Aker Bp Asa · OSL:AKRBP
Aker Bp Asa — Investor Day (January 2018)
83 slides from Aker Bp Asa's investor day presentation, Jan 15, 2018
Slide 1: Capital Markets Day 2018
CAPITAL MARKETS DAY 2018 AKER BP ASA 15 January 2018
Slide 2: Disclaimer
Disclaimer This Document 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 Document are based on current expectations, estimates and projections about globa
Slide 3: Agenda
CAPITAL MARKETS DAY 2018 Agenda Session 1: 13:00 – 14:30 Corporate strategy - Karl Johnny Hersvik, Chief Executive Officer Execute - Karl Johnny Hersvik, Chief Executive Officer Improve – Per Harald Kongelf, SVP Improvement Q&A Coffee Break Session 2: 15:00 – 16:00 Grow - Karl Johnny Her
Slide 4: Today's speakers
CAPITAL MARKETS DAY 2018 Today’s speakers Karl Johnny Hersvik, Chief Executive Officer Per Harald Kongelf, SVP Improvement Karl Johnny Hersvik (born 1972) has been CEO of Aker BP since May 2014. Prior to joining Aker BP, he served as Per Harald Kongelf (born 1959) is responsible for Aker BP's improv
Slide 5: 2017 achievements
AKER BP ASA 2017 achievements Hess Norge AS acquisition Building on successful M&A track record Farm-down 10% in Valhall/Hod to Pandion Energy Added 134 mmboe in new reserves Delivered three PDO’s to the authorities CAPEX decreased by ~20% from concept selection Efficient operations with h
Slide 6: Aker BP investment case
AKER BP ASA Aker BP investment case Well positioned to be profitable across the market cycles • Purely operating on the NCS: Low political risk and attractive fiscal regime • Strong balance sheet and capital flexibility: USD 2.9 billion in liquidity • Robust investment program with average break-e
Slide 7: Corporate strategy
Corporate strategy Karl Johnny Hersvik Chief Executive Officer 7
Slide 8: Oil market volatility calls for resilient strategy
SHAPING THE STRATEGY Oil market volatility calls for resilient strategy Steady growth in oil demand Cyclicality is the name of the game World oil demand Oil market balance OECD demand Non-OECD demand 2.5 Oversupply Undersupply Brent 140 100 2.0 120 1.5 80 100 1.0 0.5 mmbbl/day 80 mmbbl/day USD/bbl 6
Slide 9: NCS remains an attractive place to be
SHAPING THE STRATEGY NCS remains an attractive place to be >50% of oil & gas remains to be produced on the NCS CO2 emissions per unit oil & gas produced 206 16 Undiscovered resources Contingent resources 201 Reserves Sold and delivered 14 174 12 Global average:129 10 112 BCM oe 8 99 88 6 61 54 4 48
Slide 10: Create the leading offshore independent E&P company
STRATEGIC AMBITION Create the leading offshore independent E&P company Safety Focused Cost leading Maximise shareholder value Growth Robust Entrepreneurial and flexible 10
Slide 11: Strategic toolbox
CORPORATE STRATEGY Strategic toolbox Execute Reorganising the value chain Be at the forefront for with strategic partnerships and alliances digitizing E&P Safety Improve Value chain based on a shared Flexible business model LEAN understanding, ready for growth and volatility toolbox and culture Grow
Slide 12: Always prioritise safety
Safety CORPORATE STRATEGY Always prioritise safety 2018 HSSE forward agenda Safety is our number 1 priority Maintain safe and reliable operations with zero HSSE incidents and no cyber attacks with significant impact on performance Expand and roll out sustainability and energy efficiency strate
Slide 13: Targeting significant efficiency improvements
Cost CORPORATE STRATEGY leading Targeting significant efficiency improvements Great savings possible – requires new way of thinking Illustrative project economics (USD/boe) Development cost1 (USDbn) Break-even (USD/boe) Strategic 20 70 Digitalization Alliances 60 OPEX (10 yrs) 60 Facility CAPEX Lean
Slide 14: Improvement program showing tangible results
