Skip to main content Capital Markets Update – Aker BP Investor Presentation | Shale Experts
Loading...
Pm

Capital Markets Update – Aker BP

Aker BP · Feb 11, 2020 · 83 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. Capital Markets Update – Aker BP – slide 1
    Capital Markets Update Aker BP ASA 11 February 2020
  2. Capital Markets Update – Aker BP – slide 2
    AKER BP ASA - CAPITAL MARKETS UPDATE 2020 Todays programme Karl Johnny Hersvik Kjetel Digre Evy Glrstad David Tnne All speakers CEO SVP Operations & SVP Exploration & CFO Asset Development Asset Initiation High efficiency,…
  3. Capital Markets Update – Aker BP – slide 3
    High efficiency, profitable growth and value creation Capital Markets Update 11 February 2020
  4. Capital Markets Update – Aker BP – slide 4
    The challenge The need for energy The need for CO2 to support rising prosperity emissions to fall dramatically 5
  5. Capital Markets Update – Aker BP – slide 5
    Affordable, reliable, sustainable and modern energy for all World population will continue to and human prosperity is closely Energy-related CO2 emissions must increase linked to energy consumption come down to reach the Paris goals…
  6. Capital Markets Update – Aker BP – slide 6
    Oil demand varies significantly across energy scenarios Global petroleum liquids demand (mmboepd) BP More money 125 IEA Current policies EQNR Rivalry EIA OPEC IEA Stated Policies BP Evolving transition 100 EQNR Reform Shell…
  7. Capital Markets Update – Aker BP – slide 7
    Investments in oil and gas essential part of the energy transition Oil and gas a large share of the energy mix Upstream investments needed to meet the demand Average annual upstream oil and gas investment estimates (USD bill. 2018)…
  8. Capital Markets Update – Aker BP – slide 8
    The future requires more efficient production of oil and gas Lower emissions Lower cost (CO2 - kg/boe) Aker BP ambition (USD/boe) Higher returns per 27 barrel produced 25 12.5 Cater for increased cost 18 7 of emissions 8 7…
  9. Capital Markets Update – Aker BP – slide 9
    Our contribution as a pure play oil & gas company Return value Reduce emissions Share Produce efficiently Reduce emissions Contribute with to return high value from our operations data, know-how and from oil & gas resources…
  10. Capital Markets Update – Aker BP – slide 10
    Total resources1 Net production2 (billion boe) (mboepd) Creating the leading 1.84 205-220 independent CO2 emissions3 Production cost4 (kg/boe) (USD/boe) offshore E&P…
  11. Capital Markets Update – Aker BP – slide 11
    A journey of high growth and improved efficiency 205* 15* Cost Process Improvement Reorganizing Aker BP reductions improvement culture the value chain operating model 2014 2015 2016 2017 2018 2019 2020 * Production volume in…
  12. Capital Markets Update – Aker BP – slide 12
    Safe and efficient operations Health, safety, security and environment is always the number one priority in Aker BP Improvement agenda enabler for improved safety, reliability and more efficient operations Aker BP dedicated to…
  13. Capital Markets Update – Aker BP – slide 13
    AKER BP STRATEGY Our strategy for value creation EXECUTE IMPROVE GROW 14
  14. Capital Markets Update – Aker BP – slide 14
    EXECUTE Achievements in 2019 support our strategic development Operational excellence Strong organic growth 0.6 Serious Incident Frequency +70 000 boepd 92% in 2020 from three projects Production efficiency Top explorer on the…
  15. Capital Markets Update – Aker BP – slide 15
    EXECUTE Reaching our targets for 2019 Guiding CMD Actual Production 155-160 156 mboepd Capex 1.6 1.67 USD billion Exploration USD billion 0.5 0.50 Abandonment USD billion 0.15 0.11 Production cost USD per boe 12.5…
  16. Capital Markets Update – Aker BP – slide 16
    IMPROVE Aker BPs improvement pillars driving efficiency Partnerships LEAN Flexible Digitalization and alliances operations models 1 2 3 4 Core operations Driving efficiency Work processes One team Well intervention and…
