Lundin Petroleum Corporate Presentation

Transcription

1 Corporate Presentation January Jan 18 WF1231

2 Delivering Growth 4 x Production 9 >85 Mboepd (1) 8 Production (Mboepd) 7 6 Production Guidance Cash operating cost (USD/boe) 2 1 <4.6 USD/boe (1) 215 WF1231 p (1) 217 forecast 2

3 At a Glance Geographical Focus Norway pure play Organic growth strategy Strong production growth with low operating costs Resource base of ~1 billion barrels WF1231 p

4 Key Metrics Grow resource base and production organically with a disciplined geographical focus 2P Reserves Production Cash Operating Costs Operating Cash Flow Net MMboe Net Mboepd USD/boe < 4.6 Million USD Latest Guidance 217 Latest Guidance (1) WF1231 p Long-term Production Johan Sverdrup Phase 1 first oil (Late 219) Johan Sverdrup Full field production (222) >12 Mboepd >15 Mboepd production growth of 17% CAGR (1) Oil price range 5 to 6 USD/bbl 4

5 Financial Highlights - First Nine Months 217 Operating Cash Flow from continuing operations EBITDA from continuing operations 1,2 1, ,71.7 1, 1, 97% 8 8 Million USD Million USD % 6 Net Result from continuing operations (1) Million USD % WF1238 Q3 p First Nine Months 216 First Nine Months 217 First Nine Months 216 First Nine Months 217 First Nine Months 216 First Nine Months 217 (1) Includes increase in net foreign exchange gain compared to First Nine Months 216 of MUSD

6 Norway Forecast Development Expenditure on Committed Projects Forecast Development Expenditure (Million USD) Committed Projects Johan Sverdrup Phase 1 1, Johan Sverdrup Phase 2 Edvard Grieg drilling Alvheim Area infill drilling WF12168 p

7 Debt USD 5. billion RBL secured Attractive margin: 315 bps No amortisation until end 22 5, 4, 5, 4, ,24 85 ~ USD 1 billion Available Liquidity Headroom MUSD 3, 2, 1, RBL RBL Cash Net Debt 3/9/17 Sources of Liquidity Tax refund Nov 217 WF1231 p Fully funded up to Johan Sverdrup first oil at average Brent price of USD ~4/boe 7

8 Norway Investment Framework Organic Growth Significant yet to find resources Southern Barents Sea 8.8 billion barrels (1) Material acreage position in both the southern Barents Sea and the North Sea Norwegian Sea 4.9 billion barrels (1) WF1231 p Building positions in the Norwegian Sea and the Mandal High area of the North Sea North Sea 4.4 billion barrels (1) Attractive Fiscal Regime Fiscal Regime: 78% tax credit on E&A spend 9% tax credit on development spend over 4 6 years Interest deductibility Licensing Regime: Annual licensing rounds Awards based on technical merits no cash bids (1) NPD estimate - yet to find 8

9 Key Production Asset Edvard Grieg Edvard Grieg Platform Lundin operated 2P reserves: 223 MMboe Increased facilities capacity: 145, bopd (1) gross Reservoir performance better than expected significant reserve increase anticipated end 217 Development drilling ongoing Gas Export to SAGE Oil Export to Grane Ivar Aasen (WI 1.385%) onstream Q4 216 Apollo (WI 65%) Edvard Grieg (WI 65%) onstream Q4 215 Ivar Aasen processing at Edvard Grieg Gross Edvard Grieg Estimated Ultimate Recovery (MMboe) 3P Reserves Cumulative Production Remaining 2P Reserves SW Area 31 Luno II (WI 5%) Luno II North (WI 5%) Rolvsnes (WI 5%) potential future tie-back to Edvard Grieg OPEX 4.85 USD/boe (2) 4.15 USD/boe including tariff netting (2) WF1233 p PDO 216 (1) Combined for Edvard Grieg and Ivar Aasen (2) 217 forecast 9

10 Continuous Reserves Growth Alvheim Area Strong reservoir performance Facilities well managed Production decline arrested by infill drilling keeps operating costs low BoA 2 infill wells Online 218 Alvheim Alvheim FPSO Producing structure Infill drilling 218/19 infill drilling Undeveloped gas discovery Prospect Production Gas lift Water injection Vilje Portfolio of good infill drilling opportunities Kneler B Exploration opportunities Alvheim Area Gross Estimated Ultimate Recovery (MMboe) Frosk (expl well 218) Volund Volund 2 infill wells Online 3Q Bøyla WF1233 p PDO 216 3P Reserves 2C Contingent Resources Cumulative Production Remaining 2P Reserves OPEX 4.8 USD/boe (1) Infill opportunities breakeven < 25 USD/boe (1) 217 forecast 1

11 Full Field Break Even Price Johan Sverdrup Largest Phase 1 development on NCS Phase 1 progressing to schedule > 6% complete Project metrics continue to get better Investment Cost Reserves Estimate Capacity Working Interest Johan Sverdrup Unit Statoil 4.267% Lundin 22.6% Petoro 17.36% Aker BP % Maersk 8.44% Processing platform 1 Wellhead & Drilling platform Riser platform Processing platform 2 WF12298 p Living Quarters Gross Resources: billion boe 11