Cost CORPORATE STRATEGY leading Improvement program showing tangible results Ærfugl Valhall Flank West Skogul Volume 197 56 10 (mmboe) +40% +7% -5% gross 275 60 10 CAPEX 10.6 7.2 1.6 (NOKbn) -20% -24% -3% gross 8.5 5.5 1.5 Break-even 32.0 33.9 34.1 oil price -42% -16% -3% (USD/bbl) 18.5 28.5 33.0 Co
Slide 15: Robust balance sheet and strong dividend capacity
Robust CORPORATE STRATEGY Robust balance sheet and strong dividend capacity Rapid deleveraging over the past two years 3x dividend cover last four quarters Leverage ratio (Net debt / EBITDAX) Dividend coverage 3.0x 2.8x 500 2.6x 450 2.5x Free cash flow (USDm) 2.5x 400 Dividend paid (USDm) 1.9x 350 2
Slide 16: Ambition to increase dividends in the coming years
Robust CORPORATE STRATEGY Ambition to increase dividends in the coming years Rationale Aker BP ambition for dividend payments (USDm) Robust balance sheet and strong cash flow generation The Board proposes that annual dividend increases to USD 450 million for 2018 with an ambition to increase by US
Slide 17: Efficient decision making and execution
Flexible CORPORATE STRATEGY Efficient decision making and execution Enabled by an entrepreneurial and flexible organization From farm-down decision at 1 month Valhall/Hod to signed agreement From Skarv well shut-in due to 3 months damaged X-mas tree to workover started with new rig From project sanc
Slide 18: Profitable growth from existing portfolio
Growth CORPORATE STRATEGY Profitable growth from existing portfolio 2018 CMD illustrative production potential, mboepd net Strong production base of operated assets 350 • ~80% liquids / ~20% gas 300 Reserves and resources Development of at 2017 CMD Maximize resource utilization from existing hub
Slide 19: Year-end 2017 preliminary 2P reserves of 913 mmboe
Growth CORPORATE STRATEGY Year-end 2017 preliminary 2P reserves of 913 mmboe Development in 2P reserves (mmboe) Proven & probable reserves (2P), end 2017* Other Alvheim area 134 -58 1 7 126 111 Johan Sverdrup Skarv area 300 114 913 913 Organic RRR: 2.3x mmboe 711 Total RRR: 4.5x 59 257 Ivar Aase
Slide 20: More than 300 mmboe added to the resource hopper in 2017
Growth CORPORATE STRATEGY More than 300 mmboe added to the resource hopper in 2017 Development in 2C contingent resources (mmboe) Preliminary year-end 2017 2C contingent resources* 160 Garantiana 279 Gohta 229 NOAKA 22 -134 25 Filicudi 24 Other 13 Alvheim area -70 785 30 785 Ula area 16 mmboe 600 Va
Slide 21: Ambition to grow through further M&A
Growth CORPORATE STRATEGY Ambition to grow through further M&A Building on a strong M&A track record Targeting new opportunities: Acquisition of Norwegian Merger between Det Acquisition of Norwegian Financially accretive subsidiary for a cash norske and BP’s subsidiary for a cash Norwegian subsidi
Slide 22: A focused portfolio on the NCS
Focused CORPORATE STRATEGY A focused portfolio on the NCS Skarv / Ærfugl Solid base performance and area upside potential Alvheim area High production efficiency and low operating cost Ivar Aasen Skarv / Ærfugl Production ramp-up and IOR opportunities Johan Sverdrup World class development with brea
Slide 23: Delivered superior shareholder return last three years
Maximize shareholder CORPORATE STRATEGY value Delivered superior shareholder return* last three years 2015 2016 2017 AKERBP-NO 39 AKERBP-NO 183 AKERBP-NO 35 NFX-US 20 CLR-US 124 BRENT 21 LUPE-SE 9 TLW-GB 89 STL-NO 15 FP-FR 3 LUPE-SE 62 REP-ES 15 ENI-IT 2 RDSB-GB 62 CXO-US 13 STL-NO 0 BP-GB 52 RDSB-G
Slide 24: Execute
Execute Karl Johnny Hersvik Chief Executive Officer 24
Slide 25: Alvheim Area status
EXECUTE Alvheim Area status Operated, ~65%* working interest 2017 production of 70.9 mboepd net to Aker BP • Increased compared to previous year due to new wells at Viper-Kobra and Volund infills High operational efficiency with well embedded continuous improvement culture Drilling of Volund a
