DNO INTERNATIONAL ASA FOURTH QUARTER AND FULL YEAR 2008
AGENDA SUMMARY AND KEY EVENTS Helge Eide, President and MD OPERATIONAL REVIEW Ivar Brandvold, COO FINANCIAL REVIEW Haakon Sandborg, CFO Q&A FOURTH QUARTER 2008 2
GROWTH IN CYCLES THIRD GROWTH CYCLE RESERVES 1st 2nd 3rd Building production potential from a strong 160 reserve base 120 MMBOE Reduced nancial exposure to the offshore environment 80 Focus on low cost areas 40 Avoided long…
2008 KEY EVENTS PRODUCTION Production in line with guidance Successful inll and appraisal drilling DEVELOPMENT Completed Phase 1 on Tawke in Kurdistan Commenced construction work for tie-in of Tawke pipeline to Iraqs northern…
DETNOR SHAREHOLDING INTEGRATION AGREEMENT AUTUMN 2007 Mutually supported agreement to establish the second largest operator on the NCS A Norwegian E&P company with split head-office functions Trondheim/Oslo IMPORTANT BUILDING BLOCKS…
IMPAIRMENT ASSETS ASSESSED AT YEAR-END 2008 According to IFRS, the company shall assess at each reporting date whether there is any indication that an asset may be impaired Adjusting to the recent oil price and the equity markets DNO…
2008: KEY FINANCIALS SALES EBITDA* AND EBITDAX* NETBACK* 1500 1500 1500 1250 1250 1250 1000 1000 1000 NOK million NOK million NOK million 750 750 750 500 500 500 250 250 250 0 0 0 2007 2008 2007 2008…
KEY STRATEGIES VALUE CREATION KEY ATTRIBUTES EXPLORATION DRIVEN STRATEGY In low cost high potential areas ENTREPRENEURIAL COMPANY Quick decisions/risk taker OPERATING COMPANY Controlling the asset base FOCUS ON LOW…
WELL POSITIONED DNOs strategy during the last years make the company well prepared for the downturn in the market Our activities has been focused on low cost, high potential areas avoiding long term capital commitments We are…
OPERATIONAL REVIEW FOURTH QUARTER 2008 10
Det norske oljeselskap ASA BUSINESS OVERVIEW PL1067 Tawke Benenan (Hawler) Dohuk Sharyoof Tasour Nabrajah Bayoot and Raoq Block 32, 43, 47, 52, 53 and 72 Block P Inhaminga FOURTH QUARTER 2008 11
PRODUCTION FOURTH QUARTER 2008 12
ONGOING DEVELOPMENT FOURTH QUARTER 2008 14
BASEMENT DISCOVERIES BAYOOT FIELD Positive results of the appraisal wells 4, 5 and 6 in 2008 Development of permanent remote processing facilities to the Sharyoof eld ongoing RAOQ DISCOVERY Exploration well Raoq 1 discovered oil in…
FISHKHABOR TIE-IN AREA FOURTH QUARTER 2008 16
TIE-IN PROJECT WITH NOC/KRG NEAR COMPLETION FOURTH QUARTER 2008 17
TIE-IN PROJECT WITH NOC/KRG NEAR COMPLETION 46 Tie-In FOURTH QUARTER 2008 18
BENENAN (HAWLER) DISCOVERY JURASSIC DISCOVERY WELL 1 IN 2008 Lower reservoir test; 9,000 bopd and 11 million scf/d gas Upper reservoir test; 1,500-2,000 bopd, heavier oil APPRAISAL WELL 2 Indications of hydrocarbons Well temporarily…
EXPLORATION FOURTH QUARTER 2008 20
EXPLORATION IN YEMEN KEY EVENTS 2008 10 exploration wells drilled Three discoveries on Block 47, complex structural setting Two seismic acquisitions completed on blocks 52 and 72 Seismic acquisition ongoing by year end on Block 47…
EXPLORATION IN KURDISTAN KEY EVENTS 2008 Three exploration wells drilled One discovery on Erbil PSC (Benenan) Two seismic acquisitions completed on Dohuk and Erbil PSCs GOING FORWARD Temporary stop in drilling operations Maturing…
MOZAMBIQUE KEY EVENTS 2008 Exploration well Sangussi 1 dry Field work and aero electromagnetic survey Entered 4th exploration period GOING FORWARD Assessment of prospective potential and denition of drilling candidates Target 1…