  17. Capital Markets Update – Aker BP – slide 17
    IMPROVE The alliances are the cornerstones of our improvements One team common goals shared incentives 18
  18. Capital Markets Update – Aker BP – slide 18
    IMPROVE Tech is easy - implementation is hard Cooperation and Ensure Value outtake and Drive change in partnerships scalability accountability business models 19
  19. Capital Markets Update – Aker BP – slide 19
    GROW Profitable organic and inorganic growth DEVELOP MERGERS AND EXPLORATION RESOURCE BASE ACQUISITIONS 20
  20. Capital Markets Update – Aker BP – slide 20
    GROW Counter-cyclical and value-driven approach to M&A 2014 2015 2016 2017 2018 2019 Logos represents acquisitions, mergers and asset transactions by Aker BP in Norway in the respective year. (M&A: mergers & acquisitions) 21
  21. Capital Markets Update – Aker BP – slide 21
    GROW Targeting new opportunities CRITERIA FOR M&A IN AKER BP 1 2 3 4 Financially Operated Predominantly Upside accretive assets liquids potential 22
  22. Capital Markets Update – Aker BP – slide 22
    TARGETING SUPERIOR VALUE CREATION 23
  23. Capital Markets Update – Aker BP – slide 23
    TARGETING SUPERIOR VALUE CREATION Unique resource base a strong foundation for organic growth 2P reserves 2C resources Ivar Aasen Other 5% Skarv 6% Ula 4% 9% Alvheim 9% Valhall NOAKA 34% Alvheim 36% 9% Skarv 906 mmboe 931…
  24. Capital Markets Update – Aker BP – slide 24
    TARGETING SUPERIOR VALUE CREATION High and profitable growth from existing portfolio Production ambition (mboepd) 500 400 NOAKA X2.7 300 Non-sanctioned X2 200 100 Sanctioned - 2014 2015 2016 2017 2018 2019 2020…
  25. Capital Markets Update – Aker BP – slide 25
    TARGETING SUPERIOR VALUE CREATION Returning value creation to shareholders Dividends, USD million 1,150 1,050 950 Strong cash flow from 850 existing portfolio 750 Profitable growth from project pipeline 450 250 Strong…
  26. Capital Markets Update – Aker BP – slide 26
    HIGH PROFITABLE VALUE EFFICIENCY GROWTH CREATION 27
  27. Capital Markets Update – Aker BP – slide 27
    Maximizing the value of our assets Capital Markets Update 2020 Kjetel Digre SVP Operations & Asset Development
  28. Capital Markets Update – Aker BP – slide 28
    Vallhall area Alvheim area Skarv area Operator, 90% Operator, 65% Operator, 24% Ivar Aasen Ula area Johan Sverdrup Operator, 35% Operator, 15-80% 11.6% Skarv 2P reserves 2C reserves 2019 production 906 931 156 mmboe…
  29. Capital Markets Update – Aker BP – slide 29
    MAXIMIZING THE VALUE OF OUR ASSETS Key operational priorities SAFETY LOW LOW HIGH PRODUCTION PROFITABLE EMISSIONS COST EFFICIENCY GROWTH 0 5 kg < 7 95% 35 Serious CO2 emissions Production cost Production Full life cycle…
  30. Capital Markets Update – Aker BP – slide 30
    MAXIMIZING THE VALUE OF OUR ASSETS Driving operational excellence Using the improvement toolbox to build a leading operating model 31
  31. Capital Markets Update – Aker BP – slide 31
    MAXIMIZING THE VALUE OF OUR ASSETS Driving down cost targeting below USD 7 per barrel Production cost (USD/boe) 15 12.5 12 10.0 9 Sanctioned only 7 6 3 Sanctioned, non-sanctioned & NOAKA - 2019 2020 2021 2022 2023…
  32. Capital Markets Update – Aker BP – slide 32
    MAXIMIZING THE VALUE OF OUR ASSETS A large and profitable opportunity set for growth Large resource base with highly attractive economics yields increased production 2C contingent resources Break-even for non-sanctioned projects…
  33. Capital Markets Update – Aker BP – slide 33
    Skarv area Producing field Discovery Field development Exploration prospect Skarv & rfugl (Skarv Unit) - 23,835%, Snadd Outer (PL212 E) - 30% 34
  34. Capital Markets Update – Aker BP – slide 34
    rfugl project 300 MILLION BOE 15 RFUGL BREAK-EVEN PRICE Substantial improvements Accelerated Start-up in through alliances production first half of 2020 35
  35. Capital Markets Update – Aker BP – slide 35
    SKARV Increased volumes, better efficiency and lower cost Increased 2P reserves at Skarv Improved production efficiency Reduced production cost Reserves addition of 85% last three years Tremendous improvment on Skarv adds USD per barrel…
