Orron Energy AB · OMXSTO:ORRON
Orron Energy AB — Lundin Petroleum — Investor Presentation (November 2019)
35 slides from Orron Energy AB's investor presentation, November 2019
Slide 1: Corporate Presentation
Corporate Presentation November 2019 WF12520 p01 09.19
Slide 2: A Leading European Independent E&P Company
Lundin Petroleum A Leading European Independent E&P Company > 9 Bn USD >1 Bn boe Market Cap Resource base Production targeting Industry Leading >200 Mboepd Low Opex ~4 USD/bbl ~1Bn USD 1.48 Free cash USD/share flow/year dividend 2019 Low Carbon footprint approximately quarter of world average WF1252
Slide 3: Successful Organic Growth Strategy
Lundin Petroleum Successful Organic Growth Strategy Southeastern Trend Loppa High 7 ~60% core increase in number exploration of licences from Hammerfest areas Jan 2018 Harstad 8 new Targeting 10 projects exploration & ~220 MMboe (1) ~ appraisal wells per year Frøya High/ Significant yet to find Froa
Slide 4: ESG Performance and Ratings 2018
Lundin Petroleum ESG Performance Industry leading low carbon intensity per barrel produced ESG Ratings 2018 Direct investment in offset/replacing electricity usage Top 10 ESG in Europe – currently 20% of power from shore offset through a hydro project Top 5 on human rights globally Desire to invest
Slide 5: Utsira High Full Electrification - Industry Leading Low Carbon Intensity
Lundin Petroleum Utsira High Full Electrification - Industry Leading Low Carbon Intensity Illustration source Equinor Kårstø Haugsneset Johan Sverdrup Johan Sverdrup Phase 2 and Utsira High power Ivar Aasen from shore (4Q 2022) Edvard Grieg Gudrun Gina Krog Emissions intensity (1) kg CO2/boe ~18 ~8
Slide 6: Industry Leading Operating Performance
Lundin Petroleum Industry Leading Operating Performance Production Efficiency Sustained Low Opex 98% Edvard Grieg (1) ~4 USD/boe 97% Alvheim Area (1) Third of North Sea average Carbon Intensity Top Tier HSE Performance ~5 kg CO /boe today 2 Zero (1) <1 kg CO /boe in 2022 2 material incidents WF12520
Slide 7: Strong Track Record
Lundin Petroleum Strong Track Record 2P Reserves Production Operating Costs Operating Cash Flow 90–95 726 745 86 Long-term Guidance 1,848 714 81 10.7 654 3.4–4.4 USD/boe(1) 1,530 59 Net Mboepd Net MMboe Million USD 6.8 USD/boe 860 4.25 3.66 4.25 550 21 2015 2016 2017 2018 2015 2016 2017 2018 2019 20
Slide 8: Targeting >200 Mboepd Beyond 2023
Lundin Petroleum Targeting >200 Mboepd Beyond 2023 Target >200 Mboepd Upsides and New Projects ~170 >150 90–95 86 81 59 21 2015 2016 2017 2018 2019 J. Sverdrup J. Sverdrup Guidance Phase 1 Full Field Plateau Plateau Committed projects only (2020) (2023) WF12520 p07 10.19 Growth of ~20% CAGR Lundin P
Slide 9: Sustainable Free Cash Flow
Lundin Petroleum Sustainable Free Cash Flow Average E&A spend Brent (2) Annual FCF per annum Free Cash Flow (Pre-Dividend) (1) >60 USD/bbl 1 ~ billion USD 250 MUSD 2,000 1,500 MUSD 1,000 Dividend Strategy 500 Annual dividends of 0 1.48 USD per share to grow over time 2019 2020 2021 2022 2023 2024 20
Slide 10: Industry Leading Free Cash Flow Breakeven
Lundin Petroleum Industry Leading Free Cash Flow Breakeven Free Cash Flow (Pre-Dividend) Breakeven (USD/bbl) 20 10 Average Average 2020-2022 2023-2026 WF12520 p09 10.19 JS working interest at 20% from 01.01.2019 / Based on 2P reserves at end 2018 + Solveig + Rolvsnes EWT + Edvard Grieg Infills Lundi
Slide 11: Key Assets
Hammerfest Hammerfest Lundin Petroleum Key Assets Harstad Harstad Production Production Alvheim Johan Sverdrup Production Development Edvard Grieg Edvard Grieg Tie-backs Alvheim Area Oslo Oslo Stavanger Stavanger Utsira High Area WF12520 p09 10.19 Lundin Petroleum 11
Slide 12: Greater Edvard Grieg Area - Keeping the Facilities Full
