Aker Horizons ASA · SWB:7QF
Aker Horizons ASA — Q1 2023 Earnings Presentation
48 slides from Aker Horizons ASA's earnings presentation, May 3, 2023
Slide 1: First-quarter results 2023
First-quarter results 2023 3 May 2023
Slide 2: Main developments
Main developments Continued positive momentum for Aker Carbon Capture UK flagship projects bp’s Net Zero Teesside Power and Viridor’s Runcorn CCS proceed with governmental support Solid progress on Brevik CCS and Twence CCU projects Pre-FEED for European power utility customer with a mega-scale capt
Slide 3: Aker Horizons accelerating Net Zero
Aker Horizons accelerating Net Zero IEA Net Zero 2050 pathway Gt CO2 H2 2020 Electrification Wind and solar Hydrogen CCUS Energy efficiency Bioenergy Behavior, Other fuel shifts 2050 avoided demand 3
Slide 4: Aker Horizons focusing on three Net-Zero levers
Aker Horizons focusing on three Net-Zero levers Renewable energy Carbon capture Hydrogen hubs Decarbonize cement, gas-, biomass- and Decarbonize steel, transportation, fertilizer Backbone of decarbonization waste-to-energy and blue hydrogen and other industrial processes Mainstream Renewable Power A
Slide 5: Portfolio overview
Portfolio overview
Slide 6: Aker Carbon Capture
Aker Carbon Capture Transforming the carbon capture industry through standardization • Carbon capture company delivering ready-to-use capture plants; two projects in construction • Validated certified market-leading proprietary technology with close to 60,000 operative hours Key projects Brevik CCS:
Slide 7: Mainstream Renewable Power
Mainstream Renewable Power Building a Renewable Energy Major – driving the energy transition • Industry-leading wind capabilities across onshore, bottom-fixed and floating offshore • Market leader in Chile and South Africa renewables, and Vietnam offshore wind Key projects1 SN II 0.5 GW ScotWind Off
Slide 8: Aker Horizons Asset Development
Aker Horizons Asset Development Develop, build, own and operate hydrogen and derivates assets across hard-to-abate sectors • Holistic and integrated value chain approach to accelerate Net Zero • Large-scale projects enabled by strategic and financial partnerships Key projects Norway Key projects res
Slide 9: SuperNode
NOT UPDATED SuperNode Developing cable technology to enable the renewable electricity age • Superconductor technology to conduct electricity with no resistance • Proprietary cryostat designs, materials and heat management techniques Aker Horizons’ view The combination of significantly increasing o
Slide 10: Aker Carbon Capture
Aker Carbon Capture
Slide 11: Aker Carbon Capture Highlights
Aker Carbon Capture Highlights • Letter of Intent for two Just CatchTM units • Major projects progressing well with key equipment installed onsite at Brevik CCS and Twence CCU • UK flagship projects proceeding to final negotiations for governmental support • EU’s Net-Zero Industry Act to accelerate
Slide 12: Accelerating market activity
Accelerating market activity UK Government funding Pre-FEED and several studies awarded • bp’s Net Zero Teesside Power and Viridor’s Runcorn • Pre-FEED for European power utility customer with a CCS successful bidders in UK Track 1 CCUS Cluster mega scale capture capacity – 0cn Sequencing Process •
Slide 13: Asset Development
Asset Development
Slide 14: Aker Horizons Asset Development
Aker Horizons Asset Development Developing hydrogen-based projects Highlights • Offtake LOIs with solid counterparties signed for ~1.5x volume for Narvik Green Ammonia • Advanced negotiations to secure substantial amount of power for Narvik Green Ammonia • Partnership discussions progressing to onbo
Slide 15: Introducing Narvik Green Ammonia
Introducing Narvik Green Ammonia Large-scale ammonia production (part of Narvik Green Industrial Hub) Statnett 420 kV transformer Hydrogen and ammonia production Grid connection Ammonia storage & jetty NARVIK GREEN AMMONIA PROJECT DATA CAPACITY: Up to 600 MW PLANNED FID: 2025 EQUITY PARTNERS: 100% A
Slide 16: Progressing partnership discussions
Progressing partnership discussions Green Hydrogen to decarbonize Eastern Norway RJUKAN GREEN HYDROGEN PROJECT DATA CAPACITY: 20-40 MW1 PLANNED FID: 2023 EQUITY PARTNERS: 100% Aker Horizons • Signed LOI for substantial offtake from phase I, mature discussions for additional volume • Progressing part
Slide 17: Developments in key projects from wider portfolio
Developments in key projects from wider portfolio NETHERLANDS BERLEVÅG AUKRA CHILE TUNISIA (H2 Gateway) GREEN AMMONIA TO LARGE-SCALE BLUE LARGE-SCALE GREEN LARGE-SCALE BLUE LARGE-SCALE GREEN DECARBONIZE THE ARCTIC HYDROGEN AMMONIA HYDROGEN HYDROGEN PROJECT DATA PRODUCT: Green ammonia PRODUCT: Blue h
