Dno Asa Class A · OSL:DNO

Dno Asa Class A — Q1 2003 Earnings Presentation

40 slides from Dno Asa Class A's earnings presentation, 2003

1. Slide 1: Presentation of Interim results 1st quarter 2003

   Presentation of Interim results 1st quarter 2003 Managing Director Helge Eide CFO Haakon Sandborg

2. Slide 2: Highlights

   Highlights ƒ All time high production ƒ Favourable oil prices ƒ Encouraging drilling results ƒ Record breaking financial results

3. Slide 3: Main key figures

   Main key figures All figures in million NOK Q1 2003 Q1 2002 2002 Operating Revenues 580 368 1 691 EBITDA 355 191 967 Operating Profit 272 93 523 Profit (loss) before Tax 299 75 287 Profit (loss) after Tax 108 24 -77 Netback 236 146 552

4. Slide 4: DNO Mission

   DNO Mission “DNO shall be a leading, international niche player engaged in both the development of smaller oil & gas fields, and in extended production and increased recovery from mature petroleum fields”

5. Slide 5: DNO Strategy

   DNO Strategy ƒ Operator and / or active partner ƒ Networking ƒ Best practice from oil companies and contractors ƒ Investments in Offshore and Services

6. Slide 6: Does DNO's strategy work?

   Does DNO’s strategy work? 30 000 Historical production 29 307 25 000 20 000 22 399 15 000 13 235 10 000 5 000 6 920 2 364 2 886 0 1998 1999 2000 2001 2002 YTD 2003

7. Slide 7: Value creation

   Value creation CROGI Cash Return On Gross Investments Gross NetBack Investments Exploration/ Revenue Cost Acquisitions Development Growth Efficiency ƒ Value creation is driven by profitable growth in cash flow expressed as cash return on gross investments (CROGI) ƒ Key Performance Indicators linked

8. Slide 8: DNO's Monthly Oil Production

   DNO’s Monthly Oil Production 30 000 YTD 2003: 29 307 25 000 20 000 15 000 2002 2003

9. Slide 9: Oil and gas reserves: production, acquisitions, discoveries

   0 20 40 60 80 100 120 RES 31.12.01 REVISIONS DISCOVERIES ACQUISITIONS Oil Reserves PRODUCTION Reserves (BBLS) RES 31.12.02 0 5 10 15 20 25 RES 31.12.01 REVISIONS DISCOVERIES ACQUISITIONS Gas Reserves PRODUCTION RES 31.12.02

10. Slide 10: DNO in the world

    DNO in the world UK Norway Heather Jotun Unit Broom PL 103B Thistle Glitne & Enoch Solan/Strathm PL 203 PL 088BS PL 036C Ireland PL 148 Seven Heads PL 167 + 167B PL 292 PL 006C Equitorial Guinea Block P Yemen Tasour Sharyoof Block 43

11. Slide 11: Overview; United Kingdom

    Overview; United Kingdom 15 000 Oil production 10 000 5 000 ƒ Operational efficiency 0 and cost focus on Heather & Thistle 0301 0601 0901 1201 0302 0602 0902 1202 0303 Name % Operator Heather Broom 100,00 55,00 DNO DNO ƒ Broom Development Thistle Solan/Strathmore 99,00 3,70 DNO Amerada Hess Plan

12. Slide 12: Broom

    Broom ƒ Development Plan completed ƒ First oil during 2004 ƒ Extension of Heather production by 10 + years

13. Slide 13: Overview; Norway

    Overview; Norway 15 000 Oil production 10 000 5 000 ƒ Stable production 0 0301 0601 0901 1201 0302 0602 0902 1202 0303 ƒ Acquired several new Name % Operator license interests Jotun Unit 7,00 Exxon/Mobil PL 103B Glitne & Enoch 70,00 10,00 DNO Statoil ƒ Increased interest to PL 203 15,00 Marathon 15

14. Slide 14: Kneler oil discovery

    PL 203 ƒ Kneler oil discovery ƒ Ca 50 mtr. gross oil column ƒ Potential for increased reserves

15. Slide 15: Overview; International

    Overview; International 15 000 Oil production 10 000 ƒ Record production 5 000 ƒ Successful drilling results 0 0301 0601 0901 1201 0302 0602 0902 1202 0303 ƒ Positive test results Name Tasour % 41,00 Operator DNO on Seven Heads ƒ First lisence interest Sharyoof 24,45 Dove Energy Block 43 73,00 DNO S

16. Slide 16: Tasour (Block 32)

    Tasour (Block 32) ƒ Record production from the field ƒ Improved geological understanding of the Tasour area ƒ Potential for additional reserves in the Western flank

