Slide 1: DNO ASA Corporate Presentation 3rd Quarter 2002
DNO ASA Corporate Presentation 20.11.02 3rd Quarter 2002 1 3 Q 2002 DNO ASA
Slide 2: Highlights 3Q 2002
Highlights 3Q 2002 • Record financial performance from Oil & Gas activity • Strong cashflow and operating margins • Positive results from drilling activities in Yemen and UK • Signed agreements for two new assets • Upgraded Oil & Gas reserves 2 3 Q 2002 DNO ASA
Slide 3: Highlights 3Q 2002 cont....
Highlights 3Q 2002 cont…. Best financial performance from Oil & Gas activities ever: • Operating Revenue MNOK 420 • EBITDA MNOK 277 • Net Back after tax MNOK 180 • EBIT MNOK 189 • Net Profit MNOK 46 3 3 Q 2002 DNO ASA
Slide 4: 3 Q 2002 DNO ASA
4 3 Q 2002 DNO ASA
Slide 5: DNO in the world
DNO in the world 22 000 BOPD Norway UK / Ireland PL 103B Jotun Heather Glitne Field Yemen West Heather PL 203 Tasour Solan/Strathm PL 148 Sharyoof Thistle* PL 006C Block 43 Seven Heads 5 3 Q 2002 DNO ASA * Subject to DTI approval
Slide 6: 2002 Production
2002 Production Production above target 30 000 UK NORWAY YEMEN TOTAL 25 000 20 000 15 000 10 000 YTD average 22176 BOPD 5 000 0 J F M A M J J A S 6 3 Q 2002 DNO ASA
Slide 7: Production YTD 3rd Quarter
s Production YTD 3rd Quarter Production YTD 3rd Quarter 25000 22176 20000 15000 2001 BOPD 12398 2002 10000 5000 0 7 3 Q 2002 DNO ASA
Slide 8: UK Highlights
UK Highlights 6 000 • YTD Production – 4.949 BOPD 5 000 4 000 • New Partners for West Heather Satellites 2002 2002 PRODUCTION 3 000 • Successful drilling results from West Heather 2 000 PRODUCTION • Signed Agreement for Thistle Operatorship 1 000 0 J F M A M J J A S 8 3 Q 2002 DNO ASA
Slide 9: Production Test on West Heather
Production Test on West Heather 6000 BOPD 9 3 Q 2002 DNO ASA
Slide 10: Heather Area Development Plan
Heather Area Development Plan 3 Production wells drilled by end 2002 10 3 Q 2002 DNO ASA
Slide 11: Thistle
Thistle Thistle Heather W. Heather Thistle Platform is located 75 km NE of Heather Current Production 5.500 BOPD 11 3 Q 2002 DNO ASA
Slide 12: UK Proven + Probable Reserves (MM BBLS)
UK Proven + Probable Reserves (MM BBLS) North Terrace Heather Brent 9.57 18.34 Heather Triassic 11% 22% 33.26 4.06 5% 39% 19.79 23% West Heather Thistle Total 85.02 MM BBLS Net DNO 65.8 MM BBLS 12 3 Q 2002 DNO ASA
Slide 13: Norway Highlights
Norway Highlights PL 203 Jotun 103B Glitne PL 048 PL 148 PL 006C 9 000 8 000 7 000 • YTD Production – 7.030 BOPD 6 000 5 000 • Glitne Performance better than Plan 4 000 • 2 Infill Wells drilled on Jotun 3 000 2 000 2002 2002 PRODUCTION PRODUCTION 1 000 • PL 203 Reserves Increased 0 J F M A M J J A S
Slide 14: Norway Proven + Probable Reserves (MM BBLS)
Norway Proven + Probable Reserves (MM BBLS) Glitne 9% Jotun 49 % PL 203 42 % Gross DNO Initial Reserves 376 40 Produced to date 114 8 Remaining 262 32 14 3 Q 2002 DNO ASA
Slide 15: Yemen Highlights
Yemen Highlights 14 000 12 000 • YTD Production – 10.073 BOPD 10 000 • Production above Target 8 000 6 000 • New Well on Tasour Doubled Reserves 4 000 2002 2002 PRODUCTION PRODUCTION • Drilling activities continue in 4 Q 2 000 0 J F M A M J J A S 15 3 Q 2002 DNO ASA
Slide 16: Tasour Map
Tasour Map New Well 16 3 Q 2002 DNO ASA
Slide 17: Yemen Proven + Probable Reserves (MM BBLS)
Yemen Proven + Probable Reserves (MM BBLS) Tasour; 19,7 36 % Sharyoof; 35,7 64 % Gross DNO Initial Reserves 55,2 18,9 Produced to date 13,0 4,6 Remaining 42,2 14,3 17 3 Q 2002 DNO ASA