Lundin Petroleum Greater Edvard Grieg Area - Keeping the Facilities Full Edvard Grieg Gross Reserves/Resources (MMboe) 368 Edvard Grieg · 3 firm infill wells sanctioned 18 282 >300 · Further reserves upside +62% 186 Extended Plateau Production to around end 2022 from 3P Reserves mid-2020 2C Continge
Slide 13: Greater Edvard Grieg Area - Solveig Phase 1 and Rolvsnes EWT
Lundin Petroleum Greater Edvard Grieg Area - Solveig Phase 1 and Rolvsnes EWT Edvard Grieg Rolvsnes and Goddo 14-78 MMboe (1) Solveig PDO/ Rolvsnes EWT Topside modifications Solveig Rolvsnes EWT authority approvals ongoing First Oil First Oil 2019 2020 2021 Solveig >10% complete Solveig Plateau Prod
Slide 14: Alvheim Area - Continuous Reserves Growth
Lundin Petroleum Alvheim Area - Continuous Reserves Growth Alvheim Gross Reserves/Resources (MMboe) 607 · Frosk test producer on stream 494 OPEX · Alvheim infill pilots successful 6.23 +92% USD/boe (2) · Maturing new infill wells for 2020 257 Alvheim FPSO 3P Reserves 2C Contingent Resources Cumulati
Slide 15: Johan Sverdrup Phase 1 - First Oil Ahead of Schedule and Below Budget
Lundin Petroleum Johan Sverdrup Phase 1 - First Oil Ahead of Schedule and Below Budget GROSS RESOURCES PRODUCTION CAPACITY BREAK EVEN PRICE GROSS CAPEX (1) Phase 1 Full Field Phase 1 Phase 2 2.2–3.2 billion boe First oil 5 Oct 2019 First oil Q4 2022 Full Field PDO 123 Bn NOK PDO 85 Bn NOK (2) (PDO 1
Slide 16: Johan Sverdrup Phase 1 - Production Ramp-up
Lundin Petroleum Johan Sverdrup Phase 1 - Production Ramp-up Production wells onstream 8 pre-drilled wells 2-4 new wells Development Drilling producing 10-12 wells producing ~80% of plateau with 8 pre-drilled wells planned in November Plateau 440 Mbopd(1) >200 Mbopd(1) 5 Wells First Oil End October
Slide 17: Track Record of Growing Reserves
Lundin Petroleum Track Record of Growing Reserves Reserve Replacement Ratio (%) (1) 6754% Johan Sverdrup 5th consecutive year of reserves growth while growing production x 4 242% Reserves Growth 163% 144% 133% 100% 2014 2015 2016 2017 2018 WF12520 p16 02.19 (1) 2P reserves Lundin Petroleum 17
Slide 18: Pipeline of New Projects
Lundin Petroleum Southern Barents Sea Pipeline of New Projects Loppa High 8 potential new projects Alta/Gohta 115–390 MMboe (1) targeting 110–370 MMboe Hammerfest net resources (2) Committed Projects Harstad 2019 2020 2021 PDO First oil Solveig Norwegian Sea Frosk Area EWT sanctioned EWT first oil F
Slide 19: 2019 Exploration & Appraisal Programme
Toutatis Lundin Petroleum 2019 Remaining E&A wells 2019 Exploration & Appraisal Programme 2019 E&A successes Norwegian Sea 16 wells drilled (2 wells remaining) 6 discoveries 2 appraisal success Norway 10 – 50 MMboe net resource additions North Sea Alvheim Infill pilots Froskelår Discoveries Evra/Ivi
Slide 20: Long-term value creation
Long-term 1.48 USD/share value creation dividend in 2019 ~5% yield ~1 Bn USD average free cash flow per year (1) Sustainable ~11% yield dividends below 50 USD/bbl ~4 USD/boe industry leading low opex ~170 Mboepd Targeting by 2023 >200 Mboepd + organic growth upside Industry leading low carbon footpr
Slide 21: Appendices
Lundin Petroleum Key Messages Lundin Petroleum 10.7 OPEX Production Guidance Appendices (USD/boe) (Mboepd) >150 >120 6.8 86.1 ~4.5 59.3 4.25 20.7 32 2015 2016 2017 J. Sverdrup J. Sverdrup 2015 2016 2017 J. Sverdrup Phase 1 Plateau Phase 1 Strong production growth with low operating costs Exciting or
Slide 22: 2019 Latest Guidance Compared to CMD
2019 Latest Guidance Compared to CMD Latest CMD Guidance Production Guidance (Mboepd) 75–95 90–95 Operating costs (USD/boe) 4.25 4.25 CAPEX (MUSD) 930 730 E&A Expenditure (MUSD) 300 325 Johan Sverdrup First Oil Nov 2019 Oct 2019 (1) Long Term Guidance Production J. Sverdrup Phase 1 Plateau (2020) >1
Slide 23: 2019 Production
Lundin Petroleum 2019 Production Increased full year guidance First nine months 79.2 Mboepd 90–95 Mboepd towards upper end of guidance range (Previously 75-95 Mboepd) 140 120 100 78.8 82.7 Updated guidance 76.1 Mboepd 80 High 60 Low 40 Original guidance High 20 Low 0 Q1 Q2 Q3 Q4 Actual Actual Actual
