We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Equinor (EQNR) Faces Delays in Decision for Bay Du Nord
Read MoreHide Full Article
Equinor ASA’s (EQNR - Free Report) Bay du Nord development project has been deferred by the government of Canada as it is likely to cause major adverse impacts on the environment.
Discovered in 2013, Bay du Nord is situated in the Flemish Pass region off the coast of Newfoundland and Labrador. Once completed, it will be the first deepwater drilling site in Canada. Equinor is the operator of the $6.8-billion oil project.
Bay du Nord has faced strong opposition from environmental groups as it would hinder the desperate attempts to reduce emissions and protect the environment from climate change. Notably, this is the second delay in reaching a decision on the project, after the first one for 90 days in December. It has been extended for 40 more days.
The Canada Ministry of Environment and Climate Change claimed that it extended the decision-making period to provide additional time to review the considerable information and present an appropriate solution. The government cited that the minister had to review the extensive information prior to deciding whether the project might cause adverse impacts on the environment.
Equinor previously claimed that the project would contribute less than 0.03% to Canada’s total emissions, based on 2019 reported emissions. The project is also crucial to the Newfoundland and Labrador economy as it would provide significant employment and economic opportunities.
Bay du Nord will be a key driver to help meet the global oil demand, while supporting the country's pledge to carbon neutrality by 2050. The project involves three light oil discoveries in the Flemish Pass Basin, with estimated recoverable resources of 300 million oil barrels. Additional discoveries in the area could increase the estimate significantly. The project is currently expected to be valued at more than $12 billion.
However, the Newfoundland Offshore Industry Association voiced concerns regarding the additional delay in approving the project’s environmental assessment. The association claimed that the new oil, gas and coal development risks could trigger abrupt climate change.
Company Profile & Price Performance
Headquartered in Stavanger, Norway, Equinor is one of the leading integrated energy companies in the world.
Shares of EQNR have outperformed the industry in the past six months. The stock has gained 44.2% compared with the industry’s 42.2% growth.
Petrobras (PBR - Free Report) is one of the largest publicly-traded Latin America-based oil companies, which dominates Brazil’s oil and gas sector. PBR produces most of Brazil’s crude oil and natural gas, and accounts for almost the entire refining capacity of the country.
Petrobras is expected to see an earnings growth of 55.5% in 2022. PBR, burdened with a huge debt load, has laid strong emphasis on its debt reduction in its recent five-year business management plan (2022-2026) to strengthen its credit rating. As the company focuses on regaining its financial footing by selling assets and curtailing debt load, it has successfully lowered gross debt below its 2022 target of $60 billion in the third quarter of 2021, well ahead of time.
Imperial Oil Limited (IMO - Free Report) , based in Calgary, is one of the largest integrated oil companies in Canada. Its debt-to-capitalization of 19.3% is quite conservative versus 32.7% for the sub-industry to which it belongs. Apart from low leverage for its industry, Imperial Oil has ample liquidity, with cash and cash equivalents of C$1.5 billion.
Imperial Oil is expected to see an earnings growth of 74.8% in 2022. IMO remains strongly committed to returning money to investors via dividends. The company's board of directors recently approved a hike in the quarterly dividend payment. The new payout of 34 Canadian cents is 26% above the prior dividend. Further, adhering to the company's long-standing obligation to its shareholders, Imperial Oil revised its existing share purchase policy to buy up to 4% of outstanding common shares.
Chevron Corporation (CVX - Free Report) is one of the largest publicly traded oil and gas companies in the world, with operations that span almost every corner of the globe. CVX recently raised its quarterly dividend by 6% to $1.42 per share (or $5.68 per share annualized) after increasing it in April and revived its stock repurchase program to buy back $2-$3 billion in shares.
Chevron is expected to see an earnings growth of 53.9% in 2022. As of Dec 31, CVX had $5.6 billion in cash and cash equivalents, and total debt of $31.4 billion, with a debt-to-total capitalization of a modest 18.4%. Chevron also has a high investment grade rating of AA from S&P, which translates into low borrowing rates.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Equinor (EQNR) Faces Delays in Decision for Bay Du Nord
Equinor ASA’s (EQNR - Free Report) Bay du Nord development project has been deferred by the government of Canada as it is likely to cause major adverse impacts on the environment.
