)
-
-
0
Adjusting items
19
0
2
16
-
-
-
Impairment
41
0
2
39
-
-
-
Reversal of impairment
(22)
-
-
(22)
-
-
-
Adjusted exploration expenses
(207)
(168)
(9)
(30)
-
-
0
Net operating income/(loss)
1)
9,567
7,849
535
244
935
(27)
31
Sum of adjusting items
204
(1,087)
22
44
1,263
(1)
(36)
Adjusted earnings/(loss)
1)
9,771
6,762
556
288
2,197
(28)
(5)
Tax on adjusted earnings
(6,994)
(5,064)
(178)
(3)
(1,758)
6
2
Adjusted earnings/(loss) after tax
1)
2,777
1,699
378
285
439
(22)
(3)
1) E&P Norway, E&P International, MMP and Other segments are restated due
 
to implementation of IFRS 16 in the segments.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
46
Items impacting net operating income/(loss) in the
second quarter of 2022
Equinor
group
Exploration
&
Production
Norway
Exploration
&
Production
Internationa
l
Exploration
&
Production
USA
Marketing,
Midstream
&
Processing
Rene-
wables
Other
(in USD million)
Total revenues and other income
36,459
16,712
1,838
1,629
36,012
15
(19,748)
Adjusting Items
(144)
(221)
118
-
(41)
0
-
Changes in fair value of derivatives
(34)
-
40
-
(74)
-
-
Periodisation of inventory hedging effect
42
-
-
-
42
-
-
Over-/underlift
(144)
(221)
78
-
-
-
-
Gain/loss on sale of assets
(9)
-
-
-
(9)
-
-
Adjusted total revenues and other income
36,315
16,491
1,956
1,629
35,971
16
(19,748)
Purchases [net of inventory variation]
(13,851)
0
(36)
(0)
(33,379)
-
19,564
Adjusting Items
(34)
-
-
-
(50)
-
16
Operational storage effects
(50)
-
-
-
(50)
-
-
Eliminations
16
-
-
-
-
-
16
Adjusted purchases [net of inventory variation]
(13,885)
0
(36)
(0)
(33,429)
-
19,580
Operating and administrative expenses
(2,404)
(984)
(370)
(244)
(956)
(56)
206
Adjusting Items
15
70
(3)
4
(56)
-
-
Over-/underlift
60
70
(10)
-
-
-
-
Other adjustments
6
-
6
-
-
-
-
Gain/loss on sale of assets
4
-
0
4
-
-
-
Provisions
(56)
-
-
-
(56)
-
-
Adjusted operating and administrative expenses
(2,390)
(914)
(373)
(240)
(1,012)
(56)
206
Depreciation, amortisation and net impairments
(2,140)
(1,202)
(315)
(362)
(221)
(1)
(39)
Adjusting Items
(9)
(0)
(9)
-
-
-
-
Impairment
(9)
-
(9)
-
-
-
-
Adjusted depreciation, amortisation and net
impairments
(2,149)
(1,203)
(324)
(362)
(221)
(1)
(39)
Exploration expenses
(331)
(45)
(135)
(151)
-
-
-
Adjusting Items
30
0
24
5
-
-
-
Impairment
30
0
24
5
-
-
-
Adjusted exploration expenses
(301)
(44)
(111)
(146)
-
-
-
Net operating income/(loss)
17,733
14,482
982
872
1,456
(42)
(17)
Sum of adjusting items
(143)
(152)
130
10
(146)
0
16
Adjusted earnings/(loss)
17,590
14,330
1,111
881
1,310
(42)
(1)
Tax on adjusted earnings
(12,590)
(11,121)
(405)
(21)
(1,050)
7
(1)
Adjusted earnings/(loss) after tax
5,000
3,210
707
861
259
(34)
(1)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
47
Items impacting net operating income/(loss) in the
first nine months of 2022
Equinor
group
Exploration
&
Production
Norway
Exploration
&
Production
Internationa
l
Exploration
&
Production
USA
Marketing,
Midstream
&
Processing
Rene-
wables
Other
(in USD million)
Total revenues and other income
116,486
59,200
5,057
4,440
114,514
146
(66,872)
Adjusting items
(122)
(726)
661
-
30
(87)
(1)
Changes in fair value of derivatives
255
(321)
583
-
(7)
-
-
Periodisation of inventory hedging effect
46
-
-
-
46
-
-
Impairment from associated companies
1
-
-
-
-
1
-
Over-/underlift
329
251
78
-
-
-
-
Gain/loss on sale of assets
(752)
(655)
-
-
(9)
(87)
(1)
Adjusted total revenues and other income
116,364
58,475
5,719
4,440
114,544
60
(66,873)
Purchases [net of inventory variation]
(40,953)
0
(31)
(0)
(107,920)
-
66,999
Adjusting items
(682)
-
-
-
(60)
-
(622)
Operational storage effects
(60)
-
-
-
(60)
-
-
Eliminations
(622)
-
-
-
-
-
(622)
Adjusted purchases [net of inventory variation]
(41,635)
0
(31)
(0)
(107,980)
-
66,377
Operating and administrative expenses
 
