Norsk Hydro Asa · OSL:NHY
Norsk Hydro Asa — Investor Presentation (November 2001)
20 slides from Norsk Hydro Asa's investor presentation, Nov 1, 2001
Slide 1: Assessing the Impact of the Changes: Positioning of Norsk Hydro
Assessing the Impact of the Changes: Positioning of Norsk Hydro Eivind Reiten, President & CEO Norsk Hydro ASA 29758_6 - 29.10.01 * 1 - Hydro Media London, November 1, 2001
Slide 2: Today's presentation
Today's presentation Norsk Hydro - general comments Norwegian upstream activities Reorganisation of Norway's oil industry Development of Norway's gas resources Expanding international E&P activities Attractive potential and strong challenges 29758_6 - 29.10.01 * 1 - Hydro Media
Slide 3: Corporate assets and earnings mix - 2000
Corporate assets and earnings mix - 2000 Fixed assets EBITDA 6% 13% 14% 9% 15% 12% 65% 66% Total: NOK 115 billion Total: NOK 47 billion Oil & Energy Light Metals Agri Others 29758_6 - 29.10.01 * 1 - Hydro Media
Slide 4: Strong financial position
Strong financial position Long-term debt/shareholders' equity * 0,7 0,69 0,6 0,55 0,49 0,50 0,5 0.39** 0,4 0,37 0.29** 0,3 0,2 0,1 0 1997 1998 1999 2000 30.09.01 * Long-term debt divided by shareholders' equity plus minority interest ** Adjusted ratio if current cash position had been reduced to NOK
Slide 5: CROGI - our key performance metric
CROGI - our key performance metric CROGI - Cash Return on Gross Investments 12 Actual Normalized prices: 10 10,3 prices 10 NOK/USD: 8.00 9 8 8,5 8,4 Brent Blend (USD/bbl) 18 7,7 6 CAN27 (DEM/t) 200 LME 3M (USD/t) 1,500 4 2 Gains from divestments excluded 0 1996 1997 1998 1999 2000 2001 2002 Actual p
Slide 6: Growth strategy for Oil and Energy
Growth strategy for Oil and Energy Balanced portfolio Norwegian Continenmtal Shelf vs. international positions Deep water vs. lower cost onshore Develop 4-6 core areas internationally Each area with a production potential of at least 50,000 boe/day Implication: 7% average annual production growth St
Slide 7: Operated oil and gas production
Operated oil production 1.2 mill. boe/day 35% of NCS oil production Operated sales gas production 3 BCM/year 6% of NCS exports 29758_6 - 29.10.01 * 1 - Hydro Media
Slide 8: Norwegian production continues to grow
Norwegian production continues to grow NCS Production NCS production to 800 grow towards 500,000 boe per day over next 600 five years 1000 boe/day Large fields under 400 development will add new volumes after 2005 - Ormen Lange, 200 Kristin, Snøhvit 0 Production from any 2000A 2002 2004 SDFI assets
Slide 9: New technology example - subsea separation
New technology example - subsea separation 29758_6 - 29.10.01 * 1 - Hydro Media
Slide 10: Challenging deep water development
Challenging deep water development Ormen Lange gas field Water depths: 700 - 1100m Tough weather conditions Minimum temperature -2 OC Large ravine with very uneven topography Development plan to be submitted 4Q 2002 Production start 2007 Dimensioning 31.5 wave m 7.1 m Ormen Lange West Africa 29758_6
Slide 11: The state's changing role in the oil industry
The state's changing role in the oil industry Statoil privatisation A new competitor for Hydro in financial markets SDFI asset sale Limited total volume Uncertain outcome for Hydro Preferred treatment of Statoil increased size imbalance New state companies established Petoro - manage SDFI assets Gas
Slide 12: Growing export of Norwegian gas
Growing export of Norwegian gas GSM3 (40 MJ) 120 100 80 Uncommitted 60 40 Under contract 20 0 1990 1994 1998 2002 2006 2010 29758_6 - 29.10.01 * 1 - Hydro Media
Slide 13: The UK - an important growth market
The UK - an important growth market UK and Irland - supply demand balance Well functioning market 150 Established players 120 Need for new supplies 90 opening up 60 30 0 2000 2002 2004 2006 2008 2010 Demand New discoveries Production 29758_6 - 29.10.01 * 1 - Hydro Media
Slide 14: Developing the Nordic Gas Market
Developing the Nordic Gas Market Kårstø Grenland Stockholm NCS Gøteborg -Sales to Poland - Gas to power in Scandinavia? Avedøre Østerled Gas to Grenland Possible branch lines Niechorze Rostock Berlin 29758_6 - 29.10.01 * 1 - Hydro Media
Slide 15: Ready for liberalized European gas market
Ready for liberalized European gas market Turnover of Hydro's European gas business 2000 BCM 8 Oseberg 7 Frigg Norway Vesterled Heimdal 6 5 St. Fergus Europipe 4 Statpipe/ Norpipe Zeepipe 3 Denmark 2 1 UK 0 Bacton Sluiskil- Europe's Trading largest gas consumer Agri consumption / third party sales G
Slide 16: Building an attractive international portfolio
Building an attractive international portfolio Norway NW Russia Canada Iran Gulf of Mexico Libya Trinidad Angola Angola 29758_6 - 29.10.01 * 1 - Hydro Media
Slide 17: Angola - Stepping up our activities
Lo Angola - Stepping up our activities we rC on go New licenses acquired Ba sin 1 Kw Block 34: Hydro 30%, an 17 technical assistant to za 5 Ba 34 Sonangol sin Luanda Block 25: Hydro acquired 10% through farm-in 9 25 Block 17: Girassol to start production in fourth quarter ANGOLA Norsk Hydro 29758_6
Slide 18: Attractive production growth
Attractive production growth Production 7 % average annual 800 growth rate the next five years 600 1000 boe/day Increasing contribution from international 400 portfolio Significant exploration 200 potential may add new volumes beyond 2005 0 2000A 2002 2004 2001 2003 2005 EPI EPN Oil EPN Gas 29758_6
Slide 19: Hydro returns in line with industry average
Hydro returns in line with industry average CROGI (inflation adjusted) Percent 1999 2000 20 15 10 5 0 Eni Petro canada HYDRO Chevron Conoco TFE Texaco USX-Marathon RD Shell Exxon Mobil Enterprise Repsol YPF BP OMV Phillips Source: Goldman Sachs: 29758_6 - 29.10.01 * 1 - Hydro Media Essential Oils
Slide 20: Safe harbour statement
Safe harbour statement In order to utilize the "Safe Harbor" provisions of the United States Private Securities Litigation Reform Act of 1995, Hydro is providing the following cautionary statement: This presentation contains certain forward-looking statements with respect to the financial condition,