Total revenues and other income
were USD 35,052 million in the first half of 2021 compared to USD 22,733 million in the first half of 2020.
The increase was mainly due to significantly higher average prices for liquids and gas, and higher gas production, partially
offset by lower
liquids production.
Purchases
[6]
were USD 14,565 million in the first half of 2021 compared to USD 10,146 million in the first half of 2020. The increase
was
mainly due to significantly higher average prices for liquids and gas, partially offset by lower volumes
for liquids and third party sales.
Operating and administrative expenses
were
USD 4,489 million in the first half of 2021, compared to USD 5,014 million in the first half of
2020. The decrease was mainly due to lower transportation costs, especially in the MMP segment, primarily
due to lower freight rates on
shipping of liquids in addition to lower volumes. The NOK/USD exchange rate development partially offset
the decrease.
Depreciation, amortisation and net impairment losses
were USD 4,908 million in the first half of 2021, compared to USD 6,959 million in
the first half of 2020. The decrease was mainly due to lower net impairment losses in the first half of 2021 compared
to the first half of 2020.
Higher reserves estimates especially in the E&P International segment, lower depreciation basis resulting from net impairments
in previous
periods, and a classification of a US onshore asset as held for sale added to the decrease. The decrease was partially
offset by higher
investments and the NOK/USD exchange rate development.
Exploration expenses
USD 572 million in the first half of 2021, compared to USD 1,028 million in the first half of 2020. The decrease
was mainly due to lower impairment losses in the first half of 2021 compared to the first half of 2020, in addition
to lower drilling and other
costs, a lower portion of exploration expenditure capitalized in earlier years being expensed this year,
and wells expensed in earlier years
being recapitalised this year due to related projects on NCS being matured. The decrease is partially
offset by a lower portion of exploration
expenditure being capitalized this year, and higher field
development costs. For more information, see the table titled Exploration expenses in
the Supplementary disclosures.
Net financial items
amounted to negative USD 1,101 million in the first half of 2021, compared to negative USD 225 million in the first
half of 2020. The decrease of USD 876 million was mainly due to a loss of USD 462 million on derivatives related to a
long-term debt
portfolio in the first half of 2021 compared to a gain of USD 382 million in the first half of 2020. A lower gain of USD 72 million
on
Interest income and other financial items in the first half of 2021 compared to a gain of USD 238 million in the first half of
2020, and a
loss on financial investments of USD 123 million in the first half of 2021 compared to a loss of USD 98 million in the first
half of 2020,
added to the decrease. The decrease was partially offset by a gain of USD 27 million on net foreign exchange in the first half of 2021
compared to a loss of USD 24 million in the first half of 2020, and a reduction in interest and other financial expenses by a negative
USD 616 million in the first half of 2021 compared to a negative USD 723 million in the first half of 2020.
Income tax
was USD 5,620 million in the first half of 2021 and the effective tax rate was 59.7%. Income tax in the first half of 2020
was negative USD 316 million and the effective tax rate was negative 49,5%. For more information, see note 5 Income tax to the
Condensed interim financial statements.
Net income
in the first half of 2021 was USD 3,797 million compared to negative USD 956 million in the first half of 2020. The
increase was mainly due to the positive changes in net operating income as discussed above, partially offset by negative changes for
net financial items and higher income tax.
Cash flows provided by operating activities
increased by USD 7,216 million compared to the first half of 2020. The increase was
mainly due to higher liquids and gas prices and decreased tax payments, partially offset by a change in working capital and decreased
cash flow from derivatives.
Cash flows used in investing activities
decreased by USD 244 million compared to the first half of 2020. The decrease was mainly
due to increased proceeds from sale of assets, partially offset by increased financial investments.
Cash flows provided by financing activities
increased by USD 8,824 million compared to the first half of 2020. The increase was
mainly due to bonds issued in the first half of 2020 and increased repayment of finance debt, partially offset by decreased dividend
paid.
Total cash flows
decreased by USD 1,364 million compared to the first half of 2020.
Free cash flow
[5]
for the first half of 2021 was USD 9,683 million, compared to negative USD 1,492 million in the first half of 2020.
The increase was mainly due to higher operating cash flow mainly due to higher liquids and gas prices, decreased tax payments,
increased proceeds from sale of assets and decreased dividend paid, partially offset by decreased cash flow from derivatives.
For information related to guaranteed debt securities
, see Summarized financial information related to guaranteed debt securities
in the Supplementary information