Slide 26: The Alvheim FPSO production and Alvheim area reserves
EXECUTE The Alvheim FPSO production and Alvheim area reserves Alvheim FPSO historical production (mboepd gross) Reserves vs. PDO (2P gross), mmboe 160 400 140 350 120 Remaining reserves 300 Produced to end 2016 100 +123% Reserves at PDO 250 80 200 60 150 40 100 +72% +79% 20 50 0 0 2008 2009 2010 201
Slide 27: Alvheim – Maximizing area recovery
EXECUTE Alvheim – Maximizing area recovery Development of discoveries in the area • Skogul (2020), Gekko/Kobra East (2021), Caterpillar (2021) Near-infrastructure exploration • Frosk, Rumpetroll, Deep Alvheim • New exploration prospects being matured Late-life gas blowdown • Kameleon, Gekko Pr
Slide 28: Valhall & Hod status
EXECUTE Valhall & Hod status Operated, 90% working interest 2017 performance • Production 34.7 mboepd (net) • Stable opex/boe due to cost reductions Driving improvement and growth • Drilling new wells from IP platform • Plugging abandoned wells • Two wireline crews performing well interventions
Slide 29: Valhall Flank West PDO submitted
EXECUTE Valhall Flank West PDO submitted Tie-back to Valhall field center • Unmanned wellhead platform • Six production wells • Six additional well slots allowing for future expansion Robust economics • 2P reserves 60 mmboe gross / 54 mmboe net • CAPEX NOK 5.5 billion gross (USD 0.7 billion net)
Slide 30: Valhall & Hod outlook
EXECUTE Valhall & Hod outlook Valhall & Hod gross resource base (bn boe) Valhall is a giant oil field with huge potential • Initial in-place volume (HCIIP) ~4 billion boe 0.3 • Produced ~1 billion boe to date 0.4 • Current 2P reserves indicate ~30% recovery rate 0.3 Ambition to produce another 1
Slide 31: Skarv Area status
EXECUTE Skarv Area status Operated, 23.84% working interest 2017 production of 26.7 mboepd (net) Skarv FPSO is anchored to the seabed and has one of the world’s largest gas processing plants offshore Field developed with subsea wells tied back to Skarv FPSO from five sub-sea templates Transp
Slide 32: PDO submitted for Ærfugl
EXECUTE PDO submitted for Ærfugl Reserves gross mmboe Two phased subsea tie-back to Skarv FPSO +40% • 275 mmboe gross reserves 275 • Gross CAPEX of NOK 8.5 bn (NOK 4.5 bn for phase 1) 197 • Phase 1: Three new wells tied into the Skarv A template • Peak production of ~100 mboepd for both phases • E
Slide 33: Skarv area outlook
EXECUTE Skarv area outlook Focus areas Improvement program targeting Skarv FPSO production cost < 7 USD/boe when Ærfugl reaches plateau Step-up in exploration activity to appraise attractive area resource potential and utilize significant spare oil capacity • Drilling of Kvitungen Tumler prospec
Slide 34: Ula / Tambar status
EXECUTE Ula / Tambar status Operated, ~80%* working interest 2017 performance • Production 8.4 mboepd (net) • High unit production cost Ongoing activities to improve productivity and cost • Drilling two new Tambar wells • Oda development ongoing License: PL019, PL019B, PL065, PL300 Ula and Tamba
Slide 35: Ula / Tambar outlook
EXECUTE Ula / Tambar outlook Tambar (55%) re-development underway • Two new production wells • New gas lift module • Drilling started in October 2017 – first oil in 2018 • Will improve understanding of the reservoir Oda (15%) development underway • Subsea tie-back to Ula • Est. CAPEX NOK 5.4 bil
Slide 36: Ivar Aasen and Hanz status
EXECUTE Ivar Aasen and Hanz status Operated, ~35%* working interest 2017 production of 18.1 mboepd (net) First oil from Ivar Aasen on December 24, 2016 • Successful start up with production according to agreed delivery commitment to Edvard Grieg Achieved excellent production performance with h
Slide 37: Ivar Aasen outlook
