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Statoil president and CEO Eldar Sætre. Image courtesy of Ole Jørgen Bratland/Statoil.

Statoil’s operating income dove 95 percent year-over-year in the second quarter.

The Norway-based company reported a $180 million net operating income for the second quarter, down 95 percent from $3.63 billion a year ago.

“The significant decrease was primarily due to the drop in prices for liquids and gas, lower refinery margins and reduced gain on sale of assets this  quarter. Lower costs partially offset the decrease,” Statoil said.

Adjusted earnings fell 68 percent year-over-year to $913 million in the second quarter while net income dropped to a $302 million loss compared to a $866 million profit in the year ago quarter.

Adjusted earnings after tax sank to a $28 million loss, down from a $929 million profit in the second quarter of 2015.

Total revenues and other income declined 37 percent year-over-year to $10.89 billion and adjusted total revenues and other income fell 30 percent year-over-year to $11.29 billion.

Total equity liquids and gas production ticked up 5 percent year-over-year to 1.959 million barrels of oil equivalent per day.

Cash flows provided by operating activities were $1.14 billion in the second quarter of 2016 compared to $2.53 billion in the second quarter of 2015.

Free cash flow in the second quarter of 2016 was negative $1.77  billion compared to $104 million for the second quarter of  2015.

Statoil said the free cash flow reduction was mainly due to reduced liquids and gas prices.

Statoil expects to deliver efficiency improvements with pre-tax cash flow effects of around $2.5 billion from 2016.

Organic capital expenditures for 2016, excluding acquisitions, capital leases and other investments with significant different cash flow pattern, are estimated at about $12 billion.

Net operating income for Development and Production Norway (DPN) was $1.27 billion compared to $1.72 billion in the second quarter of 2015.

Adjusted earnings for the DPN segment declined 50 percent year-over-year to $1.16 billion.

Adjusted total revenues and other income for the DPN segment fell 30 percent year-over-year to about $3.20 billion in the second quarter.

Net operating income for the company’s Development and Production International (DPI) segment was negative $839 million compared to an income of $1.26 billion in the second quarter of 2015.

Net impairments of $275 million negatively impacted second quarter net operating income for the DPI segment, Statoil said.

The DPI segment booked a $506 million adjusted earnings loss compared to a loss of $16 million in the year ago quarter.

Statoil’s Marketing, Midstream and Processing (MMP) segment booked $329 million in adjusted earnings compared to $679 million in the second quarter of 2015.

Adjusted total revenues and other income for MMP fell 30 percent year-over-year to about $11.01 billion.

Net operating income for MMP was fell to a loss of $20 million compared to an incomes of $652 million in the second quarter of 2015.

“We delivered solid operational performance with strong production growth and progress on project development and execution. Our financial results were affected by low oil and gas prices in the quarter,” Statoil president and CEO of Eldar Sætre said.