Equinor Asa · OSL:EQNR
Equinor Asa — StatoilHydro — Q1 2008 Earnings Presentation
46 slides from Equinor Asa's earnings presentation, 2008
Slide 1: Financial highlights – 1Q 2008
Classification: Confidential Status: Draft Financial highlights – 1Q 2008 Eldar Sætre Chief Financial Officer
Slide 2: Solid production in strong markets
2 Solid production in strong markets • Good financial results • Production on track • Encouraging exploration • Building international growth Tordis sub sea separation facility
Slide 3: Good financial results
3 Good financial results Net income up 61% Net income • Oil price up 42% in NOK Net operating income • Gas price up 16% • Lifting down 3%, equity production up 8% NOK bn 51.4 • Higher net financial income 34.5 16.0 9.9 1Q 2007 1Q 2008
Slide 4: Net income overview
4 Net income overview Financial Operating items Taxes income 3.9 (39.3) 51.4 NOK bn Net income 16.0
Slide 5: Production on track
5 Production on track Oil Gas 2 0481 1 8891 1 900 824 1 000 boepd equity production 707 1 182 1 224 1Q 2007 1Q 2008 2008 guidance 1) Average PSA effect is 159 000 boepd in 1Q 2008 compared to 79 000 boepd in 1Q 2007.
Slide 6: Production unit cost NOK per boe
6 Production unit cost NOK per boe • Impact from merger- and restructuring costs 44.1 41.4 41.9 • Injection gas cost NOK 2.6 per boe2 33.2 31.2 31.6 Restructuing costs Injection gas purchase Production unit cost 2007 Entitlement 2007 Equity 1Q 2008 Equity 1 1) 12 month average Production unit cost.
Slide 7: Key deliveries
7 Key deliveries NCS North America New leases in Gulf of Mexico New projects on stream: New leases in Alaska Volve Sale of Gulf of Mexico shelf assets Gulltopp Gamma Main Statfjord Plan for Development and Operation delivered: Yttergryta Russia Morvin Establishment of Shtokman
Slide 8: Encouraging exploration results
8 Encouraging exploration results NCS Gulf of Mexico Gamma (StatoilHydro) Big Foot Sidetrack (Chevron) Marulk (ENI) Big Foot North (Chevron) M-structure (StatoilHydro) Green Bay (Anadarko) Obesum (StatoilHydro) Hal (ExxonMobil) Natalia (StatoilHydro) St Malo 3 (Chevron) Draupne
Slide 9: Net operating income - E&P Norway
9 Net operating income - E&P Norway • Oil price up 40% in NOK • Gas transfer price up 12% • Lifting down 1%, production up 5% – Gas lifting up 14% 42.2 – Oil lifting down 11% 31.0 NOK bn 1Q 2007 1Q 2008
Slide 10: Net operating income - International E&P
10 Net operating income - International E&P • Oil price up 51% in NOK • Lifting down 11%, equity production up 21% • Gain of NOK 0.8 billion from sales of assets 4.3 • Exploration expenses up NOK 2.5 billion 3.1 NOK bn 1Q 2007 1Q 2008
Slide 11: Net operating income – Natural gas
11 Net operating income – Natural gas • Natural gas price up 16% • Transfer price up 12%1 • Natural gas sales up 18% • Positive change in fair value of 1.9 derivatives NOK bn 0.7 1Q 2007 1Q 2008 1) A revised price formula between E&P Norway and Natural Gas was implemented in the first quarter of 200
Slide 12: Net operating income - Manufacturing and Marketing
12 Net operating income - Manufacturing and Marketing • Lower trading result • Reduced refining margins • Negative currency effects 1.4 1.0 NOK bn 1Q 2007 1Q 2008
Slide 13: Net operating income by business area
13 Net operating income by business area Items Items impacting impacting net Adjusted net net Adjusted net operating operating operating operating NOK billions 1Q 2008 income income 1Q 2007 income income E&P Norw ay 42.2 0.2 42.4 31.0 -2.3 28.7 International E&P 4.3 2.0 6.3 3.1 0.0 3.1 Natural Gas 1
Slide 14: Outlook 2Q 2008
14 Outlook 2Q 2008 • Planned maintenance schedule to affect production by approximately 55 000 boe per day in 2Q 2008 1 • Planned maintenance stop at Snøhvit • Seasonal lower gas off-take • Continued high exploration activity 1) The NCS effect of planned maintenance includes liquids only.
