Bluenord Asa · OSL:BNOR
Bluenord Asa — Noreco — FY2022 Earnings Presentation
33 slides from Bluenord Asa's earnings presentation, Feb 15, 2023
Slide 1: Focused on Delivery
Focused on Delivery Fourth Quarter & Full Year 2022 15 February 2023
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: A Significant Oil & Gas Producer in the EU...
A Significant Oil & Gas Producer in the EU... 4 Diversified, Balanced portfolio with a 36.8% WI in the TotalEnergies Operated DUC Key Highlights Portfolio of Four Hubs in the Danish North Sea DUC Partner Interest ▪ 36.8% WI in the Danish Underground Consortium (“DUC”) TotalEnergies 43.2%, op. – 15 f
Slide 5: … With A Strategically Important Asset Base
… With A Strategically Important Asset Base 5 DUC a key contributor to EU Energy Security with direct export routes to Continental Europe Key Observations Connected to the European Gas Network 1 Liquids pipeline to Fredericia ▪ Recent structural change in the EU energy 2 Gas pipeline to Nybro supply
Slide 6: Significant Progress Made During 2022
Significant Progress Made During 2022 6 Noreco is delivering and remains well positioned to continue doing so Maximise Production: 26.7mboe/d in 2022 vs. 26.9mboe/d in 2021 We Are Delivering Significant FCF Generation: $246mm in 2022(1) vs. ($137mm) in 2021 Operationally Meaningful Liquidity: $468mm
Slide 7: Delivering Operationally
Delivering Operationally 7 Today’s strong performance creates significant value from existing operations Net Production: Natural Decline Mitigated mboe/d EBITDA Generation: Substantial Increase USD million ▪ Strong overall portfolio performance ▪ Favourable pricing combined with strong operations ▪
Slide 8: Delivering Tyra
Delivering Tyra 8 Step change in production and cashflow generation post Winter 2023/24 restart A More Than Doubling of Production… mboe/d … With Lower Opex and Emissions $/boe Kg CO2 / boe ~23 ~30 c. 50mboe/d 45% Gas 26.7 ~30% <$13/boe Reduction Gas Oil 2022 2023+ 2022 2023+ 2022 2023+ Volumetric E
Slide 9: Delivering Our Potential
Delivering Our Potential 9 Framework will prioritise capital returns and allow measured organic investment Robust Capital Allocation Framework… … With Measured, Long-Term Organic Growth Capital Returns ▪ Material impact with limited expenditure De-leveraging Prioritised WROM(1) (e.g. HCA restimulati
Slide 10: We are Delivering Operationally
We are Delivering Operationally
Slide 11: Excellent Operational Performance in 2022
Excellent Operational Performance in 2022 11 Actual Production in 2022 of 26.7mboe/d vs initial guidance of 23.5 to 25.5mboe/d 2022 2023 Excellent performance with successful optimisation Strong underlying reservoir performance, activities and high operational efficiency with high activity levels pl
Slide 12: Delivering Operationally (Cont’d)
Delivering Operationally (Cont’d) Seven infill well opportunities identified: FIDs in 2022/23, drilling rig secured until March 2025 Net Volumes Capex Project 2022 2023 2024 2025 (mmboe) ($/boe) Ongoing Activity Interventions, workovers, stimulation, n/a n/a integrity and reinstatement WROM Sanction
Slide 13: We Are Delivering Tyra
We Are Delivering Tyra
Slide 14: Delivering Tyra: a Game-Changing EU Gas Producer
Delivering Tyra: a Game-Changing EU Gas Producer 14 Step-Change Project, Strongly Supporting Danish Energy Security Tyra: Strategically Important Noreco’s Production to Grow Significantly mboe/d Reserves Unlocks substantial gas-weighted volumes +200 2023 2024+ mmboe(1) c. 50mboe/d Production Signifi
Slide 15: Status Offshore Hook-Up and Commissioning
Status Offshore Hook-Up and Commissioning 15 TEH in full use since September-22 Tyra East Wellhead and Riser Platforms ▪ Well instatement started 2. Feb-23 ▪ First wellhead installed 5. Feb-23 ▪ Piping - Installation of HU spools ▪ Risers - Installation of riser spools ▪ Wellhead flowlines TEG Modul
Slide 16: Tyra Milestones Update
Tyra Milestones Update Completed 2022 ▪ TEH Living Quarter in Regular Use ▪ Offshore Installation Complete ▪ TEG Safe Access and Temp. Power Upcoming Pre-First Gas ▪ TEG Permanent Crane in Operation 2023 ▪ TW-WHRP Stand Alone Operations ▪ TEH Fire Water Connected to TEG ▪ TEG Sea Water Lift Pump Upc
Slide 17: Tyra: Schedule and Cost to First Gas
