Var Energi Asa · OSL:VAR
Var Energi Asa — Investor Presentation (October 2023)
23 slides from Var Energi Asa's investor presentation, October 2023
Slide 1: Growth and value creation
Growth and value creation Company presentation | October 2023
Slide 2: One of the fastest-growing E&P companies in the world
One of the fastest-growing E&P companies in the world >50 % expected organic production growth from 220 kboepd in 2022 towards end-2025 USD 2.6 billion in cash flow from operations after tax year-to-date (YTD) September 2023 USD 810 million in declared dividends YTD Sept 2023 with full-year guidance
Slide 3: A strong foundation to deliver value to shareholders
A strong foundation to deliver value to shareholders High-value production Low-cost barrels Diversified production of 209 kboepd in High-margin barrels with further YTD September 2023 including material OPEX reductions targeted to reach gas share with growth to >400 kboepd by USD 8 per boe¹ end-2025
Slide 4: The Norwegian Continental Shelf is an ideal foundation for value creation
The Norwegian Continental Shelf is an ideal foundation for value creation Cost competitive1 Lowest CO2 footprint1 Reliable framework Significant resources2 Opex per boe 2022 (USD) Carbon intensity 2022 (kg CO2/boe produced) Score “Transparency International’s” Corruption Total ~100bn boe Perception
Slide 5: Vår Energi has a leading position on the NCS
Vår Energi has a leading position on the NCS One of the largest independent NCS producers1 ... ... with a solid reserve base and R/P3 2022FY production (kboepd) 2022YE reserves (mmboe) Gas share R/P of production Aker BP Aker BP 10 17% 2 2 Vår Energi 220 37% Vår Energi 1 070 13 TotalEnergies 41% Tot
Slide 6: Robust portfolio and value-enhancing hub strategy
Robust portfolio and value-enhancing hub strategy 150 licenses 39 assets 1 36% gas share Hammerfest 47 operated 4 as operator YTD Sept 2023 Strong diversification across four hub areas Production split YTD Sept 2023 2P reserves split YE 20222 Production split per operator FY 2022 14% 9% 15% 18% 22%
Slide 7: Neptune acquisition adding scale, diversification and longevity
Neptune acquisition adding scale, diversification and longevity Expected completion Q1 2024 Production 2P reserves Gas share of reserves Emission intensity3 Opex +31% +25% +9pp. -33% -8% H1 2023 production (kboepd) End-2022 2P reserves (billion boe) End-2022 gas share of 2P reserves (%) FY 2022 (kg
Slide 8: Neptune acquisition summary
Neptune acquisition summary Neptune Norway’s high-quality NCS assets located near existing hub areas The Barents Sea Operator of Goliat and partner in Key terms and conditions the Johan Castberg development ▪ Vår Energi to acquire 100% of the shares of Neptune Energy Norge AS Snøhvit Highly strategi
Slide 9: Continuing +50 years of value creation and successful M&A on the NCS
Continuing +50 years of value creation and successful M&A on the NCS Accelerating growth and value creation Robust portfolio Realising our potential Strong gas position Strengthened management and organisation High-value growth Updated growth and value creation strategy Exploration excellence Creati
Slide 10: Stable and secure energy supplier to Europe
Stable and secure energy supplier to Europe Access to key 2nd largest 36% markets provider of gas from Norway1 gas share of production2 Åsgard hub Ormen Lange Flexible gas sales strategy to capture upsides ~47 USD/boe Statfjord realised gas price above spot price3 Fram Sleipner St. Fergus Easington
Slide 11: Continuous focus on operational efficiencies
Continuous focus on operational efficiencies Medium-term ambition of ~8 USD/boe Key cost reduction enablers Production cost per barrel (USD/boe) 15 14.5-15.5 13.5 Sanctioned projects coming on stream with average unit cost of ~4 USD/boe 10 Continued cost reductions from improvement program ~8 1 Acti
Slide 12: Set to double production by end-2025
