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I welcome everyone to the annual general meeting of Equinor ASA. Welcome. For those present in this room, headsets with English translations are available, and for participants at the webcast, the meeting will be simultaneously translated to English. We will therefore continue in Norwegian. My name is Tone Lunde Bakker, Chair of the Corporate Assembly and the Nomination Committee of Equinor. As you will see from the notice convening the meeting, the Board of Equinor ASA has appointed me to open today's annual general meeting in accordance with Section 5-12 of the Norwegian Public Limited Liability Companies Act. With me on the panel, I have Chair of the Board of Directors, Jon Erik Reinhardsen, CEO Eldar Sætre, General Counsel, SVP Legal, Siv Helen Rygh Torstensen, and Company Secretary and Lawyer, Marte Johanson Hanasand.
Before we begin, I would like to ask everyone to please switch your mobile phones to silent mode. We are in an extraordinary situation which affects the world, our company, and all of us. It also affects the AGM today. On the screen, you will see responses to this situation from Equinor employees, and these express what we are all striving for. Because of the Covid-19 situation, we have recommended that our shareholders follow the AGM via the webcast and that they vote in advance or cast their votes by proxy. That in itself seems unreal. In any normal situation, we would encourage our shareholders to attend the AGM physically and in person. However, this year we were forced to do the very opposite, and we thank our shareholders for their understanding. We have also ascertained that we have the legal basis for holding the AGM in this way.
For those of you who are present in this hall, we want to inform you that Equinor urges you to keep a two-meter distance between you. All shareholders in attendance and eligible to vote received ballot slips when they registered. If that was not the case, please pick up your ballot slip now. The ballot slips will be used for any written ballots. It's also been possible to vote electronically for a period of time prior to the AGM. Those who are attending the general meeting today and have already voted electronically don't need to vote again. In the event of any written ballot, the ballot will be tallied in an adjacent room under the scrutiny of representatives of the external auditor, EY. Only shareholders attending physically are entitled to address the AGM. If anyone would like the floor, please give a signal and introduce yourself by name.
Shareholders may grant the right to speak on their behalf to one advisor. The rostrum must be used. This is necessary for technical reasons and due to the live online webcast of the AGM. Shareholders who are physically attending and who submitted proposals in person will have up to five minutes to explain their motions. While shareholders who submitted proposals and are following the AGM via webcast have sent us written explanations to be read by a representative of the company. This account will take no longer than five minutes per shareholder motion, and others who would like the floor will have a time limit of three minutes to state their case. Such a time limit is necessary to ensure that the AGM be held in the most appropriate and time efficient manner possible. We continue on item two, registration of attending shareholders and proxies.
Item two is our registration of attending shareholders and proxies. In my capacity as moderator under the Public Limited Liability Companies Act, I have to make a list of the shares that are legally represented at this AGM. The secretariat is in the process of creating a list of shareholders in attendance and proxies, and I will read this list. There are 12 individuals here today eligible to vote, and along with the advanced votes cast, they represent a total of 71.47% of the company's share capital. 67.72% of these people represent their own shares, while 5.48% represent proxies. Advance votes have been cast for 3.75% of the share capital. We continue to item three, which is election of chair of the meeting. The Board of Directors proposes that the general meeting elects the Chair of the Corporate Assembly, myself, to chair the meeting. Can the AGM endorse this resolution?
I see no objections, and then the chair of the Corporate Assembly is elected. We now move on to item 4, which is the approval of the notice and the agenda. The Public Limited Liability Companies Act, Section 5-10 states that the AGM shall be convened by written notice to all shareholders with a known address. Pursuant to Section 5-10, second subsection of the PLLC Act and 5-11 B, first subsection, first sentence, the notice of the meeting shall be sent out not later than three weeks prior to the meeting. The notice convening the meeting and the notice of attendance were sent to all shareholders registered in the Norwegian Central Securities Depository, VPS, on the date of the notification pursuant to the deadline specified in the act.
The notice, financial statements, and directors report, as well as other attachments to the notice, are published on the company's website in compliance with Section 5 (11) A of the PLLC Act and the company's articles of association. The notification has taken place in accordance with the Norwegian PLLC Act and the provision of the articles of association. In my capacity as chair, I propose that after the accounts by the Chair of the Board and the CEO relating to items six and seven, a representative from the company will read out the presentations from the shareholders submitting motions under items nine, 10, and 11. The shareholder who is attending in person and submitted a motion, namely under item 12, will present said motion, whereupon a representative from the company will read the presentations from the shareholders submitting motions under items 13 and 14.
Once all the proposals have been introduced, we will open the floor for other interventions and comments from the attendees on the six shareholder motions, plus items 6 and 7. The point of dealing with these items all together is to maximize practicality and time efficiency. Voting will take place in accordance with the notice of the meeting. It's only the discussions that will be merged for the said items. This is the same method we have employed previously. I would like to ask you, are there any comments on to the notice or to the proposed agenda? There appears not to be any. Therefore, we hereby declare the AGM to be legally convened and the agenda to be adopted. We now move on to item 5, which is selection of two persons to co-sign the minutes together with the chair of the meeting.
To co-sign the minutes together with the chair, we propose Bjørn Ståle Haavik, the state's representative from the Ministry of Petroleum and Energy, and Ingvild Hjellbakk Skott . Are there any comments to this nomination? There are not. With that, Bjørn Ståle Haavik and Ingvild Hjellbakk Skott are considered elected. The AGM will now address item six relating to the approval of the annual report and accounts, as well as the fourth quarter to 2019 dividends. As mentioned earlier, the discussions related to items 7, 9, 10, 11, 12, 13, and 14 will be dealt with in conjunction with the discussions under item 6. The annual reports and accounts with the auditor's report and the statements by the corporate assembly have been made available on the company's website, and reading them aloud is therefore unnecessary.
I will now give the floor to the Chair of the Board, Jon Erik Reinhardsen, who will give an account of the board's view of operations and proposal for dividend, item six, and the board's proposal for authorization to distribute dividend based on approved annual accounts for 2019, item seven, and the board's report on the corporate governance in item 15. The Chair will also give an account for the board's response to the six shareholders' proposals, items nine, 10, and 11, 12, 13, and 14. The floor will then be given to CEO Eldar Sætre, and later, under item 16 on the agenda, the Chair of the Board will give a separate report on the board of directors' proposed statement regarding remuneration of executive management. Please go ahead, Jon Erik.
Thank you, Tone.
Dear fellow shareholders, it's always a pleasure for me to welcome you to Equinor's AGM. I have to admit that the joy I feel this year has undercurrents I would gladly forgo. We are in the middle of a very special situation. This AGM is characterized by that. Many people who would normally have been here in Stavanger now have to follow the AGM online. The COVID-19 pandemic and the market situation create an extraordinary state of affairs for all of us. In Equinor, we have managed to maintain most of the operative activities, thanks to a quick response and efficient measures. With us, as in the rest of society, many work from home offices. There are meetings on digital surfaces, digital screens. The coworker contact is different.
We also have a state of affairs where the demand for our products is considerably reduced because of necessary restrictions globally. At the same time, we've had an extraordinary supply side to the oil and gas market. All in all, this has contributed to a collapse in the petroleum market and a weak gas market. We will revert to that. I want to take this opportunity to thank all our employees who are working hard on platforms, onshore, and from home offices in Norway and abroad. It's impressive to see how the wheels keep turning with new tools and digital solutions. Equinor entered this situation with a very strong foundation. We have a clear strategy. For years now, we have worked on improvements and rationalization, and this has made our company better equipped to handle the challenges that face us now.
The course we staked out through our strategy, always safe, high wealth creation, low carbon emissions, and the ambitious goals from the climate roadmap we introduced earlier this year stand firm. In recent weeks, we have employed strong measures to guarantee flexibility and robustness throughout this difficult situation we are going through. Eldar will go through this in detail in his introduction, but let me go back to last year, which is what we're really rounding off formally today, and let me start with the most important thing, safety. The total recorded injuries has been reduced, but the company was not able to continue the positive trend when it comes to the frequency of serious incidents that we have seen for many years now. Last year, the frequency was 0.6 per million man-hours for serious incidents, a small increase from the year before.
Safety demands continuous focus. We work systematically with improvement and clear leadership throughout the organization. It's the clear expectation of the board that this safety work will continue undiminished. I will now give an account of the activities of the company in 2019, including the report of the board about dividend, the account of corporate governance from the board, and the board's response to the shareholder motions in the cases and items 9, 10, 11, 12, 13, and 14. The senior management remuneration will be addressed by the board under item 16. 2019 was a good year for Equinor. The adjusted earnings ended up at $13.5 billion pre-tax, a reduction from $18 billion in 2018. Equinor delivered an adjusted operating performance in 2019 of $4.9 billion.
