Equinor Sidesteps Climate Pressure at AGM as Hammerfest Outage Tests LNG Reliability

Equinor seeks multi-year gas deals amid Hammerfest LNG valve failure; shareholders approve dividend but 21% of independents back climate resolution

Equinor is walking a tightrope. The Norwegian energy giant is trying to persuade Europe’s biggest gas buyers to commit to multi-year contracts at elevated prices, even as a mechanical failure at its flagship LNG terminal raises uncomfortable questions about the resilience of its supply chain. Next week’s gathering in Oslo, hosted by pipeline operator Gassco, will be the stage for that delicate conversation.

For the moment, shareholders appear unruffled. At the annual general meeting in Stavanger, investors approved the 2025 annual report and endorsed a fourth-quarter dividend of $0.39 per share. The stock has been trading ex-dividend since 13 May, with the payout expected on 27 May in Norwegian kroner. Equinor also launched the second tranche of its share buyback programme, worth up to $375 million. Of that total, $123.8 million will be purchased in the open market, while the remainder will be bought directly from the Norwegian state, which holds a 67% stake.

That state grip helped shield management from activist pressure. Seven shareholder proposals were tabled, including a climate resolution from Follow This that garnered 21% support among independent shareholders. The state voted against all such motions, and every one failed. Still, the 21% backing signals that a sizeable minority among free-float investors wants faster decarbonisation — a tension that is likely to persist.

Operationally, the mood is more mixed. Equinor’s Hammerfest LNG plant, Europe’s largest export terminal for liquefied natural gas, suffered an unplanned shutdown because of a valve failure. The facility can process 18.4 million cubic metres of gas per day, accounting for roughly 5% of Norway’s total gas exports. Equinor did not disclose any further damage, but the outage comes at a sensitive time. Just days earlier, the company had started early gas production from the Eirin field in a bid to prop up Norwegian export volumes.

On the positive side, Equinor continues to squeeze value from ageing fields. The Gullfaks complex, which was originally due to be exhausted by 2007, has now been given a lease of life until at least 30 June 2036. Since start-up, Gullfaks has produced around 2.8 billion barrels of oil, and it recently celebrated its 5,000th tanker cargo. The Snorre field has also been extended, with its productive life pushed out to 2040. These mature assets provide the cash flow that underpins the dividend and buyback commitments while the company finances new offshore developments.

At the bourse, the stock has broadly rewarded investors. It closed in Frankfurt on Wednesday at €32.19, a year-to-date gain of 54.17%. That is still 12.79% below the recent annual high, but the uptrend remains intact.

Equinor’s problem is how to maintain that trajectory. Developing new fields on the Norwegian continental shelf requires hefty upfront investment, and the company is reluctant to commit without guaranteed offtake. That is why the Oslo meeting matters. Europe’s gas market remains tight, and Equinor’s proposal is straightforward: customers get supply security, but they must pay a premium for it. Germany, the UK, Belgium, Poland and the Netherlands are among the countries being courted.

Analysts disagree on the calculus. Morgan Stanley holds an “outperform” rating? Actually, primary says Morgan Stanley: "Hold" with target 376 NOK. Santander upgraded to "Outperform" on 11 May with a target of 415 NOK. The split reflects a difference in emphasis: those who see a persistently tight European gas market expect pricing power to support margins, while those focused on Equinor’s capital intensity argue that the growing project pipeline carries execution risk.

For Equinor, the Oslo talks are about more than contract volumes. If the company secures long-term price guarantees, the path to financing new offshore projects becomes far clearer. Without them, it will rely more heavily on legacy fields and spot-market exposure. That is a strategic choice Europe’s energy buyers will soon have to make.