Set to double production by end-2025 Production target including Neptune Energy Norge Sustaining value creation beyond 2025 kboepd ~100% Infill drilling, improved recovery and extended lifetime ~400¹ Neptune Norge Acquisition Maturing a high value project portfolio 11 development projects.: Johan Ca
Slide 13: Quality project portfolio delivering on growth strategy
Quality project portfolio delivering on growth strategy Existing production and sanctioned developments First oil field extension First oil new field development Started production Hub areas Operator 2P >500 mmboe (mmboe) 2023 2024 2025 reserves in development portfolio Balder X Balder area 312 Brei
Slide 14: Extending production from the Balder area towards 2045
Extending production from the Discovery (oil and gas, operated) Discovery (gas and condensate, partner-operated) Balder area towards 2045 Exploration targets (to be drilled) Ringhorne N Producing asset Q1 2024 Strong historic growth utilising hub strategy... Ringhorne King & Prince Ringhorne >500 mm
Slide 15: Jotun FPSO the key Balder hub enabler
Jotun FPSO the key Balder hub enabler First oil Q3 2024 Material future value Revised capex estimate, schedule maintained >85% Major heavy-lift installations completed 9 of 14 producing wells completed ~78 kboepd <5 USD/bbl complete1 at peak production², gross production cost 3 of 5 subsea campaigns
Slide 16: Significant Barents Sea position
Significant Barents Sea position Johan Castberg (30% WI) Reserves Field development +136 Operated by Equinor Barents Sea 2P net reserves as of year-end 20221 (mmboe) Goliat (65% WI) Producing asset Operated by Vår Energi 59 233 174 Snøhvit Field (12% WI) Operated by Equinor Johan Castberg Goliat Rem
Slide 17: Best-in-class exploration
Best-in-class exploration Successful exploration programme ~1bn >50% boe risked net exploration exploration success rate prospects 2020-2023 Targeting (ILX) wells ... ... and high-impact wells 8-10 1-2 per year per year Remaining 2023 program Discoveries 2020-2023 17
Slide 18: Clear path to 50% emission reduction by 2030
Clear path to 50% emission reduction by 2030 tCO2-eg 400 Recognised ESG leadership 2005 Baseline -50%¹ Top 5% Sustainalytics ESG rating in the industry Jotun FPSO & Ringhorne electrification Jotun FPSO Energy A+ rating on field Balder FPU mgmt. off field R&D ESG100 GHG removals 2022 2030 1. Scope 1
Slide 19: Attractive combination of resilience, growth and distributions
Attractive combination of resilience, growth and distributions Capital allocation framework Sustain production of existing portfolio Fund capex of existing developments and new value-creating projects Maintain an investment grade balance sheet Pay dividends according to stated policy Use additional
Slide 20: Strong cash flow potential supporting attractive distributions
Strong cash flow potential supporting attractive distributions Indicative cash flow generation 2023-2027 Dividends declared USD billion, cumulative USD million 25 1 075 USD 110/bbl oil price 950 20 USD 90/bbl oil price 810 Free cash flow USD 70/bbl 15 oil price 20-30% of CFFO (after tax) (illustrati
Slide 21: One of the fastest-growing E&P companies in the world
One of the fastest-growing E&P companies in the world Material and diversified production base Maximising value creation with hub-centred strategy World-class capabilities, with tangible growth and track record Credible path to 50% emission reduction (scope 1 and 2) for operated assets by 2030 Mater
Slide 22: Board of Directors
Board of Directors Thorhild Widvey Ove Gusevik Francesco Gattei Guido Brusco Chairperson Director Director Director Former Minister HitecVision Eni Eni of Petroleum and Senior Partner Chief Financial Officer Upstream Director Energy Clara Andreoletti Marica Calabrese Fabio Romeo Liv Monica Director
Slide 23: var energi
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