Aker BP Sees Surge in Operating Profit in Q3

Norwegian producer Aker BP generated some $242mn in earnings before interest and tax in the third quarter, up from $196mn a year earlier, the company reported on October 29, attributing the growth to production gains.

Aker BP, owned by BP and Norwegian investment firm Aker, produced some 201,600 barrels of oil equivalent/day in the three months, up from 146,100 boe/day a year earlier. The surge came on the back of the start-up last autumn of the Equinor-operated Johan Sverdrup oilfield, in which Aker BP has a 11.6% interest.

The company narrowed its full-year 2020 production guidance to 210-215,000 boe/d, from 205-220,000 boe/d. It said it was still on track to pay out $425mn in dividends for the year, while shaving its capital expenditure plan from $1.35bn to $1.30bn. It also lowered exploration spending from $350mn to $300mn.

"Third quarter 2020 was a strong quarter for Aker BP. We are well on track to deliver on our production guidance for the year, our development projects are progressing as planned, and we are keeping cost and emissions under control," CEO Karl Johny Hersvik said in a statement. "The recent tax changes provide improved investment conditions in Norway and Aker BP is uniquely positioned to benefit from this opportunity through our large project hopper with low breakevens." 

Norway provided some kroner 100bn ($10.6bn) in tax relief to oil and gas companies in June, to encourage new project approvals. Aker BP responded by approving its Hod redevelopment plan in the Valhall area, which it had shelved earlier in the year.