Okea Asa · OSL:OKEA
Okea Asa — Sparebank1 Markets E&P Seminar 2020
16 slides from Okea Asa's conference presentation, January 2020
Slide 1: The New generation NCS operator
The New generation NCS operator January 2020
Slide 2: Human life quality accelerated as oil became available
Human life quality accelerated as oil became available World energy use 1015 BTU Populationx100mill Life expectancy/ Life expectancy Population growth 2
Slide 3: Oil demand is persistently high with any global CO2-policy
Oil demand is persistently high with any global CO2- policy Natural decline of oil production In any scenario, significant investments in Oil production is required 7 % annual decline 7,5% annual 6% annual 8% annual growth growth growth 2020 2040 IEA – World Energy Outlook 2019 3
Slide 4: OKEA – an independent E&P company on the NCS
OKEA – an independent E&P company on the NCS OKEA at a glance Production • Founded in 2015 by a management team with a strong track record in Development HQ (Trondheim) creating value from both organic growth and M&A on the NCS Draugen (44.56% WI, op.) • NOK 4.5bn transaction with Shell in 2018 tran
Slide 5: Changes in NCS dynamics create opportunity for OKEA
Changes in NCS dynamics create opportunity for OKEA From majors to pure E&P companies Taking part in significant future NCS production mmboepd 5,0 • Future prospects of NCS remains highly attractive • Exit or reduced exposure among major IOCs 4,0 • Opens up opportunities for pure E&Ps • OKEA marked
Slide 6: OKEA is a responsible and value focused E&P company
OKEA is a responsible and value focused E&P company Safe and responsible Improvement and Value driven M&A Financial flexibility and operations digitalization robustness $ A NCS focused E&P Continuously improving Target value Prudent financial company operations enhancing growth strategy “The OKEA wa
Slide 7: The OKEA ambition – where we are going
The OKEA ambition – where we are going • Further optimizing Draugen operations ‒ The back-bone of the portfolio ‒ Through continued operational excellence significant cash will be generated • Production growth ‒ Value over volumes ‒ Ability to capitilise on Draugen experience • Pursue additional ope
Slide 8: Proven operational capabilities on Draugen
Safe and responsible operations Proven operational capabilities on Draugen • No incidents or leakages in 2019 • Strong production in 2019, 5% above target • Average 90.8% reliability last 3 years, 94% in 2019 • Unique knowledge of Draugen upside potential • Positive production outlook • Several main
Slide 9: Improving Draugen operational efficiency
Improvement and digitalization Improving Draugen operational efficiency • Optimised decision processes have reduced lead time • Mapping of governing documents, removing redundancy • Software applications down by 33% • Using industry standards for development projects • Revised roles and responsibili
Slide 10: OKEA is committed to operating safely and responsibly
OKEA is committed to operating safely and responsibly Safety Environment Safe and sustainable business with zero harm to people Energy efficient production with focus on reducing environmental footprint or assets • Serious incident frequency (SIF) for Draugen on “0” for 2019 (as for 2018 and 2017) D
Slide 11: OKEAs smart digital journey enables both business and technical innovation
Improvement and digitalization OKEAs smart digital journey enables both business and technical innovation Reduced opex • Redused number of software applications • Condition based monitoring • Perfomance contracts on equipments, systems and services targeting • Moving functionality and people from of
Slide 12: Target the right deals
Value driven M&A Target the right deals • Target value enhancing M&A on NCS • Emphasising portfolio fit to enable synergies • The right deals more important than timing • Desire operatorships ‒ producing assets and developments up to 100 mmboe • Funding through operating cash flow and owner support
Slide 13: Strong financial performance
Financial flexibility and robustness Strong financial performance Production (kboepd) EBITDA1 (NOKm) Cash position2 (NOKm) Q3 2019 Q3 2019 Q3 2019 Previous Previous Previous 2 # of Draugen liftings 1 1 1 799 594 22,4 19,5 20,0 18,1 1 329 413 404 586 133 395 0.4 42 57 Q3 2018 Q4 2018 Q1 2019 Q2 2019
Slide 14: High level of activity in coming years
Outlook High level of activity in coming years Q4’19 Q1’20 Q2’20 Q3’20 Q4’20 Q1’21 Q2’21 Target further debottlenecking and cost reductions Draugen Appraisal well BOK/BOV1 Hasselmus Hasselmus FID Progressing redevelopment of Gjøa P1 towards first oil late 2020 Gjøa P1 production start Gjøa Progress
Slide 15: OKEA investment highlights
OKEA investment highlights • NCS-focused E&P company with strong cash flow from ca. 20 000 boed in net production Safe and responsible • A responsible operator focusing on safety and lowest possible environmental footprint operations on NCS • Proven value creation in 2019 as operator of the Draugen
Slide 16: okea.no
okea.no Ståle Myhre VP Investor Relation 16