Sammendrag:

The objective of this thesis was to quantitatively examine the extent to which the low carbon
energy transition affects the competitive status of the global energy company Equinor.
According to the previous research, the age of hyper competitiveness and transition to
alternative energy sources suggest that Equinor faces strong competitive pressures. These are
posed by a combination of external market drivers and internal business processes. The effect
of the energy transition on the competitive status of Equinor was analysed from four
perspectives.
Firstly, competitiveness was analysed with the market concentration measure – the HerfindahlHirschman Index (HHI) consisting of a sample which represented 30 oil and gas companies.
Our study shows that in the global oil and gas market from 2018 to 2020 market concentration
was low and competitiveness high.
Secondly, Competitive Profile Matrix (CPM) examined three possible strategies (Multiple
expansion, retrenchment and stability strategies) of how companies can tackle the energy
transition. Comparing Equinor with its competitors, our study shows that Equinor’s response
in this response to the energy transition is slightly below average. Companies with the highest
total revenues performed worse in tackling the energy transition.
Thirdly, an in-depth analysis of a retrenchment strategy was examined through the ReservesLife Index (RLI). Our study shows that Equinor is one of the leading companies when it comes
to retiring its oil and gas reserves. At the production pace as of in 2020, Equinor will extract its
remaining proven oil and gas reserves within 7 years. This is in contrast to Saudi Aramco which
has an RLI of 56 years.
Finally, assessment of Equinor’s strategic position and competitive status was evaluated
through a quantified SWOT analysis based on internal core competencies and external market
opportunities. Our study shows that Equinor is strong in transforming its business internally
with an Internal Factors Evaluation (IFE) score of 3.5. This contrast with how the company
respondsto the external market opportunities and threats. Its External Factors Evaluation (EFE)
score of 2.8 is below the average of its competitors.
Our main conclusion is that the energy transition has had a marginally negative effect on
Equinor’s competitiveness. Equinor has had a slightly negative CPM, a positive RLI, and a
neutral SWOT and HHI. Furthermore, the renewable segment of Equinor’s portfolio represents
only two percent of the company’s total revenues. Equinor also lacks access to key renewable
energy sources like hydropower and biofuels.