17. Slide 17: Overview; Ireland

    Overview; Ireland ƒ Partners: – Ramco: 86,5 % – IPDL (DNO): 12,5 % – Sunningdale Oils 1,0 % ƒ Plan of Development approved March 2003 ƒ Positive test results of production well 48/24-6 ƒ Gas deliveries to commence before the end of 2003

18. Slide 18: Overview; Equatorial Guinea

    Overview; Equatorial Guinea ƒ Participation in Block P, offshore Rio Muni in Equatorial Guinea ƒ Partners: – Ocean Energy – Petronas – Atlas Petroleum – DNO ƒ Equity TBA

19. Slide 19: Other activities

    Other activities ƒ Optimizing Portfolio ƒ Corporate Governance ƒ AIM Listing

20. Slide 20: 2003 Outlook

    2003 Outlook ƒ Potential for production above 26’ BOPD target if positive outcome from drilling – Glitne, Tasour, Sharyoof ƒ High drilling activity - potential for increased reserves – Bl. 43, Tasour, Sharyoof, PL 203, PL 167 ƒ Progress Broom Development ƒ First gas production 4 Q 2003

21. Slide 21: Financials

    Financials 1st Quarter 2003 CFO Haakon Sandborg

22. Slide 22: Financial Highlights

    Financial Highlights ƒ 36 % increase in operating revenues ƒ Exploration activities ƒ Record EBIT and Netback ƒ Positive net finance ƒ Investments in Seven Heads

23. Slide 23: P & L Statement

    P & L Statement All figures in million NOK Q1 ‘03 Q4 ‘02 Q3 ‘02 Q2 ‘02 Q1 ‘02 2002 Operating Revenues 580 425 440 457 368 1 691 Exploration and Impairment -33 -21 -7 -53 -33 -114 Operating Exp , excl expl & DD&A -197 -173 -150 -155 -145 -623 EBITDA 355 244 283 249 191 967 EBITDAX 388 265 290 302 224

24. Slide 24: Financial Items

    Financial Items All figures in million NOK Q1 ’03 Q4 ‘02 Q3 ‘02 Q2 ‘02 Q1 ‘02 2002 Interest revenues 3 4 4 2 3 13 FX-contracts, swaps 18 18 4 36 6 64 Agio, other financial revenues 4 31 -3 5 0 33 Financial revenues 25 53 4 43 10 109 -15 Interest expenses -12 -14 -15 -13 -15 -56 Disagio / agio 15 -8

25. Slide 25: BS - Assets

    BS - Assets All figures in million NOK 31.03.2003 31.12.2002 31.12.2001 Fixed Assets 1 427 1 379 1 372 Financial Fixed Assets 269 256 485 Intangible Assets 135 142 150 Total Fixed Assets 1 830 1 777 2 006 Cash and Cash Equiv 267 84 164 Other Current Assets 275 180 255 Total Current Assets 541 264 34

26. Slide 26: BS - Equity and Liabilities

    BS - Equity and Liabilities All figures in million NOK 31.03.2003 31.12.2002 31.12.2001 Shareholders´Equity 1 021 902 942 Interest-Bearing Long-Term Debt 579 553 651 Prov for Liabilities and Charges 382 346 441 Total Long-Term Liabilities 962 898 1092 Other Short-Term Debt 389 241 320 Total Short-Te

27. Slide 27: Cash Flow

    Cash Flow All figures in million NOK Q1 2003 Q4 2002 Q3 2002 Q2 2002 Q1 2002 2002 Consolidated profit before tax 299 54 166 -7 76 287 Taxes paid for the period -119 -156 -97 -117 -45 -415 Depreciation, depletion and amort. 73 156 83 101 92 432 Associated companies 0 46 20 122 4 192 Changes in workin

28. Slide 28: Value Creation

    Value Creation CROGI Cash Return On Gross Investments Gross NetBack Investments Exploration / Revenue Acquisitions Cost Efficiency Development Growth ƒ Value creation is driven by profitable growth in cash flow expressed as cash return on gross investments (CROGI) ƒ Key Performance Indicators linked

29. Slide 29: Oil Production

    Oil Production 30 000 NORWAY UK YEMEN 25 000 ƒ Production increase 20 000 – Thistle acquisition – Block 32 Yemen 15 000 ƒ Increase from 4Q02 10 000 – 474 394 barrels 5 000 – 5 271 barrels per day 0 0301 0601 0901 1201 0302 0602 0902 1202 0302

