Norway-based Equinor has announced plans to curtail operations in the United States, Canada and Britain because of record low oil prices tied to the coronavirus pandemic and lower demand, Kallanish Energy reports.
The company on Wednesday said it has halted operations in the oil-rich Bakken Shale in North Dakota and Montana and in the gas-rich Marcellus Shale in the Appalachian Basin.
It will not drill any new unconventional wells this year in the United States, Reuters reported.
Equinor said it was cutting up to $2.5 billion from its capital budget, trimming $400 million from its exploration budget and reducing operating expenses by $700 million.
The work force in the three countries will be cut by 20% and contractor numbers will be cut in half, it said.
The current plan does not include any asset sales, Reuters said.
“Equinor is in a strong financial position to handle market volatility and uncertainty,” Equinor CEO Eldar Saetre said in a statement. “Our strategy remains firm and we are now taking actions to further strengthen our resilience in this situation with the spread of the corona virus and low commodity prices.”
The state-controlled company said it can be cash flow neutral with an average oil price of about $25 (U.S.) per barrel for the rest of 2020.
The company is also involved in offshore drilling in Newfoundland and Labrador in eastern Canada.
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