12 Johan Sverdrup Phase 1 Key Milestones Being Delivered on Schedule Riser platform jacket installed - July 217 Drilling Platform Topsides assembled - September 217 Riser Platform Jacket Drilling Platform Topsides Norway Oslo Haugesund WF12378 p Johan Sverdrup 12

13 Johan Sverdrup Concept Select Phase 2 PDO Submission Phase 2 First Oil Phase 1 First Oil Phase PRODUCTION CAPACITY Phase I 44 Mbopd Full Field 66 Mbopd First oil Phase 1: Late 219 First oil Phase 2: Q4 222 FULL FIELD - GROSS CAPEX PDO (1) 27 Bn NOK Current (2) Bn NOK TOTAL SAVING 3-35% Saving since PDO submission WF12298 p (1) Nominal, NOK6:USD (2) Nominal 217, fixed currency, excluding IOR 13

14 Big Fields Get Bigger 3,2 3, 2,8 3P Reserves 2C Contingent Resources Cumulative Production 2P Reserves 2,6 2,4 16% 2,2 Gross MMboe % % EG South West 1 WF12297 p PDO End 216 Alvheim Area PDO End 216 Edvard Grieg PDO End 216 Johan Sverdrup Gross ultimate reserves and resources 14

15 Low Carbon Footprint Norway has one of the lowest carbon emission rates per barrel in the world Carbon mitigation technology and improved emissions management Greenhouse Gas Emissions Intensity WF1231 p low carbon intensity provides a competitive advantage As key player in Norwegian O&G is: 1 st on estimate of GHG emissions per unit of capital employed 2 nd in terms of upstream emissions per barrel Barclays Equity Research kgco 2 e/boe Norway World North America Edvard Grieg 15

16 Appraisal Focus Significant resource upside in existing field areas Alta/Gohta appraisal drilling/testing in Completed Alta EWT in 218? Rolvsnes appraisal drilling/testing in 218 De-risks larger area potential Luno II appraisal drilling in 218 Norwegian Sea Loppa High Alta/Gohta Southern Barents Sea Hammerfest 1,2 Net Reserves & Resources MMboe (1) Trondheim 1, North Sea Norway MMboe 8 Utsira High Area Stavanger 6 WF12378 Q3 p P 3P Contingent Resources (1) Reserves/resources at end 216 Luno II / Rolvsnes 16

17 Exploration Strategy NCS ranks in top 1 worldwide exploration areas (2) Southern Barents Sea 8.8 billion barrels (1) Loppa High Southeastern Trend Southern Barents Sea Hammerfest NCS > 16 billion barrels yet to find (1) Southern Barents Sea ~5% resource potential Underexplored wildcat wells drilled Significant remaining potential in North Sea and Norwegian Sea areas Norwegian Sea 4.9 billion barrels (1) Norwegian Sea Frøya High/ Froan Basin Trondheim North Sea 4.4 billion barrels (1) Norway North Sea Alvheim Area & Utsira High Area Stavanger WF12378 Q3 p Mandal High (1) NPD estimate yet to find resources (2) Woodmac 17

18 Exploration Strategy 1+ exploration/appraisal wells planned in 218 Southern Barents Sea - Drill Out & Build 5 wells in Large under-explored basin >8 Bn boe (1) - Drill out material prospects 218 wells targeting >1.5 Bn boe (2) - Building prospectivity licensing rounds Frøya High/Froan Basin - New Core Area - Building new core area licensing rounds - Maturing prospectivity >2 Bn boe (2) for 219 drilling Alvheim Area Sustain Production 1 well in Drilling & maturing prospectivity - Adding new opportunities licensing rounds Utsira High Sustain Production 3 wells in Progressing Luno II/Rolvsnes towards development - Drilling & maturing prospectivity Mandal High New Core Area 1 well in 218 WF12392 p (1) NPD estimate yet to find (2) Gross unrisked prospective resources - Building new core area deals/licensing rounds - Testing material prospectivity >8 MMboe (2) 18

19 Key Messages Production Guidance (Mboepd) > OPEX (USD/boe) > >85 <4.6 ~ Guidance J. Sverdrup Phase 1 J. Sverdrup Plateau Guidance J. Sverdrup Phase 1 Strong production growth with low operating costs Exciting organic growth strategy Continued strong focus on cost discipline and operating efficiency WF1231 p Responsible operator with focus on HSE and risk management 19

20 Appendix 2

21 Financial Performance 2, 1,8 EBITDA Operating Cash Flow Total Capex Full Year 215 Full Year 216 1,6 1,4 1,2 EBITDA (MUSD) Operating cash flow (MUSD) , Production (boepd) 32,3 72,6 MUSD Average Brent oil price (USD/boe) Cost of operations (USD/boe) WF11543 p

22 Peer Comparison Reserves Life Index (1) s growth profile better than peers Years WF1231 p (1) Data Source: based on latest 2P reserves and production data disclosed by peer group companies Lundin Petroleum Peer Group: Aker BP, Enquest, Faroe, Galp, IPC, OMV, Ophir, Premier, Repsol, Soco, Total, Tullow, Vermilion 22