Slide 18: Seven Head Location
Seven Head Location 18 3 Q 2002 DNO ASA
Slide 19: Seven Heads - Overall Field Layout Schematic
Seven Heads - Overall Field Layout Schematic Reserves (p + p) Gross 300 Bcf / 55 Mill. bbls oe DNO 38 Bcf / 7 Mill. bbls oe First gas production planned for 3 Q 2003 19 3 Q 2002 DNO ASA
Slide 20: Summary and Short Term Outlook
Summary and Short Term Outlook • 2002 Production > 22.000 BOPD • Total DNO ”P + P” Reserves increased to 119 Mill. Bbls * • West Heather Development Plan expected to be presented to DTI beginning of 2003 • Continued drilling activities in Yemen during next 3-4 months • Seven Heads Development Plan e
Slide 21: Key Financials 3rd Quarter 2002
Key Financials 3rd Quarter 2002 21 3 Q 2002 DNO ASA
Slide 22: Financial Highlights 3Q 2002
Financial Highlights 3Q 2002 • EBITDA NOK 277 mill., YTD NOK 716 mill. • Net back after taxes paid NOK 180 mill, YTD 457 NOK mill. • Oil price increase offset by lower production and FX rate • Increased reserve estimates in Yemen reduce DD&A expenses • NOK 5.4 mill. amortization of Timan Pechora pro
Slide 23: Financial Highlights 3Q 2002
Financial Highlights 3Q 2002 • Strong improvement in net finance • Increase in taxes from NCS / INT (Bl. 53 Cost Recovery) • Net profit NOK 46 mill. (up 10% from 3Q 01) • NOK 35 mill. share issue 23 3 Q 2002 DNO ASA
Slide 24: DNO Production vs. Brent Oil Price
DNO Production vs. Brent Oil Price 30000 30 HIGHLIGHTS: 25000 25 • Increase in Brent quarterly average to USD 26.80 in 3Q 02 20000 20 • Average production for usd/bbl bbl/day 15000 15 3Q 02 22.176 BOPD (3Q 01 11.722 ) 10000 10 5000 5 0 0 01 01 01 01 02 02 10 2 02 0 03 06 09 12 03 06 09 Prod mth bbl/
Slide 25: Operating Revenue 3Q 2002
Operating Revenue 3Q 2002 Revenues per Business Area HIGHLIGHTS: • NOK 440 mill. operating revenue 500 457 440 in 3Q 02 (up 35% from 3Q 01) 368 • Operating revenue decline 3.7% 400 314 327 in 3Q 02 from 2Q 02, due to 287 271 fall in production NOK 22 mill. NOK Mill 300 and lower FX NOK 33 mill, 200
Slide 26: Income Statement 3Q 2002
Income Statement 3Q 2002 HIGHLIGHTS: GROUP (NOK mill.) 3Q02 2Q02 1Q02 YTD02 YTD01 • Record EBITDA and Operating Profit Operating Revenues 440 457 368 1 266 928 Exploration and Impairment -7 -53 -33 -93 -9 • DDA reduced due to increased Operating Exp., excl expl & DD&A -157 -155 -145 -456 -402 reserv
Slide 27: Net Finance 3Q 2002
Net Finance 3Q 2002 HIGHLIGHTS: • Lower unrealized disagio • Strong improvement in net finance • NOK 46 mill. YTD income from FX-contracts and swaps GROUP (NOK mill.) 3Q02 2Q02 1Q02 Ytd 02 Ytd 01 Interest revenues 4 2 3 9 26 FX-contracts, swaps 4 36 6 46 7 Agio, other financial revenues 4 5 0 9 22 I
Slide 28: Revenues, EBITDA, EBIT and Net Profit
Revenues, EBITDA, EBIT and Net Profit Revenues, EBITDA, EBIT, net profit HIGHLIGHTS: • Increasing EBITDA and 500 Operating Profit 400 • Net Profit improvement 3rd quarter (PDR ASA writedown 2nd Quarter) Mill NOK (current) 300 • Steady development in net profit 200 adjusted for PDR ASA, Timan Pechora
Slide 29: Net Back After Tax 3Q 2002
Net Back After Tax 3Q 2002 EBITDA, EBITDAX and NETBACK HIGHLIGHTS: • Netback (after taxes paid) 350 NOK180 mill. in 3Q 02 (NOK 164 mill. in 3Q 01) 300 Mill NOK (current) 250 200 150 100 50 0 01 01 01 01 02 02 02 Q1 Q2 Q3 Q4 Q1 Q2 Q3 EBITDAX EBITDA Netback 29 3 Q 2002 DNO ASA
Slide 30: EBITDA per Business Area