(7,289)
(2,762)
(1,187)
(719)
(2,976)
(165)
520
Adjusting items
(208)
(20)
(51)
3
(150)
10
-
Over-/underlift
(77)
(20)
(57)
-
-
-
-
Other adjustments
6
-
6
-
-
-
-
Gain/loss on sale of assets
14
-
0
3
-
10
-
Provisions
(150)
-
-
-
(150)
-
-
Adjusted operating and administrative expenses
 
(7,497)
(2,782)
(1,238)
(715)
(3,127)
(155)
520
Depreciation, amortisation and net impairments
(5,207)
(2,945)
(2,041)
(348)
247
(3)
(116)
Adjusting items
(1,393)
(821)
1,030
(711)
(891)
-
-
Impairment
1,109
-
1,030
-
79
-
-
Reversal of impairment
(2,502)
(821)
-
(711)
(970)
-
-
Adjusted depreciation, amortisation and net
impairments
(6,600)
(3,767)
(1,011)
(1,059)
(644)
(3)
(116)
Exploration expenses
(809)
(265)
(373)
(172)
-
-
(0)
Adjusting items
59
4
65
(11)
-
-
-
Impairment
85
4
65
15
-
-
-
Reversal of impairment
(26)
-
-
(26)
-
-
-
Adjusted exploration expenses
(751)
(260)
(308)
(183)
-
-
-
Net operating income/(loss)
62,228
53,228
1,425
3,201
3,864
(21)
531
Sum of adjusting items
(2,346)
(1,563)
1,706
(718)
(1,072)
(77)
(623)
Adjusted earnings/(loss)
59,881
51,665
3,131
2,483
2,792
(98)
(93)
Tax on adjusted earnings
(42,986)
(40,078)
(940)
(55)
(1,972)
23
36
Adjusted earnings/(loss) after tax
16,895
11,587
2,191
2,428
820
(74)
(57)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
48
Items impacting net operating income/(loss) in the
first nine months of 2021
Equinor
group
Exploration
&
Production
Norway
Exploration
&
Production
Internationa
l
Exploration
&
Production
USA
Marketing,
Midstream
&
Processing
Rene-
wables
Other
(in USD million)
Total revenues and other income
1)
58,316
21,678
3,814
2,847
55,574
1,390
(26,987)
Adjusting Items
(1,065)
(259)
93
-
485
(1,380)
(3)
Changes in fair value of derivatives
27
(64)
-
-
91
-
-
Periodisation of inventory hedging effect
394
-
-
-
394
-
-
Impairment from associated companies
4
-
-
-
-
4
-
Over-/underlift
(40)
(196)
156
-
-
-
-
Gain/loss on sale of assets
(1,393)
-
(5)
-
-
(1,385)
(3)
Provisions
(57)
-
(57)
-
-
-
-
Adjusted total revenues and other income
1)
57,252
21,419
3,907
2,847
56,060
9
(26,990)
Purchases [net of inventory variation]
(23,617)
0
(21)
(0)
(49,914)
-
26,319
Adjusting Items
(112)
-
-
-
(233)
-
121
Operational storage effects
(233)
-
-
-
(233)
-
-
Eliminations
121
-
-
-
-
-
121
Adjusted purchases [net of inventory variation]
(23,729)
0
(21)
(0)
(50,148)
-
26,441
Operating and administrative expenses
1)
(6,875)
(2,652)
(1,010)
(842)
(2,782)
(105)
517
Adjusting Items
(50)
27
(53)
31
(54)
-
-
Over-/underlift
(29)
25
(53)
-
-
-
-
Change in accounting policy
(23)
2
-
-
(25)
-
-
Gain/loss on sale of assets
31
-
-
31
-
-
-
Provisions
(29)
-
-
-
(29)
-
-
Adjusted operating and administrative expenses
1)
(6,924)
(2,625)
(1,064)
(812)
(2,836)
(105)
517
Depreciation, amortisation and net impairments
1)
(6,942)
(3,116)
(1,044)
(1,248)
(1,399)
(2)
(132)
Adjusting Items
(510)
(1,102)
(191)
39
744
-
-
Impairment
1,166
276
59
86
744
-
-
Reversal of impairment
(1,675)
(1,379)
(250)
(47)
-
-
-
Adjusted depreciation, amortisation and net
impairments
1)
(7,451)
(4,218)
(1,235)
(1,209)
(655)
(2)
(132)
Exploration expenses
(798)
(294)
(349)
(156)
-
-
0
Adjusting Items
148
7
101
40
-
-
-
Impairment
171
7
101
62
-
-
-
Reversal of impairment
(22)
-
-
(22)
-
-
-
Adjusted exploration expenses
(650)
(286)
(248)
(116)
-
-
0
Net operating income/(loss)
1)
20,085
15,617
1,389
600
1,479
1,283
(283)
Sum of adjusting items
(1,588)
(1,327)
(50)
110
942
(1,380)
118
Adjusted earnings/(loss)
1)
18,497
14,290
1,339
710
2,421
(98)
(165)
Tax on adjusted earnings
(12,853)
(10,510)
(489)
(3)
(1,911)
15
45
Adjusted earnings/(loss) after tax
1)
5,644
3,780
850
707
510
(83)
(119)
1) E&P Norway, E&P International, MMP and Other segments are restated due
 