30. Slide 30: Oil Price vs FX (April 2001 - March 2003)

    Oil Price vs FX (April 2001 - March 2003) Brent Spot NOK/USD 9,5 35 33 9 31 ƒ Average Brent spot 8,5 29 first quarter, 31,47 8 27 USD/BBL, up from 25 27,34 USD/BBL in 7,5 23 fourth quarter 2002 21 7 19 6,5 17 AM J J A S O ND J F MAM J J A S O ND J F M

31. Slide 31: Revenue Development

    Revenue Development 600 NCS UKCS International IOT 500 400 ƒ Production increase Bl. 32 and UK Thistle acquisition 300 200 ƒ Favourable oil prices 100 0 0301 0601 0901 1201 0302 0602 0902 1202 0303

32. Slide 32: Production & Transport Expenses

    Production & Transport Expenses 200 Direct field NOK mill 165 ƒ Increase in production and 150 transportation expenses at 100 110 116 117 112 122 115 120 group level 99 ƒ Thistle contributing 50 positively to unit cost 0 reduction on the UKCS 25 0301 0601 NCS 0901 1201 UKCS 0302 0602 INT 0902 1202 0

33. Slide 33: DD&A, G&A and Other Expenses

    DD&A, G&A and Other Expenses 120 7 DD&A nok mill DD&A per bbl 100 6 96 5 91 80 86 60 74 78 73 4 3 ƒ No impact on DD&A 40 53 51 51 2 from Thistle acquisition 20 1 0 0 ƒ Lower G&A and other 0301 0601 0901 1201 0302 0602 0902 1202 0303 50 5 G&A in NOK mill G&A per bbl 45 4,5 40 35 37 4 3,5 expenses in

34. Slide 34: EBITDA per Unit and Net Back

    EBITDA per Unit and Net Back 400 NCS UKCS INT 300 200 100 ƒ Increase in netback 0 caused by strong 0301 0601 0901 1201 0302 0602 0902 1202 0303 EBITDA and no tax payments NCS in the 300 Net Back 200 first quarter 100 0 0301 0601 0901 1201 0302 0602 0902 1202 0303

35. Slide 35: Revenues, EBITDA, EBIT, Net Profit

    Revenues, EBITDA, EBIT, Net Profit 600 Revenues EBITDA EBIT 400 200 ƒ Strong EBIT and 0 EBITDA ƒ No impact from 0301 0601 0901 1201 0302 0602 0902 1202 0303 offshore and services 150 Net profit Net profit, adjusted 100 50 ƒ Record net profit 0 0301 0601 0901 1201 0302 0602 0902 1202 0303 -50 -100

36. Slide 36: CROGI

    CROGI 45 % CROGI Actual CROGI Norm ƒ High cash flow 40 % returns after tax 35 % validating business 30 % strategy 25 % 20 % ƒ On normalized basis 15 % (USD 18 per bbl and 10 % USD/NOK 7,5), 5% exceeding CoC 0% 0301 0601 0901 1201 0302 0602 0902 1202 0303

37. Slide 37: Key Figures

    Key Figures Q1 2003 Q4 2002 Q3 2002 Q2 2002 Q1 2002 2002 Earnings per Share 2,04 -1,55 0,91 -1,34 0,49 -1,50 EBITDA per Share 6,55 4,85 5,62 4,95 3,78 19,20 EBITDA Margin 61,2 57,4 64,3 54,5 51,8 57,2 EBIT Margin 47,0 21,3 44,4 31,5 25,2 30,9 CROGI (actual) 41,60 % 14,60 % 28,60 % 20,30 % 23,20 % 25

38. Slide 38: Appendices

    Appendices

39. Slide 39: DNO Share Price last 12 months

    DNO Share Price last 12 months 19 180 DNO OSE10 Energy OSEAX 18 170 160 17 150 16 140 15 130 14 120 13 110 12 100 2.4. 2.5. 2.6. 2.7. 2.8. 2.9. 2.10. 2.11. 2.12. 2.1. 2.2. 2.3.

40. Slide 40: Shareholders

    Shareholders NAME SHARES PERCENT NATIONALITY 1 INCREASED OIL RECOVERY 6 563 142 12,11 NOR 2 DET STAVANGERSKE DAMSKIPSSELSKAP 2 000 000 3,69 NOR 3 THE LAW DEBENTURE TRUST 1 999 642 3,69 GBR 4 LARSEN OIL & GAS AS 1 802 148 3,32 NOR 5 UNISTAR HOLDINGS INC 1 537 000 2,83 USA 6 SKAGEN VEKST 1 499 759 2,7

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