Slide 15: Guiding
15 Guiding 2008 • Equity production (mill boepd) 1.9 • Capex (NOK bn) ~75 1 • Exploration activity (NOK bn) ~18 1 2012 • Equity production (mill boepd) 2.2 • Production cost (NOK/ boe 2008 - 2012) 33 - 36 1, 2 1) Based on NOK 6/USD 2) Production cost range during the period 2008-2012, based on equit
Slide 16: Supplementary information
16 Supplementary information Page 17 Items impacting income statement 19 Segment taxes 20 Net financial items 21 Net debt to capital employed 22 Simplified cash flow 23 ROACE 24 Key figures StatoilHydro group 26 Exploration StatoilHydro group 27 E&P Norway 29 E&P Norway production 31 International E
Slide 17: Items impacting income statement
17 Items impacting income statement 1Q 2008 1Q 2007 NOK billions Before tax After tax Before tax After tax Impairment (2.5) (2.5) 0.0 0.0 Derivatives 0.8 0.4 (3.0) (1.4) Over (+) /underlift (-) (1.9) (0.7) 2.1 0.7 Other 3.2 2.8 (1.0) (0.7) Impact on net income (0.4) 0.0 (1.9) (1.4)
Slide 18: Items impacting income statement
18 Items impacting income statement 1Q 2008 1Q 2007 NOK billions Before tax After tax Before tax After tax Impairment (2.5) (2.5) - - INT (exploration expenses) (2.1) (2.1) - - NG (DD&A) (0.4) (0.4) - - Derivatives IAS 39 0.8 0.4 (3.0) (1.4) INT - - (0.4) (0.2) EPN 1.0 0.2 0.6 0.1 NG (0.6) (0.1) (2.
Slide 19: Segment taxes
19 Segment taxes NOK billion 1Q 2008 1Q 2007 Exploration and Production Norway 31.8 23.4 International Exploration and Production 3.4 1.5 Natural Gas 1.3 0.5 Manufactoring and Marketing 0.3 0.6 Eliminations 0.4 (0.5) Tax on financial items and other tax adjustments 2.1 0.3 Total 39.3 25.7
Slide 20: Net financial items
20 Net financial items Currency gain on long-term Financial Net financial debt expenses items 1Q 2008 Currency gain on liquidity management and other 1.0 Currency 1.7 NOK bn 1.0 3.9 Interest and Net financial other financial 0.7 items 1Q 2007 items (0.1) 1.2
Slide 21: Net debt to capital employed
21 Net debt to capital employed Net debt Net debt to capital employed1 25.5 ** ** 12% 24% NOK bn 2 2 2.1 1% % (12)% (21.1) 2007 1Q 2008 2007 1Q 2008 1) Debt to capital employed ratio = Net interest-bearing debt/capital employed 2) Adjusted for increase in cash for tax payment
Slide 22: Simplified cash flow
22 Simplified cash flow Depreciations Change in and non cash working Change in items capital non-current (2.7) items Cash flows 11.6 investing (4.8) Taxes paid activities Income (2.2) (Net) before tax (11.2) Repayment of LT Change in Net ST liquid assets borrowings borrowings (2.0) = 45.1 1.0 NOK bn
Slide 23: ROACE vs peer group
23 ROACE 22.5% in 1 Q 2008 StatoilHydro Peer group 1 0% 10% 20% 30% 1) Peer group includes (listed in alphabetical order): Anadarko, BG, BP, ChevronTexaco, CNQ, ConocoPhillips, Devon, Encana, Eni,ExxonMobil, Lukoil, Occidental, Petrobras, Repsol YPF, Shell, Total
Slide 24: StatoilHydro group changes 4Q 2007– 1Q 2008
24 StatoilHydro group Net operating income changes 4Q 2007– 1Q 2008 1.5 2.1 1.6 3.7 2.0 9.7 51.4 30.8 4Q 2007 E&P Norway International Natural Gas Manufacturing Other Eliminations 1Q 2008 E&P & Marketing