to implementation of IFRS 16 in the segments
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
49
Adjusted earnings after tax* by reporting
Quarters
Q3 2022
Q2 2022
Q3 2021
(in USD million)
Adjusted
earnings
Tax on
adjusted
earnings
Adjusted
earnings
after tax
Adjusted
earnings
Tax on
adjusted
earnings
Adjusted
earnings
after tax
Adjusted
earnings
Tax on
adjusted
earnings
Adjusted
earnings
after tax
E&P Norway
1)
21,079
(16,356)
4,723
14,330
(11,121)
3,210
6,762
(5,064)
1,699
E&P International
1)
942
(301)
641
1,111
(405)
707
556
(178)
378
E&P USA
889
(21)
868
881
(21)
861
288
(3)
285
MMP
1)
1,452
(929)
523
1,310
(1,050)
259
2,197
(1,758)
439
REN
(46)
14
(32)
(42)
7
(34)
(28)
6
(22)
Other
1)
(15)
9
(6)
(1)
(1)
(1)
(5)
2
(3)
Equinor group
24,301
(17,585)
6,715
17,590
(12,590)
5,000
9,771
(6,994)
2,777
Effective tax rates on adjusted
earnings
72.4%
71.6%
71.6%
1) Q3 2021 is restated due to implementation
 
of IFRS 16 in the segments.
First nine months
2022
2021
(in USD million)
Adjusted
earnings
Tax on
adjusted
earnings
Adjusted
earnings
after tax
Adjusted
earnings
Tax on
adjusted
earnings
Adjusted
earnings
after tax
E&P Norway
1)
51,665
(40,078)
11,587
14,290
(10,510)
3,780
E&P International
1)
3,131
(940)
2,191
1,339
(489)
850
E&P USA
2,483
(55)
2,428
710
(3)
707
MMP
1)
2,792
(1,972)
820
2,421
(1,911)
510
REN
(98)
23
(74)
(98)
15
(83)
Other
1)
(93)
36
(57)
(165)
45
(119)
Equinor group
59,881
(42,986)
16,895
18,497
(12,853)
5,644
Effective tax rates on adjusted earnings
71.8%
69.5%
1) First nine months of 2021 are restated due
 
to implementation of IFRS 16 in the segments.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
50
Reconciliation of adjusted earnings after tax to net income
 