EXECUTE Ivar Aasen outlook Aker BP’s laboratory for operational improvements Drilling of two water injectors in 2018 Hanz appraisal well planned in 2018 Area infill drilling opportunities identified, first IOR/infill campaign planned for 2019 Maturing near-by exploration prospects Optimize
Slide 38: MMO activity to prolong field life
EXECUTE MMO activity to prolong field life Ula Tambar Valhall & Hod • Oda tie-in to Ula • Ula Power • Tambar Artificial Lift • Topside modifications for tie-in of Flank West platform • Ula lifeboat project • Flank North water Injection Skarv/Snadd Alvheim Ivar Aasen • Turret modifications for Snadd
Slide 39: 5 operated rigs in 2018
EXECUTE 5 operated rigs in 2018 Rig Q1 Q2 Q3 Q4 Maersk Tambar Ivar Aasen Hanz Interceptor Sublet to Oda license (infill) (production wells) (appraisal) Transocean Frosk Raudåsen Valhall Arctic (EXP) (EXP) (pilot) Valhall Drilling Valhall (production wells) Platform Maersk Valhall NF Valhall (plug &
Slide 40: Improve
Improve Per Harald Kongelf SVP Improvement 40
Slide 41: Improvement is a strategic imperative
IMPROVE Improvement is a strategic imperative Aker BP is running a comprehensive improvement program to maximise flow efficiency and remove waste Reorganising the value chain Be at the forefront for with strategic partnerships and alliances digitizing E&P Value chain based on a shared Flexible busin
Slide 42: The problems with traditional supplier relationships
IMPROVE The problems with traditional supplier relationships Alliance Traditional Time horizon Long-term From project to project No. of suppliers Minimum sufficient Several Risk sharing & Aligned incentives and shared upside and Dis-aligned incentives, no risk sharing Incentives downside risk Team I
Slide 43: Alliance principles
IMPROVE Alliance principles One integrated organization Incentives – shared risk and reward Early involvement Aker BP Overrun Cap Most Likely Cost Overrun Overrun DG0 DG1 DG2 DG3 Contractor A Evaluate Select Concept Mature Execute Savings viability Concept Scope of work Ability to influence concept
Slide 44: Alliance delivery: Volund infill project
IMPROVE Alliance delivery: Volund infill project The first project completed by the subsea alliance – delivered 30% below target -33% -30% Traditional Market effects Budget subsea Unrealised risk Budget subsea Alliance MLC + Cost MLC underrun AFE Facility benchmark project (2016) allowance project (
Slide 45: The alliance model continues to deliver
IMPROVE The alliance model continues to deliver Selected projects currently being worked by the Subsea Alliance (subsea scope only) Valhall Flank West Skogul -30% -35% -20% -24% DG2 DG3 Facility AFE Revised Facility Subsea Alliance effects subsea target Facility Alliance effects DG3 target tradition
Slide 46: Digitalization opens up for massive improvements
IMPROVE Digitalization opens up for massive improvements Big data & analytics Cloud computing/storage Collaborative technology Virtual reality platforms Instant analysis of large data Highly scalable, variable-cost Employee engagement and Interact more naturally with sets to identify new patterns st
Slide 47: It all starts with data
IMPROVE It all starts with data Aker BP has established a data platform in cooperation with Cognite Design criteria for the data platform • Open architecture End-user • Scaleable, flexible and robust applications Operational Operations 3rd Party 3rd Party Intelligence Support Applications Solution
Slide 48: Digitalization in Aker BP
IMPROVE Digitalization in Aker BP Developing use cases on the data platform… …and progressing key digital initiatives Insert Insert image as image as Remote operations Ivar Aasen End-user fill fill applications Operational Operations 3rd Party 3rd Party Intelligence Support Applications Solutions Un
Slide 49: The Framo story
