Dno Asa Class A · OSL:DNO
Dno Asa Class A — Pareto E&P Seminar 2007
28 slides from Dno Asa Class A's conference presentation, Jan 18, 2007
Slide 1: DNO ASA Corporate Presentation
DNO ASA CORPORATE PRESENTATION Pareto E&P Seminar 18 January 2007 Helge Eide CEO 2006
Slide 2: Disclaimer
DISCLAIMER This Presentation includes and is based, inter alia, on forward-looking information and state ments that are subject to risks and uncertainties that could cause actual results to differ. These statements and this Presentation are based on current expectations, estimates and projections ab
Slide 3: Our mission
OUR MISSION IS TO BE A LEADING EXPLORATION AND PRODUCTION COMPANY FOCUSED ON TRANSFORMING 2006 RESOURCES TO RESERVES AT LOW COST, GENERATING SUBSTANTIAL AND CONSISTENT VALUE FOR OUR SHAREHOLDERS
Slide 4: Investment Highlights
INVESTMENT HIGHLIGHTS DNO offers to investors: • A pure-play E&P investment • Solid foundation for growth • Diversified, risk balanced exploration portfolio with strong reserve growth potential • Exploration activities funded by high margin production • Rig capacity secured for extensive exploration
Slide 5: Share Price Development
SHARE PRICE DEVELOPMENT MAJOR MILESTONES LAST 10 YEARS Share price (NOK) First growth cycle New growth cycle 18.00 TSR (CAGR): 33 TSR (CAGR): 167 percent percent 16.00 14.00 12.00 Rev italization in 1996 New strategy in 2003 Change in control Divestment of north sea 10.00 New strategy assets
Slide 6: New Growth Cycle
NEW GROWTH CYCLE Realizing and returning values WI P50 Reserves (MBOE) 2001 - 2006 1 st grow th cycle New grow th cycle • Initial focus on small and mature fields in the North Sea 144 138 125,4 • Shift in strategy in 2004 - approximately USD 230 million in sales proceeds from 85,5 72 64,3 divestment
Slide 7: Worldwide Portfolio
WORLD WIDE PORTFOLIO 37 LICENSES - 17 AS OPERATOR Northern Europe Norway • 24 Licenses (8 as Operator) • One producing asset • Large exploration potential • Minimized financial exposure from exploration Middle East UK • 1 Licenses as Operator • 10 Licenses (8 as Operator) • 3 producing assets • Larg
Slide 8: Strong Reserve Development
PERFORMANCE LAST 21 MONTHS STRONG RESERVE DEVELOPMENT WI Reserves P+P (MBOE) Primarily organic reserve growth Last 21 months • Discoveries at Goliat (NCS) and 160 Tawke (N. Iraq) adds 70 million 140 barrels in P+P reserves (WI) to DNO 120 Taw ke • Reserves have increased by 92 100 percent YTD 80 Gol
Slide 9: Outstanding Reserve Economics
IMPORTANT KEY PERFORMANCE INDICATORS OUTSTANDING RESERVE ECONOMICS FDA (P+P) Recycle Ratio (P+P) Reserve Replacement (P+P) 2.0 USD/bbl 7.5 times 9.4 times 5 10 10 5 5 9,4 7,5 2,6 2,9 4,5 4,7 2,5 4,1 2,0 3,4 3,9 3,2 0 0 0 2003 2004 2005 YTD 2003 2004 2005 YTD 2003 2004 2005 YTD 2006 2006 2006 Low cos
Slide 10: DNO Is Delivering Reserves at Low Cost
MARKET FD&A DNO IS DELIVERING RESERVES AT LOW COST FDA Cost (USD) Exploration 16 performance DNO FDA Cost Sector FDA Costs M&A Deal Costs • DNO has 14 consistently delivered top 12 quartile exploration 10 performance • DNO adds 8 considerable 6 shareholder value through the drill bit 4 • DNO's explo
Slide 11: Production
WORKING INTEREST PRODUCTION 2003 - 2006 Production (BOPD) 2006 Production (BOPD) 30 000 20 000 Tasour Sharyoof Nabrajah Glitne Divested production 15 000 20 000 10 000 10 000 5 000 0 0 2003 2004 2005 2006 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov YTD 2004 – 2006 2006 • Slight annual growth • Q4: 1
Slide 12: Yemen Assets
YEMEN ASSETS Producing assets in Yemen • Tasour Field in Block 32 * • Nabraj ah Field in Block 43 * • Sharyoof Field in Block 53 • Production from the three fields are tied back to Block 14 facilities operated by Nexen Exploration assets in Yemen • Block 44 * • Block 47 * • Block 72 * • Block 84* (r
Slide 13: Yemen Production Update
YEMEN PRODUCTION UPDATE Production (WI) (BOPD) High margin production 20 000 Tasour Sharyoof Nabrajah • 2006 production from Yemen increased by 4 percent • Nabrajah production below plan 15 000 • Successful appraisal wells at Tasour and Sharyoof adds new 10 000 production • Godah Field adding new 5
Slide 14: Tasour Area Status and Planned Activities
TASOUR AREA STATUS AND PLANNED ACTIVITIES Tasour Field • Tasour #22ST on line early September • Tasour #23ST test gave 200 bopd in December, Planning long-term test in Q107 Godah Field • Godah # 2 & 3 brought on stream in Q406 Tasour 22ST Godah Field Tasour 23 (Basement & Carbonate prospect) Copyr