EBITDA per Business Area EBITDA per Business Area HIGHLIGHTS: • INT still generates more than 300 70% of total EBITDA 250 • NCS improved from 2nd 200 quarter due to no dry well costs in 3Q 02 Mill NOK 150 100 50 0 01 01 01 01 02 02 02 -50 Q1 Q2 Q3 Q4 Q1 Q2 Q3 NCS UKCS INT Group 30 3 Q 2002 DNO ASA
Slide 31: EBIT per Business Area
EBIT per Business Area EBIT per Business Area (O&G) HIGHLIGHTS: • Strong EBIT due to INT and NCS 250 200 150 NOK Mill 100 50 0 01 01 01 01 02 02 02 Q1 Q2 Q3 Q4 Q1 Q2 Q3 -50 NCS UKCS INT Total 31 3 Q 2002 DNO ASA
Slide 32: Group Direct Field Expenses per bbl
Group Direct Field Expenses per bbl Production and transportation expenses - HIGHLIGHTS: total and per barrel oil equiv. • Per bbl direct field expenses USD 7.61 in 3Q 02 (down 36% 14 500 from 3Q01) 11,88 12 10,16 400 • 3Q 02 total direct field 10 9,33 9,35 expenses reduced by 5.7% 7,61 compared to
Slide 33: Group Direct Field Expenses per bbl
Group Direct Field Expenses per bbl Production and transportation expenses HIGHLIGHTS: per barrel oil equiv. • Lower direct field expenses INT and UKCS in 3Q 02 • Lower production in UKCS and 25 NCS increases pr bbl costs. 20 USD / Bbl o.e. 15 11,88 9,33 10,16 9,35 10 6,75 7,03 7,61 5 0 01 01 01 01
Slide 34: Balance Sheet 3Q 2002 – Assets
Balance Sheet 3Q 2002 – Assets HIGHLIGHTS: • Received USD 15 mill. payment from Unocal in exchange for letter of credit covering Heather decomissioning • Zero book value of shares in Petrolia Drilling ASA • NOK 73 mill. cash increase GROUP Assets 3Q02 2Q02 1Q02 YE 2001 YE 2000 (NOK mill.) Fixed Asse
Slide 35: Balance Sheet 3Q 2002 – Shareholders' Equity and Liabilities
Balance Sheet 3Q 2002 – Shareholders’ Equity and Liabilities HIGHLIGHTS: • Decrease in long-term liabilities due to NOK 80 mill. reduction in deferred tax liability • Increase in short-term debt due to higher payable tax and accrued expenses GROUP Shareholders' Equity and Liabilities 3Q02 2Q02 1Q02
Slide 36: Cash Flow 3Q 2002
Cash Flow 3Q 2002 Cash flow Group YTD YTD 3Q02 2Q02 1Q02 (NOK mill.) 3Q02 3Q01 Operating activities: 166 -7 76 Consolidated profit before tax 235 305 -97 -117 -45 Taxes paid for the period -259 -58 83 101 92 Depreciation, depletion and amortisation 276 154 20 122 4 Associated companies 146 20 6 0 -1
Slide 37: Capex and Cash Flow from Operations
Capex and Cash Flow from Operations Capital Expenditure and CF from Operations HIGHLIGHTS: • Strong cash flow cover of investments 400 6,00 • 3rd quarter investments: 350 5,00 300 –UKCS NOK 33 mill Times coverage 4,00 250 3,00 –Bl. 32 NOK 28 mill Mill NOK 200 2,00 –Bl. 53 NOK 25 mill 150 100 1,00 –I
Slide 38: Key Figures 3Q 2002
Key Figures 3Q 2002 HIGHLIGHTS: • Strengthening of margins. • After tax cash flow return (CROGI) 22% YTD. GROUP 3Q02 2Q02 1Q02 YTD02 YTD01 Earnings per Share NOK 0,91 -1,34 0,49 0,05 2,03 EBITDA per Share NOK 5,48 4,94 3,78 14,07 10,21 EBITDA Margin % 62,8 54,5 51,8 56,6 55,8 EBIT Margin % 42,9 31,5
Slide 39: 20 Largest Shareholders DNO ASA
20 Largest Shareholders DNO ASA 20 largest shareholders as of 18th November 2002 Share-holding Percentage Name Nationality 6 563 142 12,11 INCREASED OIL RECOVERY AS NOR 2 315 148 4,27 LARSEN OIL & GAS AS NOR 2 000 000 3,69 DET STAVANGERSKE DAMPSKIPSELSKAP NOR 1 710 000 3,15 THE LAW DEBENTURE TRUST G
Slide 40: For more information......
For more information...... www.dno.no 40 3 Q 2002 DNO ASA