IMPROVE The Framo story Sharing operational data with equipment manufacturer Framo is a leading supplier of pumping systems Framo is using Ivar Aasen as a case for exploring remote operations with live data access (free of charge) through the Cognite system The purpose is to develop diagnostic
Slide 50: Supporting offshore operations using tablets and AR
IMPROVE Supporting offshore operations using tablets and AR Cognite Operations Support Current features • Computer vision to read equipment tags • Live sensor data feed • Locate failing equipment in interactive 3D model • Shows all relevant information available Roadmap for more functionality •
Slide 51: Ivar Aasen digital operations model
IMPROVE Ivar Aasen digital operations model Aker BP’s laboratory for developing the digital oil field Digital twin based on live data from the Cognite data platform Digital tools, e.g. Cognite Operations Support Integrate OEMs in operations, e.g. Framo Predictive maintenance based on machine
Slide 52: PUSH – Digital project execution
IMPROVE PUSH – Digital project execution Joint collaboration between Aker Solutions and Aker BP where the objective is to radically improve the way Accellerating the transition to fully offshore projects are engineered digitized field development projects Developing digital tools to reduce execu
Slide 53: Data liberation and sharing will improve NCS competitiveness
IMPROVE Data liberation and sharing will improve NCS competitiveness Current state Desired state High degree of rework in subsurface projects and limited Faster maturation of subsurface projects and faster learning ability to benchmark performance of equipment and assets enabled by industry benchmar
Slide 54: Improvement is a strategic imperative
IMPROVE Improvement is a strategic imperative Aker BP is running a comprehensive efficiency improvement program Reorganising the value chain Be at the forefront for with strategic partnerships and alliances digitizing E&P Mimimize waste Maximize flow efficiency = Reduced execution time Improved marg
Slide 55: Q&A
CAPITAL MARKETS DAY 2018 Q&A 55
Slide 56: Grow
Grow Karl Johnny Hersvik Chief Executive Officer Gro Gunleiksrud Haatvedt SVP Exploration 56
Slide 57: Johan Sverdrup development on track
GROW Johan Sverdrup development on track Drilling platform heavy lift at Klosterfjorden Project progressing according to plan: • Construction was close to 80% complete by end 2017 • Drilling platform modules integrated on barge in Norway • Riser platform modules ready for transport to Norway in Fe
Slide 58: Targeting an area solution for NOAKA
GROW Targeting an area solution for NOAKA Statoil, LOTOS and Aker BP have agreed to establish an area forum to evaluate a joint area development for North of Alvheim* and Krafla/Askja (NOAKA) Two area solutions to be evaluated; • PQ alternative with a field hub with processing platform in the mi
Slide 59: Aker BP assessment of NOAKA
GROW Aker BP assessment of NOAKA Maturing of selected concept towards DG2 should be based on concept that facilitates for highest area resource recovery The NOAKA area is prospective with a lot of possible future tie-ins from exploration prospects • Unrisked exploration resources in the area is
Slide 60: Project inventory provides flexibility
GROW Project inventory provides flexibility Plateau Aker BP Gross Est. first Project Operator production Equity mmboe oil/gas (gross) Valhall IP wells Aker BP 90.0% 54 ~12 mboepd 2018 Boa infills 2017 Aker BP 57.6% 15 ~8 mboepd 2018 Tambar development Aker BP 55.0% 26 ~10 mboepd 2018 Kameleon infill
Slide 61: Creating the leading explorer
GROW | EXPLORATION Creating the leading explorer ENSURE ESTABLISH DISCOVER CONTINUOUS IMPROVE long term reserve new core areas 250 mmboe net positioning for data quality and replacement and to Aker BP in significant technology to value creation 2016 - 2020 additional create a discoveries competitive
Slide 62: NCS production stable to 2025 – then what?
