Oil and gas assets in the Permian Basin, the center of the U.S. shale industry, and on the Norwegian Continental Shelf are becoming too expensive, an executive of Norway's Equinor ASA (NYSE: EQNR) said Nov. 20.
Despite rising oil prices in recent years, which made assets more expensive, the company still sees opportunities to make good deals, CFO Lars Christian Bacher told Reuters on the sidelines of an Equinor conference.
"I don't want to reveal where those places are, but the Norwegian Continental Shelf is a hotspot, meaning that it's expensive, and Permian is expensive too, so we are not likely to do much [there]," he said.
Also during the conference on Nov. 20, Equinor's head of exploration said the company plans to drill more exploration wells internationally and more onshore wells in 2019 compared to this year.
"In general, there will be more international activity, and a larger share of onshore activity," Tim Dodson told Reuters on the sidelines of the Equinor conference.
Equinor's plans include high-impact wells offshore Canada, the U.S., Mexico and Brazil, as well as onshore wells in Turkey, Argentina, Algeria and Russia.
Exploration on the Norwegian Continental Shelf is expected to remain around 2018 levels at 20 to 25 wells, he added.
Additionally, Russian gas deliveries to northwest Europe will likely continue to grow in the time ahead, the Norwegian oil and gas producer told the investor conference.
In the third quarter, Russian deliveries to the region expanded to 59 billion cubic meters (Bcm) from 50 Bcm in the same period of 2017, the company added.
Tropical Forest Protection
Earlier on Nov. 20, Equinor released a statement saying it was preparing to pay for the protection of tropical forests to help reduce its carbon footprint.
The investments could start in 2019, pending the establishment of a "well-functioning" market, a company spokesman said, although he declined to comment on payment size.
While Equinor's European emissions are subject to carbon taxes, the company is also active in regions, such as Africa, the Americas and others, that are not part of similar schemes.
"Equinor is now preparing investments in reduced deforestation corresponding to the emissions from the company's volumes from operated production in areas where there [is] no price on CO2," the company said in a statement.
"Emissions from this operated production were slightly below 1 million tonnes in 2017. This underlines Equinor's support for a global price on carbon," it said.
Preventing deforestation is vital to reaching the goals of the Paris climate accords, and a key reason why Equinor will put a price tag on its own greenhouse gas emissions, it said.
Equinor also hopes to contribute to the development of an international carbon market that would enable companies to invest in the protection of tropical forests, it said.
Editor's note: this is a compilation of multiple Reuters reports.
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