Tyra: Schedule and Cost to First Gas 17 Remaining net capex of ~$190mm to reach first gas in Dec-23 on a P50 Basis Remaining P50 Capex (Net): ~$280mm(1) First Gas Range: Winter 2023/24 (USD million) P10 P50 P90 300 110 Oct-23 Dec-23 Mar-24 90 280 190 Remaining H2 2022 Remaining Post Total (Pre-First
Slide 18: We are Delivering Our Long-Term Potential
We are Delivering Our Long-Term Potential
Slide 19: Delivering Our Potential
Delivering Our Potential 19 Disciplined Capital Allocation Will Define Actionable Opportunity Set Shareholder Returns Significant Deleveraging With Tyra onstream Prioritised Target through-cycle Sustainable, long-term leverage: < 2.0x dividend profile supported by our balance sheet (Net Debt / EBITD
Slide 20: Portfolio Supports Long-Term Energy Security
Portfolio Supports Long-Term Energy Security 20 Low-Cost Volumes to Support a Sustainable, Long-Term Cashflow Profile Development Project and Key Highlights Development Concept ▪ Project Team established ▪ Five wells produced via unmanned, 4-leg jacket Valdemar Bo South ▪ First oil expected in 2026
Slide 21: Potential to Maintain Plateau Production
Potential to Maintain Plateau Production 21 Decisions to invest further will need to support long-term cashflow generation potential Long-Term Production Potential: Reflecting Organic Opportunity Set ▪ Long-term potential exists to mitigate decline and maintain plateau production levels after Tyra o
Slide 22: Our Sustainability Commitments
Our Sustainability Commitments 22 Balanced approach, with Energy Security and the Energy Transition as key themes Noreco has invested > $1bn in delivering gas redevelopment project Deliver Tyra ▪ Expected to deliver 2.8 billion cubic meter of gas / year 1. ▪ Key gas producer in the EU Energy Securit
Slide 23: CCS Status
CCS Status 23 Optionality in early stage projects while regulatory frameworks remain uncertain Operator TotalEnergies awarded two CO2 Storage license of which Bifrost is included The awarded license with scope beyond originally defined for Project Bifrost Status Project Bifrost beginning 2023 (Half
Slide 24: CarbonCuts: Noreco Investment
CarbonCuts: Noreco Investment 24 An early stage CCS initiative which offers a unique and fit-for-size opportunity in supporting Denmark’s CCS ambitions At a Glance ▪ An early-stage feasibility study for onshore CO2 storage supported by Noreco ▪ Building a CO2 storage facility at the coastline of Rød
Slide 25: Financial Overview
Financial Overview
Slide 26: Strong Financial Performance in 2022
Strong Financial Performance in 2022 26 Significant cash generation with strong asset performance and supportive commodity prices Revenue USD million EBITDA USD million 967 611 294 198 265 167 230 140 179 107 Q1-22 Q2-22 Q3-22 Q4-22 FY 2022 Q1-22 Q2-22 Q3-22 Q4-22 FY 2022 Operational Cashflow USD mi
Slide 27: Commodity Price Hedges Provide Cashflow Visibility
Commodity Price Hedges Provide Cashflow Visibility 27 forward prices Gas hedging for 2023 and 2024 significantly above current market spot and Oil Price Hedging Hedged volumes (mmbbl) Hedge price ($/bbl) 1.6 % of 2023 Oil Production Hedged(1): ~60% 80 74.7 74.7 68.0 68.0 1.2 61.3 61.3 60 51.7 51.7 5
Slide 28: Strong Capital Structure & Liquidity Position
Strong Capital Structure & Liquidity Position Fully-Funded to Deliver the Tyra Redevelopment Project Robust Capital Structure USD million Strong Liquidity Position USD million Stable with No Principal Maturities Pre-Tyra Fully-Funded to Tyra First Gas 208 25 1,208 (268) 200 468 175 975 939 800 268 D
Slide 29: Closing Remarks
Closing Remarks
Slide 30: Focused on Delivery
Focused on Delivery 30 Maximising Value and Ensuring Energy Security: Today and Tomorrow Maximise Production from our operational hubs We Are Delivering Minimise Costs to support overall profitability Operationally Reduce Emissions through targeted interventions Unlocks > 1 Tcfe(1) supporting long-t
Slide 31: Q&A
Q&A 15 February 2023
Slide 32: Appendix
Appendix 15 February 2023
Slide 33: Issue of NOR15 Convertible Bond
Issue of NOR15 Convertible Bond NOR13 restructuring successfully completed Overview of NOR15 Overview of NOR13 Conversion and NOR15 Issuance USD million 3 Jan-23 ▪ NOR13 restructuring announced Nov-23 – Executed through issue of NOR15 165.2 165.2 56.2 207.6 ▪1 NOR15 of $207.6mm issued in Dec-22, 151