Highlights Repositioning completed On track to 12,000 b/d 12 exploration wells coming up 2 2
Noreco repositioned in 2011 NOK 2 billion asset sales Financial NOK 2 billion reduced investment commitments NOK 1 billion debt repayment Siri and Huntington resolved Operational Oselvar in line with plan High impact exploration…
Oselvar on track First oil H1-2012 Final commissioning Drilling last producer 5
Huntington on track First oil H2-2012 3 producers completed with excellent results FPSO upgrade on track 6
Exploration programme
Norecos exploration portfolio Mid Norway North Sea Barents Sea 8
Large remaining resource potential Yet to find: 16 bill boe North Sea : 5,3 bill boe Norwegian Sea: 4,9 bill boe Barents Sea: 5,9 bill boe 9 Source: NPD Resource Report 2011
Our exploration organisation Hydrocarbon Systems Analyses Area geoscience teams - organic geochemistry Geological analyses and interpretation - basin modelling - seismic data - well data - documents and articles - external studies…
Our area exploration approach E.g. Mid Norway Geologic knowledge, competencies and skills Technology geophysics, hydrocarbon systems, well data analyses Regional geoscience and the geographic area approach 11
Exploration drilling program Mid Norway Frontier play Emerging play North Sea Albert Mature play Barents Sea Jette Crazy Horse Kalvklumpen Lupin Eik Scotney Ogna Snurrevad Romeo Clapton Luna 13
Exploration drilling program Total P50 expectation: 142 mmboe (net to Noreco) Frontier play Average Chance of Success is 1 in 4 Emerging play Mature play 14
Luna Noreco 47% - Noreco operated Target reservoir is Permian sandstones CoS - 14%: Primary risk element - trap 125 400 mmboe gross, net P50: 152 mmboe Well ongoing 15
PL396 Eik Prospect Noreco 50% - Noreco operated Middle Jurassic rotated fault block play CoS - 28%: Primary risk element - trap integrity 135 319 mmboe gross , net P50: 108 mmboe Expected spud in March 2012 using Aker Barents A…
PL519 Albert Prospect Noreco 20% - Lundin operated Major fault bound high with a Lower Cretaceous play CoS - 24%: Primary risk element reservoir 280 510 mmboe gross , net P50: 78 mmboe Expected spud in April 2012 using Bredford…
P1650 Crazy Horse Prospect Noreco 78% - Noreco operated Targeting Lower Cretaceous sands in a stratigraphic trap CoS - 21%: Primary risk element charge (migration) 88 230 mmboe gross in Scapa Sands only Net P50: 118 mmboe Expected…
2012 exploration program 19 P90-P10 volume range, mmboe
Operating in the Barents Sea 20
Income statement Fourth quarter 2011 NOK million Q4-11 Q3-11 Q4-10 Total revenues 193 194 171 Production expenses 100 57 50 Exploration and evaluation expenses 32 103 297 Payroll and other operating expenses 50 80 95 EBITDA 12 (45)…
Balance sheet 31 December 2011 NOK million 31.12.2011 30.09.2011 31.12.2010 Assets Non-current assets 7 596 8 295 9 611 Current assets 1 367 3 065 2 109 Cash 689 387 892 Total assets 9 652 11 747 12 613 Equity and liabilities Total…
Financial ratios improved 31 December 2011 Equity ratio Gearing ratio percent 23
Strong liquidity after asset sales Cash and liquidity NOK million 24
Summary Reposition completed in Q4 12,000 b/d by end-2012 12 exploration wells Strengthened financial position Norecos vision is to build a leading independent oil and gas company in the North Sea region 25
ADDITIONAL INFORMATION Ref.: pres-external 27
Noreco at a glance Exploration-driven E&P company 12 exploration wells planned for the coming 18 months Production from five fields 2011-H2: 3,500 boe/day Two field developments ongoing Adding 8-9,000 boe/day in 2012…
Exploration strategy Licensed acreage awarded on NCS last 10 years Active and focused exploration program from a large portfolio Focus on wells that can create significant value Clear entry and exit strategy for each license…
High impact exploration program Prospect License Noreco Chance of Volume 1) Drilling Operator share success potential start Kalvklumpen PL414 20% Dry Det Norske Zidane-2 2) PL435 Ongoing RWE Luna DK 1/11 47% 14% 196-490 Ongoing Noreco…
