Dno Asa Class A · OSL:DNO

Dno Asa Class A — Investor Presentation (September 2005)

41 slides from Dno Asa Class A's investor presentation, September 2005

  1. Slide 1: DNO ASA: Building Shareholder Value Through Reserve Growth at Low Costs

    DNO ASA BUILDING SHAREHOLDER VALUE THROUGH RESERVE GROWTH AT LOW COSTS September 2005 Helge Eide, Managing Director / President Haakon Sandborg, CFO

  2. Slide 2: Disclaimer

    Disclaimer THIS PRESENTATION IS BEING FURNISHED TO YOU SOLELY FOR YOUR INFORMATION ON A CONFIDENTIAL BASIS AND MAY NOT BE REPRODUCED, REDISTRIBUTED OR PASSED ON, IN WHOLE OR IN PART, TO ANY OTHER PERSON. IN PARTICULAR, THIS PRESENTATION NOR ANY COPY THEREOF MAY BE TAKEN OR TRANSMITTED OR DISTRIBUTED

  3. Slide 3: A pure-play E&P company

    A pure-play E&P company Key facts about DNO Appealing business model... Operational facts „ A pure-play E&P investment YTD 2005 Production 13 700 BOPD „ Diversified, risk balanced portfolio Reserves (P+P) 30.06.05 75 MBOE „ Strong reserve growth statistics Financial facts „ Excellent reserve economi

  4. Slide 4: New Growth Cycle

    New Growth Cycle - After Realizing & Returning values in 2004 Embraced a new growth strategy P50 Reserves (MBOE) 1996 - 2005 150 „ Restructured portfolio 144 125 „ Transaction value of USD 240 100 75 million 86 50 64 „ Paid out Dividend of approximately 29 34 USD 100 million (cash and shares) 3 3 15

  5. Slide 5: Value Creation Cycle

    Value Creation Cycle 19.09.2005 Corporate Presentation September 2005 Slide 5

  6. Slide 6: YTD Performance

    ‘2005 YTD Performance

  7. Slide 7: First six months 2005: Increased reserves at low costs

    First six months 2005 - Increased reserves at low costs P+P Reserves FD&A cost (USD/bbl) Netback RoO (USD/bbl) 80 5 16 70 14 60 4 14 50 12 40 3,9 12 12 12 3,5 10 11 30 3 3,3 20 8 9 10 2 6 0 4 31.12.2004 30.06.2005 1 1,4 Acquired Discovered Reserves Reserves Produced 0,8 2 0 0 2001 2002 2003 2004 200

  8. Slide 8: 2005 Production

    2005 Production - Ahead of plan July 05 Production – 14 047 BOPD 1 H 05 Production – 13 694 BOPD „ Glitne: 1 406 BOPD „ Glitne: 1 625 BOPD „ Tasour: 6 129 BOPD „ Tasour: 5 984 BOPD „ Sharyoof: 6 142 BOPD „ Sharyoof: 6 085 BOPD „ Nabrajah 370 BOPD 16000 Start of Nabrajah production 14000 12000 10000

  9. Slide 9: Review of Portfolio

    Review of Portfolio

  10. Slide 10: Corporate Presentation September 2005 Slide 10

    19.09.2005 Corporate Presentation September 2005 Slide 10

  11. Slide 11: Yemen

    Yemen - continued success Yemen Licenses Yemen Highlights „ Good production performance „ Successful drilling results „ Increased reserves 19.09.2005 Corporate Presentation September 2005 Slide 11

  12. Slide 12: Yemen

    Yemen - Masila area current gross production ca. 280.000 BOPD DNO participation: Block 14: 175 000bopd 1) Sunah Block 32: 15.000bopd 2) NE Sunah 1)Tasour 3) Hemiar 4) Dahban Block 53: 18,000 bopd 5) Camaal 1)Sharyoof Block 53 6) Heijah 7) Naziah Block 43: 5-15,000bopd 8) Tawila 1 9) Haru 1)Nabrajah

  13. Slide 13: Tasour Update

    Tasour Update Oil rate Tasour Cumulative oil 25 000 25 000 000 20 000 20 000 000 Cumulative oil (bbls) 15 000 15 000 000 Oil rate (bopd) 10 000 10 000 000 5 000 5 000 000 0 0 okt-00 apr-01 nov-01 mai-02 des-02 jun-03 jan-04 aug-04 feb-05 Tasour # 19 Location Tasour # 18 Location „ Increased producti

  14. Slide 14: Sharyoof Update

    Sharyoof Update Oil rate Sharyoof Cumulative oil 30 000 30 000 000 25 000 25 000 000 20 000 20 000 000 Cumulative oil (bbls) Oil rate (bopd) 15 000 15 000 000 10 000 10 000 000 5 000 5 000 000 0 0 nov-01 mai-02 des-02 jun-03 jan-04 jul-04 feb-05 „ Increased production after Sharyoof # 14 „ Drilling