GROW | EXPLORATION NCS production stable to 2025 – then what? Decline after 2025 – possible to mitigate? NCS robust in several demand scenarios Postponement to 2025 by upsides in fields and discoveries Offshore less hit by global peak demand than unconventionals Yet to Find in known basins and
Slide 63: Exploration thriving on the NCS
GROW | EXPLORATION Loppa North Exploration thriving Loppa South on the NCS Barents Sea SE Aker BP 2018 exploration campaign Skewed towards frontier prospects 12 exploration wells Risked pre drill estimates ranging from Norwegian Sea NE 50 – 150 mmboe net to Aker BP Skarv Trends Exploration w
Slide 64: Barents Sea: A long term game
GROW | EXPLORATION Barents Sea: A long term game Shenzhou Korpfjell Gråspett Gemini N Disappointing exploration wells in 2017 Koigen Scarecrow WISTING Continued exploration on new Bone plays/areas in 2018 Børselv Stangnestind Kayak Barents Sea still above global JOHAN CASTBERG Filicudi oil disco
Slide 65: Northern areas - Exploration campaign 2018
GROW | EXPLORATION Northern areas Gråspett Shenzhou Scarecrow - Exploration campaign 2018 Stangnestind Svanefjell Barents Sea Gjøkåsen Stangnestind megaclosure, new play Svanefjell possible high-impact well Four partner wells, diversified targets Skarv Kvitungen Tumler – potential high value
Slide 66: North Sea: Increasing value of producing assets
GROW | EXPLORATION North Sea: Increasing value of producing assets - Establishing new fields Raudåsen Twofold Exploration task: Deliver high value volumes to Aker BP 1 production hubs Alvheim Frosk Ula Valhall Hornet 2 Reveal hydrocarbon accumulations to establish new core areas Sleipner Are
Slide 67: The producing assets – how to create high value
GROW | EXPLORATION The producing assets – how to create high value Exploration within tie-in radius to producing assets Even small discoveries close to existing fields create large values ULA Require unified seismic data sets covering the entire area of interest Invested USD 10 million in new
Slide 68: Summary 2018 exploration wells
I K J GROW | EXPLORATION E Summary 2018 exploration wells D H Aker BP Pre-drill License Prospect name Operator share mmboe* Time PL340 Frosk Aker BP 65 % 3 - 21 Q1 A PL790 Raudåsen Aker BP 30 % 9 - 74 Q1 B PL839 Kvitungen Tumler Aker BP 24 % 37 - 269 Q1 C PL659 Svanefjell Aker BP 50 % 17 - 331 Q2 D
Slide 69: Finance
Finance Alexander Krane Chief Financial Officer 69
Slide 70: Funding our business
FINANCE Funding our business Financial strengths Strong cash flow generation in the years to come USD 2.9 billion in liquidity provides capital flexibility • Attractive organic reinvestment opportunities Ownership Cash flow • Inorganic growth opportunities Strong support from principal owners
Slide 71: Debt structure
FINANCE Debt structure Pro-forma Q4-17 debt capacity and drawings (USDm) Debt maturity profile (USDbn) 400 6 155 4.0 255 RBL - drawn (LIBOR + 2.0 - 3.0%) 1 500 Bank Term Loan (LIBOR + 1.5 - 2.0%) 2 670 US bond (6.0% fixed) 3.0 DETNOR02 (NIBOR + 6.5%) 4 000 RBL - undrawn Undrawn 2.0 2 670 Drawn 3 485
Slide 72: Tax regime supportive of growth