The company had high production, and also delivered an organic reserve replacement ratio of 83% in 2019, and the ratio between reserves and production, RP, is now 8.6 years. Throughout the past years, we have also improved our project portfolio considerably. This equips us to handle the current situation in a good way. We are concerned on the board that the improvement work must continue, even if prices have dropped severely. The company is in a sound financial position. We have put in place measures that make us stay competitive, that ensures wealth creation, and creates new activity in future. As for our plans and activities in 2020 and beyond, CEO Eldar Sætre will tell you more about that. During the past week, there's been a lot of focus on internal control, cost level in the media, and loss of equity in our American activities.
I will take this opportunity, dear co-shareholders, to share some reflections from our side. For the period from five to 10 years ago, they described a cost culture in the then American organization and parts of it that was definitely not a good thing. The way they describe it, we must simply say that this is not what we want in Equinor at all, and they also identified key weaknesses in the control system. This has been on the board's agenda since they identified these cases, and we have strongly and closely monitored this in the subsequent years.
Even if there will always be areas where we can improve, I must say that we have a very different situation today than they describe here. However, it's not a lack of internal audit and control that's led to the account losses we've had over a period of time in the U.S. It's primarily because of changes in expected oil prices and write-offs and costs of an exploration campaign in the Gulf of Mexico a few years back. We and other companies did not find that it met our expectations. It's a risky business to explore. Sometimes you discover oil, sometimes you don't. Onshore, we and other industries that were buying at that time at high prices, and at too high prices for field reserves, the prices did not stand up to the collapse of the oil industry in 2014.
This is a very expensive lesson that we would have liked to forgo, but we still own these reserves, and these are assets we believe will be recovered. Let me put it in perspective. The international activities have paid off for us. We have net totally invested a bit more than $100 billion outside Norway. We've had an incoming revenue stream so far of up to $70 billion. At the end of the year, we booked assets of $45 billion, roughly, after the write-offs that we made in the U.S. and in other places. Just like we went heavily into the Norwegian shelf to begin with, we see the same trend internationally. The international calculation is positive already by more than $10 billion, without us looking at value creation and wealth creation beyond the booked value.
The point was to get as much wealth as we can out of the assets we have. Let me point to some of the wealth creation we have delivered throughout this period. From 2001, we have all in all paid more than NOK 1,600 billion in taxes and dividend to the Norwegian government, and more than NOK 100 billion to other shareholders. From we went on the stock exchange in 2001, the yield on capital to our shareholders has been better than any of our competitors, and better than the stock exchanges in Oslo and New York. This happened while we built up our international activity, and that's part of it if we are to give a complete picture of the company. In his speech, Eldar will talk about our future thoughts about how we report.
The company's dividend policy is to increase the cash dividend at the rate of the long-term underlying earnings. The company decides on dividend to be paid for the first to third quarter based on an authority given by the AGM. The AGM approves the fourth quarter and the whole year as proposed by the board. The board suggests that the dividend for the fourth quarter 2019 be NOK 0.27 per share, an increase of 3.8%. As I mentioned, this is in keeping with our dividend policy and is based on delivery in 2019. As we've done in previous years, the board will ask the AGM for its authorization to decide on quarterly dividend until the next AGM. Given the extraordinary situation we are faced within the company, the board has decided to reduce the dividend for the first quarter 2020 by 67% to $ 0.09 per share.
This is still in accordance with our dividend policy, where we also take into account the expected cash flow, investment plans, financing needs, and the necessary financial capacity. The dividend for the first quarter of 2020 reflects the current market scenario. This decision comes in addition to several powerful measures announced by the company in recent years to strengthen our financial resilience. There's no change in Equinor's overarching dividend policy. In future, the board will therefore assess the overarching situation quarter by quarter. I refer to item 6 on the agenda. Let me move on to give an account of the board work in 2019. Corporate governance in our company is based on transparency and equal treatment of all shareholders. Our mandate is to guarantee long-term wealth creation for our shareholders, and look after the interests of other stakeholders in the company and the larger society.
The board of Equinor attach importance to keeping a high standard of corporate governance in keeping with Norwegian and international standards of best practice. The board must be independent and focused on preventing conflicts of interest between the shareholders, the board, and the corporate management. The board visits, when this is possible, regularly Equinor facilities and offices in Norway and internationally. We do this, among other things, to gain more insight, more knowledge about security and safety, and about the operative activities. In 2019, the whole board or parts of the board visited activities in Norway, the U.S., and the U.K., among other places, and we held eight ordinary and two extraordinary board meetings with an average participation of more than 98%. This year as well, we have received shareholders' motions to the AGM. I'll comment on and give reasons for the recommendations the board has given.
We have six submitted motions, all affecting how the company works to face the climate challenge, and I will look at them as a whole. Climate change is the greatest challenge of our time, and Equinor supports the ambitions of the Paris Accord to develop towards a low-carbon future. Because of this, the company has an integral part of its strategy work updated and presented a new holistic and ambitious climate roadmap. This will ensure competitive and robust business models for long-term wealth creation on the path to a net zero emission society by 2050. Equinor has a good and transparent dialogue with shareholders, and we strive for transparency on important issues surrounding our strategy and activities. We had a joint declaration in spring 2019 with the investor community Climate Action 100+ with new steps to highlight continuing leadership within climate change and showing strong support for the Paris Accord.
Since then, in a goal-oriented way, we have followed up all the items announced. In January this year, we announced a very ambitious plan to get close to net zero emissions from the Norwegian shelf by 2050. One month later, on our Capital Markets Day in February, we presented the totality of our updated climate roadmap. Here we announced Equinor's ambition to reduce net carbon intensity the whole way from production to consumption for produced energy by at least 50% by 2050, and our ambition to strengthen our industry leading position within carbon-effective production and achieve carbon neutral global operations as early as by 2030, and our ambition to have more or less 10 times our current energy capacity by 2026 and be a global leader within ocean wind.
This climate roadmap describes the necessary measures to stay competitive and drive change to a low-carbon future in keeping with the Paris Agreement. The company is compliant in its operations and focuses on health and safety for all employees. We seek to prevent damage to the environment, and we take the necessary precautions and work risk-based according to local requirements and practice to manage our environmental footprint. Safe and responsible operations are crucial to our activities and create the conditions for long-term wealth creation. The company is of the view that the company's climate strategy demonstrates a sustainable and balanced transition to a low-emission society. On behalf of Equinor, I take this opportunity to thank our shareholders for their commitment, which is important to us. We have faith in transparency and cooperation to reach our goals and the society's goals.
There's broad consensus about how important it is to address the climate changes, but people have different opinions about the best way to go about it. The board stresses the importance of complying with the principles for good corporate governance, and the board is of the view that our climate strategy demonstrates a sustainable and balanced transition to a low-emission society. Based on the above, the board recommends that the AGM votes against the motions numbers 9, 10, 11, 12, 13, and 14. Dear AGM, we're in a historically demanding situation. With the improvement work that has been carried out in recent years, Equinor is well equipped to handle the situation and navigate through what is demanding waters. Equinor's project portfolios takes Equinor towards the goal of being a broad energy company with good projects both within oil and gas and renewable energy.
The company has a sound foundation with competence, experience, and the ability to handle the current challenges. At the same time, we have room for maneuver and financial muscles to create and exploit future business models and opportunities. On behalf of the board, I want to thank the corporate management, especially the CEO, Eldar Sætre, for a good cooperation and for sound wealth-creating work in the past year. I also want to thank all the employees of the company who have helped create the results we have presented. I now give the floor to the CEO. Thank you for your attention. Thank you very much for your account. Due to the COVID-19 virus, we will clean the rostrum quickly before giving the floor to the CEO, Eldar Sætre
Thank you, Jon Erik. Dear fellow shareholders, the circumstances we now experience related to the coronavirus are quite extraordinary for us all. Therefore it makes me especially pleased that we're able to actually hold this year's annual general meeting in a highly untraditional, though satisfactory manner. As Jon Erik mentioned, 2019 was a good year for Equinor, and it may be useful to keep that in mind. While we experience an exceptional situation, both related to action to avoid the spread of the coronavirus and in our markets with extremely low oil and gas prices. We've already taken important steps to ensure our competitivity in this demanding situation through reducing costs and improving the liquidity. This provides greater financial flexibility in addition to the strong starting position we held even before the pandemic struck.
