Oil majors aren’t famed for their pranks, but Statoil had analysts checking it wasn’t April Fool’s Day when it announced a new name that turned out to have been acquired from an Oslo veterinary practice specializing in horses.
“We checked the calendar,” SpareBank 1 Markets analyst Teodor Sveen Nilsen said in a note to clients. “It’s not April 1.”
Should shareholders back the change at its annual general meeting in May, Statoil will be called Equinor, a name intended to reflect the Norwegian oil company’s commitment to cleaner energy sources. Initial reactions on Twitter suggest not everyone is convinced by a rebranding exercise that chief executive Eldar Saetre said could cost as much as 250 million kroner ($32 million).
“I don’t expect Equinor to be love at first sight for everyone,” Mr Saetre told reporters in Oslo on Thursday. “Give it a little time, let it mature. I feel very confident that this is right and important for the company to do.”
At least the Norwegian oil company shouldn’t experience the legal challenge faced by Denmark’s Orsted A/S, which announced in October it was changing its name from Dong Energy to mark its departure from oil and gas. Descendants of Danish scientist HC Orsted have filed a lawsuit against the company for using the name, which they say is protected.
Nevertheless, delegates attending the Norwegian Oil and Gas Association conference in the capital had mixed feelings about the Statoil development.
“It’s sad to lose the Statoil name, but at the same time I can understand,” Christine Sagen Helgo, the mayor of Stavanger, the company’s hometown on Norway’s west coast, said in an interview. “It’s forward-looking. They want to highlight that they wish a greater balance.”
The name change is bound to “stir up some emotions,” said Frode Alfheim, the head of Industry Energy, Norway’s biggest oil union. But what counts is that the company remains 67 percent state-owned, stays in Stavanger and focuses on the Norwegian continental shelf, he said.
The name change is supported by Statoil’s five labor unions and, crucially, Norway’s government. Prime Minister Erna Solberg shrugged off a demand by the opposition Labor party that Parliament be involved, saying politicians should “respect” Statoil’s wishes. But even she conceded “it’s a name we will all need to get used to.”
Petroleum and Energy Minister Terje Soviknes was told of the plan about a month and a half ago, and found out the new name only recently, he said in an interview. He was “a bit bewildered” to begin with, but didn’t have any objections.
“I can see that some people might make jokes,” he said. “At the same time, you feel it maturing quickly, and that it’s reasonable to highlight -- including through the name -- that you’re broadening the company.”