  36. Capital Markets Update – Aker BP – slide 36
    2019 CO2 EMISSION REDUCTIONS IN PRACTICE Optimization of energy use and logistics at Skarv ANNUAL CO2 REDUCTIONS OF ABOVE 25 000 TONNES Reduced export pressure and reduced Rescheduling in collaboration with other 1 energy use in…
  37. Capital Markets Update – Aker BP – slide 37
    SKARV Priorities and outlook Skarv production outlook1) (net mboepd) 60 Execute Deliver rfugl project on time and cost Maintain high production efficiency 50 40 Non- Improve sanctioned Piloting automated inspections…
  38. Capital Markets Update – Aker BP – slide 38
    Alvheim area Producing field Discovery Alvheim (PL203) - 65%, Volund (PL150) - 65%, Vilje (PL036 D) - 46.9%, Byla/Frosk (PL340) - 65%, Skogul (PL460) - 65% 39
  39. Capital Markets Update – Aker BP – slide 39
    ALVHEIM A GREAT SUCCESS STORY The Aker BP blueprint for area developments Alvheim area total reserves1) Million boe 607 1 Excellent operations 2 Active area development 184 2004 2005 2006 2007 2008 2009 2010 2011…
  40. Capital Markets Update – Aker BP – slide 40
    ALVHEIM AREA Priorities and outlook Alvheim production outlook1) (net mboepd) 60 Execute Safe and reliable operations Deliver new wells 50 40 Improve Production optimization Non-sanctioned 30 High production…
  41. Capital Markets Update – Aker BP – slide 41
    Valhall area Producing field Field development Valhall (Valhall Unit) - 90%, Hod (PL33) - 90% 42
  42. Capital Markets Update – Aker BP – slide 42
    Valhall Flank West project 80MILLION BOE 28 VALHALL FLANK WEST BREAK-EVEN PRICE A new standard for Alliance strategy vital for Excellent safety flank developments project success performance 43
  43. Capital Markets Update – Aker BP – slide 43
    VALHALL AREA First successful offshore Single-Trip Multi-Frac campaign Key technology to enable increased recovery Applied at Valhall with success An alliance delivery Part of the Well Intervention and Stimulation alliance with…
  44. Capital Markets Update – Aker BP – slide 44
    VALHALL AREA Priorities and outlook Valhall production outlook1) (net mboepd) 90 Maintain high production efficiency Execute Drill, complete and stimulate new wells 80 Execute P&A campaign 70 Non-sanctioned 60 Reduce opex…
  45. Capital Markets Update – Aker BP – slide 45
    Ula area Producing field Discovery Exploration prospect Ula (PL19) - 80%, Tambar (PL65) - 55%, Oda (PL405) - 15% 46
  46. Capital Markets Update – Aker BP – slide 46
    ULA AREA Priorities and outlook Ula production outlook1) (net mboepd) 15 Execute Ula infill drilling campaign Drill Triassic pilots, and test of gas injection Non-sanctioned 10 Improve Handling of produced water Drive…
  47. Capital Markets Update – Aker BP – slide 47
    Ivar Aasen Producing field Discovery Exploration prospect Ula (PL19) - 80%, Tambar (PL65) - 55%, Oda (PL405) - 15% 48
  48. Capital Markets Update – Aker BP – slide 48
    IVAR AASEN THE DIGITAL FRONTRUNNER Onshore control room a successful first year 1 Record production efficiency 2 Cooperation across disciplines 3 Evaluating partly unmanned operations Facsimile from Aker BP Capital…
  49. Capital Markets Update – Aker BP – slide 49
    IVAR AASEN Priorities and outlook Ivar Aasen production outlook1) (net mboepd) 30 Maintain high production efficiency Execute Drill two new IOR wells Perform first TAR since start-up 20 Full electrification by 2022…
  50. Capital Markets Update – Aker BP – slide 50
    JOHAN SVERDRUP A world class oil field RESOURCES PRODUCTION PROFITABILITY CO2 INTENSITY Resources: 2.2-3.2 bn boe Currently 350 mboepd Break even oil price below 0.67 kg per barrel USD 20 per barrel 2P reserves: 2.7 bn boe Plateau…
  51. Capital Markets Update – Aker BP – slide 51
    JOHAN SVERDRUP Phase 2 with first oil late 2022 to lift production to +660 000 boepd New processing platform 28 wells 5 templates Gross Capex: NOK 41 bill. Adding 220 000 boed Illustration: Equinor Aker BP interest…