Reserves and resources Total resource base Development in 2P reserves mmboe mmboe 2P reserves are verified by DeGolyer & MacNaughton 31
Reserve tables by field Reserves and associ ated contingent resources Net reserv es (mm boe) Net contingent resources (m mboe) Country License Asset Name Equity Ca tegory 2P 2C DK 16/98 Cecilie 61 % Reserves 1.2 DK 19/98 Connie 61 %…
Bond debt profile NOK million Bond Outstanding Due Terms Convertible NOK 173 mill 11 May 2012 6 % fixed, unsecured NOR03 NOK 475.5 mill 20 Nov 2012 3m NIBOR + 7.9 %, pledge in shares in subsidiaries NOR04 NOK 1,179 mill 20 Nov 2014…
Interest Interest bearing Interestbearing debt debt&& bearingdebt equity &equity equity NOK million Q4-2011 Q3-2011 Q2-2011 Q1-2011 Q4-2010 NOKNOK million million Q4-2011 Q4-2011Q3-2011 Q3-2011Q2-2011 Q2-2011Q1-2011…
Dynamic hedging programme Put options Noreco is using put 1,000 barrels options to protect cash flow from oil price downside 24 months rolling forward programme Asian type puts based on monthly average Brent oil price 35
Noreco production per field boe/day Field Noreco share Q4-2011 Q3-2011 Q2-2011 Q1-2011 Nini East 30% 2 185 2 015 2 257 1 853 Nini 30% 582 768 893 1 238 Cecilie 61% 395 260 470 529 Lulita 28.2% 260 286 329 220 Enoch 4.36% 103 100 104…
Exploration and investment activity NOK million Q4-2011 Q3-2011 Q2-2011 Q1-2011 Q4-2010 Exploration expenses 32 103 86 202 301 Exploration capitalized 10 132 14 22 -63 Investments in fields 170 274 249 240 113 Total 212 509 349…
Net Risked P50 mmboe 0 100 150 200 250 50 300 350 Rau - P Hunt. Forties - M Hunt. Fulmar - M Yoda - M Galtvort - M Syd Tor Pod - P Talisker - P Knokandoo - P Historic Pre Drill P10 Historic Pre Drill P50…
PL440S Clapton Prospect Noreco 12% - Faroe Petroleum operated Chalk reservoir around the flanks of a major salt diapir Located in Central Graben in proven play Cos - 25%: Primary risk element - trap integrity 76 194 mmboe gross ,…
P1666 Romeo Prospect Noreco 22% - Suncor operated Robust fault bound dip closure in proven Upper Jurassic play. Considerable upside potential to west of license (Alpha prospect) CoS - 24%: Primary risk element - trap geometry 19…
PL490 Snurrevad Prospect Noreco 20% - Lundin operated Lower Cretaceous stratigraphic trap south of Loppa High in Barents sea, with significant additional high risk plays that will be de-risked by the well CoS 10%: Primary risk element…
PL453S Ogna Prospect Noreco 25% - Lundin operated Simple fault bound 4-way dip closure in an Upper Jurassic play, in close vicinity to local kitchen, analogue to Bream discovery CoS 19%: Primary risk element presence of local mature…
P1658 Scotney Prospect Noreco 44% - Suncor operated Robust 4-way dip closure in proven Upper Jurassic play, in close vicinity to existing infrastructure CoS 26%: Primary risk element reservoir presence 17 100 mmboe gross , net P50:…
PL385 Jette Prospect Noreco 20% - Statoil operated Middle Jurassic target in conventional play in a prolific area CoS - 32%: Primary risk element - trap 35 210 mmboe gross , net P50: 25 mmboe Expected spud Q3/Q4 2012 rig…
PL360 Lupin Prospect Noreco 15% - Statoil operated Large fault bound structure in Ling Graben, gas prospect, target reservoir is the Rotliegendes sands, few wells in North Sea have targeted this play hence new play opener CoS - 10%:…
Shareholders Top 20 shareholders as of 28 February 2012 Shareholder Shares % of total IK M INDUSTR I-INV E ST A S 23 673 998 9,7 % LY SE E NE R G I A S 23 647 460 9,7 % O M HO LDING A S 11 546 426 4,7 % G O LDMA N SA CHS INT. - E Q UITY -…
Important information This company presentation (the Presentation) has been prepared by Norwegian Energy Company ASA (Noreco or the Company). The Presentation has not been reviewed or registered with, or approved by, any public authority,…
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