Equinor is taking a more aggressive stance in the green transition with a change of leadership as incoming chief executive Anders Opedal seeks to raise renewable investment targets and accelerate carbon dioxide emission cuts at the Norwegian state-controlled giant.
Opedal, who is set to take over the top job from long-serving company stalwart Eldar Saetre in November this year, proclaimed he was ready to divert capital from Equinor’s traditional oil and gas business to achieve the company’s lofty aim to become a global leader in the shift to green energy.
Equinor has previously set a target to boost production from renewable projects tenfold to between 4 gigawatts and 6GW by 2026, giving an average annual growth rate of 30%, and thirtyfold to between 12GW and 16GW by 2035 under a climate roadmap outlined earlier this year with a strong focus on offshore wind.
Furthermore, it is looking to achieve carbon-neutral operations by 2030, with a target to cut CO2 emissions by 40% at its main production base off Norway by that year and 70% by 2040 towards a net-zero emissions goal by 2050.
“I believe we need to do more and I am willing to re-allocate capital to achieve this,” Opedal said after being unveiled this week as the replacement to Saetre, who is retiring after six years as chief executive.
Opedal said “We have strong ambitions to speed up implementation of these goals to take them further”, adding that Equinor “aims to take the lead in the energy transition”.
“I want to work with these ambitions over time to see how we can raise these ambitions,” he said.
The incoming boss has been charged with a mandate from the company’s board to “further develop Equinor as a force in the green shift” by accelerating the pace of its activities in this area as peer players, notably BP, pursue a similar path.
Chairman Jon Erik Reinhardsen said: “We live in a changing world and we cannot stand still. We have to develop solutions faster than those around us to be on the leading edge so that we can provide the world with the solutions it needs in future.”
Opedal, who has previously had responsibility for Equinor’s green flagship projects including the Hywind Tampen floating wind scheme and the Northern Lights carbon capture, utilisation and storage project as head of technology, projects and drilling, said it wants to “accelerate growth in order to become a leading company within renewables”.
“We see formidable global growth in renewables. We have the competence, technology, project experience and muscle to play a role, and to create significant value for shareholders and society,” he said.
Opedal claimed the company was “far advanced” in developing solutions for CCUS and hydrogen, and could “work more systematically to develop new business concepts” in the green arena.
He outlined a three-pronged strategy that would entail minimising CO2 emissions at its oil and gas fields while prioritising value over volume in its production, accelerating growth in renewables and practising technological innovation to create a platform for growth in low-carbon solutions.
Opedal said that Equinor would ultimately produce less oil and gas than at present, aligning itself with the likes of UK supermajor BP that has also unveiled radical ambitions to become an integrated energy company with renewables becoming an increasingly sizeable part of its portfolio.
“We will seek opportunities where we can use our competence to produce with low emissions and high value creation,” he said, adding this would entail the use of new technology such as unmanned platforms and digital drilling operations to optimise oil and gas production with a reduced carbon footprint.
Opedal will be building on the legacy of Saetre, who has presided over the change of company name from Statoil to Equinor, as well as the final investment decisions on the Hywind Tampen and Northern Lights projects.
Research firm Rystad Energy’s global head of renewables, Gero Farruggio, said Equinor is taking the lead in renewables investments globally among its peer players, with planned capital expenditure of $10 billion in this area.
The sum accounts for more than 50% of projected overall spending by oil and gas companies between 2021 and 2025.
“We forecast that Equinor will have the highest utility renewable production capacity by 2030 based on the existing portfolio developments of its peers, representing about 23% of gross capacity from E&P companies,” he said.