  52. Capital Markets Update – Aker BP – slide 52
    MAXIMIZING THE VALUE OF OUR ASSETS SAFETY LOW LOW HIGH PRODUCTION PROFITABLE EMISSIONS COST EFFICIENCY GROWTH 53
  53. Capital Markets Update – Aker BP – slide 53
    NOAKA Progressing towards a joint development of the NOAKA area Frigg Gamma Lang- Krafla Askja Fulla Rind Peik Fry Delta fjellet Gas export to Statpipe Oil export to Grane oil pipeline (GOP) Central UPP with power PDQ…
  54. Capital Markets Update – Aker BP – slide 54
    Creating value through exploration Capital Markets Update 2020 Evy Glrstad SVP Exploration and Asset initiation
  55. Capital Markets Update – Aker BP – slide 55
    EXPLORATION STRATEGY The Aker BP exploration formula Maximize value of Explore for new Smart integration of operated hubs hub potential data and technology 60 % 40 % 56
  56. Capital Markets Update – Aker BP – slide 56
    EXPLORATION Excellent exploration results in 2019 Discovered volume per year (mmboe) 2019 discoveries (mmboe) 2019 achievements 350 200 Participated in Other 300 16 Shrek Liatrnet exploration wells rn 150 250 250…
  57. Capital Markets Update – Aker BP – slide 57
    EXPLORATION PERFORMANCE Exploiting the potential around Alvheim Frosk on test production Evaluating options for Froskelr Maturing new exploration opportunities Froskelr Frosk 62-140 mmboe 50 mmboe Aker BP 60% Aker BP 65%…
  58. Capital Markets Update – Aker BP – slide 58
    EXPLORATION PERFORMANCE Skarv a key exploration region Alve NE pre-drill estimate 8-25 mmboe Aker BP 88%* Operator Aker BP Skarv FPSO high capacity and long-life RFUGL rn infrastructure 34-88 mmboe RN (gas) Aker BP 30%…
  59. Capital Markets Update – Aker BP – slide 59
    EXPLORATION PERFORMANCE Liatrnet exciting opportunity in the NOAKA area Discovery estimated to 80-200 mmboe recoverable Potential tie-in to NOAKA development solution Appraisal well planned in 2020 PL442 Liatrnet appraisal well…
  60. Capital Markets Update – Aker BP – slide 60
    EXPLORATION 2020 High risk and high potential in the Barents Sea Will set the future direction for Aker BP activity in the region PL722 Shenzhou PL719 Sandia pre-drill est. pre-drill est. 191-505 mmboe 23-527 mmboe Aker BP 20% Aker…
  61. Capital Markets Update – Aker BP – slide 61
    0 100 200 300 400 1 Nidhogg (PL1008) wells 10 Planning 2 Stangnestind (PL858) EXPLORATION 3 Sandia (PL719) 4 Shenzhou (PL722) 5 Bask (PL533) mmboe 320 Net unrisked 6 Alve NE…
  62. Capital Markets Update – Aker BP – slide 62
    EXPLORATION Positioning Aker BP for further profitable growth EXECUTE IMPROVE GROW Follow up on 2019 successes Apply new technology Utilize existing infrastructure with appraisal and to create and search for new targets new…
  63. Capital Markets Update – Aker BP – slide 63
    Maximizing returns through the cycle Capital Markets Update 2020 David Tnne Chief Financial Officer
  64. Capital Markets Update – Aker BP – slide 64
    FINANCIAL STRATEGY Maximizing returns through the cycle by balancing three priorities Invest in profitable growth Maintain sufficient Return financial capacity value creation 65
  65. Capital Markets Update – Aker BP – slide 65
    FINANCIAL STRATEGY Delivering on our 2019 ambitions Invested with discipline Optimized capital structure Returned value Capital budget (USD billion) Dividend per share (USD) Capex Expex Abex 2019 2.25 2.30 2.28 April - Replaced RBL…
  66. Capital Markets Update – Aker BP – slide 66
    FINANCIAL STRATEGY Strong cash generation from producing assets Production sanctioned only Capex sanctioned only1) Free cash flow sanctioned only2) mboepd USD billion USD billion 250 2.0 2.0 USD 50/bbl USD 80/bbl 200 1.5 1.5…
  67. Capital Markets Update – Aker BP – slide 67
    INVEST IN PROFITABLE GROWTH Large resource base with highly attractive economics 2C contingent resources Break-even for non-sanctioned projects (USD/boe)1) 60 Other 50 6% Skarv 9% 40 Alvheim area NOAKA 34% 9% 30 931 mmboe…
  68. Capital Markets Update – Aker BP – slide 68
