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Statoil profits cut in half

Lower oil and gas prices more than halved fourth-quarter pre-tax profits at Norway's biggest company, Statoil. The firm reported earnings before taxes of NOK 8.79 billion (USD 984 million), down from NOK 18.74 billion in the fourth quarter of 2000.

The pre-tax fourth-quarter profits failed to meet analysts' expectations, and Statoil's share price dipped in early trading. A Reuters poll had suggested analysts anticipated higher pre-tax earnings of NOK 9.9 billion.

The Norwegian state is in the process of partially privatizing Statoil, with plans to sell off up to a third of the company's shares. Statoil chief executive Olav Fjell says the company has no need, however, to link up with a foreign firm to achieve growth targets despite the decline in profits and revenues.

Both Gaz de France and Germany's Ruhrgas have been rumoured partners for Statoil, but Fjell told Reuters the company is not actively looking for a tie-up.

Net earnings at Statoil fell to NOK 2.61 billion from NOK 4.72 billion in the fourth quarter of 2001. That was higher than some analysts had expected.

Fjell attributed the profit declines to lower oil and gas prices, narrower refining margins and a weaker financial result. Oil prices, for example, fell to just over USD 19 a barrel from nearly USD 30 at the end of 2000.

Total revenues at Statoil fell to NOK 62.17 billion from NOK 67 billion in the fourth quarter of 2000.

Oil and gas production is expected to rise to an average of 1.03 million barrels of oil equivalents (boe) per day this year, from 1.01 million boe in 2001. That includes a 5 percent cut ordered by Norway's government during the first half of 2002. Production will further rise to 1.12 million boe in 2004.

Norway currently is the world's third largest oil exporter behind Saudi Arabia and Russia.