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Equinor (EQNR) Awards EPCI Contract for Halten East Project

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Equinor ASA (EQNR - Free Report) assigned a significant engineering, procurement, construction and installation (“EPCI”) contract to TechnipFMC (FTI - Free Report) for subsea tiebacks for its Halten East development, offshore Norway.

The contract involves the development and installation of flowlines, and the installation of umbilicals and subsea structures.

Halten East is a subsea development, which comprises five subsea templates tied back to the existing infrastructure on the Asgard field. The Halten East development will consist of the Gamma, Harepus, Flyndretind, Nona, Sigrid and Natalia discoveries.

Equinor operates the Halten East development, with license partners Var Energi, Spirit Energy and Petoro. The Halten East recoverable reserves are estimated to be 16 million standard cubic meters of oil equivalent. Of the total, 60% is gas channeled through Karsto to Europe.

Halten East development is planned to be carried out in two stages. In the initial phase, six wells will be drilled in the 2024-2025 period. The second phase is expected to be developed in 2029. Production from the first two wells is scheduled to commence in 2025. A total of 10 wells are expected to be drilled, which will be placed online once completed.

TechnipFMC is a leading manufacturer and supplier of products, services and fully integrated technology solutions for the energy industry. The company, along with Equinor and its consortium partners, will transform the finances of the project by optimizing design, engineering, manufacturing and installation.

TechnipFMC did not reveal any financial details of the contract. For TechnipFMC, a significant contract is estimated to be $75-$250 million. The latest contract is subject to government approval for development and operation.

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 51.6% compared with the industry’s 45.3% growth.

 

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Zacks Rank & Other Stocks to Consider

Equinor currently sports a Zack Rank #1 (Strong Buy).

Investors interested in the energy sector might look at the following companies that also presently flaunt a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Oasis Petroleum  is an independent explorer that engages in the acquisition and development of oil and gas resources. OAS exited Chapter 11 Bankruptcy sometime back with a clean balance sheet. It has managed to wipe out $1.8 billion in debt. Now the figure stands at less than $400 million.

The company’s quality asset base and balance sheet strength will support free cash flow generation and, consequently, shareholder returns. Oasis Petroleum currently pays a quarterly dividend of 58.5 cents ($2.34 annualized), while it recently completed a $100-million share repurchase program.

PDC Energy, Inc.  is an independent upstream operator that explores, develops and produces natural gas, crude oil and natural gas liquids. As of Mar 31, 2022, PDC Energy had $1.65 billion in total liquidity, while its credit facility currently had a total borrowing base of $3 billion. Moreover, PDC Energy’s debt maturity profile is favorable.

PDC Energy’s cash flows will also receive some downside protection from oil and gas hedges. The company has hedged a portion of its 2022 oil production at attractive prices. At that price, PDC Energy's hedges are expected to add robust positive value in revenues and considerably soften the blow if there is another meltdown in oil prices.


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