Slide 25: StatoilHydro group changes 1Q 2007– 1Q 2008
25 StatoilHydro group Net operating income changes 1Q 2007– 1Q 2008 2.5 1.2 (0.4) 1.3 1.1 11.2 51.4 34.5 1Q 2007 E&P Norway International Natural Gas Manufacturing Other Eliminations 1Q 2008 E&P & Marketing
Slide 26: Exploration StatoilHydro group
26 Exploration StatoilHydro group NOK bn. 1Q 2008 1Q 2007 Exploration expenditure 3.9 2.7 Exploration expenditure (activity) 2.2 0.4 Expensed, previously capitalised exploration expenditure -1.9 -1.1 Capitalised share of current period’s exploration activity 4.2 2.0 Exploration expenses NOK bn. 1Q 2
Slide 27: E&P Norway changes 4Q 2007 – 1Q 2008
27 E&P Norway Net operating income changes 4Q 2007 – 1Q 2008 0.6 (0.1) 42.2 7.0 1.0 (1.8) 0.9 2.1 32.6 NOK bn 4Q 2007 Price Volume Other income Exploration Operating DA&I Sales and 1Q 2008 expenses admin.
Slide 28: E&P Norway changes 1Q 2007 – 1Q 2008
28 E&P Norway Net operating income changes 1Q 2007 – 1Q 2008 (1,2) 0.4 0.2 (0.2) (0.3) 0.0 42.2 12.2 31.0 NOK bn 1Q 2007 Price Volume Other income Exploration Operating DA&I Sales and 1Q 2008 expenses admin.
Slide 29: StatoilHydro production per field 1Q 2008
29 StatoilHydro production per field 1Q 2008 StatoilHydro - operated StatoilHydro-operated StatoilHydro share Produced volumes 1000 boed Oil Gas Total Brage 32.70% 7.8 1.3 9.1 Fram 45.00% 24.0 2.1 26.1 Gimle 65.13% 7.0 0.0 7.0 Glitne 58.90% 5.9 0.0 5.9 Grane 38.00% 66.0 1.9 67.9 Gullfaks 70.00% 115.
Slide 30: StatoilHydro production per field 1Q 2008
30 StatoilHydro production per field 1Q 2008 Partner - operated Partner-operated StatoilHydro share Produced volumes 1000 boed Oil Gas Total Ekofisk 7.60% 22.8 4.4 27.2 Enoch 11.78% 0.9 0.0 0.9 Murchison 11.52% 0.4 0.0 0.4 Ormen Lange 28.91% 4.0 45.4 49.4 Ringhorne Øst 14.82% 4.8 0.1 4.9 Sigyn 60.00
Slide 31: International E&P changes 4Q 2007 – 1Q 2008
31 International E&P Net operating income changes 4Q 2007 – 1Q 2008 2.4 0.7 (1.2) 0.7 (0.6) 4.3 NOK bn 2.2 4Q 2007 Price Volume Depreciation Exploration Other 1Q 2008
Slide 32: International E&P changes 1Q 2007 – 1Q 2008
32 International E&P Net operating income changes 1Q 2007 – 1Q 2008 (0.9) (0.1) 3.5 (2.5) 1.2 NOK bn 4.3 3.1 1Q 2007 Price Volume Depreciation Exploration Other 1Q 2008
Slide 33: International E&P equity production per field
33 International E&P equity production per field E&P International Produced equity volumes - StatoilHydro 1000 boepd StatoilHydro share Oil Gas Total Alba 17.00% 6.8 6.8 Caledonia 21.32% 0.0 0.0 Jupiter 30.00% 0.8 0.8 Schiehallion 5.88% 4.1 0.1 4.2 Lufeng 75.00% 1.4 1.4 Azeri Chiraq (ACG EOP) 8.56%
Slide 34: Natural gas changes 4Q 2007 – 1Q 2008
34 Natural gas Net operating income changes 4Q 2007 – 1Q 2008 2.5 (6.1) 1.7 0.5 NOK bn 0.9 1.9 3.2 1.0 (1.8) 4Q 2007 Sales price Purchase Sales Purchase Opex IAS 39 Other 1Q 2008 Price volume volume
Slide 35: Natural gas changes 1Q 2007 – 1Q 2008
35 Natural gas Net operating income changes 1Q 2007 – 1Q 2008 3.8 (4.0) (3.4) NOK bn 3.7 (0.1) 1.5 1.9 (0.3) 0.7 1Q 2007 Sales price Purchase Sales Purchase Opex IAS 39 Other 1Q 2008 price volume volume
