Soaring gas prices in the second half of last year contributed to Corrib Gas partner Equinor surging to a profit a year after recording a loss of more than €150 million.
Accounts filed for Norway’s Equinor Energy Ireland Ltd show the company posted profits after tax of €378.97 million in 2021, compared with a €156.25 million loss a year earlier.
The profits include a tax credit of €89.17 million, chiefly as a result of utilising tax losses and tax assets. Revenues increased almost threefold to €304.2 million. While that is less than the overall profits, sales were boosted by a gain from administrative expenses of €41.3 million. A year earlier the same line item reduced earnings by €213.8 million.
In November of last year, Equinor agreed to sell its entire 36.5 per cent stake in the Corrib gas field for $434 million to Canadian firm Vermilion Energy.
The directors state that as part of the deal, Equinor and Vermilion agreed to hedge about 70 per cent of the production of the Corrib gas field for 2022 and 2023, and have also agreed a contingent payment that will be paid on a portion of the revenue if European gas prices exceed a given level. The transaction “is scheduled to complete in the second half of 2022”, the directors added.
“In 2021, there was significant price volatility, primarily triggered by high economic growth and subsequent supply chain bottlenecks on the back of measures to contain the Covid-19 pandemic,” the directors stated.
Equinor paid out a dividend of €100 million. The book value of its share of the Corrib gas field last year increased from €156.44 million to €226.28 million. This arose chiefly as a reversal of an €184.9 million impairment.
At the end of December last, the Irish Equinor unit had accumulated profits of €451.6 million.