Norwegian oil services firm Aker Solutions said on July 15 the outlook has improved for the second half of the year with oil prices partly recovered from the lows in April and Norway offering tax incentives for the oil industry.
Its full-year 2020 revenue, however, is still expected to fall by about a quarter year-on-year to 21-22 billion Norwegian crowns (US$2.35 billion) as oil firms have slashed investments by 20-30% due to a plunge in petroleum demand.
“For the second half of the year, we are cautiously optimistic about an improved outlook for project sanctioning, supported by government measures to boost activity and more stable commodity prices,” Luis Araujo, Aker Solutions CEO, said.
The company said it expected activity to be driven by its home market in Norway and the projects aimed at reducing carbon emissions or boosting renewable energy.
“The majors have not included capex cuts for items in their transformation agenda, and Aker Solutions expects the transition to low-carbon and renewables to accelerate,” the company said.
Aker Solutions added 7 billion crowns (US$752 million) in new orders in the second quarter, including preliminary contracts for Equinor’s Askeladd Vest and Breidablikk developments off Norway, bringing the total backlog to 26.9 billion crowns.
Its second-quarter adjusted EBITDA fell 44% to 353 million crowns after restructuring charges of 117 million crowns, while unadjusted EBITDA was down to 232 million crowns.
Aker Solutions said it had already achieved about 90% of the previously announced plan to cut cost by about 1 billion crowns compared with 2019.
It had reduced its permanent workforce to about 13,000 in June from 16,000 a year ago, and more than halved the number of contractors to 2,300.
($1 = 9.3571 Norwegian crowns)
Recommended Reading
US NatGas Futures Hit Over 2-week Low on Lower Demand View
2024-04-15 - U.S. natural gas futures fell about 2% to a more than two-week low on April 15, weighed down by lower demand forecasts for this week than previously expected.
US Natgas Prices Hit 5-week High on Rising Feedgas to Freeport LNG, Output Drop
2024-04-10 - U.S. natural gas futures climbed to a five-week high on April 10 on an increase in feedgas to the Freeport LNG export plant and a drop in output as pipeline maintenance trapped gas in Texas.
Report: Freeport LNG Hits Sixth Day of Dwindling Gas Consumption
2024-04-17 - With Freeport LNG operating at a fraction of its full capacity, natural gas futures have fallen following a short rally the week before.
US NatGas Flows to Freeport LNG Export Plant Drop Near Zero
2024-04-11 - The startup and shutdown of Freeport has in the past had a major impact on U.S. and European gas prices.
Freeport LNG Down One Train After Texas Freeze
2024-01-29 - Freeport LNG’s 15 mtpa three-train export facility on the Texas Gulf Coast will be without its Train 3 for at least one month, due to an electrical issue during the recent Texas freeze.