Slide 18: EU firming up incentives to speed up deployment of H2
EU firming up incentives to speed up deployment of H2 The European Commission unveils plan for European Hydrogen Bank • Potential game-changer for hydrogen projects in Europe • Aims to bridge the cost gap between renewable hydrogen and fossil fuels • Key to achieving the EU targets for renewable hyd
Slide 19: Mainstream Renewable Power Chile market update
Mainstream Renewable Power Chile market update
Slide 20: Chile is suited for renewable development
Chile is suited for renewable development Key commentary BloombergNEF Climatescope emerging markets ranking (2022) Relative attractiveness for clean power investment and deployment • First OECD member country in South America Rank Country Score • Credit rating: A (S&P), A2 (Moody’s), A- (Fitch) 1 Ch
Slide 21: Chile has fostered world leading growth in renewables
Chile has fostered world leading growth in renewables Key commentary Cumulative installed capacity (GW) Hydro Coal Gas Diesel Wind Solar Other • Healthy demand growth in an emerging 40 economy with a large mining sector – compounded average annual 35 growth (2010-2023): 6.8% 30 • Continues to attrac
Slide 22: Chilean power market at a glance
Chilean power market at a glance The Chilean power system has worked well but is now under stress due to the increase of renewable penetration and the lack of flexibility of the transmission system Central Free and regulated Nodal power system dispatch customers 22
Slide 23: Mainstream has a leading role in the power sector in Chile
Mainstream has a leading role in the power sector in Chile Key commentary • Mainstream is the largest 100% wind and solar company in Chile • Current portfolio: 1.1 GW in operation, 260 MW not yet reached COD • Development pipeline: 1.2 GW wind, 0.2 GW solar • Mainstream is balanced with more wind th
Slide 24: High pace green transition creating challenges in Chile
High pace green transition creating challenges in Chile Grid under stress due to the increase of renewable penetration Key commentary North Chile node – average December pricing • The high growth in renewables, especially solar, is creating large regional imbalances 250 • The market consequences of
Slide 25: 2022 – A tough year for renewables in Chile
2022 – A tough year for renewables in Chile Delayed commissioning of wind plants – spike in internodal price risk – spike in system costs Covid Average power prices and system costs vs 2021 • Supply chain issues, delayed construction • Turbine deliveries and local installation capacities seriously c
Slide 26: Chile market design no longer fit for purpose
Chile market design no longer fit for purpose Regulator recognizing changes are needed, but policy response to date inadequate Active engagement with regulator and Government Signatories • January: Power market regulator (CNE) proposed 15 technical and regulatory measures recognizing that changes ar
Slide 27: Mainstream Renewable Power Business update
Mainstream Renewable Power Business update
Slide 28: Mainstream Renewable Power
Mainstream Renewable Power Leading pure-play renewable energy company Highlights • Chile: 1.1 GW fully operational with 0.3 GW reaching COD in Q1 • Market challenges in Chile continue as grid transmission remains dislocated • South Africa: ~100 MW corporate PPA signed with industrial off-taker • Off
Slide 29: Key portfolio updates
Key portfolio updates Onshore wind and solar Chile • 1.1 GW fully operational across Andes platform with two Huemul projects (0.3 GW) reaching COD in Q1 • Two Andes projects remain to complete construction • Actively pursuing mitigation by addressing market inefficiencies with the regulator and gove
Slide 30: Key portfolio updates
Key portfolio updates Offshore wind Norway • Announcement of Norway’s first area allocation round with a total capacity of 3 GW • The first round includes bottom-fixed at Sørlige Nordsjø II (1,500MW) and floating at Utsira Nord (3x500MW) • Sørlige Nordsjø 2: pre-qualification deadline of August 4th
Slide 31: 20.6 GW net global pipeline
20.6 GW net1 global pipeline Global portfolio of 31 GW net Development Construction Operational Pre-Development 10+ GW 19.2 GW 0.3 GW 1.1 GW Change since +3.7 GW -0.5 GW +0.3 GW Q1 2022 Additions of ScotWind, AOW +0.5 GW in Andes Renovables projects reached COD and early-stage development -0.2 GW sa
Slide 32: Financials
Financials
Slide 33: Portfolio asset values
Portfolio asset values NOK million Net asset value1 Gross asset value distribution NOK million, 31 March 2023 NOK billion, 31 March 2023 AH % AH ownership value Cash Aker Carbon Capture Aker Carbon Capture 43.3% 3,863 Listed assets 3,863 17% 18% Mainstream2 58.4% 12,169 Other Asset Development 100.0