We've also established early on a COVID-19 project organization working across the entire company to ensure that we can handle all pending issues in the best and most coordinated manner possible. Equinor is a global company, and all of our locations are affected in various ways. We are also preparing for this to go on for a considerable time ahead. We now work mostly from our home offices, and we have reduced travels to an absolute minimum, and we've taken action to minimize the spread of infection in the fields and at the plants. At the same time, we also quickly learn how to work in other ways, not the least how to use digital technology more efficiently, and this learning must be included also in the way forward.
Today, I will spend the time to reflect on the markets in which we operate before commenting on the company's results for 2019, saying a few words on our strategic development. Let me also start with safety. The safety of all our employees, all of those who work for us, is our very top priority. We see a positive development within many areas. The personal injury frequency dropped in 2019 to 2.5 from 2.8 the year before. In addition, we also saw a continued reduction in what we call serious oil and gas leaks. However, as for the frequency of serious incidents, we were unable to maintain the positive trend and ended up at 0.6 compared to 0.5 the year before. The serious incidents, they remind us that safety is about people, both each of us and our colleagues.
Not the least, the tragic incident at the Heimdal platform in November of last year is an especially strong reminder of this. We absolutely depend on a robust and ubiquitous safety culture, and an important part of this is to ensure that the organization learns as much as possible of each incident. Furthermore, risk understanding, management, and cooperation are all important elements of such a culture. Equinor shall always be a leading company in safety, and therefore, we keep working on making improvements in all of these areas that I mentioned. Now, let me proceed with the financial results of last year. In 2019, we delivered solid results with an adjusted operating result of $13.5 billion before taxes and $4.9 billion after taxes. The operating result with respect to IFRS was $9.3 billion in 2019 compared to $20.1 billion in 2018.
The reduction was mainly due to lower liquid and gas prices. The yield on average earning assets was 9%, and we delivered $13.5 billion in cash flow from operations after taxes. Overall, own production of oil and gas was about 2.1 million barrels of oil equivalents a day, which is about the same as the year before when we adjust for the moving of gas sales to periods with higher expected prices. Last year, we also had one of the highlights in the history of Equinor when we could on the 5th of October start up the production at the industrial giant Johan Sverdrup. This field offers both high value creation and record low emissions. The production was started more than two months ahead of the original schedule and more than 30% below the original cost estimate.
The balance price of the full field development, including phase two, is below $20 per barrel. Expected operating costs are below $2 per barrel. Since the start-up, we've also had an impressive build-up of production, and the plateau of phase one was reached already by April of 2020. I would also like to mention five other projects that went into production in 2019, and those are Trestakk, Mariner, Utgard, Snefrid Nord, and Barnacle. In 2019, we also strengthened our position within digitalization and automation. New digital solutions resulted in $400 million in cash flow effects throughout last year. The digital improvement measures include, among other things, 20 fields of streaming data to our integrated operations center in Bergen, and by the end of the year, all plants on the Norwegian Shelf will be hooked up.
We have implemented so-called digital twins at 10 plants, a technology which helped Johan Sverdrup start a month early, among other things. We have also installed equipment for so-called automated drilling control on 13 rigs, and we can already see good effects from this technology. Our data platform for underground data has now been made available for more than 50 fields, where we now apply AI technology and other measures to enhance exploration and optimize production. In addition, more than 6,000 of our employees will start to use advanced digital solutions by the end of this year. Let me also mention our exploration activities. At the end of the fourth quarter of 2019, Equinor had completed 42 exploration wells, of which 18 with commercial findings. 11 of these findings were made on the Norwegian Shelf. 2019 also represented, in many ways, the crossroads for our renewable business.
We decided to invest in Hywind Tampen, the world's first floating offshore wind farm to supply offshore field operations in Norway. Now, just before Easter, the plan for development and operations was approved. We also won important bidding rounds last year related to the development of Empire Wind off the coast of New York and Dogger Bank in Great Britain, the world's largest offshore wind project. Renewables projects in development in 2019 will increase Equinor's capacity of electricity production by 2.8 GW, which is more than five times today's capacity. As we announced at the Capital Market Day in February, we will also now increase the visibility of the results from our renewables activities when presenting the quarterly reports. The renewables business today does not constitute a separate reporting segment, but as this business grows, it will be natural for us to include a special segment for this, too.
Jon Erik addressed in his speech the discussion now going on about the value creation in the U.S. and what this business has had. We have reported quarterly about any depreciations and reversals in the U.S., and this is what has mainly resulted in financial loss over time. In addition, in recent years, we've given an annual overview of, among other things, revenue and costs, results before and after taxes, investments, and equity development in the U.S. This has not been hidden or secret in any way, but from now on we will make changes to make the results from the U.S. more visible also in our quarterly presentations. Starting with the presentation of the results for the second quarter, we will report the U.S. as a separate operational segment within Exploration & Production International.
This implies that we will provide the same financial information as for the reporting segments, including the financial results, adjusted results, before and after taxes, investments, any depreciations and reversals, and the developments within other assets. We will also make a further assessment of the convenience of including establishing the U.S. as an entirely independent reporting segment. Let me then say something about how we regard our industry and our markets considering today's extremely demanding situation. The outbreak of the coronavirus has led to strict government measures in many countries, which in turn have had a strong negative impact on the demand for our products, and especially this applies to oil. We expect a significant decline in the world economy in this year, as well as still low market prices for a good while.
Some of the most important determining factors ahead will be on the demand side, an easing of the measures meant to curb the spread of the coronavirus, and on the supply side, political measures to improve the demand-supply balance, and market-run consequences in the direction of reduced production capacity. Today's market is considerable change since 2019, when the average oil price was $64 a barrel. As a long-term industry, we are used to prices swinging considerably at times. The situation we are in now is quite extraordinary, and it lacks comparison in the history of Equinor. As I mentioned in the beginning, we have taken powerful action and presented a cost reduction plan of $3 billion for this year.
In addition to this, we've issued $5 billion in bonds, and the board has also suspended the share buyback program for now, and the dividend for the first quarter is reduced by 67% to $0.09 a share. I also want to say a bit about the significance of our strategy: safe operations, high value creation, and low carbon emissions. This strategy has served us well and now seems, in fact, more important than ever. At the start of 2020, we launched a new climate roadmap to ensure a competitive business model and long-term value creations in line with the Paris Agreement. Our ambitions include, among other things, to reduce the carbon intensity of all our products all the way from production to consumption by at least 50% by 2050. We have an ambition to have carbon neutral global operations by 2030.
Furthermore, we would like the renewable energy capacity to increase tenfold by 2026 and to become a global leader in offshore wind. We also have an ambition to gradually reduce the overall greenhouse gas emissions from our own operated fields and onshore operations in Norway. This will be done step by step with a 30% cut in 2030 and a 70% cut by 2040, and nearly zero in 2050. I can also say a little about the project we call Northern Lights, for which we are about to submit a plan for development and operations to the authorities. Here we are cooperating with Shell and Total, as well as with Norwegian authorities to implement a full-scale carbon capture and storage. This project is part of a value chain in which we capture CO2 from industrial locations.
First of all, to begin with, from Norway, we transport it to the natural gas processing plant at Kollsnes and then export it out to a storage reservoir in the North Sea, south of the Troll Field. As for climate challenges, I would like to emphasize the following. These don't make the news headlines in today's situation, but they are not less important for that reason. I am absolutely convinced that the attention to climate changes will come back stronger and that the expectations to both governments and companies will be greater than ever. Allow me, therefore, to also say a bit about the dialogue we have with the investor group of Climate Action 100+. In April of last year, we made a joint declaration with this group announcing new steps to show our strong support of the targets in the Paris Agreement.
In the course of 2019 and 2020, we delivered on all of these items, also on the short, medium, and long-term perspective. I also want to take the opportunity to thank the investors behind Climate Action 100+ for the regular and constructive dialogue that we continue to have with them. Let me end by saying the following. These are extremely demanding times. I am nevertheless convinced that we will get through this together in a good manner. We've handled demanding situations before. Now we will do it again. Today, Equinor has a strong position in many areas. We also have a clear strategy for further development of the company. We have positioned ourselves well in order to ensure long-term value creation for the shareholders to develop into a wide energy company and to be competitive also in a low-carbon future.
Both the results and the industrial progress in 2019 confirm that we are on track. I also want to thank all our employees for the efforts they make every single day. I am impressed and very proud of our organization's ability to handle all the changes that have come, and at the same time, staying in operation in a safe and efficient manner. The work that you all do is extremely important to keep supplying society with energy in challenging times, and to continue our development of becoming a wide energy company. You make me a proud Group CEO. Finally, I will also extend my gratitude to the Board of Directors, not the least to the Chair of the Board of Directors for a good and trusting cooperation. Thank you for your attention.
