Slide 1: Q4 and full-year 2023 & strategy update
Q4 and full-year 2023 & strategy update 8 February 2024 Aker BP ASA
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: 2023 highlights
2023 highlights ▪ Strong performance – delivering on targets ▪ Development projects on track ▪ Exploration success ▪ Leading the way in low GHG emissions ▪ Financially strong & growing dividends 3
Slide 4: 2023 operational improvements
2023 operational improvements Increasing production… …reducing production cost… …while decarbonising our business 1,000 barrels oil equivalent per day (mboepd)1 USD per boe1 Aker BP emission intensity, kg CO2e per boe 457 12.4 5.9 9.5 4.8 9.2 4.5 309 4.3 8.3 6.2 211 209 2.8 179 2019 2020 2021 2022 2
Slide 5: 2023 key financials
2023 key financials Total income Free cash flow 13.7 USD billion 3.1 USD/share Earnings Dividend 2.1 USD/share 2.2 USD/share Free cash flow: Net cash flow after tax from operating activities less net cash flow from investment activities 5
Slide 6: 2023 deliverables
2023 deliverables Original Latest Actual guidance1 guidance2 2023 Production 430-460 455-465 457 mboped Production cost 7.0-8.0 6.0-6.5 6.2 USD/boe Capex 3.0-3.5 3.0-3.5 3.3 USD billion Exploration 0.4-0.5 0.4-0.5 0.36 USD billion Abandonment 0.1-0.2 ~0.2 0.16 USD billion 1) 10 February 2023 2) 27 O
Slide 7: Aker BP's improvement programme
Aker BP’s improvement programme Strategic alliances Lean operations Flexible business models Digitalisation One-team culture with our main Framework for developing Re-thinking how we structure our Essential enabler suppliers based on common goals more efficient interactions with suppliers and for bu
Slide 8: Our strategic priorities
Our strategic priorities Ambition to lead the industry transformation as the E&P company of the future Deliver high return Establish the next Operate safely Decarbonise projects on quality, wave of profitable and efficiently our business time and cost growth options Return maximum value to our share
Slide 9: Operate safely and efficiently
Operate safely and efficiently 9
Slide 10: World-class oil and gas portfolio
World-class oil and gas portfolio Large scale, low risk assets on the Norwegian Continental Shelf 2P reserves1 2C resources1 Production2 arstad 1.72bn 0.81bn 457 boe boe mboepd Sandnessj en Skarv Unchanged +9% +48% when excluding production in 2023 from 2023 from 2022 Trondheim Johan Sverdrup Edvard
Slide 11: Safety
Safety Injury frequency (TRIF)1 Serious incident frequency (SIF)1 3.7 2.6 2.4 2.0 1.7 0.7 0.7 0.3 0.3 0 2019 2020 2021 2022 2023 2019 2020 2021 2022 2023 1) TRIF and SIF in prior years have been restated to reflect a more accurate methodology for measurement of exposure hours. See Quarterly report Q
Slide 12: Production
Production Oil & gas production per area 1,000 mboepd 481 453 450 444 432 Ula area 412 Alvheim area Skarv area Valhall area Grieg/Aasen 222 210 207 208 199 181 Johan Sverdrup Q1-21 Q2-21 Q3-21 Q4-21 Q1-22 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 Q3-23 Q4-23 Lundin portfolio included from Q3-22 12
Slide 13: Johan Sverdrup
Johan Sverdrup A giant field with excellent reservoir properties ▪ Excellent operational performance ▪ Stable production at elevated capacity level ▪ Continuously working to optimise production Daily oil production since start-up 755 mbblpd Aker BP holds 31.6% ownership in the Johan Sverdrup partner
Slide 14: Production efficiency
Production efficiency Increased production uptime Rolling 12m, operated assets only 95% 94% 91% 92% 90% 86% 88% 85% 85% Q4-21 Q1-22 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 Q3-23 Q4-23 14
Slide 15: Low-cost operations
Low-cost operations Total operational cost1 USD per boe, 2023e 20 15 10 5 0 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 1) Source Wood Mackenzie. Companies included: Aker BP, BP, Chevron, ConocoPhillips, Diamondback Energy, DNO, Eni, EOG Resources, 15 Equinor, ExxonMobil, , Galp Energia, Harbou