  15. Slide 15: Nabrajah Update

    Nabrajah Update Nabrajah Oil rate Cumulative oil 3 000 25 000 2 500 20 000 2 000 Cumulative oil (bbls) 15 000 Oil rate (bopd) 1 500 10 000 1 000 5 000 500 0 0 01.aug.05 02.aug.05 12.jul.05 13.jul.05 14.jul.05 15.jul.05 16.jul.05 17.jul.05 18.jul.05 19.jul.05 20.jul.05 21.jul.05 22.jul.05 23.jul.05 2

  16. Slide 16: Nabrajah: Basement appraisal

    Nabrajah - Basement appraisal Principal input parameters for reserves estimate based on Nabrajah # 5: „ Area: 10 sq. km „ Oil column: 400 m „ Porosity: 1,0 % „ Rec. fact.: 35 % The presence of gas cap can help maintaining reservoir pressure and increase recovery Nabrajah #9 Target Nabrajah #2 Locati

  17. Slide 17: Nabrajah: High upside in Basement

    Nabrajah - High upside in Basement „ Nabrajah # 8 total additional oil column potential is 650 meters…. „ Which in turn has the potential to increase Basement reserves by 160 % 19.09.2005 Corporate Presentation September 2005 Slide 17

  18. Slide 18: Yemen Potential: At Qishn level

    Yemen Potential cont… - At Qishn level Block 44 Qishn Prospect Proven oil in Qishn, areas in DNO licenses Block 53 DNO Licences Block 32 Deep Block 72 Block 43 Shallow 50 km 19.09.2005 Corporate Presentation September 2005 Slide 18

  19. Slide 19: Yemen Potential: At Basement level

    Yemen Potential - At Basement level Block 44 Basement Prospect areas DNO Licences Block 53 Proven oil in Nabrajah Basement Block 32 Block 72 Block 43 50 km 19.09.2005 Corporate Presentation September 2005 Slide 19

  20. Slide 20: North Sea: Exploiting core competence

    North Sea - Exploiting core competence North Sea Building new portfolio „ APA (TFO) 2004 „ 2 licences as operator PL 229, 15% (PL305B and PL341) „ 2 licences as partner (PL332 and PL334). UK 211/22B, 60% „ ExxonMobil Acq. PL 263, 30% „ 4 licenses, 2 as Operator „ ChevronTexaco Acq. PL 035, 25% „ 1 l

  21. Slide 21: Corporate Presentation September 2005 Slide 21

    19.09.2005 Corporate Presentation September 2005 Slide 21

  22. Slide 22: Corporate Presentation September 2005 Slide 22

    19.09.2005 Corporate Presentation September 2005 Slide 22

  23. Slide 23: Corporate Presentation September 2005 Slide 23

    19.09.2005 Corporate Presentation September 2005 Slide 23

  24. Slide 24: Corporate Presentation September 2005 Slide 24

    19.09.2005 Corporate Presentation September 2005 Slide 24

  25. Slide 25: UK: Jaguar Prospect

    UK - Jaguar Prospect 211/16a-5 211/19a-M71 211/19a-9 211/18aF5 211/16b A 211/18-8 A A 211/19-2 211/16a-6 211/16a-6 211/19aF3 A 211/18a A 211/18-3 A 210/20a 211/18aF5 211/16a 211/18-7 211/17 A 211/18aF1 211/18b 211/19a 211/16-2 211/18a-A46 211/16a-A20A 211/16a-A19 211/18-1 A 211/16a-A13 A A 211/18-2

  26. Slide 26: Northern Iraq: A unique opportunity

    Northern Iraq - A unique opportunity Update on Northern Iraq Iraq „ PSA covers approx. 4 000 sq. km. „ Work program includes 250 km. 2D seismic + 3 wells within 4 years from June 2004 „ Preparations for work program are progressing according to PSA 19.09.2005 Corporate Presentation September 2005 Sl

  27. Slide 27: Short term outlook

    Short term outlook Stepping up drilling program 2 H 05 Increased Production „ Yemen - 12 wells „ Higher production from Yemen „ 4 infill wells on Sharyoof (2 in progress) „ Nabrajah gross capasity to be increased „ 4 basement appraisal wells on Nabrajah stepvise to 50.000 BOPD by 4 Q 2006 „ 2 explor