Thank you for both accounts. Let's move on to item nine, a proposal put forward by a shareholder, and the proposal under item nine was distributed with a notice of the meeting and is being shown on the screen, so it will not be read aloud. The shareholder putting forward this motion is not present. Fredrik Jebsen Bråthen from Equinor's corporate communication department will thus read the presentation by the shareholder, and will revert to any comments regarding item nine and the vote on this motion.
Chairman, Mr. Sætre, directors, and shareholders. Equinor jumped over its shadow after the AGM in 2019. On sixth of February 2020, Equinor set a climate ambition. We welcome this ambition because it includes emission reductions of energy products, the so-called Scope 3 emissions. A year ago, at the same location in Stavanger, Scope 3 was the elephant in the room that the board did not want to talk about. Scope 3 was a reason that the board rejected our resolution that supports Equinor to set Paris-aligned targets for all emissions. Our activities do not include direct engagement with end users of products, the director stated in the board's response. We thank the board of Equinor for crossing the Rubicon on Scope 3, and we thank the investors that supported such a step by voting for our climate targets resolution in 2019.
Equinor's move showed once again that a minority of responsible shareholders drives change. Today, our updated climate targets resolution comes to a vote again. Our request remains the same. In this year's resolution, we recognize Equinor's first important step and support the company to advance this ambition to short, medium, and long-term targets that are aligned with a well below two degrees Celsius pathway. Your ambition of halving the carbon footprint of energy products is unfortunately by far not enough to reach the Paris goal. We believe that only concrete targets for all emissions will lead oil majors to necessary shift in investments from fossil fuels to renewables. Only the biggest industry incumbents like Equinor have the technical knowhow, financial muscle, and marketing making opportunities to rapidly scale the energy transition to renewables.
In the five years since the Paris Climate Agreement, oil majors have moved too slowly to adopt renewables. Total investments in renewable energy by Equinor and its peers are around 5% of their investment pipelines. Nowhere near what is needed to have any chance of reaching the Paris goals. We, the shareholders, have the opportunity to compel oil majors to change course. A growing body of investor opinion sees climate resolutions as integral to their fiduciary responsibility. As the proxies have understood, investors are stewards of both their investees companies' future and the world economy wracked by climate breakdown. Shareholder votes for these climate targets will never be unnecessary. All of our climate resolution will end with the words, "You have our support." To offer shareholders transparency and clarity about your climate ambition, we have two questions that can be answered by a simple yes or no.
1, will your net relative emission reduction ambitions, net carbon footprint ambitions lead to a net absolute emissions reductions for your total yearly Scope 1, 2, and 3 emissions within this decade by 2030? 2, will your ambitions lead to a fundamental shift in investments away from fossil fuels to renewables of at least 50% annually within this decade by 2030? We thank you for this opportunity and hope to meet you in person again in 2021.
Thank you. We move on to item 10, a proposal put forward by a shareholder. The proposal under item 10 was distributed with a notice of the meeting and is being shown on the screen, it will not be read aloud. The shareholder putting forward this motion is not present, Fredrik Jebsen Bråthen from Equinor's corporate communication will thus read the presentation by the shareholder and will revert to any comments regarding item 10 and the vote on this motion. Equinor is the Norwegian people's oil company. Norwegian citizens currently own 67% of the shares Just over 70%, including the National Insurance Fund's shares. Our interests are supposed to be looked after by the government and the Ministry of Petroleum and Energy.
I'm a shareholder and I'm a citizen, and it seems to me that it's the interests of the petroleum industry that are being looked after, not those of the citizens and future generations. The Grandparents Climate Campaign, therefore, had an amicus brief for Friends of the Earth and Greenpeace when they sued the government for violation of the environmental article 112 in the Constitution by awarding exploration licenses in the Arctic. Our only planet is hit by very serious climate-related disasters more and more, and the United Nations Climate Panel are clear. They say that we now are too dependent on fossil energy sources, and we have a climate and nature crisis all in one. There is a fatal global warming that is exacerbated. There's rapid development now of new renewables. Equinor has the financial muscles to lead this development and at the same time phase out fossil energy production.
This would contribute to a lot of new industrial jobs that Norway needs in Equinor and in the supplier industry. Instead of reducing the activity on the Norwegian shelf, Equinor plans to electrify parts of Norwegian oil production to reduce domestic climate emissions in keeping with the Paris Accord. Equinor should instead contribute to emission reduction by reducing the oil production and exploration activity, rather than use valuable renewables to reduce emissions. The major emissions are happening when Norwegian petroleum and gas is burnt abroad. When other countries have to reduce their emissions, we have no guarantee that we will get a financially viable price for our oil and gas. As a shareholder, I object strongly to Equinor's foreign projects. Going into oil sands in Alberta and Canada led to great pollution problems for the indigenous peoples and damaged their health and natural environment.
Equinor invested NOK 800 billion of Norwegian citizens' money abroad. All in all, they haven't made money on these enormous investments. Norway should be ashamed to be behind these great pollution problems and the global warming of these projects. These days, we are going through a global pandemic caused by the new coronavirus. There's no inoculation against it or immunity in the population. The result is a dramatic reduction of air traffic and other traveling, and a serious downturn on the stock exchanges of the world, which may contribute to a long-term reduction in demand for fossil fuels. Instead of waiting for better times for the oil industry, which probably won't come, Equinor should produce a plan for reducing oil and gas production as rapidly as possible. This was Bente Marie Bakke.
We move on now to Item 11, a proposal put forward by a shareholder under Item 11. You can read this in the notice of the meeting, and it's being shown on the screen, and it will not be read aloud. The shareholder putting forward this motion is not present. Fredrik Jebsen Bråthen from Equinor's Corporate Communication will thus read the presentation by the shareholder and will revert to any comments on this, and a vote on the proposal.
Doctors have an ethical obligation to notify when there is a great threat to health. According to the medical journal, The Lancet, global warming is the greatest threat against public health in our century. The climate crisis is a health crisis. If other countries do what Norway did and all energy companies do what Equinor
The world, according to today's best scientific estimate, will be headed towards a global warming of 3 degrees Celsius or more. This will give an increase in heat waves, malnutrition, hunger, diarrhea, and other infections. This will quash the progress made in global health in the last decades. Rising oceans, flooding, droughts, heat waves, and cyclones will make large parts of the world uninhabitable. Many hundred millions of people will be forced to leave their homes. All countries, even Norway, will be affected by the health consequences of the climate changes. As a rich country with large global greenhouse gas emissions, Norway has a special moral and financial responsibility to be in the front of the climate battle. Equinor is contributing to Norway's largest greenhouse gas emission, therefore, the company has a special responsibility to govern the energy market in a more health-suitable direction.
Equinor is on its way with good projects and plans. Nevertheless, only constitutes a fraction of the greenhouse gas emissions caused by the company's fossil energy production outside of Norway. I remind you of the Urgenda case in the Netherlands, where the courts made the state take active charge against the climate damage. Equinor is in a good position to take such action financially, knowledge-wise, and in terms of experience. Not only considering the health threat, but also considering the company's finances, this is urgent. Demand for fossil energy is declining, and there is an increasing risk of lawsuits.
It's enough to remind you of the American tobacco companies who've been made to pay billions of dollars in compensation to the people who have suffered, not only because they were producing health-damaging products, but also because they continued once they were aware of the health risks that it led to. Good climate action are also good health action. According to the WHO, the health gains in themselves, in reduced global warming, will far supersede the costs of reaching the targets of the Paris Agreement. Around 1,000 Norwegian doctors recently delivered a declaration to the Storting president about the health threats of climate changes. I would like to remind you that the state, that's the people. The concern that a lot of Norwegians now have is shared by many Equinor shareholders and employees. The company will no longer be able to say in defense that they didn't know.
Without changing its course, Equinor will risk that the judgment of history will be crushing. As a shareholder and a doctor, on behalf of the Doctors' Climate Campaign, I ask for Equinor to accept the following motion. Thank you.
We move on to item 12, a proposal put forward by two shareholders. The proposal under item 12 was distributed with the notice of the meeting and is being shown on the screen, so it will not be read aloud. When they're finished cleaning, we'll give the floor to the shareholder who submitted the proposal, who'll have five minutes for their presentation, and we'll revert to any comments and the vote on this motion.
