Norwegian energy firm, Equinor, has recorded an adjusted pre-tax profit of $75 billion for 2022, Financial Times has reported.
According to the FT report, Equinor benefitted the most from the energy crisis elicited by the Russia-Ukraine war.
Equinor’s 2022 profit places it ahead when compared to the performance of other energy majors who own or have had a business presence in Nigeria.
Upside to the Russia-Ukraine war: The Russia-Ukraine war which began in February 2022 brought a silver lining for major Oil and Gas companies around the world as the rise in oil and gas prices made it possible for players to make heavy gains since 2022.
However, environmental activists and the United Nations Secretary-General, Antonio Guterres have called out oil majors for profiting off ecological pollution which has caused pain and displacement to many communities worldwide.
The backstory: In January 2023, Equinor indicated an interest in selling off its stake in the Nigerian offshore Agbami oilfield. The company eventually launched the sale of its stake in the offshore asset, joining ExxonMobil, Shell, and TotalEnergies who have sought to sell off assets in Nigeria.
According to Reuters, Equinor had hired investment bank, Standard Chartered to run the sale process, which could raise $1 billion. Equinor has invested over $3.5 billion in its 20.21% stake in the Agbami oil field. Meanwhile, Chevron is the operator with 67.30% interest and Prime 127 holds the remaining 12.49%. Equinor has drilled 10 wells with a 40% discovery rate.
Other big winners for 2022: Reuters reports that ExxonMobil recently posted a $56 billion net profit for 2022, taking home about $6.3 million per hour in 2022.
- Meanwhile, Shell posted a record $40 billion profit in 2022, capping a tumultuous year in which a surge in energy prices after Russia’s invasion of Ukraine allowed it to hand shareholders unprecedented returns.
- Chevron posted a record $36.5 billion profit for 2022 which was more than double year-earlier earnings.
- TotalEnergies posted a record net profit of $36.2 billion in 2022, double the previous year.
Why they’re leaving Nigeria: According to the State of African Energy Report by the African Energy Chamber (AEC), the Nigerian oil sector is in competition with new potential developments in other African countries. Nigeria represents the legacy market while the new potential producers present more exciting opportunities for majors.
The October 2022 report highlighted Libya, Chad and Egypt as the biggest gainers from 2022 to 2030, while Nigeria, Ghana, Algeria and South Sudan could see a reduction in exploration activities. The report says Nigeria has seen a dent in volumes due to closures and maintenance challenges.
For the record: During his State of the Union address on February 7, United States President, Joe Biden, spoke about the need to tax the rich who are making profits off higher energy prices.