Quarters
Reconciliation of adjusted earnings after tax to net income
 
First nine
months
Q3 2022
Q2 2022
Q3 2021
(in USD million)
2022
2021
26,103
17,733
9,567
Net operating income/(loss)
A
62,228
20,085
17,906
13,075
7,880
Income tax less tax on net financial items
B
43,554
13,768
8,196
4,658
1,687
Net operating income after tax
C = A-B
18,674
6,317
(1,802)
(143)
204
Items impacting net operating income/(loss)
1)
D
 
(2,346)
2)
(1,588)
(321)
(485)
(886)
Tax on items impacting net operating income/(loss)
E
 
(567)
2)
(915)
6,715
5,000
2,777
Adjusted earnings after tax*
F = C+D-E
 
16,895
2)
5,644
1,053
2,023
(536)
Net financial items
G
1,907
(1,637)
121
81
258
Tax on net financial items
H
265
526
9,371
6,762
1,409
Net income/(loss)
I = C+G+H
20,847
5,206
1) For items impacting net operating income/(loss),
 
see Reconciliation of adjusted earnings in the Supplementary
 
disclosures.
Quarters
Change
Adjusted exploration expenses*
First nine months
Q3 2022
Q2 2022
Q3 2021
Q3 on Q3
(in USD million)
2022
2021
Change
102
121
108
(6%)
E&P Norway exploration expenditures
350
408
(14%)
172
115
12
>100%
E&P International exploration expenditures
331
272
21%
23
26
31
(28%)
E&P USA exploration expenditures
99
77
28%
296
263
151
96%
Group exploration expenditures
780
757
3%
15
58
62
(76%)
Expensed, previously capitalised exploration expenditures
100
21
>100%
(19)
(19)
(6)
>100%
Capitalised share of current period's exploration
 
activity
(129)
(129)
0%
(17)
30
19
N/A
Impairment (reversal of impairment)
59
148
(60%)
275
331
226
22%
Exploration expenses according to IFRS
809
798
1%
17
(30)
(19)
N/A
Items impacting net operating income/(loss)
1)
(59)
(148)
(60%)
 
 
 
 
Equinor third quarter 2022
 
51
292
301
207
41%
Adjusted exploration expenses*
751
650
15%
1) For items impacting net operating income/(loss),
 
see Reconciliation of adjusted earnings in the Supplementary
 
disclosures.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equinor third quarter 2022
 
52
Calculation of capital employed and net debt to capital employed ratio
The table below reconciles the net interest-bearing debt adjusted, the capital employed, the net debt to
 
capital employed ratio
adjusted including lease liabilities and the net debt to capital employed adjusted ratio with
 
the most directly comparable financial
measure or measures calculated in accordance with IFRS.
Calculation of capital employed and net debt to capital
 
employed ratio
At 30 September
At 31 December
(in USD million)
2022
2021
Shareholders' equity
42,706
39,010
Non-controlling interests
8
14
Total equity
 
A
42,714
39,024
Current finance debt and lease liabilities
6,235
6,386
Non-current finance debt and lease liabilities
25,792
29,854
Gross interest-bearing debt
B
32,028
36,239
Cash and cash equivalents
23,348
14,126
Current financial investments
20,995
21,246
Cash and cash equivalents and financial investment
 
C
44,342
35,372
Net interest-bearing debt [9]
B1 = B-C
(12,315)
867
Other interest-bearing elements
 
1)
8,950
2,369
Net interest-bearing debt adjusted normalised for
 
tax payment, including lease liabilities*
B2
(3,365)
3,236
Lease liabilities
3,483
3,562
Net interest-bearing debt adjusted*
B3
(6,848)
(326)
Calculation of capital employed*
Capital employed
A+B1
30,400
39,891
Capital employed adjusted, including lease liabilities
A+B2
39,350
42,259
Capital employed adjusted
A+B3
35,867
38,697
 
 
 