Dear AGM, we live in difficult times, but we do the best we can here to keep our distance. I can see that. I'm Martin Norman. I represent Greenpeace and WWF, and they are putting the motion forward with us. We have put forward a motion that we feel that the board and the shareholders should vote in favor of.
We all know, Equinor know very well, that the climate crisis is sneaking up on us violently, hard, and it's coming faster than the conservative estimates seem to suggest. There's another crisis, and there's less talk about that, and that's a general natural crisis. There was a report from WWF in 2018 that showed that all over our planet, nature is under great pressure from industrialization. There was a UN report in 2019 that showed the very same thing, just in much more detail. 25% of the species of the Earth are threatened with extinction. The thing is, not Equinor, not the shareholders, not the Norwegian people will benefit from a collapse of our general ecosystem, will they? Equinor has changed a lot since I started attending this AGM in 2009. We recognize that.
We see many changes in the company, we agree totally about how quickly the change has to happen, but that's maybe no surprise. When we start looking at the guidelines Equinor has when it comes to our natural environment, generally, we don't find much. IUCN, we've seen them refer to that. You shouldn't drill in areas that are protected by IUCN, and we really hope you won't do that because it would be illegal, as far as I know. That brings us back to the thing I was saying. The only thing they relate to is whether it's possible, sometimes it's not possible, and whether it's legal. The problem here, in our view, is that far too often, nature loses out at the altar of profit. This doesn't happen only in other countries in the world. We see it in Norway.
Recently, when it came to the ice edge, our politicians decide on a location for the ice edge despite all professional scientific advice from scientists. In a world like that, it's not enough to relate to what is law. It's tempting, obviously, for Equinor to do that. I can understand that. You can say it's not their job to do anything other than obey the law. However, if that's the case, I think you can save a lot of money on communication. As shareholders, as Norwegians, we expect you to be more forward-looking and active as a company when it comes to the climate and when it comes to the natural environment. We ask for support for item 12, for our proposal.
Now I'm on the rostrum, I want to say another thing. It's not quite pertinent when it comes to item 12, but I worked a lot with North America and Equinor's investment in North America, and I'm speaking on behalf of many, many people in Norway when I say that even I am surprised at what happened there. I'm not talking about the NOK 200 billion necessarily, because everyone knew that they bought at a high price, but the business culture shocked me, and that it could go on for so long. I hope that we will have an open and transparent process surrounding this, so we can get to the bottom of how it happened and make sure it never happens again. Thank you.
Thank you. We will now have another round of cleaning, and we now move on to item 13. Sorry, item 13, put forward by shareholder, and since it's been shown on the screen, it will not be read aloud. The shareholder putting forward this motion is not present, so Fredrik Jebsen Bråthen will thus read the presentation by the shareholder, and then we'll revert to any comments, and the vote on this motion later.
To protect the value of my shares and reduce the Norwegian state's risks relating to Equinor's global oil and gas operations. At the same time, Norway must meet its obligations with regard to keeping global warming below two degrees Celsius and assist in global CO2 emission reductions. The market situation for oil and gas activities is now as follows. One, the share prices of oil and gas companies keep declining, whereas shares in companies in the renewable energy sector are sharply increasing. Two, Equinor's oil and gas operations overseas have generated great losses and write-offs for the company. Equinor is now active in 34 countries, of which 20 with high corruption risks, low transparency, and poor governance. With the currently very low oil prices, further losses are expected.
Three, there is much more oil and gas in the proven global reservoirs than can be extracted if the UN two degrees Celsius target is to be met. New drilling projects in the Norwegian sector should be stopped and oil production reduced. Four, it is highly likely that the price of oil will keep declining and stay below $20 a barrel for a long time. Therefore, Equinor may end up with many stranded assets that will have a substantial effect on the value of the company and not at least the Norwegian state's revenues after granting governmental subsidies for new reservoir drilling. Five, the costs of oil and gas production in the Norwegian sector are much higher than, say, in Saudi Arabia or Russia, who both are likely to continue producing as long as there is a demand.
Six, Equinor's oil and gas products sold generate some 300 million tons of CO2 emissions per year. This is 7.5 times Norway's onshore emission. Seven, Equinor's activities within sustainability, Scope 1, Scope 2, and especially Scope 3, are not impressive. One model is Microsoft, who aims to recover all CO2 emissions from the atmosphere that they and their supplier activities have generated since 1975. This by 2050. However, this is an impossible task for Equinor, as the company generates some 300 million tons of CO2 emissions per year through their oil and gas sales. There are, again, Norwegian plans to start CO2 gas absorption and transportation from onshore industrial plants for injection, CCS, into Equinor's wells in the Norwegian sector. This is an extremely costly process that has no future until at least the CO2 quota price is over NOK 2,000 per ton of CO2.
It is currently at about NOK 250 per ton of CO2 in the EU quota system. By way of comparison, oil at $30 per barrel corresponds to about NOK 2,300 per ton of oil, about the same as the costs of CCS from Norway into Equinor's wells. Compare governmental report number D-O14A, 2016. This clearly shows how economically hopeless the CCS process is. In 2019, Equinor only spent $60 million on low carbon R&D. That is less than 0.1 of their revenue. Not impressive for a $65 billion company who claim to be concerned about global warming and the environment. Eight, an example of how Equinor can be split into two companies is found in Denmark. DONG was a national oil and gas and energy company. The company was split into two parts.
The oil and gas business was sold to other market players, and a new company, Ørsted A/S, was established focusing on renewable energy projects in Europe and electricity production in Denmark. Ørsted's share price doubled in two and a half years, while Equinor's shares are down by 40% in the same period. All of this is not new, and many people have discussed and written about it, including Norsk Klimastiftelse, the Norwegian Climate Foundation, memo number one, 2020. Yours sincerely, Even Bakke.
Thank you. We now move on to item 14, a proposal put forward by a shareholder. The proposal under item 14 was distributed with the notice of the meeting and is being shown on the screen, so it will not be read aloud. The shareholder putting forward this motion is not present, so Fredrik Jebsen Bråthen from Equinor's corporate communication will thus read the presentation by the shareholder and will refer to any comments regarding item 14 and the vote on this motion. The winter this year was the mildest in Norway in 120 years, and the ice is melting quickly at both poles. The global average temperature of 2019 was one of the very highest ever measured.
A main reason for the strong heating is, as known, the increase in the human influence climate changes as a consequence of increased emissions of the greenhouse gases CO2 from the burning of fossil fuels such as oil and gas. Equinor is one of the world's large producers of precisely oil and gas. While the alarm bells are ringing with investors and insurance companies, Equinor, according to their new climate roadmap, shows no plans of reducing their own production of oil and gas in the years ahead. On the contrary, exploration and drilling is to continue as before. Equinor should be acknowledged for having this climate roadmap and saying that they will put more effort into renewables and other means to reduce their own carbon intensity from produced energy by at least 50% by year 2050. It's too little and it's too late.
Equinor's steady course of continued oil and gas production is not sustainable, neither for the company nor for the coming generations. When Norges Bank is recommending the state to pull the pension fund investments out of smaller oil companies, Equinor should listen. As a responsible energy company, Equinor needs to reduce the risk by changing the course and ensuring the company's future and the values of the shareholders. An increased effort in renewable energy must not be in addition to, but it must replace oil and gas. The planned billion investments in exploration and drilling must be replaced by investments in production of renewable energy. Equinor should go ahead with a good example to the other oil companies and show them the way out of fossil dependency. Based on this, I would like for the AGM's support to the proposal or the motion signed by Guttorm Grundt.
Thank you. We'll now open the floor for comments on the presentation by the chair of the board and the CEO, as well as comments on the six proposals from shareholders that have been presented. For practical reasons and for time efficiency at this AGM, I would ask that you keep your comments brief and to the point and respect the allotted time of up to three minutes. The floor is now open. Would those who are here like to speak, then please raise your hand. Thank you. There are people in the adjacent room, and they also have to make themselves known and will be accompanied down for their statement. Go ahead. Please go to the rostrum and introduce yourself.
You have up to three minutes speaking time, and I ask you to please keep your distance to others on your way up to the rostrum and down, and we'll clean the rostrum for you.
Lerstad, we shareholders are shocked and badly informed about this huge, enormous loss of NOK 200 billion in the U.S. This is the largest industrial scandal in Norwegian history, according to the media, and this can't all be due to lower oil prices and unprofitable investments. American auditors have pointed to economic chaos, a bad culture, overconsumption, waste, and incompetence. Has no one listened to them among the corporate management in Norway? Did they not understand how little profit there was in the U.S.? For NOK 200 billion, you could have had a lot of excellent renewable projects and created jobs in Norway. I'm sure they must have known about this poor business culture.