23 217 Production First nine months production of 87.1 Mboepd Q3 production of 89.2 Mboepd Reservoir and facilities outperformance Increased Edvard Grieg facilities capacity Updated full year production guidance: 85 Mboepd 1 Annual CMD, 93% First Nine Months Production Efficiency (%) Edvard Grieg Net Production Guidance (Mboepd) % Q1 Actual 82.6 Q2 Actual 89.5 Annual CMD, 95% Alvheim Area Q3 Actual 89.2 Guidance 2 Q4 Low High 97% WF12378 p Original guidance January: 7-8 Mboepd 2 Revised guidance August: 8-85 Mboepd 23

24 Edvard Grieg Reservoir Performance Southwest appraisal well 1 3 MMboe gross resource upside Potential resource upside in other areas of the field Fourth water injection well currently drilling Latest drilling results inline with prognosis Communication with rest of field Northern Tellus area (OP5) Results in line with prognosis Contribution from weathered/fractured basement Communication with rest of field WI1 OP5 WF12378 p Reservoir depletion rate more favourable than anticipated Minimal water production (expected late 216) Reservoir model being updated Updated reserves and profiles end 217 EG Southwest appraisal WI3 WI2 OP3 OP1 OP2 WI5 OP4 OP6 OP1 24

25 Utsira High Norway Significant resource upside in existing field areas Rolvsnes appraisal drilling/testing in 218 De-risks larger potential of Goddo PL167 PL167b Lille Prinsen Utsira High Luno II concept studies ongoing, further appraisal drilling planned in 218 Ivar Aasen PL51 Johan Sverdrup Unit Apollo PL338 1,2 Utsira High Net Reserves & Resources MMboe (1) PL338C Edvard Grieg Johan Sverdrup MMboe 1, 8 6 Fignon Luno II North Rolvsnes Back Basin Goddo PL265 PL51B WF1232 p P (2) 3P (1) Reserves/resouces at end 216 (2) Net remaining reserves at end 216 Contingent Resources Unrisked Prospective Resources (P5) Luno II PL359 PL815 KM 1 licences Operator Partner Oil field/discovery Gas Prospect/lead 25

26 Creating Shared Value from Responsible Energy Management Norwegian oil and gas sector is #1 in the Resource Governance Index (RGI) NORWAY: RGI SCORE AND RANK 1 st Operating in the world class governance environment of Norway gives a competitive edge in providing low carbon intensity and responsibly managed energy resources We find s sustainability ambition and approach to be consistent with ours: based on a strong commitment from senior management to the highest standard, it is fully integrated into day to day operations supported by a strong company culture and governance model ABN Amro WF12346 p th Source: "Natural Resource Governance Institute" 217 RGI Index 26

27 s Shareholders Shareholder structure Others, 8% Retail, 9% Institutional Investors, 34% Number of shares in issue: 34.4 million Statoil ASA, 2% Average traded volume per trading day in 217: ~.9 million shares (1) Part of OMX3, NASDAQ Stockholm Shares in free-float approx. 51% Rest of the Europe, 8% Geographically (2) Lundin Family, 29% Rest of the World, 9% UK/Ireland, 26% Scandinavia excl. Sweden, 14% WF113 p USA, 18% source: IPREO End August 217 Sweden, 25% (2) Institutional Investors only 27

28 Disclaimer Forward-Looking Statements Certain statements made and information contained herein constitute "forward-looking information" (within the meaning of applicable securities legislation). Such statements and information (together, "forward-looking statements") relate to future events, including the Company's future performance, business prospects or opportunities. Forward-looking statements include, but are not limited to, statements with respect to estimates of reserves and/or resources, future production levels, future capital expenditures and their allocation to exploration and development activities, future drilling and other exploration and development activities. Ultimate recovery of reserves or resources are based on forecasts of future results, estimates of amounts not yet determinable and assumptions of management. All statements other than statements of historical fact may be forward-looking statements. Statements concerning proven and probable reserves and resource estimates may also be deemed to constitute forward-looking statements and reflect conclusions that are based on certain assumptions that the reserves and resources can be economically exploited. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as "seek", "anticipate", "plan", "continue", "estimate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe" and similar expressions) are not statements of historical fact and may be "forward-looking statements". Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. No assurance can be given that these expectations and assumptions will prove to be correct and such forward-looking statements should not be relied upon. These statements speak only as on the date of the information and the Company does not intend, and does not assume any obligation, to update these forward-looking statements, except as required by applicable laws. These forward-looking statements involve risks and uncertainties relating to, among other things, operational risks (including exploration and development risks), productions costs, availability of drilling equipment, reliance on key personnel, reserve estimates, health, safety and environmental issues, legal risks and regulatory changes, competition, geopolitical risk, and financial risks. These risks and uncertainties are described in more detail under the heading Risks and Risk Management and elsewhere in the Company s annual report. Readers are cautioned that the foregoing list of risk factors should not be construed as exhaustive. Actual results may differ materially from those expressed or implied by such forward-looking statements. Forward-looking statements are expressly qualified by this cautionary statement. WF8278 p1 6.17

29