NEW VENTURES FROM CURRENT CORE AREAS Develop current positions in proven basins, known and new plays Follow potential extensions of proven plays into adjacent basins POTENTIAL OUTSIDE KURDISTAN AND YEMEN Pursue entries into frontier…
YEAR-END FINANCIAL RESULTS FOURTH QUARTER 2008 25
KEY FIGURES NOK Million 2008 2007 Operating Revenues 1,376 1,320 Net prot discontinued operations - 915 Impairment losses -927 - Net prot -904 1,006 EBITDA before impairment 651 808 Netback before impairment 453 690 FOURTH…
FINANCIAL SUMMARY 2008 ANNUAL KEY FINANCIALS PURSUING E&P STRATEGY 2000 Substantial 2008 investments provided new discoveries, Revenues 1800 Operating Prot before Impairment development candidates and production capacity…
ANNUAL FINANCIALS SALES EBITDA* AND EBITDAX* NETBACK* 1600 1200 800 1400 700 1000 1200 600 800 1000 500 NOK million NOK million 800 NOK million 600 400 600 300 400 400 200 200 200 100 0 0 0 2006 2007…
CASH FLOW COVERAGE SOURCES AND USES OF CASH CASH FLOW COVERAGE New Interest-Bearing Debt 90 % 2000 Netback before exploration and impairment CAPEX 77 % 80 % 1500 Exploration expensed 70 % 64 % 1000 60 % 500 NOK Millon per…
CAPITAL STRUCTURE ASSETS EQUITY AND LIABILITY Cash: 6000 6000 NOK 176 million 5000 5000 Financial assets: 4000 NOK 735 million 4000 Net debt to cap: 3000 3000 48 per cent NOK Million NOK Million 2000 2000 1000…
CONVERSION OF NOK DEBT TO USD BOND MATURITY REDUCED FX EXPOSURE 2000 NOK USD NOK 920 mill. bond loans converted from 1800 NOK to USD in Q4 2008 463 75 per cent of bond loans now in USD 1600 FX exposure reduced 1400 LONG-TERM…
ACCOUNTING EFFECTS OF IMPAIRMENT NOK Million Q4 2008 Q3 2008 Impairment -708 Share of result Q408 +87 Net impairment of investment in Det norske oljeselskap ASA -621 Total impairment of available-for-sale shares -31 -27 Total impairment…
MAIN FINANCIAL RESULTS Q4 2008 QUARTERLY KEY FINANCIALS OIL PRICE AND EXPENSED EXPLORATION 500 Sales EBITDA* Netback* Oil price drop reduces Q4 revenues Netback cash ow declined to NOK 29 million, on lower 400 422 revenues and dry…
INCOME STATEMENT THREE MONTHS ENDING TWELVE MONTHS ENDING NOK Million 31.12.08 30.09.08 31.12.07 31.12.08 31.12.07 Sales 217.3 324.5 364.7 1,376.2 1,319.9 Cost of goods sold -198.7 -156.1 -187.7 -745.5 -547.1 Gross prot 18.6 168.4 177.0…
EXPLORATION ACTIVITY EXPLORATION EXPENSED Q4 2008 EXPLORATION EXPENSES 140 Yemen Kurdistan Africa Other Expensed dry wells Yemen (Wasaa 1, Mesari 1, Ghatel 1S2, Seer 1) at total cost NOK 60 million 120 Additional NOK 13 million…
CAPITAL EXPENDITURE CAPEX PER SEGMENT Q4 2008 CAPEX 400 Kurdistan Yemen Other Development capex NOK 48 million and capitalized exploration NOK 33 million in Yemen 350 Tawke facility and tie-in investments of NOK 112 300 million NOK…
2009 CAPEX GUIDING TOTAL INVESTMENTS PER ACTIVITY PLAN FOR 2009 1800 Exploration Development Committed Investments Development CAPEX NOK 135 million 1600 Exploration NOK 100 million 1400 Contingent Additional Investments…
WELL POSITIONED IN CURRENT ENVIRONMENT Tawke tie-in nearing completion prepared for full scale production without further investments Strong proved and developed reserve base Long-term debt structure, with minor near-term…
FIRST QUARTER 2009: 13 MAY 2009 WELCOME BACK FOURTH QUARTER 2008 39
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