This is passive ownership policy. The state's representative, can he explain how the state and Equinor, how their dialogue progressed? There has been many warnings from the environmental organizations, from trade unions. Specifically, how does internal audit now show improvement? We have only seen some comments in the accounts, but we shareholders have not been kept abreast on an ongoing basis about the losses in the U.S. It has not been reported as a separate segment either. Equinor must ensure that all shareholders get all relevant and updated information about the activities of the company. This is also important for item 15 today about the Corporate Governance
Report from the Board of Directors. Apart from the Chair of the Board's speech today, besides that, we want a more complete comment from the auditor, the Board, the Legal Counsel, the Corporate Management. We don't want this from parliament or through the media.
We suggest that shareholders should at least be given a more thorough and written account of this to highlight any improvement work that's been going on, and a critical review of this huge loss in the U.S. in the past few years. This must be presented at the AGM in 2021, and then we shareholders can take a stand on whether we will accept that report or not. Thank you. There appears not to be any more people who wish to speak. Yes. Okay. There's one. Please go ahead.
Hello. My name is [Eva Sætra]. For information, I am in no family relation to the CEO. I would like to say something about wind energy. As a shareholder, I am interested in the financial result of Equinor being the best possible. As a shareholder, I suppose that the company will comply with laws and regulations. As shareholder, I also would like the company's result to be based on their own value creation. Equinor inform us, in connection with the result of 2019, that the price of delivered electric power from offshore wind in 2019 was about two NOK per kilowatt hour, or GBP 170 per MWh , since it was in Scotland. This is a price which is three to four times higher than market price in the U.K., according to Nord Pool, and means that the electricity is strongly subsidized.
Subsidies are paid with value creation in other industry, which thereby is burdened unnecessarily. Subsidies may at times be suitable for development projects with a limited framework. However, subsidies should not be used for regular industrial business, since it reduces the value creation in society. Such business is not sustainable in the long run and can harm the players. I have some questions. I forwarded these questions to the secretary, sorry, and asked for them to be included in the notice, but they were not. What? Pardon? Something was said off mic. It was not presented too late. No, it wasn't. I ask for the board or the management to answer the following questions.
How great of a part of the revenue from offshore wind are direct subsidies, in other words, surplus with respect to the market price and per development, and how great subsidies are given in the sense of advantages once the power has already been delivered? That's because offshore wind is uneven energy that needs to be balanced through the use of other energy. When will Equinor expect the price of offshore wind to balance with the actual market price? What is Equinor's demand or requirement of long-term profit for offshore wind? Something else that doesn't pertain to offshore wind, has Equinor considered alternatives such as nuclear power?
I have received an answer, a general response from Equinor, and I thought it was very general, so I regard that it's not necessary to read the response here, but I would like you to take it down in the minutes, please. Thank you.
Thank you. Anyone else wanting the floor? I don't see anyone. Let's close the list of speakers. That brings us back to the approval of the annual accounts and directors' report for 2019. I will now give the floor to State Authorized Public Accountant, Erik Mamelund from EY, who will read excerpts from the auditors' report for 2019. Mr. Mamelund is participating via live webcast from Fornebu.
Thank you. I will read the conclusions in our audit opinion. We have audited the financial statements of Equinor ASA, comprising the financial statements of the parent company and the group. The financial statements of the parent company comprise the balance sheet as at 31st December 2019, the statements of income, comprehensive income, and cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies.
The consolidated financial statements of the group comprise the balance sheet as at 31st December 2019, the statements of income, comprehensive income, changes in equity, and cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies. The financial statements are, in our opinion, prepared in accordance with the law and regulations. The financial statements present fairly in all material respects the financial position of the parent company as at 31st December 2019, and of its financial performance and its cash flows for the year then ended, in accordance with the Norwegian Accounting Act and accounting standards and practices generally accepted in Norway.
The consolidated financial statements present fairly in all material respects the financial position of the group as at 31st December 2019, and of its financial performance and its cash flows for the year then ended, in accordance with the International Financial Reporting Standards as adopted by the EU. In other respects, I refer to our auditor's report, where we also talk about three vital key audit matters for the audit of 2019. Recoverable amounts of production plants and oil and gas assets, including assets under development, and estimation of the asset retirement obligations, and IT user access management. That was a summary of our audit opinion, thank you for your attention. I give the floor back to you, Tone.
Thank you, Mr. Mamelund. As the Chair of the Corporate Assembly, I will now read aloud the Corporate Assembly statement on the Board of Directors' proposal.
At its meeting on 19th March 2020, the corporate assembly reviewed the financial statements and directors' report for 2019 for Equinor ASA and the Equinor Group, and the board's proposal for the allocation of the net income for the year. The corporate assembly supports the board's proposal for the annual accounts and the allocation of the net income. The general meeting is encouraged to adopt the board's proposal for the annual accounts for 2019 for Equinor ASA and for the Equinor Group, as well as the directors' report on the distribution of the proposed fourth quarter 2019 dividend. The payment of dividend is expected to take place around 29th May 2020. Can the general meeting approve the proposed resolution under item six? You need to step up here. We don't have a microphone, sorry.
First of all, you haven't answered all the questions I asked just now. I have an additional proposal or an elaboration on the proposal regarding item six, what's been referred to earlier that, as a shareholder, I ask for a more detailed written account of improvements and a critical review of the enormous losses in the U.S. throughout the recent years, that it must be produced at the AGM in 2021. This is not controversial business. It's about transparency and new information that we as shareholders. We have the right to get this information as shareholders. The proposal is that it is brought as a motion next year as the shareholders. For next year. That's if it's a follow-up, but we have now dealt with the accounts for 2019, that is what we are dealing with now.
The shareholder cannot be heard. No mic, sorry. This will be seen as a new item that you are presenting now. I was going to answer your question. We see this as a new item when you ask for an account in the way you do from the corporate management. It's too late now to put forward a request for a new matter that would have had to be part of the notice convening this AGM. That was I suggest, as you said yourself, that an account be given of this in 2021 at the AGM when we deal with the accounting year of 2020. I ask my question again. Can the AGM approve the proposed resolution under Item 6? There seem to be no further objections. The proposal is hereby carried.
We move on to Item 7, the authorization to distribute dividend based on approved annual accounts for 2019. The proposed resolution was distributed along with the notice. It is displayed on the screen and will not be read out loud. Can the general meeting adopt the proposed resolution under Item 7? There seem to be no objections, the board of directors proposal is thereby carried.
Eight, reduction in capital through the cancellation of own shares and the redemption of shares belonging to the Norwegian government. The suggested decision was distributed with the notice, and is on the screen, and will not be read aloud. Can the general meeting adopt the proposed resolution under Item 8? There seem to be no objections, and the proposal from the board is hereby deemed carried.
We will then move on to vote on Item 9 and the submitted proposal, which is displayed on the screen. The proponents have confirmed that a written ballot is not requested, and thus, we will vote with a show of hands. If you wish to support the shareholder's motion, vote in favor of the motion, and you vote against the motion if you wish to follow the recommendation of the Board. I now ask those of you in the room who support the motion of the shareholder to raise a hand, while those who do not support the motion do nothing. For the proposed resolution to be carried, a simple majority of votes cast is required, and I've noted that the representative of the Norwegian government, holding 67% of the votes, and several other shareholders have done nothing, indicating that they support the Board's recommendation.
Therefore, the resolution does not have the required majority and has not been carried. Shareholders who've not cast their vote electronically in advance and who wish to register their vote in favor of this motion are asked to turn to the DNB desk by the entrance immediately after the meeting is adjourned. Those who do not register the vote in favor of the motion with DNB at the end of the AGM will automatically be registered as having voted against the motion. We now move on to vote on Item 10, and the proposal submitted is displayed on the screen. The proponents have confirmed that a written ballot is not requested, and thus, we will vote with a show of hands.
If you wish to support the shareholder's motion, vote in favor of the motion, whereas you vote against the motion if you wish to follow the recommendation of the board. I now ask those of you in the room who support the motion of the shareholder to raise a hand, while those who do not support the motion, do nothing. Thank you. For the proposed resolution to be carried, two-thirds majority of votes cast is required. I've noted that the representative of the Norwegian government, holding 67% of the votes, and several other shareholders have done nothing, indicating that they support the board's recommendation. Therefore, the resolution does not have the required majority and has not been carried.
