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Equinor (EQNR), Sonatrach Unite for E&P Activities in Algeria

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Equinor ASA EQNR signed a memorandum of understanding (MoU) with Sonatrach to strengthen both parties’ cooperation in the exploration and production (E&P) of oil and gas in Algeria and worldwide.

The MoU involves cooperation opportunities in greenhouse gas emissions, carbon management and industrial safety management. Notably, it is expected to continue strengthening the existing partnership between the firms.

Moreover, the companies will explore opportunities in implementing technologies to improve hydrocarbon recovery and the development of flexible operating models for driving oil operations at the highest level. However, no financial information regarding the deal was revealed.

Several companies have signed MoUs with state-owned energy company Sonatrach after Algeria enacted its new oil law, seeking to boost benefits for the country from oil and gas production. Last year, the country approved a new energy law that offers incentives to foreign entities to attract investors who stayed away due to the unfavorable business environment.

Equinor has been operating in Algeria since 2004. The company along with BP plc BP and Sonatrach is actively involved in the development and production of two of the largest gas fields in the country, namely In Salah and In Amenas. Notably, each of the gas fields has a production capacity of nine billion cubic meters per year.

Moreover, Equinor developed a partnership on exploration in the 2,730-sq-km Timissit license in the Illizi-Ghadames basin in southeast Algeria.

On its part, the company has been actively engaged in developing ways to produce low-carbon hydrogen from natural gas. The oil giant is efficiently realigning its enterprise strategy by generating adequate energy from wind farms to power more than one million homes in Europe as part of its ambition to reach carbon neutrality globally by 2030.

Company Profile & Price Performance

Headquartered in Stavanger, Norway, Equinor is one of the leading integrated energy companies in the world.

Shares of the company have outperformed the industry in the past six months. Its stock gained 36.2% compared with the industry’s 22.2% growth.

Zacks Rank & Stocks to Consider

The company currently has a Zack Rank #3 (Hold).

Some better-ranked players in the energy space are Suncor Energy Inc. SU, currently sporting a Zacks Rank #1 (Strong Buy), and China Petroleum & Chemical Corporation SNP, carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Over the past 60 days, the Zacks Consensus Estimate for Suncor’s 2021 earnings has been raised by 71.6%, whereas that for China Petroleum has been increased by 23.9%.

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