Slide 16: Future operations – modernising and digitalising the way we work
Future operations – modernising and digitalising the way we work Integration of Integrated New cooperation Remote operations new concepts Operation Centres models and maintenance New ways of Data-driven Increased digital Automation working decisions competence for all 16
Slide 17: Decarbonise our business
& AkerBP Decarbonise our business
Slide 18: Aker BP's decarbonisation strategy
Aker BP’s decarbonisation strategy Reducing absolute scope 1&2 GHG emissions before neutralising residual emissions Scope 1&2 Scope 3 Aker BP’s targets 1. Reduce operated scope 1&2 Avoid Reduce Neutralise Upstream scope 3 GHG emissions with 50% by reduction through procurement 2030 and ~100% by 2050
Slide 19: Aker BP – a global leader in low CO2 emissions
Aker 140 BP – a global leader in low CO2 emissions 120 Net emission intensity 2023 kg CO2e per boe, equity share 100 80 60 40 20 0 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 285 largest producing upstream companies Source: Wood Mackenzie– Global upstream CO2 emissions 19
Slide 20: Targeting net zero scope 1&2 emissions by 2030
Targeting net zero scope 1&2 emissions by 2030 Aker BP to offset all our remaining emissions using high-quality carbon removal projects Total estimated equity share scope 1&2 emissions Our approach 1 000 tonnes CO2e 800 Avoid Thousands New assets with power from shore 600 Target 100% electrification
Slide 21: Deliver high-return projects on quality, time and cost
Deliver high-return projects on quality, time and cost 21
Slide 22: Aker BP project overview
Aker BP project overview 770 mmboe net oil and gas volume at net capex of around USD 3 billion after tax Aker BP Production Asset area Field development Gross/net volume Net capex estimate PDO submission ownership start Frosk 80.0% 10/8 mmboe USD 0.2bn 2021 2023 Alvheim Kobra East & Gekko 80.0% 50/4
Slide 23: Our key principles for successful project execution
Our key principles for successful project execution Partnerships Standardisation Frontloading ✓ Competence and learning ✓ Well designs and equipment ✓ Early planning and maturation ✓ Continuity ✓ Topside and subsea equipment ✓ Supplier involvement ✓ Common goals and incentives ✓ Facilitate efficient
Slide 24: Alliances with leading suppliers – with proven track record
Alliances with leading suppliers – with proven track record The cornerstone of project planning and execution Alliances established with leading suppliers ▪ Covering majority of capital spend ▪ Subsea, Fixed Facilities, Modifications and Drilling ▪ One team - Common goals - Shared incentives Organis
Slide 25: Project execution on track
Project execution on track Good progress in the first year since PDOs Yggdrasil subsea template, Estonia Aker Solutions Stord Valhall PWP, Stavanger ▪ Key milestones achieved on schedule ▪ Main contracts placed and capacity secured Aker Solutions Verdal Onshore plant - power from shore ▪ Fabrication
Slide 26: Developments to drive growth and value creation
Developments to drive growth and value creation Planning to produce around 525 mboepd in 2028 Production outlook Our project portfolio mboepd ~525 ▪ Net resources of 770 mmboe 410-440 ▪ The projects lift Aker BP’s production by 250-300 mboepd in 2028 ▪ Low CO2 emission intensity ▪ Full-cycle portfol
Slide 27: Yggdrasil
Yggdrasil New North Sea area hub by joining forces across licences Aker BP Hugin: 87.7% Gas ~40% of (operator) Munin: 50.0% estimated volumes Fulla: 47.7% Partners Equinor and Power supply PGNiG Upstream Norway from shore Munin Unmanned production platform Volume estimate 650 mmboe (gross) / A new d
Slide 28: Valhall PWP-Fenris
Valhall PWP-Fenris Unlocks new volumes and secures life-time extension on Valhall PWP WP/IP PH Aker BP Valhall: 90.0% Establishes Valhall (operator) Fenris: 77.8% as area gas-hub Partners PGNiG Upstream Norway Power supply and Pandion from shore Valhall Volume estimate 230 mmboe (gross) / Minimal em