Slide 36: Manufacturing & Marketing changes 4Q 2007 – 1Q 2008
36 Manufacturing & Marketing Net operating income changes 4Q 2007 – 1Q 2008 0.7 1.0 (0.6) NOK bn 1.3 (0.2) (0.2) 4Q 2007 Oil Sales Manufacturing Marketing Other 1Q 2008
Slide 37: Manufacturing & Marketing changes 1Q 2007 – 1Q 2008
37 Manufacturing & Marketing Net operating income changes 1Q 2007 – 1Q 2008 0.2 (0.5) (0.1) (0.1) NOK bn 1.4 1.0 1Q 2007 Oil Sales Manufacturing Marketing Other 1Q 2008
Slide 38: Manufacturing & Marketing income statement
38 Manufacturing & Marketing Income statement NOK bn M&M - distribution of Net operating income 1Q 2008 1Q 2007 Oil sales & trading 0.2 0.0 Manufacturing 0.5 1.0 Marketing 0.3 0.4 Other -0.1 0.0 Total 1.0 1.4 M&M - operational data 1Q 2008 1Q 2007 FCC margin (USD/bbl) 5.6 5.4 Contract price methanol
Slide 39: Manufacturing & Marketing margins and prices
39 Manufacturing & Marketing Margins and prices FCC NWE refining margins Methanol contract price USD/bbl EUR/ton 2008 2007 550 14 500 12 450 10 400 350 8 300 6 250 4 200 150 2 100 0 50 J F M A M J J A S O N D J F M A M J J A S O N D
Slide 40: Sensitivities, effect of changes in parameters
40 Sensitivities, effect of changes in parameters Net income effect NOK bn 1 Net operating income Oil price + USD 1/bbl 3 effect 1 Gas price + NOK 0.1/scm 4 A ) Exchange rate + NOK 0.5/USD (P&L effect excl 4 finance) 13 B ) Exchange rate + NOK 0.5/USD (P&L effect from (2) long term debt) (4) A + B )
Slide 41: Reconciliation ROACE
41 Reconciliation ROACE Calculation of numerator and denominator used in ROACE calculation Twelve months ended {in NOK million, except percentages) 31 March 2008 31 March 2007 31 December 2007 Net income for the last 12 months 50,749 49,009 44,641 After-tax net financial items for the last 12 months
Slide 42: Normalised production cost per boe
42 Normalised production cost per boe
Slide 43: Reconciliation net debt and capital employed
43 Reconciliation net debt and capital employed
Slide 44: Forward looking statements
44 Forward looking statements This Operating and Financial Review contains certain forward-looking statements that involve risks and uncertainties. In some cases, we use words such as "believe", "intend", "expect", "anticipate", "plan", "target" and similar expressions to identify forward-looking st
Slide 45: End notes
45 End notes 1. After-tax return on average capital employed for the last 12 months is calculated as net income after-tax net financial items adjusted for accretion expenses, divided by the average of opening and closing balances of net interest-bearing debt, shareholders' equity and minority intere
Slide 46: Investor relations in StatoilHydro
46 Investor relations in StatoilHydro Lars Troen Sørensen senior vice president dlts@statoilhydro.com +47 51 99 77 90 Morten Sven Johannessen IR officer mosvejo@statoilhydro.com+47 51 99 42 01 Herlaug Louise Barkli IR officer hlba@statoilhydro.com +47 51 99 21 38 Anne Lene Gullen Bråten IR officer a