Statoil share rising nearly three percent on the Oslo Stock Exchange on Tuesday morning after the company presented results for the second quarter was clearly better than the market expected.
The oil price has more than halved over the past year, and the result Saetre presented was 30 percent lower than in the same period last year. Analysts had already expected a decline of 40 percent.
– It is clear fall in oil prices is dramatic for Statoil. Our income is largely determined by price times volume, and when the price is halved, hit it quite brutally, says Sætre, who nevertheless satisfied with what the company has achieved in recent months.
He points to the fact that oil production has increased, despite the fact that the company has sold off fields and made significant cost cuts.
In June also started production of the first steel jacket for the giant field Johan Sverdrup. Read more about Statoil’s giant fields here: Therefore, this oil field so important for the Norwegian economy
On track with cost
– We have a very strong production and good production regularity. And the cost goes down. It might not be everyone out there thought we were going to get it. It is clear it is positive, he said.
Statoil has since 2013 cut nearly five billion in costs, and announced earlier this year an improvement program where the company will reduce annual costs by almost 14 billion in 2016. It means that about 1,500 employees and more than 500 consultants lose their jobs in the company by the end of next year.
Saetre is very pleased that austerity is already beginning to appear in the results.
– Often it takes time from when you take action until you see it again in the results. It’s good to see that improvement activity is not just a paper thing, he said.
But does not exclude new rounds
Cut Plans to Statoil is based on the oil price will rise to $ 80 in 2018 . In recent weeks, oil prices have fallen, and is now around $ 53 a barrel. Saetre think oil price will rise up to 2018, but await large fluctuations in the future.
– We still have a situation where there is too much oil in the market, he said.
– Men we have also shown that we can handle an oil price of $ 60 until 2018 in a good way, and still be in balance so that we do not spend more money than we earn. I am absolutely confident that if it should be even lower prices, we can deal with it in a good way, he adds.
– But that presupposes further cuts?
– It is clear we have to adapt our business for profitability. But for now, we are working with the plans we have, which runs until 2016, he said.
Kutter not yield
The representatives of Statoil believes the company should put some of the bill for the low oil prices over the shareholders in the form of lower dividends. There is no question, according to Saetre, who today announced a dividend of NOK 1.80 per share.
1.80 kroner per share represents a dividend of 5.7 billion each quarter, or 23 billion million to shareholders on an annual basis.
– our dividend policy remains unchanged, and is formulated such that it should be able to cut through oil price fluctuations. I see no reason to do anything with the dividend policy, he says to Aftenposten.
– It is the profitability of the industry that is the issue we need to focus on. If I had ten billion more had I not invested more, he explains.
– Or retained more employees?
– No.
– The officials fear the cuts could jeopardize safety, there is a concern you share?
– To establish an activity that increases your risk is out of the question for me. We will improve safety in the company while cutting costs, and shows today that we are still doing it. We see the same positive trend on security as we have done in recent years, says Sætre.
He notes that the rate of serious events was 0.6 in the last 12 months, compared with 0.7 years before.
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