Slide 24: CAPEX
Lundin Petroleum CAPEX CAPEX commitments for 2P + Solveig and Rolvsnes EWT CAPEX (Base) + Edvard Grieg infills 1,000 900 800 700 600 Million USD 500 8.24 400 7.97 300 7.82 200 7.59 100 8.04 0 2019 2020 2021 2022 2023 2024 2025 2026 Alvheim Hub Edvard Grieg Area Johan Sverdrup Solveig Other Total CAP
Slide 25: Tax Depreciation
Lundin Petroleum Tax Depreciation(1) Special Petroleum Tax 9,000 8,000 7,000 6,000 Million NOK 5,000 4,000 3,000 2,000 1,000 0 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Brent price 2019 2020-22 2023-26 Historic CAPEX incl. Uplift Future CAPEX incl. Uplift at 60 USD/bbl Cash Tax Due
Slide 26: First Nine Months 2019 - Cash Flow, Debt Position and Liquidity
Lundin Petroleum First Nine Months 2019 - Cash Flow, Debt Position and Liquidity 682.4(1) -250.5 RBL Facility Size 5 Bn USD +0.5 Bn USD -1,520.5 4.1 Available 3.4 Liquidity 0.9 Free Cashflow 959.0 Headroom Bn USD MUSD 1,117.9 985.3 -826.4 Bn USD MUSD Organic Free Cashflow MUSD 158.9 29.3 0 Cash Flow
Slide 27: Organic Value Creation Through Innovation
Lundin Petroleum Organic Value Creation Through Innovation New reservoirs and plays Maximising recovery Cutting-edge technology Subsurface expertise WF12520 p25 02.19 TOPSEIS Developed by Lundin and CGG Lundin Petroleum 27
Slide 28: Year-end 2018 Net Reserves and Resources (MMboe)
Lundin Petroleum Year-end 2018 Net Reserves and Resources (MMboe) Does not reflect sale of 2.6% equity in Johan Sverdrup 3P RRR(3): 118% 3P RLI(4): 29 Years 2P RRR(3): 163% 2P RLI(4): 24 Years WF12520 p26 08.19 (1) 2P Reserves is Proved plus Probable remaining reserves (4) Reserve life index (RLI) i
Slide 29: Southern Barents Sea Exploration - Early Days
Southern Barents Sea Exploration - Early Days Large underexplored area ~120 wildcat wells drilled 7 Bn boe yet to find (1) 5 significant discoveries to date >2.5 Bn boe of commercial resources Wisting 440 MMbo Area producing 500 Mboepd by 2027 Johan Castberg 550 MMbo Barents Sea Alta/Gohta Snøhvit 1
Slide 30: North Sea Exploration Significant Potential
North Sea Exploration Significant Potential Northern North Sea Significant remaining prospectivity Alvheim Area Bergen 4.4 Bn boe yet to find (2) Froskelår Main Discovery Alvheim Infill Pilots 60–130 MMboe(3) Evra/Iving Continue to build position Froskelår NE Discovery 181 MMboe(1) 2–10 MMboe(3) New
Slide 31: Safe Operations
Lundin Petroleum Safe Operations Total Recordable Incident Rate (TRIR) (1) 2.6 0.8 Norway (2) Lundin (3) Zero serious injuries (3) Zero process safety incidents (3) No material environmental incidents (3) WF12520 p32 10.19 (1) Per million manhours (2) Norway industry average 2018 (IOGP) (3) First ni
Slide 32: ESG Supported Initiatives
Lundin Petroleum ESG Supported Initiatives Global Reporting Extractive Industry Initiative (GRI) Transparency Initiative Reporting according to the GRI G4 Guidelines. Support and promotion of EITI’s efforts to combat corruption. United Nations Sustainable Our Global Compact Development Goals commitm
Slide 33: Shareholder Structure
Lundin Petroleum Shareholder Structure Listed on Nasdaq Stockholm Shares in free-float approx. 60% Tickers: LUPE.SS, LUPE.ST, ADR: LUPEY Rest of the World Sweden 11% 14% Scandinavia Lundin Family 35% 7% excluding Sweden Institutional 285.9 million 48% Investors USA 26% shares 25% 5% UK, Ireland Equi
Slide 34: Disclaimer
Disclaimer Forward-Looking Statements Certain statements made and information contained herein constitute "forward-looking information" (within the meaning of applicable securities legislation). Such statements and information (together, "forward-looking statements") relate to future events, includi
Slide 35: www.lundin-petroleum.com
Lundin € Petroleum www.lundin-petroleum.com
Lundin Petroleum — Investor Presentation (November 2019) on 6ix