Slide 29: Skarv Satellites
Skarv Satellites Investments in future flexibility enabling further area development Aker BP Alve North: 68.1% Gas ~70% of (operator) Idun North: 23.8% estimated volumes Ørn: 30.0% Partners Equinor, Wintershall DEA Low operational and PGNiG Upstream cost Norway Volume estimate 119 mmboe (gross) / Lo
Slide 30: Utsira High projects
Utsira High projects Increased capacity utilisation at Ivar Aasen and Edvard Grieg platforms Aker BP Solveig Ph. II: 65.0% Adds low-cost (operator) Symra: 50.0% production Hanz: 35.0% Partners Equinor, OMV, Unlocks potential Wintershall Dea and future developments Sval Energi Solveig Volume estimate
Slide 31: Alvheim projects
Alvheim projects Unlocks new volumes, reduces unit cost and secures life-time extension on Alvheim Aker BP Frosk: 80.0% Tie-backs to existing (operator) KEG: 80.0% infrastructure Tyrving: 61.3% Accounts for ca. 50% Partners Vår Energy, of net Alvheim ConocoPhillips, Petoro, volumes in 2024/25 PGNiG
Slide 32: Establish the next wave of profitable growth options
Establish the next wave of profitable growth options 32
Slide 33: Growth through M&A and projects
Growth through M&A and projects Transactions + 18 organic development projects 500 000 457k 400 000 300 000 200 000 100 000 0 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 33
Slide 34: Our exploration strategy
Our exploration strategy Aker BP operator Aker BP partner Uniquely positioned on the NCS ▪ 2nd largest in Norway with over 200 licences ▪ Operator of ~70% ▪ 27 licences awarded in APA 2023 – all-time high Targeting net 250 mmboe from 2022 to 2027 ▪ Drill 10-15 exploration wells per year ▪ 80% near-f
Slide 35: 2023 – another year of successful exploration
2023 – another year of successful exploration Significant oil discovery in the Yggdrasil area Discovery at Frigg East ▪ Current volume estimate of 53-90 mmboe gross ▪ Increases the resource base for Yggdrasil ▪ Highly profitable with break-even well below $20/bbl Partner in several other discoveries
Slide 36: 2024 exploration program
Ferdinand Hassel 2024 exploration program Aker BP operator Aker BP partner Elgol Licence Prospect Operator Aker BP Pre-drill Status share mmboe PL102G Trell North Aker BP 61% 3 - 12 Drilling PL1138 Ametyst Harbour Energy 30% 23 - 116 Drilling PL956 Ringhornet Ty Vår Energi 20% 7 - 27 Drilling PL442
Slide 37: Significant upside potential around existing assets
Significant upside potential around existing assets Reserves and resources billion boe 4.0 ▪ Skarv: Infill drilling, exploration and ILX potential, development of tight reservoirs net risked ▪ Edvard Grieg/Ivar Aasen: Infill drilling, 3.0 exploration and basement upside 3P reserves ▪ Johan Sverdrup:
Slide 38: Return maximum value to shareholders and society
Return maximum value to shareholders and society 38
Slide 39: 2023 financials in brief
2023 financials in brief Operating cash flow Tax paid 20.4 USD/share 11.8 USD/share Free cash flow Financial capacity 3.1 USD/share 6.8 USD billion Dividend Leverage ratio 2.2 USD/share 0.2 Free cash flow: Net cash flow after tax from operating activities less net cash flow from investment activitie
Slide 40: Q4 2023 - Sales of oil and gas
Q4-23 Q4 2023 - Sales of oil and gas Volume sold Realised prices Total income mboepd USD/boe USD million 477 150 467 450 450 428 69 59 66 60 3 826 66 3 513 3 556 3 310 3 291 99 914 398 336 88 582 399 84 77 87 78 74 409 390 408 384 362 64 60 3 140 3 140 2 887 2 712 2 858 Q4-22 Q1-23 Q2-23 Q3-23 Q4-23
Slide 41: Income statement
Q4-23 Income statement USD million Before impairment Q4 2023 Impairments Actual Q3 2023 Actual 467 mboepd (450) Total income 3 556 3 556 3 513 Oil and gas sales Production costs 298 298 252 Other operating expenses 17 17 12 EBITDAX 3 241 3 241 3 249 $82 per boe (84) Exploration expenses 67 67 74 Net
Slide 42: Cash flow