I ask shareholders who have not cast their vote electronically in advance and who wish to register their vote in favor of the motion to go to the DNB desk by the entrance immediately after the meeting is adjourned. Those who do not register the vote in favor of the motion with DNB at the end of the AGM will automatically be registered as having voted against the motion. We will then move on to the vote on Item 11, and the proposal submitted is displayed on the screen. The proponents require two-third majority, I'm sorry, I read from the wrong place. The proponents have confirmed that a written ballot is not requested, and thus, we will vote with a show of hands.
If you wish to support the shareholder's motion, vote in favor of the motion, and vote against the motion if you wish to follow the recommendation of the board. I now ask those of you in the room who support the motion of the shareholder to raise a hand, while those who do not support the motion, please do nothing. Thank you. For the proposed resolution to be carried, two-third majority of votes cast is required. I've noted that the representative of the Norwegian government, holding 67% of the votes, and several other shareholders have done nothing, indicating that they support the board's recommendation. Therefore, the resolution does not have the required majority and has not been carried.
Shareholders who have not cast their vote electronically in advance and who wish to register their vote in favor of the motion should go to the DNB desk by the entrance immediately after the meeting is adjourned. Those who do not register their vote in favor of the motion with DNB at the end of the AGM will automatically be registered as having voted against the motion. We then move on to the vote on Item 12, and the proposal submitted is displayed on the screen. The proponents have confirmed that a written ballot is not requested, and thus, we will vote with a show of hands. If you wish to support the shareholder's motion, vote in favor of the motion, and you can vote against the motion if you wish to follow the recommendations of the board.
I now ask those of you who support the motion of the shareholder to raise a hand, while those of you who do not support the motion do nothing. Thank you. For the proposed resolution to be carried, a simple majority votes is required. I have noted that the representative of the Norwegian government, holding 67% of the votes, and several other shareholders have done nothing, indicating that they support the board's recommendation. The resolution does not have the required majority and has not been carried. I ask the shareholders who have not cast their vote electronically in advance and who wish to register their vote to go over to the DNB desk by the entrance immediately after the meeting is adjourned.
Those who do not register the vote in favor of the motion with DNB at the end of the AGM will automatically be registered as having voted against the motion. We now move on to the vote on Item 13, and the proposal submitted is displayed on the screen. The proponent has confirmed that a written ballot is not requested, and thus, we will vote with a show of hands. If you wish to support the shareholder's motion, vote in favor of the motion, whereas you'll vote against the motion if you wish to follow the recommendation of the board. I now ask those of you who support the motion of the shareholder to raise a hand, while those who do not support the motion do nothing. For the proposed resolution to be carried, a two-thirds majority of votes cast is required.
I've noted that the representative of the Norwegian government, holding 67% of the votes, have done nothing, indicating that they support the board's recommendation. The resolution therefore doesn't have the required majority and has not been carried. I ask the shareholders who have not cast their vote electronically in advance and who wish to register their vote in favor of the motion to go to the DNB desk by the entrance immediately after the meeting is adjourned. Those who do not register the vote in favor of the motion with DNB at the end of the AGM will automatically be registered as having voted against the motion. We move on to vote on Item 14, and the proposal submitted is displayed on the screen. The proponent has confirmed that a written ballot is not requested, and thus we'll vote with a show of hands.
If you wish to support the shareholder's motion, vote in favor of the motion, and you can vote against the motion if you wish to follow the recommendation of the board. I now ask those of you in the room who support the motion of the shareholder to raise a hand, while those of you who do not support the motion do nothing. For the proposed resolution to be carried, a two-thirds majority of votes cast is required. I've noted that the representative of the Norwegian government, holding 67% of the votes, and several other shareholders have done nothing, indicating that they support the board's recommendation. Therefore, the resolution does not have the required majority and has not been carried.
I ask shareholders who have not cast their vote electronically in advance and who wish to register their vote in favor of the motion to go over to the DNB desk by the entrance immediately after the meeting is adjourned. Those who do not register the vote in favor of the motion with DNB at the end of the AGM will automatically be registered as having voted against the motion. The results of the ballots for the shareholder proposals will, as with all ballot results, be included in the appendices to the meeting minutes posted on the company website shortly after the AGM.
We move on to Item 15, which is the board's report on corporate governance. Pursuant to Section 5-6(4) of the Norwegian Public Limited Liability Companies Act, the AGM shall review and consider the board's report on corporate governance submitted in compliance with Section 3-3b of the Norwegian Accounting Act. The statement is included in Chapter three in Equinor's annual report, which has been made available on Equinor's website prior to the AGM. The AGM shall carry out an advisory vote regarding the corporate governance report, the board proposes that the general meeting endorses the report. Reference is made to the chair of the board's comments on the report earlier at today's general meeting. Are there any comments on the report?
Yes. To the rules of procedure, I feel that this report is deficient in some ways.
It's supposed to give corporate governance in a complete manner from the last period. In Chapter 3, it says that all shareholders have the right to all updated, reliable, and relevant information about the company's activities. That's what it says there. As a shareholder, I have previously mentioned that we don't feel we have got comprehensive and satisfactory information and a proper overview of what's been going on. This isn't all about the accounts for and reports for 2019. It dates back further, as we all know, we would have appreciated at least a comment in more depth and some suggested solutions and closer reasons, more detailed reasons for how this was possible. Maybe it doesn't belong under item 15 exactly, I think it's appropriate to mention it with that reservation.
I say thank you for your comment, and I ask whether the AGM can endorse the board of directors report. In that case, with that comment, it's been resolved that the general meeting endorses the board of directors report. The board of directors statement now on stipulation of salary and other remuneration for executive management. In accordance with Section 6-16a of the Public Limited Liability Companies Act, the board of directors will prepare a statement on the stipulation of salary and other remuneration for executive management. The full statement is included in Equinor's annual report in Chapter 312 and referred to in note four in Equinor ASA's financial statements, and has also been available on Equinor's website prior to the AGM. I'll give the floor to Chair of the Board, Jon Erik Reinhardsen, who will give a briefing on the statement.
Thank you, Tone. In the Board of Directors declaration on remuneration and other employment terms for Equinor's Corporate Executive Committee, the Board has prepared a statement on the company's stipulation of salary and other remuneration and the formal decision process and the overall remuneration concept for the Executive Management. Equinor's salary policy and terms are well anchored in the Corporate Value Statement, Personnel Policy, and performance-oriented frameworks. The reward systems are meant to ensure that we attract and retain the right people. The Board places great emphasis on offering the company's Executive Management terms which are competitive but not market leading in the markets where we operate. The Remuneration Policy and the principles applied in 2019 were mainly in line with the declaration presented at last year's Annual General Meeting. A bit about the terms of the CEO.
The CEO's base salary in 2019 was increased by 3.5%, in line with the pay settlement for all employees in Equinor. The CEO has a variable performance based salary with a potential of maximum 50% of the total fixed salary and a long-term incentive scheme with share purchase for up to 30% of the fixed salary. In our assessment of the CEO's performance, and hence the basis of his annual bonus for 2019, the board has emphasized that deliveries in key areas have been both above, on, and below the targets set for 2019. The total recordable incident frequency, abbreviated TRIF, is at the best level in the history of the company. The serious incident frequency, the SIF, was not reduced according to the target, however, and is an area of continuous focus on improvement.
In recent years, we have had considerable reductions in the number of oil and gas leaks, and this trend continued in 2019. Production efficiency was below the target and was adversely affected by special conditions in a few fields. Cost development did not reach the target and will need a continued strong focus in the time ahead. Investment costs are further reduced as a consequence of streamlining and strict priorities. Value creation and exploration had a positive development in 2019 and reached the target. While relative total shareholder return, TSR, was below the target, the relative return on average capital employed was better than the target. We also see a strong delivery and employee development. The CEO has been a strong role model for sustainable development and for the transition to new sources of energy, both within and outside of the company.
Finally, the remuneration systems for management are there to ensure that we attract and retain people who are strongly motivated to deliver on the company's business strategy and who are able to adapt to a changing business world. When the company and our industry are now struck very hard by a pandemic and sharply falling prices, I would like to highlight two important instruments in our remuneration framework. The so-called threshold ensures that bonuses are reduced or not paid when indicated by the company's financial situation. The modifier ensures that any bonus payments are clearly linked to Equinor's relative performance in relation to 11 other comparable companies. The assessment of the board of directors is that the company's remuneration systems and practices are transparent, and any deviations have been explained according to the valid guidelines and good business practice. Thank you for your attention.
