Slide 1: Presentation of first quarter 2020
Presentation of first quarter 2020 OKEA ASA 28 April 2020
Slide 2: General and disclaimer
General and disclaimer This presentation is prepared solely for information purposes, and does not constitute or form part of, and is not prepared or made in connection with, an offer or invitation to sell, or any solicitation of any offer to subscribe for or purchase any securities. Investors and p
Slide 3: Highlights 1st quarter 2020
Highlights 1st quarter 2020 Operations • No serious incidents at operated operations • Production 19 099 boepd • High availability at Draugen and Gjøa Financial • Revenues from oil and gas of NOK 504 million • EBITDA of NOK 312 million • Non-cash one off effects • NOK 634 million in impairments • NO
Slide 4: Financials
Financials Birte Norheim, CFO
Slide 5: Oil and gas production, sales and revenues
Oil and gas production, sales and revenues Solid production, but revenue decrease due to lower sold volumes and lower realised prices Oil and gas volume (boepd) Realised prices (USD/boe) Petroleum revenues (NOK million) Production Sales Liquids Natural gas -22% -14% -33% -2% -56% 19 498 19 099 20 26
Slide 6: Income statement
Income statement 1st quarter Full year Q1 Comments Figures in NOK million 2020 2019 2019 Total operating income 551 764 3 020 • Income: Production expenses -167 -144 -709 • Reduced volumes sold from Gjøa and Draugen Changes in over/underlift positions and inventory -33 -165 -272 • Lower oil and gas
Slide 7: Impairment
Impairment Stressed macro conditions NOK Million 5 472 -634 5 500 346 Impairment indicators Q1 5 000 253 35 4 838 •Significant drop in oil and gas prices 4 500 4 000 Methodology applied 3 500 •Forward curve per 31 March applied for NPV calculations until 2022 3 000 •Bottom-up calculation per asset 2
Slide 8: Cash development Q1 2020
Cash development Q1 2020 NOK Million 1 800 -404 1 700 1 663 71 50 1 600 1 500 333 1 400 1 300 52 1 259 40 1 200 1 100 1 000 900 800 700 600 500 400 300 200 100 0 Cash 01.01.20 Operating activities Taxes paid Investment activities Buy-back OKEA02 Interest paid Cash 31.03.20 8
Slide 9: Managing the business during the market turmoil
Managing the business during the market turmoil OKEA in a good position to handle the downturn •Solid cash balance; no maturities until 2023 •Production expense 87.3 NOK/boe (~8.3 USD/boe1) •100 000 bbl2 of May lifting from Draugen hedged at 57 USD/bbl •Preserve cash and cut cost Risk of temporary b
Slide 10: Cash and covenants forecast
Cash and covenants forecast Cash Balance (USD Million) Leverage ratio 2020 2021 2022 200 0 1 160 2 120 3 4 80 5 6 40 7 0 8 2020 2021 2022 Yme start up Q2 2021 Yme start up YE 2020 Covenant Yme start up Q2 2021 Yme start up YE 2020 Covenant • Solid cash position and long-term cash generation • Risk o
Slide 11: Operations
Operations Tor Bjerkestrand, SVP Operations
Slide 12: Production volumes Q1
Production volumes Q1 High production from both Draugen and Gjøa Daily average production (boepd) 25 000 20 045 19 498 19 099 20 000 18 125 17 020 •High availability 15 000 10 488 10 496 8 135 9 812 •Production optimisation 7 842 10 000 5 000 9 241 9 648 8 922 8 637 8 835 0 Q1 19 Q2 19 Q3 19 Q4 19 Q
Slide 13: Draugen operations – OKEA operated
Draugen operations – OKEA operated Safe operations and stable production despite Covid-19 Net production (boepd) Q1 operations 12 000 • No serious incidents or leaks 10 000 8 000 • 97% availability and production optimisation 6 000 9 648 • Covid-19 situation managed 8 637 9 241 8 835 8 922 4 000 • R
Slide 14: Gjøa operations – OKEA non-operated asset
Gjøa operations – OKEA non-operated asset High availability and production ahead of plan Net production (boepd) Q1 operations 12 000 10 000 • One incident – dropped object on drilling rig 8 000 • No leaks 6 000 • 97% availability and production above target 10 488 10 496 9 812 4 000 8 135 7 842 • Co
Slide 15: Development Projects
Development Projects Knut Gjertsen, SVP Projects and Technology
Slide 16: Yme
Yme Planned production start is year-end 2020, effects of Covid-19 still uncertain Status • Offshore campaign for wellhead module is successfully completed, and Rowan Viking is demobilised. Well head scope reduced to 5 000 hours. • Offshore campaign for replacement of well plugs for two gas injector
Slide 17: Development Projects
Development Projects P1/Gjøa (Neptune op.) Grevling/Storskrymten Hasselmus Grevling • Geopilot well drilling completed • Matured Grevling/Storskrymten • Suspended for 12 months • Two additional sidetracks towards concept selection • Substantial reduced CAPEX increases CAPEX • PL973 exploration wells
Slide 18: Outlook & concluding remarks
Outlook & concluding remarks
Slide 19: Outlook
Outlook •Manage operations through the downturn • Postpone all investments that do not support short term cashflow • Push forward maintenance turnaround on Draugen •Protecting financial position • Control spend in own operated assets • Waiver process towards bond holders •Guiding 2020 • Production:
Slide 20: OX
OX