Norsk Hydro Asa · OSL:NHY
Norsk Hydro Asa — Investor Day (2005)
33 slides from Norsk Hydro Asa's investor day presentation, 2005
Slide 1: Oil & Energy
Oil & Energy Tore Torvund Executive Vice President and Head of Oil & Energy
Slide 2: Agenda
Agenda z Status targets z Growing asset base z Beyond 2010 z Sources of production growth z Targets 2006 2
Slide 3: Performance
Performance CMD 2004 2005 estimate Production target 575 000 boed 565 000 boed Production cost NOK 21/boe* NOK 20/boe* CAPEX level NOK 16 billion NOK 13.5 billion** Exploration level NOK 2 billion NOK 2.1 billion** * Excluding costs for gas injection (CMD 2004 assumption: NOK 3, current realised est
Slide 4: 2006 production target: 615 000 boed
2006 production target: 615 000 boed 700 600 500 400 300 200 100 0 CMD 2004 Partner-operated PSA effects Spinnaker 4
Slide 5: Oil and gas: Reserves and resources
Oil and gas: Reserves and resources Million boe Hydro share 4 000 3 500 3 000 2 500 2 000 1 500 1 000 500 0 Proven reserves year- Additional expected Production 2005E Added expected Additional expected end 2004 (SEC) reserves year-end 2004 reserves 2005E* resources in portfolio ** * Including Spinna
Slide 6: Additional expected resources in portfolio
Additional expected resources in portfolio 1 000 Million boe Hydro share in fields and discoveries International 750 Murzuq NC190 – Block 17 Under Partner-operated NCS Snorre IOR – Lavrans – Eldfisk – Ekofisk evaluation Operated NCS Peon – Astero – Troll Brent – Osberg/Troll/Grane IOR International
Slide 7: Hydro E&P activity
Hydro E&P activity Russia Norway Denmark Canada Iran Libya US Gulf of Mexico Nigeria Brazil Angola Current E&P activity 7
Slide 8: Exploration competence developed on NCS
Exploration competence developed on NCS Discoveries on NCS 1985-2005 Million boe Hydro operator Other NCS operators Troll Oil Saga Petroleum 0 2 000 4 000 6 000 8 000 10 000 Reserves including 49 producing fields, 13 closed, 5 under development and 19 planned and discoveries in 1997-2005 Source: NPD
Slide 9: Rig coverage provides flexibility
Rig coverage provides flexibility z Rig capacity secured on Norwegian Continental Shelf through 2009 z Transocean Winner contracted for three years z Rig slots secured in Gulf of Mexico and West Africa 9
Slide 10: Long-term commitment to Russia
Long-term commitment to Russia z Shtokman short list z 15 years of cooperation z Preparing to drill Well 7 in 2006 10
Slide 11: Pioneer in new technology
Pioneer in new technology Planning ahead for Increased Oil Recovery Oseberg: Increased oil recovery - gas injection 11
Slide 12: Pioneer in new technology
Pioneer in new technology Planning ahead for Increased Oil Recovery Troll: Increased oil recovery - horizontal wells 12
Slide 13: Pioneer in new technology
Pioneer in new technology Planning ahead for Increased Oil Recovery Grane: Increased heavy oil recovery - gas injection and horizontal wells 13
Slide 14: Pioneer in new technology
Pioneer in new technology Planning ahead for Increased Oil Recovery Chinook: Increasing heavy oil recovery - horizontal wells 14
Slide 15: On time and on cost
On time and on cost Offshore projects last five years Average project size Total cost change NOK billion % Hydro Hydro Hydro operator Other operators 0 5 10 15 20 -10% 0% 10% 20% 30% 40% Offshore projects with budgets exceeding NOK 1 billion Source: MPE; St. prop. 1 2000- 2005 15
Slide 16: Norwegian operations: Hydro's bread and butter
Norwegian operations: Hydro’s bread and butter z Strong focus on safe, efficient and smart operations z Consistent top-quartile performer z Basis for future growth 16
Slide 17: Drilling excellence drives value creation
Drilling excellence drives value creation z Early mover in drilling technology z 47 multilateral wells drilled with 76 branches z 50% of the world’s advanced multilateral wells z 88% of the world’s advanced offshore multilateral wells z First six-branched well on NCS started Dec 2005 17
Slide 18: Extending production growth through 2010
Extending production growth through 2010 Oil and gas production 1 000 boe/day z Top-quartile growth continues 800 - In oil - In gas - On NCS 600 - Internationally z Robust growth 400 - 85% sanctioned projects - Low break-even prices 200 z Growing international share - Higher after-tax value per barr
Slide 19: International breakthrough: Canada, Hebron
International breakthrough Canada: Hebron moving toward development 19
Slide 20: International breakthrough: Iran
International breakthrough Iran: World-class oil discovery 20
Slide 21: International breakthrough: Shtokman
International breakthrough Штокмановского ГКМ: Shtokman short-listing 21
Slide 22: International breakthrough: Angola, Gimboa
International breakthrough Angola: Moving ahead with Gimboa (Block 4) 4 22
Slide 23: International breakthrough: Libya
International breakthrough Libya: Secured operatorship in NC146 23
Slide 24: International breakthrough: Brazil, Chinook
International breakthrough Brazil: Chinook heavy oil 24
Slide 25: International breakthrough: GoM, Spinnaker
International breakthrough GoM: Spinnaker Exploration Company 25
Slide 26: Exploration acreage secured worldwide
International breakthrough Exploration acreage secured worldwide NCS Barents Sea/ Russia Americas Middle East Africa Current E&P activity Frontier E&P activity 26
Slide 27: Maximize NCS value
Barents Sea Maximize NCS value z Large IOR potential z 15 new fields under development Norwegian Sea z Exploration success z About 40 exploration wells 2006-2007 North Sea 27
Slide 28: Increased value of gas portfolio
Increased value of gas portfolio NCS St.Fergus NBP Bacton Emden TTF ZB/hub PEG 28
Slide 29: 2006 targets
2006 targets z Production target 615 000 boe/day z Production costs NOK 23/boe* z CAPEX level NOK 20 billion z Exploration level NOK 5 billion ` Excluding costs for gas injection 29
Slide 30: New fields on stream 2005 - 2008
New fields on stream 2005 - 2008* Field Hydro peak production (boe/day) Peak year 2003 2004 2005 2006 2007 2008 International Lorien 9 000 2007 Dalia 24 000 2007 Rosa 13 000 2008 Oseberg South J 3 500 2006 Oseberg Vestflanken 15 500 2007 Oseberg Sør J Sentral 2 000 2009 Operator NCS
Slide 31: Investor Relations in Hydro
Investor Relations in Hydro
Slide 32: Investor Relations in Hydro
Investor Relations in Hydro t +47 22 53 32 73 Idar Eikrem Senior Vice President Idar.Eikrem@hydro.com m +47 950 28 363 t +47 22 53 24 55 Gudmund Isfeldt Investor Relations Officer Gudmund.Isfeldt@hydro.com m +47 480 01 180 t +47 22 53 35 39 Stefan Solberg Investor Relations Officer Stefan.Solberg@hy
Slide 33: Hydro is a Fortune energy and aluminium supplier
Hydro is a Fortune 500 energy and aluminium supplier founded in 1905, with 36,000 employees in nearly 40 countries. We are a leading offshore producer of oil and gas, the world's third-largest integrated aluminium supplier and a pioneer in renewable energy and energy- efficient solutions. As we look