Slide 15: Sharyoof Area Status and Planned Activities
SHARYOOF AREA STATUS AND PLANNED ACTIVITIES Prospective area close to Sharyoof Field • Sharyoof # 23 on stream in Q406 • Bayoot SW #2 exporting oil at 300 – 600 bopd (trucking) • Hekma # 1 flowed an aggregated test production of 2000 bopd from two reservoir intervals in January • Bayoot South #1 sho
Slide 16: Nabrajah Area Status and Planned Activities
NABRAJAH AREA STATUS AND PLANNED ACTIVITIES • Commissioning of water handling and gas injection facilities • 3-D seismic within Nabrajah area completed – will serve as important input to new well locations • Reserve revision ongoing • Shaibah #1 exploration well to be Prospect/leads drilled before n
Slide 17: Continued High Drilling Activity
YEMEN CONTINUED HIGH DRILLING ACTIVITY Yemen drilling plan 2007 20- 25 wells: • 15 - 20 Operated by DNO • BL 32, 43, 44, 47, 72 • 5 Operated by others • BL 53 • The following wells are currently being drilled: • Nasim #1 in BL 72 • Shaibah #1 in BL 43 • Balal #1 in BL 53 Copyright 2007 DNO ASA Par
Slide 18: Northern Iraq Unique Opportunity
NORTHERN IRAQ UNIQUE OPPORTUNITY Achievments to date (20 months) • 2D seismic acquisition • 5 exploration / appraisal wells • Confirmed Tawke oil discovery with first well - estimated Oil in Place 330 million barrels – 100 millon barrels recoverable (gross) • 3-D seismic across Tawke structure • Taw
Slide 19: Tawke Early Production Development
TAWKE EARLY PRODUCTION DEVELOPMENT Tawke Early Production Plan TAWKE CPF Plan is based on test production from Tawke # 1 / 1A, and Tawke # 2 Capacity of Pipeline and Central Processing Facilities ; 50,000 bopd First oil planned Q1 2007 18 development wells on Tawke planned for 2007 Copyrig
Slide 20: Norwegian Continental Shelf Strong Position
NORWEGIAN CONTINENTAL SHELF STRONG POSITION Norway • DNO holds 24 licenses in Norway and 1 in UK (9 as Operator) • Relatively unexplored compared to the UKCS • DNO has secured rig capacity Copyright 2007 DNO ASA Pareto E&P Seminar 20 January 18 2007
Slide 21: Barents Sea
NORWEGIAN CONTINENTAL SHELF BARENTS SEA Recoverable P50 reserves substantially higher than initially anticipated • 250 million barrels (P50) - 37,5 million barrels net to DNO after Goliat South well last year • Additional appraisal well on Goliat South completed in November 2006 • Recent exploration
Slide 22: The Norwegian Sea
NORWEGIAN CONTINENTAL SHELF THE NORWEGIAN SEA PL 263/263B Zita (30%) • One exploration well commenced in December 2006 (Norsk Hydro is Operator) • P50 unrisked prospect resource potential is approx. 200 million barrels – 60 million barrels to DNO Copyright 2007 DNO ASA Pareto E&P Seminar 22 Januar
Slide 23: High Potential Prospects
NORTHERN EUROPE HIGH POTENTIAL PROSPECTS At least 6 wells planned to be drilled in 2007: 3 Operated by DNO • Lie, Torkildsen, Draupne 3 Operated by others • Ragnarrock, Goliat Copyright 2007 DNO ASA Pareto E&P Seminar 23 January 18 2007
Slide 24: 2007 Drilling Plan
2007 DRILLING PLAN PARTICIPATE IN APPROIXIMATELY 50 WELLS IN 2007 Northern Europe Norway • 6 exploration/appraisal wells Middle East Northern Iraq • 18 development wells, plus possible exploration wells Yemen • 20 - 25 exploration, appraisal and development wells Africa • 2-3 exploration / appraisal
Slide 25: DNO ASA Group Organization
DNO ASA Group Organzation DNO ASA Managing Director Helge Eide QHSE Finance & Admin Ole-Andreas Isdahl Haakon Sandborg DNO London Rob Arnott Northern Europe Africa Yem en Northern Iraq Roar Tessem Ole Nygaard Sven Erik Lie Magne Nordmann Total staff : Approximately 300 Copyright 2007 DNO ASA Paret
Slide 26: Netback to Exploration Coverage
RESULT OF OPERATIONS NETBACK TO EXPLORATION COVERAGE Netback (RoO) to Total Investments (NOK million) Increasing total investments • 100 percent increase YTD 450 Netback producing activities • Start of Northern Iraq development 400 Exploration cost expensed • Development on blocks 32 & 43 in Yemen 3
Slide 27: Building Values
BUILDING VALUES TRANSFORMING RESOURCES TO RESERVES AT LOW COSTS Substantial upside potential Short to medium term value drivers • Organic reserve growth through ~30 expl. wells the drill bit • Achieving first oil production 138 from Northern Iraq in Q1 2007 ~12 expl. wells 28 2P reserves YE 2P reser
Slide 28: Our mission
OUR MISSION IS TO BE A LEADING EXPLORATION AND PRODUCTION COMPANY FOCUSED ON TRANSFORMING 2006 RESOURCES TO RESERVES AT LOW COST, GENERATING SUBSTANTIAL AND CONSISTENT VALUE FOR OUR SHAREHOLDERS