Equinor sets target for 50% capex on renewables by 2030; drops fossil growth goal

London (Quantum Commodity Intelligence) – Norwegian energy major Equinor expects to increase the share of its capital expenditure in renewables and low carbon solutions to 50% in 2030, up from 4% in 2020, the company said in a statement Tuesday.

The figure covers renewable electricity and low-carbon hydrogen and is part of a broader aim to achieve new interim targets of 20% and 40% net carbon intensity cuts by 2030 and 2035, respectively.

Oil and energy businesses have come under increasing pressure from shareholders, NGOs and even the judiciary to diversify away from polluting fossil fuels and commit to carbon reduction goals.

"This is a business strategy to ensure long-term competitiveness during a period with profound changes in the energy systems, as society moves towards net zero," said Anders Opedal, President and CEO in the company's strategy update.

"We will continue to cut emissions, and in the longer term, Equinor expects to produce less oil and gas than today, recognising reducing demand. Significant growth within renewables and low carbon solutions will increase the pace of change towards 2030 and 2035."

Equinor expects gross investments in renewables of around $23 billion from 2021 to 2026 and to reach a share of installed capacity of 12–16 GW by 2030.

The company also has a 2035 aim to develop the capacity to store 15-30 million mt of CO2 per year and to provide clean hydrogen in 3-5 industrial clusters.

The strategy update also shelved a previous goal for 3% yearly increases in oil and gas output up to 2026, but production targeted in low-cost and low-emission fields will still grow over the period.

"New projects coming on stream by 2030 have an average break even below $35/b and a short payback time of less than 2.5 years," said the statement.

"Further improvements at the world-class Johan Sverdrup field reduces the break-even price by 25% to $15/b."