Thank you, Jon Erik. In accordance with Section 5-6(3) of the Public Limited Liability Companies Act, the board of directors shall prepare a separate statement on salary and other remuneration for executive management. The AGM shall conduct an advisory vote on the board's guidelines for the stipulation of remuneration for the current financial year, i.e., the financial year 2019. Furthermore, the act requires that the part of the statement which relates to remuneration linked to the development of the company's share price is subject to approval by the general meeting. Any comments on the statement? Just a quick clarification. Maybe you've already answered, because of the economic crisis and reduced dividend policy, does this reflect in any way the setting of salary, et cetera, that there's less bonus to the CEO and the corporate management? It should be in harmony with other industries and other companies.
That is probably your answer, is it? I can comment, of course. The corporate management has already waived a bonus for 2020 to reflect the reality we are in the midst of. The second factor, the mechanisms I just described, where we adjust the payment to the real world around us. We reduce the potential. That's what it means. Thank you for questions and replies. I ask, are there any other comments on that statement? Does the general meeting want us to deal with these two parts of the proposal separately? This does not seem to be the case, and the general meeting has thereby endorsed the board statement and approved the proposal for remuneration linked to the development of the company's share price.
We now move on to item 17, which is approval of remuneration for the company's external auditor for 2019. The AGM is asked to approve the auditing fees for Equinor ASA for 2019. It is proposed that the auditor's fee for auditing services in 2019 for Equinor ASA of NOK 27,063,000 to be adopted by the general meeting. Can the general meeting adopt the proposed resolution under item 17? There appear to be no objections, and the proposal is thereby carried.
We move on to item 18, the election of members to the corporate assembly. The term of office expires this year for all shareholder elected members of the corporate assembly. As Chair of the Nomination Committee, I will now review the Nomination Committee's roster of nominees. The Nomination Committee has attached importance to several criteria in its composition of the corporate assembly, including diversity of expertise and background, agenda balance, and consideration for the bringing in of new blood, compared with the need for continuity. The Nomination Committee has written to the major shareholders in Equinor asking for nominees for positions. An electronic letter box for proposals was also set up on equinor.com. The Nomination Committee's motions are shown on the screen and will not be read out loud. We also show extracts from the resumes of the new nominees on the screen.
The nominations committee recommends three new candidates as members of the corporate assembly, and two new candidates as deputies to the corporate assembly, plus one existing deputy member nominated as a new member. Other members of the assembly are recommended for re-election, and in addition, we are recommending a re-election of the chair and deputy chair of the assembly. Candidates will be an election by the assembly itself. The new candidates are Kjerstin Rasmussen Braathen , who's CEO of DNB ASA. She used to be director of corporate finance in DNB and has worked in the bank since 1999 in various positions within the business market. Mari Rege is a professor of economics at the University of Stavanger, the business school, where she also chairs the university's program on labor market economy.
Brynjar Forbergskog, he is Working Chair of the Board of Torghatten ASA, and before that, he was CEO of that company. Kjersti Fyllingen , Managing Director at Haraldsplass Diakonale Sykehus AS. A current deputy member, she is nominated as a new member to the assembly. The two candidates that are suggested as new deputies for the assembly are Knut Nesse and Trond Straume. Knut Nesse is CEO of the AKVA group ASA. Before that, he was CEO at Skretting Group and Nutreco. Trond Straume is Managing Director of Volue AS. Before that, he was Managing Director at Powel AS. For further information about the candidates, we refer to the recommendation by the Nomination Committee, published on Equinor's homepage with other case documents for the AGM. They are all independent of the Board and the Corporate Management of Equinor.
We suggest that members and deputy members of the corporate assembly, that the election be made with effect from 15th May 2020 until the AGM 2022. Can the general meeting adopt the proposed resolution under item 18? There seems to be no objection, the proposal is carried.
We move on to item 19, a stipulation of remuneration to members of the Corporate Assembly. The proposal has been distributed with the notice of the meeting and is being shown on the screen. It will not be read aloud. As chair of the Nomination Committee, I can inform you that this year the Nomination Committee proposes no increase in remuneration to the members of the Corporate Assembly because of the effects of COVID-19, the related measures. Are there any comments to the proposal? There appears not to be. The proposal is carried.
We move on to item 20, election of members to the nomination committee. The term of office expires this year for all members of the nomination committee. As chair of the nomination committee, I will now review the nomination committee's roster of nominees. On Easter Monday, we received sad news of the death of one of our committee members, Elisabeth Berge, former Permanent Undersecretary in the Ministry of Petroleum and Energy. For many years, Elisabeth was a permanent member of our committee, and until recently, she was involved in preparing the roster of nominees for this year's AGM. Due to her retirement from the Ministry, the Petroleum and Energy Ministry, she was stepping down from the nominations committee this year. We thank Elisabeth for her strong commitment to and efforts for Equinor. May she rest in peace.
According to the Articles of Association of the company, the Nomination Committee should comprise four members who shall be shareholders or represent shareholders and be independent of the Board and management. The Chair and one other member should be from the shareholder elected members of the Corporate Assembly. The Nomination Committee has attached importance to several criteria in its composition of the committee, including shareholder representation, diversity of expertise and background, agenda balance, and the consideration of bringing in new blood compared with the need for continuity. The Nomination Committee has, as I mentioned before, written to the major shareholders of Equinor and asked for suggestions for candidates, including members of the Nomination Committee. In addition, an electronic letter box for proposals was set up on Equinor's website. The motion is shown on the screen and will not be read out.
The nomination committee nominates Bjørn Ståle Haavik as a new member, and reelection of Chair Tone Lunde Bakker, and the members, Jarle Roth and Berit Ellingsen. As personal deputy for Bjørn Ståle Haavik, the nomination committee nominates Permanent Undersecretary Andreas Hilding Eriksen, Ministry of Petroleum and Energy. Resumes of new member Bjørn Ståle Haavik and new deputy Andreas Hilding Eriksen are shown on the screen. The election is proposed to take effect from 15th May 2020 and until the AGM of 2022.
I don't know whether that's the way it has to be, but it's the way it has been in large companies in Norway. Something's been commented from the room by one of the participants, but they're off mic, so the interpreters cannot hear them. Can the general meeting adopt the proposed resolution under item 20? There appear to be no objections, and the proposal by the Nomination Committee is thereby carried. We move on to item 21, which is determination of remuneration to the Nomination Committee. The proposal was distributed with a notice convening the AGM and is shown on the screen and will not be read out. As Chair of the Nomination Committee, I can inform you that this year the Nomination Committee proposes no increase in remuneration to the members of the committee due to the effects of COVID-19 and related measures.
Any comments to the proposed resolution? There appears not to be. The proposal is then carried. We now move on to item 22. Since 2004, the company has offered a share savings plan for employees of the group. The purpose of this scheme is to augment good business culture and encourage loyalty through employees becoming part owners of the company. Globally, more than 83% of all employees participate in a share savings plan. At the AGM in 2019, it was decided to authorize the board of directors to acquire shares in the market for this purpose. This authorization expires on the date of the AGM of 2020. It is proposed that the general meeting give the board of directors a new authorization to acquire shares in the market in order to continue the company's share savings plan.
The proposed resolution is in the notice of the meeting and is being shown on the screen, so it will not be read aloud. Can the general meeting adopt the proposed resolution under item 22? There appear to be no objections, and the proposal is thereby carried.
We move on to item 23. The board of directors requests authorization from the AGM to repurchase up to 75 million own shares in the market, approximately 2.2% of the company's share capital, in accordance with Section 9 (4) of the Public Limited Liability Companies Act. Such authorization is common in many listed companies. The repurchase of owned shares benefits the shareholders by the remaining shares representing an increased ownership interest in the company. For a detailed explanation of the background for the proposal, see the notice. The motion has also been distributed with the notice of the meeting and is being shown on the screen and will not be read aloud. Can the general meeting adopt the proposed resolution under item 23? There seem to be no objections, and the proposal is thus carried. Before we close, I want to give the floor to our legal counsel.
Just for the sake of good order, I want to point out that what you asked for is to be regarded as a new item, which means that it has to be presented as a proposal from the AGM next year. There's no position from the company regarding presenting such an account. That has to be decided by the company, but we won't do it at this AGM. It's a new item. I'm just making that clear to the shareholder. We have noted that you have asked for it. I simply wanted to clarify that we don't have the obligation, but we've certainly noted your request. Thank you.
At this point, we've been through all the items on the agenda. Shortly, the minutes of the AGM will be published on the company's website.
Thank you for your commitment and flexibility regarding today's agenda, and thank you to all shareholders who've been following the meeting via the webcast and for your attendance. The meeting is adjourned.