Slide 1: Second Quarter 2021
Second Quarter 2021 Oslo, 13 July 2021
Slide 2: Disclaimer
Disclaimer THIS PRESENTATION (THE “INFORMATION MATERIAL”) HAS BEEN PRODUCED AND PARTY SOURCES ARE SOLELY OPINIONS AND FORECASTS WHICH ARE SUBJECT DELIVERED BY NORWEGIAN ENERGY COMPANY ASA (THE “COMPANY”). THIS TO RISKS, UNCERTAINTIES AND OTHER FACTORS THAT MAY CAUSE ACTUAL INFORMATION MATERIAL DOES
Slide 3: Important Information
Important Information AN INVESTMENT IN THE COMPANY INVOLVES RISK, AND SEVERAL FACTORS DOMESTIC AND FOREIGN LAWS AND REGULATIONS, TAXES, CHANGES IN COULD CAUSE THE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS OF COMPETITION AND PRICING ENVIRONMENTS, FLUCTUATIONS IN CURRENCY THE COMPANY TO BE MATERIALL
Slide 4: Highlights for the Quarter
Highlights for the Quarter 27.3 Production in upper range ▪ The Noble Sam Turner rig program for planned well workovers & maintenance mboepd of guidance delivering positive impact on production performance ▪ Pre-Tyra cash flow secured through ongoing hedging arrangements 57.5 Realised oil price USD
Slide 5: Near-Term Growth and Deleveraging on the Horizon
Near-Term Growth and Deleveraging on the Horizon Fully-funded to material cashflow generation with expected production c. 50mboe/d by 2023 ▪ Tangible, near-term growth through the Tyra redevelopment project – 2021 & 2022: Focus on base delivery, securing Tyra and minimizing exposure to market volati
Slide 6: Operational Review
Operational Review
Slide 7: Quarterly Production in Upper Range of Guidance
Quarterly Production in Upper Range of Guidance - Significant Operational Improvement on Performance Quarter on Quarter ▪ Second quarter production of 27.3 mboepd ▪ Quarterly operational efficiency at 83.1% versus 77.0% in Q1 ▪ Initiated Noble Sam Turner rig program catching up on planned workover a
Slide 8: Tyra Redevelopment: Project Overview
Tyra Redevelopment: Project Overview Largest project undertaken on the DCS, unlocking gross potential in excess of 200mmboe Highlights Project Overview ▪ Largest gas condensate field on the Danish Continental Shelf (“DCS”) – Processing > 90% of the gas produced in Denmark ▪ Tyra redevelopment projec
Slide 9: Tyra Redevelopment: Status and Milestones
Tyra Redevelopment: Status and Milestones Project significantly de-risked with fabrication of topside close to sail away ▪ Project progressing with first gas set for Q2 2023 following the COVID-19 related revision in 2020 ‒ Assessment based on current assumptions using the latest information receive
Slide 10: Next Milestone: Sail away from Sembcorp
Next Milestone: Sail away from Sembcorp Tyra East Wellhead & Riser Platforms on schedule: ▪ HTV (Heavy Transport Vessel) “BIGROLL” arrived at the Singapore yard 20th June 2021 ▪ 3 platform modules loaded onto HTV in July ▪ Vessel will remain at the yard for approx. 1 month to load and tie-down 3 pla
Slide 11: Tyra Redevelopment: Cost and Economics
Tyra Redevelopment: Cost and Economics Noreco’s revised cost estimate for entire Tyra project is DKK 22 billion (gross) Gross Expenditure: Overview and Expenditure to Date Economics: Comparable Developments(1) ▪ Noreco currently assumes an estimated DKK 22 billion total cost based on the NPV: USD /b
Slide 12: Material, Balanced Reserves & Resources Base
Material, Balanced Reserves & Resources Base 2P reserves of 201mmboe at end 2020, with 2C resources of 200mmboe+ Reserves & Resources: End 2020 (mmboe net) Development of 2P Reserves (mmboe net) Total Reserves & Resources at end 2020: 400mmboe+ 201,1 c. 200.0 24,5 201,1 195,3 (28,0) 9,3 167,3 Reserv
Slide 13: Redeveloped Tyra Drives c. 90% Production Growth
Redeveloped Tyra Drives c. 90% Production Growth Defined, low-risk and fully-funded to expected production of c. 50,000boe/d by 2023 Net Production(1) 60 (mboe/d) Base (Dan, Halfdan, Gorm) 50 Tyra (incl. Harald) Mature Projects(1) 40 2C Resources(2) 30 20 10 0 2021 2022 2023 2024 2025 2026 2027 2028
Slide 14: Financial Review
Financial Review IE
Slide 15: Developing Noreco as a Material Cashflow Generator