Q4-23 Cash flow USD million Q4-23 Q3-23 Q2-23 Q1-23 Operating cash flow before tax 3 710 2 963 2 938 3 251 $0.5 bn (1.2) Taxes paid (2 207) (862) (2 817) (1 569) Free cash flow (FCF) Cash flow – operations 1 503 2 101 121 1 682 $0.73 (1.83) Cash flow – investments (1 042) (944) (776) (705) Free cash
Slide 43: Balance sheet
Q4-23 Balance sheet USD million Assets 31.12.23 30.09.23 31.12.22 PP&E 17 450 16 123 15 887 $6.8 bn ($6.8) Goodwill 13 143 13 554 13 935 Total available liquidity Other non-current assets 3 314 3 166 2 984 Cash and equivalent 3 388 3 375 2 756 Other current assets 1 751 1 909 2 000 32% (33%) Total A
Slide 44: Capital allocation priorities
Capital allocation priorities Aker BP’s financial frame – designed to drive value creation and shareholder return 1 Financial capacity 2 Profitable growth 3 Return value Maintain financial flexibility and Invest in robust projects Resilient dividend growth in line investment grade credit rating with
Slide 45: Continuously optimising our capital structure
Continuously optimising our capital structure Financing transactions in 2023 Bond maturities USD/EUR billion USD 1,500 million in new Senior Notes issued 1.75 ▪ USD 500 million Notes due in 2028 ▪ USD 1,000 million Notes due in 2033 USD ~1,000 million in existing bonds repurchased 0.66 1.00 1.00 ▪ 2
Slide 46: Maintaining financial flexibility
Maintaining financial flexibility Net interest-bearing debt Leverage ratio1 Liquidity available2 Excl. leases, USD billion Targeting below 1.5 over time USD billion 4 3.7 6.7 6.8 6.8 3.4 6.4 4 6.2 6.2 6.1 3.1 3.1 5.6 3 1.5 5.4 2.6 4.8 2.5 4.5 4.4 3 2.4 2.4 1.2 4.4 2.2 2.2 2.0 2 1.6 0.9 2 0.6 0.5 1 0
Slide 47: Grow production with robust high return projects
Grow production with robust high return projects Projects to lift Aker BP’s production by 250-300 mboepd in 2028 Production outlook Robust and profitable project portfolio mboepd ~525 $35-40/bbl 410-440 Project portfolio break-even oil price1 ~25% Project portfolio IRR at $65/bbl oil price 1-2 years
Slide 48: Investing in robust and profitable projects
Investing in robust and profitable projects In an investment-friendly tax system Aker BP est. capex before and after tax USD billion 6 ▪ Total capex estimate 2023-2028 in line with 5 plans presented one year ago 4 ▪ Minor adjustments to capex phasing between years 3 2 ▪ ~85% of the planned capex is
Slide 49: The tax system is highly supportive for investments
The tax system is highly supportive for investments In the investment phase, taxes paid are significantly lower than tax expense in the P&L Illustrative1 tax calculations Aker BP 2023 - 2028 USD billion 10 ▪ Relatively low tax payments in periods with 8 high investments ▪ Especially prominent in low
Slide 50: Near-term tax payments
Near-term tax payments Sensitivity for H2-2024 USD million 2 500 Tax instalments for fiscal year 2023 ▪ Tax for the year is paid in six bimonthly instalments with six months delay 2 000 ▪ Q1-24 and Q2-24 instalments now fixed based on full-year 2023 performance 1 500 $100/bbl 1 000 Assumptions for H
Slide 51: Strong and resilient cash flow as basis for dividend growth
Strong and resilient cash flow as basis for dividend growth Aker BP value creation plan 2023-2028 Dividends USD billion, accumulated USD per share 2.40 2.20 2.08 ▪ Low-cost production gives 20 2.00 resilient dividend capacity $90/bbl ▪ Distributions shall reflect the 15 Dividend capacity through the
Slide 52: 2024 guidance
2024 guidance 2023 2024 actuals guidance Production (mboped) 457 410-440 Opex (USD/boe) 6.2 ~7.0 Capex (USDbn) 3.3 ~5.0 Expex (USDbn) 0.36 ~0.5 Abex (USDbn) 0.16 ~0.25 52
Slide 53: Summary – Executing on our strategic priorities
Summary – Executing on our strategic priorities Deliver high return Establish the next Operate safely Decarbonise projects on quality, wave of profitable and efficiently our business time and cost growth options Discover 250 Zero serious incidents Grow production to ~525 mmboe by 2027 Equity GHG int
Slide 54: www.akerbp.com
AkerBP www.akerbp.com