Equinor (EQNR), Gasum Extend LNG Deal to Boost Maritime Sector
Equinor ASA EQNR, the Norwegian state-owned energy giant, and Finnish energy company Gasum have extended their long-term contract for liquefied natural gas (LNG) bunkering. This agreement ensures that Gasum will continue to supply LNG to Equinor’s dual-fuel chartered fleet, highlighting both companies' commitment to reducing emissions in the maritime sector.
The renewed contract, which builds on the existing collaboration between Gasum and Equinor, dates back to 2011. It includes not only the supply of LNG but also additional support services such as cooling down and gassing up, essential for the efficient operation of LNG-powered vessels. These services have been integral to the partnership, contributing to the seamless transition and operational efficiency of Equinor’s fleet.
Gasum has highlighted the use of its specialized bunker vessels, Coralius, Kairos and Coral Energy, for the bunkering operations. These vessels have been pivotal in carrying out three separate LNG cool-down operations for Equinor in Skagen this year alone, showcasing the operational readiness and logistical coordination between the two companies.
In its statement, Gasum emphasized the immediate environmental benefits of using LNG and bio-LNG. The company is on a strategic path to bring 7 terawatt-hours (TWh) of renewable gas to the market by 2027. This ambitious goal is projected to result in a combined carbon dioxide reduction of 1.8 million tons per year for its customers, demonstrating a clear commitment to lowering greenhouse gas emissions.
Equinor, which has been working with Gasum since the beginning of 2020 to deliver LNG to its crude shuttle tankers, also extended its LNG bunkering deal to the Amsterdam-Rotterdam-Antwerp region within the same year. In 2022, Equinor reaffirmed its commitment by exercising the option to extend this contract, reflecting the trust and reliability established through their collaboration.
Both Gasum and Equinor are deeply committed to sustainability. Equinor aims to become a net-zero emissions energy company by 2050, aligning with the broader global efforts to combat climate change. By leveraging LNG and bio-LNG, both companies are not only enhancing the operational efficiency of their fleets but also contributing significantly to the reduction of greenhouse gas emissions.
The extension of the LNG bunkering agreement between Gasum and Equinor highlights the critical role of strategic partnerships in advancing sustainability goals. It also underscores the potential of LNG as a viable solution for reducing the environmental impact of maritime operations.
Zacks Rank & Key Picks
Equinor currently carries a Zacks Rank #3 (Hold).
Some better-ranked players in the energy sector are Marathon Petroleum Corporation MPC, SM Energy Company SM and Sunoco LP SUN. While Marathon Petroleum and SM Energy currently sport a Zacks Rank #1 (Strong Buy) each, Sunoco carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Marathon Petroleum's acquisition of Andeavor has expanded its foothold in the Permian Basin, creating an enviable retail and marketing portfolio. MPC’s emphasis on operational excellence, safety and environmental responsibility, coupled with investments in low-carbon initiatives, positions it well for sustainable growth and continued value creation for shareholders.
The Zacks Consensus Estimate for MPC’s 2024 EPS is pegged at $19.28. The company has a Zacks Style Score of A for Value. It has witnessed downward earnings estimate revisions for 2024 in the past 30 days.
SM Energy is set to expand its oil-centered operations in the coming years, with an increasing focus on crude oil, especially in the Permian Basin and Eagle Ford regions. The company’s attractive oil and gas investments should create long-term value for shareholders.
The Zacks Consensus Estimate for SM’s 2024 EPS is pegged at $6.63. The company has a Zacks Style Score of B for Value. It has witnessed upward earnings estimate revisions for 2024 in the past seven days.
Sunoco is a leading wholesale motor fuel distributor in the United States, boasting a vast distribution network spanning 40 states. With long-term contracts servicing more than 10,000 convenience stores, it distributes over 10 fuel brands, ensuring a stable revenue stream. SUN currently has a Value Score of A.
The Zacks Consensus Estimate for 2024 and 2025 earnings per unit is pegged at $5.07 and $4.47, respectively. The partnership has witnessed upward earnings estimate revisions for 2024 and 2025 in the past 60 days.
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