FINANCE Tax regime supportive of growth NCS tax system and implications for Aker BP Tax-adjusted net debt (USDbn) prelim. end 2017 Key attractions of the NCS tax system • ~90% of investments recovered over 6 years 3.2 2.0 • OPEX, exploration and decommissioning costs 78% Special immediate tax reco
Slide 73: Financial risk management
FINANCE Financial risk management Hedging Overview of current commodity hedges Commodity Hedges 2018 2019 → Hedging policies in place to mitigate foreign exchange and commodity risks % Hedged of total 20% - oil production Foreign Exchange Put option strike price USD 50-60/bbl - • Aker BP is a US
Slide 74: 2018 guidance
FINANCE 2018 guidance Item 2018 guidance 2018 Production 155 – 160 mboepd 2018 Production cost USD ~12 per boe 2018 CAPEX USD ~1.3 billion 2018 EXPEX USD ~350 million 2018 decommissioning USD ~350 million expenditures Note: Guidance based on USD/NOK 8.0 * All amounts are presented pre-tax 74
Slide 75: 2018 guidance - production and production cost
FINANCE 2018 guidance - production and production cost Key activities Comparison of operated hubs, 2018 vs 2017 (9m) 2018 production expected between 155 – 160 mboepd • 80% liquids / 20% gas 40 2018 production cost expected to average ~12 USD/boe Ula area 2018 FY guidance • Including tariffs and
Slide 76: 2018 guidance - CAPEX
FINANCE 2018 guidance - CAPEX Key activities Split by main project Alvheim area • Drilling Kameleon infill South and Volund sidetrack North Alvheim area • Skogul: Construction of subsea systems and flowlines Johan Sverdrup Valhall area • IP drilling program (3 wells) • Flank West: Detailed engin
Slide 77: 2018 guidance – EXPEX and Decommissioning
FINANCE 2018 guidance – EXPEX and Decommissioning Exploration expenditures Decommissioning expenditures Drilling of 12 exploration wells (7 operated) Continuous P&A activity on Valhall until 2020 Field evaluation costs (NOAKA, Hod redevelopment) Decommissioning program for legacy assets (Var
Slide 78: Cash flow outlook 2018
FINANCE Cash flow outlook 2018 Illustrative 2018 break-even prices 2018 cash flow illustration based on mid-point of Realized Hydrocarbon Price (USD/boe) 50 60 70 80 production guidance range Production cost (USD/boe) (12) (12) (12) (12) Other OPEX (USD/boe) (1) (1) (1) (1) Financial cost (USD/boe
Slide 79: Concluding remarks
Concluding remarks Karl Johnny Hersvik Chief Executive Officer 79
Slide 80: Aker BP investment case
CONCLUDING REMARKS Aker BP investment case Well positioned to be profitable across the market cycles • Purely operating on the NCS: Low political risk and attractive fiscal regime • Strong balance sheet and capital flexibility: USD 2.9 billion in liquidity • Robust investment program with average
Slide 81: Priorities going forward
CONCLUDING REMARKS Priorities going forward Safe and efficient operations Execute Excellent project delivery Relentless focus on cost reductions and Safety productivity gains Improve Mature projects to below 35 USD/boe break-even Maximize recovery from existing resource base Grow Pursue
Slide 82: Q&A
CAPITAL MARKETS DAY 2018 Q&A 82
Slide 83: Aker BP
& AkerBP www.akerbp.com