 
Equinor third quarter 2022
 
53
Calculated net debt to capital employed*
Net debt to capital employed
(B1)/(A+B1)
(40.5%)
2.2%
Net debt to capital employed adjusted, including lease
 
liabilities
(B2)/(A+B2)
(8.6%)
7.7%
Net debt to capital employed adjusted
(B3)/(A+B3)
(19.1%)
(0.8%)
1)
 
Cash and cash equivalents adjustments regarding
 
collateral deposits classified as cash and cash equivalents
 
in the Consolidated
balance sheet but considered as non-cash in the non-GAAP
 
calculations as well as financial investments in
 
Equinor Insurance AS
classified as current financial investments.
Equinor third quarter 2022
 
54
FORWARD
 
-LOOKING STATEMENTS
This report contains certain forward-looking statements that involve risks and uncertainties. In some cases,
 
we use words such as
"ambition", "continue", "could", "estimate", "intend", "expect", "believe", "likely", "may", "outlook",
 
"plan", "strategy", "will", "guidance",
"targets", and similar expressions to identify forward-looking statements. Forward-looking
 
statements include all statements other than
statements of historical fact, including, among others, statements regarding Equinor's plans, intentions, aims,
 
ambitions and
expectations,; the decision to stop new investments into Russia and trading in Russian oil; estimates
 
regarding tax payments; the
commitment to develop as a broad energy company; the ambition to be a leader in the energy transition
 
and reduce net group-wide
greenhouse gas emissions; future financial performance, including cash flow and liquidity; accounting
 
policies; the ambition to grow
cash flow and returns; expectations regarding returns from Equinor’s oil and gas portfolio;
 
plans to develop fields and increase gas
exports; plans for renewables production capacity and investments in renewables; expectations and plans
 
regarding development of
renewables projects, CCUS and hydrogen businesses; market outlook and future economic projections and
 
assumptions, including
commodity price and refinery assumptions; organic capital expenditures through 2025; expectations
 
and estimates regarding
production and execution of projects; the ambition to keep unit of production cost in the top quartile
 
of our peer group; scheduled
maintenance activity and the effects thereof on equity production; completion and results of acquisitions and disposals;
 
expected
amount and timing of dividend payments and the implementation of our share buy-back programme; and
 
provisions and contingent
liabilities. You should not place undue reliance on these forward-looking statements. Our actual results could differ materially from
those anticipated in the forward-looking statements for many reasons.
These forward-looking statements reflect current views about future events and are, by their nature, subject
 
to significant risks and
uncertainties because they relate to events and depend on circumstances that will occur in
 
the future. There are a number of factors
that could cause actual results and developments to differ materially from those expressed or implied by these forward-looking
statements, including levels of industry product supply, demand and pricing, in particular in light of significant oil price volatility and the
uncertainty created by Russia’s invasion of Ukraine;
 
our subsequent decision to stop new investments into Russia and exiting our
Russian joint ventures; levels and calculations of reserves and material differences from reserves estimates; natural disasters,
adverse weather conditions, climate change, and other changes to business conditions; regulatory stability
 
and access to attractive
renewable opportunities; unsuccessful drilling; operational problems, in particular in light of supply chain disruptions;
 
health, safety
and environmental risks; the effects of climate change; regulations on hydraulic fracturing; security breaches, including breaches
 
of
our digital infrastructure (cybersecurity); ineffectiveness of crisis management systems; the actions of competitors; the development
and use of new technology, particularly in the renewable energy sector; inability to meet strategic objectives; the difficulties involving
transportation infrastructure; political and social stability and economic growth in relevant areas
 
of the world; reputational damage; an
inability to attract and retain personnel; risks related to implementing a new corporate structure;
 
inadequate insurance coverage;
changes or uncertainty in or non-compliance with laws and governmental regulations; the actions
 
of the Norwegian state as majority
shareholder; failure to meet our ethical and social standards; the political and economic policies
 
of Norway and other oil-producing
countries; non-compliance with international trade sanctions; the actions of field partners; adverse changes
 
in tax regimes; exchange
rate and interest rate fluctuations; factors relating to trading, supply and financial risk; general economic
 
conditions; and other factors
discussed elsewhere in this report and in Equinor's Annual Report on Form 20-F for
 