Developing Noreco as a Material Cashflow Generator Pre-2021 2021/22 2023+ Yesterday Today Tomorrow ▪ Acquisition of Shell’s 36.8% WI in the DUC(1) ▪ Tyra: On-track for first gas by mid-2023 ▪ Step-change when Tyra onstream: for USD 1.9 billion successfully closed in 2019 ‒ Key milestones to be achie
Slide 16: Financial Summary: Q2 2021
Financial Summary: Q2 2021 Robust capital structure and liquidity position; fully funded to deliver Tyra ▪ Strong operating and financial results during Q2 Key Financial Data: Q2 2022 – Significant improvement in performance vs. Q1 Hydrocarbon Production (mboe/d) 27.3 – Supports Tyra delivery, with
Slide 17: Capital Structure: Q2 2021
Capital Structure: Q2 2021 No cash maturities prior to Tyra first gas; liquidity of USD 245 million at end of the quarter Net Debt Overview: End June 2021(1) Available Liquidity: End June 2021 (USD million) (USD million) 178 1 278 145 Working Capital 100 245 unwind also expected to 1 133 increase li
Slide 18: Hedging: Focused on Pre-Tyra Cashflow Visibility
Hedging: Focused on Pre-Tyra Cashflow Visibility Programme executed to minimise exposure to near-term commodity price volatility Hedged Volumes Average Hedge Price (mmbbl) (USD/bbl) 61,3 3,0 55,7 55,8 55,6 51,7 53,5 2,4 2,4 1,9 1,8 1,6 Oil H2 2021 H1 2022 H2 2022 H1 2023 H2 2023 H1 2024 H2 2021 H1 2
Slide 19: NOR14 Amendment: Strong Bondholder Support
NOR14 Amendment: Strong Bondholder Support Amendment of maximum leverage until end 2023 supported by more than 2/3 of bondholders Overview Summary of Amendment ▪ Noreco announced on 28 June that it was looking to engage with NOR14 holders to proactively address elevated leverage levels ▪ Leverage ra
Slide 20: Capex: Material Change in Profile Post-Tyra
Capex: Material Change in Profile Post-Tyra Majority of Tyra capex expected to be incurred during 2021 and 2022 Noreco Capex Profile: Illustrative Forward Expenditure based on FID Projects Only(1,2) (USD million) 230-280 230-280 Tyra Other Investment Projects 30 30 Forecast production based on minim
Slide 21: Opex: Lifting Cost < USD 13/boe on Tyra Restart
Opex: Lifting Cost < USD 13/boe on Tyra Restart Material reduction post-Tyra, with our long-term focus on extracting all economic barrels Illustrative Development of Operating Costs: Net to Noreco(1) Illustrative Development of Unit Operating Cost(1) 600 (USD million) (mboe/d) 50 (USD /boe) c. 50.0
Slide 22: Material Cashflow Generation: Illustrative Profile
Material Cashflow Generation: Illustrative Profile Illustrative free cashflow generation from 2023 to 2027 of over USD 1.4 billion Illustrative Free Cashflow Generation: 2023 to 2027(1) 500 (USD million) 400 USD 75/bbl(3) 300 Forward Curve(2) USD 55/bbl(3) Illustrative free cashflow: $55 to 75/bbl o
Slide 23: Disciplined Capital Allocation
Disciplined Capital Allocation Deleveraging from 2023 to deliver fit-for-purpose capital structure Key Capital Allocation Messages Free Cashflow ▪ Illustrative free cashflow of over USD 1.4 billion cumulative from 2023 to 2027(1) ▪ Noreco anticipates significant deleveraging once Tyra onstream Delev
Slide 24: Sustainability
Sustainability
Slide 25: Sustainability: Our Role in the Energy Transition
Sustainability: Our Role in the Energy Transition Defined principles will influence our evolving approach and support a key tenet of our strategy which is achieving a set of substantive, quantifiable and achievable ESG goals Principles, Objectives & Approach Sustainability Linked KPIs ▪ Noreco has s
Slide 26: Closing Reflections
Closing Reflections : ¥ NA avert oor [TT ES
Slide 27: Fully-Funded Growth and Deleveraging from 2023
Fully-Funded Growth and Deleveraging from 2023 Material Reserves & ▪ 2P reserves of 201 mmboe ✓ Resources Base ▪ 2C resources of approximately 200 mmboe for progression with additional projects ▪ Base production providing significant operational cashflow Substantial ✓ Production ▪ Low decline rates
Slide 28: Contact: ir@noreco.com
Contact: ir@noreco.com > NorEco 28