    INVEST IN PROFITABLE GROWTH Great opportunity for strong organic growth Production ambition (mboepd) 500 CAGR Potential to near triple 2019-2026 production with NOAKA 15% 400 NOAKA Substantial organic growth from 10% large…
  69. Capital Markets Update – Aker BP – slide 69
    INVEST IN PROFITABLE GROWTH Flexible investment program continuously optimized Capex outlook (USD billion) 2020 capex per asset 3.0 Other Ivar 4% Aasen 4% 2.0 Skarv 7% NOAKA 1.67 1.5 Ula 11% USD Valhall 45% 1.5 Johan…
  70. Capital Markets Update – Aker BP – slide 70
    INVEST IN PROFITABLE GROWTH Climate risk integrated in investment decisions Carbon pricing consistent with meeting climate goals 120 2020 carbon price 2030 carbon price 100 Investments tested against cost of carbon emissions…
  71. Capital Markets Update – Aker BP – slide 71
    INVEST IN PROFITABLE GROWTH Driving down production cost below USD 7 per barrel Production cost (USD/boe) 12.4 Driven by improvement agenda and new fields in production 10.0 Sanctioned only Cost of emissions in line with IEAs 7…
  72. Capital Markets Update – Aker BP – slide 72
    INVEST IN PROFITABLE GROWTH Reducing cost and optimizing timing of decommissioning Abandonment spend (USD million) 300 Strong performance in 2019 Valhall QP Ula Rig Access Jette P&A 200 200 2020 plan Mainly P&A at Valhall…
  73. Capital Markets Update – Aker BP – slide 73
    INVEST IN PROFITABLE GROWTH Investments in exploration provide upside to current plan Exploration spend (USD million) 700 2019 review 16 exploration wells 600 Discovered 170 mmboe Finding cost: USD 0.6 / bbl a.t. 501 500 500 2020…
  74. Capital Markets Update – Aker BP – slide 74
    INVEST IN PROFITABLE GROWTH Profitable growth generating increased cash flow Current producing fields and sanctioned and non-sanctioned projects Production outlook Capex outlook Free cash flow outlook1) mboepd USD billion USD billion…
  75. Capital Markets Update – Aker BP – slide 75
    MAINTAIN SUFFICIENT FINANCIAL CAPACITY Protecting a strong balance sheet Leverage ratio Financial framework and risk management Net debt / 12m EBITDAX Continuously optimizing capital structure BBB- (stable) 3.0 BBB- (stable) Investment…
  76. Capital Markets Update – Aker BP – slide 76
    MAINTAIN SUFFICIENT FINANCIAL CAPACITY Capital structure with significant available capacity High debt capacity low utilization Debt facilities Bond maturities Tax-adjusted net debt per 31.12.2019 USD million USD million USD billion…
  77. Capital Markets Update – Aker BP – slide 77
    MAINTAIN SUFFICIENT FINANCIAL CAPACITY The plan is robust in various oil price scenarios Leverage ratio - an approximation including all investments and dividends 3.0 2.5 2.0 1.5 50/bbl 1.0 0.5 65/bbl 0.0 80/bbl…
  78. Capital Markets Update – Aker BP – slide 78
    RETURN VALUE CREATION Balanced and stable fiscal regime Tax payments - USD million For fiscal year 2018 For fiscal year 2019 Sensitivity for fiscal year 20201) 70 70 340 60 60 208 212 70 70 163 60 60 106 106 100 50 50 50…
  79. Capital Markets Update – Aker BP – slide 79
    RETURN VALUE CREATION Returning value creation to shareholders Dividends, USD million 1,150 1,050 950 Ambition to return value creation as dividends 850 Strong cash flow from current production 750 Profitable growth from flexible…
  80. Capital Markets Update – Aker BP – slide 80
    FINANCIAL GUIDANCE 2020 Growing production reducing spend increasing dividends Production Capital spend Production cost Dividend mboepd USD billion USD/boe USD million Abex Exploration Capex +36% +13% -4% -19% 205-220 2.3 12.4…
  81. Capital Markets Update – Aker BP – slide 81
    FINANCIAL STRATEGY Capital allocation to maximize returns through the cycle Invest in Maintain sufficient Return profitable growth financial capacity value creation Production potential existing portfolio Leverage ratio Dividend plan…
  82. Capital Markets Update – Aker BP – slide 82
    HIGH PROFITABLE VALUE EFFICIENCY GROWTH CREATION 83
  83. Capital Markets Update – Aker BP – slide 83
    84

From the store

Browse maps, data & reports in the Shale Experts store