Slide 34: Aker Horizons and holding companies per Q1 2023
Aker Horizons and holding companies per Q1 2023 NOK million Income statement Q1 2023 Balance sheet Q1 2023 Cash flow statement Q1 2023 Operating revenue 29 Interest-bearing assets 26 Cash flow from operating activities (74) Operating expenses (62) Investments1 16,021 EBITDA (33) Current operating as
Slide 35: External financing
External financing NOK million Overview of financing facilities Debt maturities NOK million 8,197 Debt Total facility Key terms RCF Green bond Subordinated 6.0% coupon per annum, with deferral NOK 2,000m Convertible bond shareholder loan option against a 1.0% deferral fee Shareholder loan 1 5,697 Su
Slide 36: Liquidity and net interest-bearing debt
Liquidity and net interest-bearing debt NOK million Cash and undrawn RCF as of 31 March 2023 Net interest-bearing debt as of 31 March 2023 NOK million NOK million 9,470 Undrawn RCF 3,773 5,697 5,697 Interest-bearing 3,773 debt 6,117 2,344 Undrawn RCF Cash Cash and undrawn RCF Debt Cash and IB receiv
Slide 37: Capital structure at Q1 2023
Capital structure at Q1 2023 Key figures Capital structure NOK billion1 NOK billion1 22.0 Unlisted assets 18.1 Most recent transaction value or book value. Includes Mainstream, Covenant LTV2 = -7% Asset Development, SuperNode, (vs. covenant of 50%) 9.5 cash and other assets Per 31 March 2023 Undrawn
Slide 38: Q&A
Q&A
Slide 39: Global pipeline of wind and solar assets
Global pipeline of wind and solar assets Pipeline reflects assets in development, construction and operational Capacity distribution by geography Offshore – Europe APAC LatAm (3.1 GW) Development 0.9 GW (3.6 GW) Total net 0.9 GW 15% 17% 20.6 4% GW Asia Pacific Europe (0.9 GW) Development 3.1 GW 64%
Slide 40: Mainstream Project Overview
Mainstream Project Overview Asset Portfolio Country Technology Gross Capacity Economic Net Capacity P50 Production FC COD PPA Tariff PPA Volume PPA Tenor (MW) interest (MW) (GWh/y) (GWh) (years) Operational Alena Andes – Condor Chile Wind 86 100% 86 291 2019 2021 USD 43 5281 20 Rio Escondido Andes –
Slide 41: Mainstream Project Overview
Mainstream Project Overview Asset Portfolio Country Technology Gross Capacity Economic interest Net Capacity Target FC Target COD PPA Tariff 2 PPA Volume PPA Term (MW) (GWh) (years) (MW) Late stage development3 Caman 2 Andes - Copihue Chile Wind 49 100% 49 2025 2027 N/A N/A N/A Entre Rios Nazca - Hu
Slide 42: Mainstream Financial Information
Mainstream Financial Information Mainstream proforma accounts1 Highlights FY Q1 Q2 Q3 Q4 FY Q1 EURm • Mainstream’s Income Statement is reflective of the principal activities 2021 2022 2022 2022 2022 2022 2023 of development, construction and operation of projects Revenue 80 31 36 44 43 155 44 • Mark
Slide 43: Aker Horizons Asset Development financial information
Aker Horizons Asset Development financial information AAD proforma accounts1 Highlights FY Q1 Q2 Q3 Q4 FY Q1 NOKm • Income statement reflective of the key activities in the period: 2021 2022 2022 2022 2022 2022 2023 • Revenue mainly driven by a divestment of a small corporate unit Revenue 14 3 4 - -
Slide 44: Aker Horizons Asset Development pipeline
Aker Horizons Asset Development pipeline Development Under construction and in Opportunities pipeline operation Identified projects and early-stage dialogue Active dialogue with end-users and co- Offtake and feedstock contracts with co-developers, offtakers or value chain developers and/or initial p
Slide 45: Aker Horizons' 2025 ambitions
Aker Horizons’ 2025 ambitions 100bn 10 GW 25 Mt NOK in green in renewable CO2e p.a. investments power capacity emissions reduction1 1. The 25 Mt CO2e target consists of two main elements: 10 Mt CO2e of emissions reductions enabled through CCUS and ~15 Mt CO2e from avoiding emissions in electricity g
Slide 46: Sustainability integrated in all we do
Sustainability integrated in all we do Sustainability commitment across four core themes Alignment with international frameworks Planet-positive impact • Our investment thesis is grounded in a desire to be planet-positive • We commit to accelerating Net Zero commitments and decarbonization of indust
Slide 47: Disclaimer
Disclaimer This presentation includes and is based, inter alia, on forward-looking information and statements that are subject to risks and uncertainties that could cause actual results to differ. These statements and this presentation are based on current expectations, estimates and projections abo
Slide 48: To learn more about Aker Horizons visit akerhorizons.com
To learn more about Aker Horizons visit akerhorizons.com