Discovered in 2013, Bay du Nord is situated in the Flemish Pass region off the coast of Newfoundland and Labrador. Once completed, it will be the first deepwater drilling site in Canada. Equinor is the operator of the $6.8-billion oil project.
Bay du Nord has faced strong opposition from environmental groups as it would hinder the desperate attempts to reduce emissions and protect the environment from climate change. Notably, this is the second delay in reaching a decision on the project, after the first one for 90 days in December. It has been extended for 40 more days.
The Canada Ministry of Environment and Climate Change claimed that it extended the decision-making period to provide additional time to review the considerable information and present an appropriate solution. The government cited that the minister had to review the extensive information prior to deciding whether the project might cause adverse impacts on the environment.
Equinor previously claimed that the project would contribute less than 0.03% to Canada’s total emissions, based on 2019 reported emissions. The project is also crucial to the Newfoundland and Labrador economy as it would provide significant employment and economic opportunities.
Bay du Nord will be a key driver to help meet the global oil demand, while supporting the country's pledge to carbon neutrality by 2050. The project involves three light oil discoveries in the Flemish Pass Basin, with estimated recoverable resources of 300 million oil barrels. Additional discoveries in the area could increase the estimate significantly. The project is currently expected to be valued at more than $12 billion.
However, the Newfoundland Offshore Industry Association voiced concerns regarding the additional delay in approving the project’s environmental assessment. The association claimed that the new oil, gas and coal development risks could trigger abrupt climate change.
Company Profile & Price Performance
Headquartered in Stavanger, Norway, Equinor is one of the leading integrated energy companies in the world.
Shares of EQNR have outperformed the industry in the past six months. The stock has gained 44.2% compared with the industry’s 42.2% growth.
Image Source: Zacks Investment Research
Zacks Rank & Stocks to Consider
Equinor currently carries a Zack Rank #3 (Hold).
Investors interested in the energy sector might look at the following companies that presently sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Petrobras (PBR - Free Report) is one of the largest publicly-traded Latin America-based oil companies, which dominates Brazil’s oil and gas sector. PBR produces most of Brazil’s crude oil and natural gas, and accounts for almost the entire refining capacity of the country.
Petrobras is expected to see an earnings growth of 55.5% in 2022. PBR, burdened with a huge debt load, has laid strong emphasis on its debt reduction in its recent five-year business management plan (2022-2026) to strengthen its credit rating. As the company focuses on regaining its financial footing by selling assets and curtailing debt load, it has successfully lowered gross debt below its 2022 target of $60 billion in the third quarter of 2021, well ahead of time.
Imperial Oil Limited (IMO - Free Report) , based in Calgary, is one of the largest integrated oil companies in Canada. Its debt-to-capitalization of 19.3% is quite conservative versus 32.7% for the sub-industry to which it belongs. Apart from low leverage for its industry, Imperial Oil has ample liquidity, with cash and cash equivalents of C$1.5 billion.
Imperial Oil is expected to see an earnings growth of 74.8% in 2022. IMO remains strongly committed to returning money to investors via dividends. The company's board of directors recently approved a hike in the quarterly dividend payment. The new payout of 34 Canadian cents is 26% above the prior dividend. Further, adhering to the company's long-standing obligation to its shareholders, Imperial Oil revised its existing share purchase policy to buy up to 4% of outstanding common shares.
Chevron Corporation (CVX - Free Report) is one of the largest publicly traded oil and gas companies in the world, with operations that span almost every corner of the globe. CVX recently raised its quarterly dividend by 6% to $1.42 per share (or $5.68 per share annualized) after increasing it in April and revived its stock repurchase program to buy back $2-$3 billion in shares.
Chevron is expected to see an earnings growth of 53.9% in 2022. As of Dec 31, CVX had $5.6 billion in cash and cash equivalents, and total debt of $31.4 billion, with a debt-to-total capitalization of a modest 18.4%. Chevron also has a high investment grade rating of AA from S&P, which translates into low borrowing rates.