the year ended December 31, 2021, filed with the
U.S. Securities and Exchange Commission (including section 2.13 Risk review - Risk factors
 
thereof). Equinor's 2021 Annual Report
and Form 20-F is available at Equinor's website www.equinor.com.
Although we believe that the expectations reflected in the forward-looking statements are reasonable, we
 
cannot assure you that our
future results, level of activity, performance or achievements will meet these expectations. Moreover, neither we nor any other person
assumes responsibility for the accuracy and completeness of the forward-looking statements. Any
 
forward-looking statement speaks
only as of the date on which such statement is made, and, except as required by applicable law, we undertake no obligation to update
any of these statements after the date of this report, either to make them conform to actual results
 
or changes in our expectations.
We use certain terms in this document, such as "resource" and "resources" that the SEC's rules prohibit us from including
 
in our filings
with the SEC. U.S. investors are urged to closely consider the disclosures in our Form 20-F, SEC File No. 1-15200. This form is
available on our website or by calling 1-800-SEC-0330 or logging on to www.sec.gov.
Equinor third quarter 2022
 
55
END NOTES
1.
The group's
average liquids price
 
is a volume-weighted average of the segment prices of crude oil, condensate and natural gas
liquids (NGL).
2.
The
refining reference margin
 
is a typical gross margin and will differ from the actual margin, due to variations in type of crude
and other feedstock, throughput, product yields, freight cost, inventory, etc
3.
Liquids volumes
 
include oil, condensate and NGL, exclusive of royalty oil.
4.
Equity volumes
 
represent produced volumes under a
production sharing agreement (PSA)
 
that correspond to Equinor’s
ownership share in a field.
Entitlement volumes
, on the other hand, represent Equinor’s share of the volumes distributed to the
partners in the field, which are subject to deductions for, among other things, royalty and the host government's share of profit oil.
Under the terms of a PSA, the amount of profit oil deducted from equity volumes will normally
 
increase with the cumulative return
on investment to the partners and/or production from the licence. Consequently, the gap between entitlement and equity volumes
will likely increase in times of high liquids prices. The distinction between equity and entitlement
 
is relevant to most PSA regimes,
whereas it is not applicable in most concessionary regimes such as those in Norway, the UK, the US, Canada and Brazil.
 
5.
Transactions with the
Norwegian State.
 
The Norwegian State, represented by the Ministry of Trade, Industry and Fisheries, is
the majority shareholder of Equinor and it also holds major investments in other entities. This ownership
 
structure means that
Equinor participates in transactions with many parties that are under a common ownership structure
 
and therefore meet the
definition of a related party. Equinor purchases liquids and natural gas from the Norwegian State, represented by SDFI (the
State's Direct Financial Interest). In addition, Equinor sells the State's natural gas production
 
in its own name, but for the
Norwegian State's account and risk, and related expenditures are refunded by the State.
 
6.
The production guidance reflects our estimates of
proved reserves
 
calculated in accordance with US Securities and Exchange
Commission (SEC) guidelines and additional production from other reserves not included in
 
proved reserves estimates. The
growth percentage is based on historical production numbers, adjusted for portfolio measures.
7.
The group's
average invoiced gas prices
include volumes sold by the MMP segment.
8.
The internal
transfer price
 
paid from the MMP segment to the E&P Norway and E&P USA segments.
9.
Since different legal entities in the group lend to projects and others borrow from banks, project financing through external
 
bank
or similar institutions is not netted in the balance sheet and results in over-reporting of the debt
 
stated in the balance sheet
compared to the underlying exposure in the group. Similarly, certain net interest-bearing debt incurred from activities pursuant to
the Marketing Instruction of the Norwegian government are offset against receivables on the SDFI. Some
 
interest-bearing
elements are classified together with non-interest bearing elements and are therefore included when
 
calculating the net interest-
bearing debt.
Signatures
Pursuant to the requirements of the Securities
 
Exchange Act of 1934, the registrant has duly
 
caused this report to be signed on its behalf
 
by
the undersigned, thereunto duly authorised.
EQUINOR ASA
(Registrant)
Dated: 28 October, 2022
By: ___/s/ Torgrim Reitan
Name: Torgrim Reitan
Title:
 
Chief Financial Officer