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Statoil profit hit beyond Norway’s Shores

Statoil profit hit beyond Norway’s Shores

OSLO: Statoil ASA’s ambitious expansion in oil production beyond Norwegian shores is increasingly yielding an unwanted byproduct: losses.

The state-run oil and gas company posted a 16% drop in second-quarter profit on Tuesday, hit by the continuous slide in oil prices as well as further losses from overseas operations.

Net profit, boosted by gains from disposals, stood at 10 billion Norwegian kroner ($1.22bn) in the three months to June 30, compared with 11.9 billion kroner in the same period a year earlier. Revenue fell 13% to 124 billion kroner, beating expectations of 122 billion kroner.

Statoil said that while its Norwegian business generated diminished operating profit of 17.9 billion kroner, foreign businesses had an operating loss of 0.1 billion kroner, its third consecutive quarter of red ink.

A marginally negative result isn’t satisfactory,” Chief Executive Eldar Saetre said in an interview. “We are working quite actively on this now.”