  28. Slide 28: Financial Summary

    Financial Summary

  29. Slide 29: First six months 2005: Strong results

    First six months 2005 - Strong results Key Figures (USD) YTD 2005 YTD 2004* „ Production (BOPD): 13.694 13.351 „ Sales 94 75 „ EBIT 58 35 „ Net profit 18 5 „ EBITDA 67 43 „ Netback 17 3 „ Exploration investments expensed 10 14 * Asset sales proceeds not included 19.09.2005 Corporate Presentation Sep

  30. Slide 30: Result of Operations

    Result of Operations - efficiency of the company’s producing assets Quarterly YTD FY USD Million Q2 05 Q1 05 Q4 04 Q3 04 Q2 04 2005 2004 2004 Sale of petroleum products 57.42 53.04 57.10 53.32 40.56 110.45 83.25 193.67 Lifting costs -6.83 -7.87 -6.89 -6.15 -6.21 -14.70 -12.81 -25.83 DD&A -4.64 -4.70

  31. Slide 31: Netback to Investments Coverage

    Netback to Investments Coverage - High share of FD & A costs funded by producing assets Netback (RoO) to Total Investments (USD Million) Acquisition and development 30 includes Netback (RoO) „ Development Nabrajah field 25 Acquisition and „ Acquisition of licenses in Norway development and UK 20 Exp

  32. Slide 32: Capital Structure

    Capital Structure Building on a strong balance sheet Balance Sheet 20.06.2005 and 31.12.2004 350 24 „ 54 % of balance sheet cash 300 Other current assets 250 „ Net funds (cash balances less 16 200 173 interest-bearing debt) USD 15 mill. Cash 150 114 „ Capacity for further debt 100 120 Non-current 50

  33. Slide 33: Reserve Economics

    — rc et conomi Yad Sh)

  34. Slide 34: Adding new reserves

    Adding new reserves - Focus on low risk, high potential prospects DNO business model Gross Reserve Growth (MBOE) 75 „ Strict investment criteria Northern Europe Middle East 60 48 49 „ Applying distinct knowledge and 45 technolgy 30 27 28 26 15 „ Low finding costs through smart exploration 0 2001 200

  35. Slide 35: Development

    Development - Focus on cost efficiency and short lead time DNO business model Reserve Life Index (P+P) 20 „ Portfolio management and 17,8 15 optimization 15,3 14,5 15 10 „ Short lead time to production 5 „ Cost effective solutions 5,6 0 „ Near existing infrastructure 2001 2002 2003 2004 2005 FD&A co

  36. Slide 36: Production

    Production - DNO business model yields high margin production Netback RoO (USD/Bbl) DNO business model 16 „ Low lifting costs 14 14,01 12 12,05 11,92 11,57 „ Proactive infill drilling 10 8 11,13 8,89 6 „ Strong and sustainable cash flow 4 2 „ Extend field life by increased oil 0 recovery methods Q1

  37. Slide 37: Reserve Economics

    Reserve Economics - Consistent top quartile performance FD&A Cost USD/bbl (P+P) Recycle Ratio (P+P) Reserve Replacement % (P+P) 3 5 10 3 years rolling average 3 years rolling average 3 years rolling average 9 2,5 4 8 7 2 3 6 1,5 5 2 4 1 3 1 2 0,5 1 0 0 0 2001 2002 2003 2004 YTD 2001 2002 2003 2004 Y

  38. Slide 38: Future Outlook

    Future Outlook Significant growth potential

  39. Slide 39: Future Outlook: Reserves & Resources

    Future Outlook - Reserves & Resources (net to DNO) Mill. barrels as of 31.03.05 Producing Fields „ Tasour Field, Yemen 5,3 „ Sharyoof Field, Yemen 7,4 „ Glitne Field, NCS 0,9 Under development „ Nabrajah Field, Yemen 44.0 Not under development „ Goliath 7,5 „ Hanz & W. Cable 10,0 Total P+P Reserves

  40. Slide 40: Future Outlook: Prospect inventory holds large potential

    Future Outlook - The prospect inventory holds large potential Production 2005 – 2011 (BOPD) Potential reserves vs. max. unrisked resources 200 000 2 500 Million barrels 180 000 High growth potential Medium growth potential 100 % 160 000 2 000 Producing assets 140 000 120 000 1 500 100 000 80 000 1 0

  41. Slide 41: 20 Largest Shareholders

    20 Largest Shareholders - increased share of international investors Account Holding Percentage Name Citizenship type 21 217 168 9,38 GOLDMAN SACHS INTERN EQUITY NONTREATY CUS NOM GBR 11 893 625 5,26 INCREASED OIL RECOVERY NOR 8 998 296 3,98 GALTUNG DSVIG EINAR NOR 7 351 296 3,25 JPMORGAN CHASE BANK

DNO — Investor Presentation (September 2005) on 6ix