Equinor Asa · OSL:EQNR
Equinor Asa — Investor Day (February 2019)
36 slides from Equinor Asa's investor day presentation, Feb 6, 2019
Slide 1: Capital markets update
e acy equinor Capital markets update February 06, 2019 London, United Kingdom
Slide 2: Forward-looking statement
Forward-looking statement This presentation contains certain forwarctlooking statements that involve risks and uncertainties. In some cases, we use words such as “ambition’. ‘continue’, ‘could’, ‘estimate’, ‘expect’ "believe", focus’, "ikely’, ‘may’, ‘outlook’, ‘plan’, ‘strategy’. “will. "guidance"
Slide 3: Growing returns, production and value
Growing returns, production and value Eldar Scetre President and Chief Executive Officer
Slide 4: Always safe
equinor ** Always safe Serious incident frequency (SIF) hy: aes Serious incidents per million work-hours ee 5: _— 19 eS 2018 2009 2010 2011 2012 2013 2014 2015 2016 2017 (06 February 2019
Slide 5: High value, delivering on our strategy
2018 High value RoACE 12 Percent Adjusted after tax Volumes, sanctioned projects >] bn boe Equinor- and partner-operated projects, sanctioned in 2018. Equinor equity. elivering on our strategy Organic free cash flow 6.5 bn USD After dividend, excluding considerations from closed transactions and sig
Slide 6: Need for significant new energy supply
Need for significant new energy supply Global energy mix! Percent 100% — ———————> J - 15% 50% 25% 0% Reform Renewal 2016 2050 © Coal mOil ™ Gas Nuclear Hydro Bioenergy _® New renewables 1. 2050 eneray mix based on Reform and Renewal (2° scenario) scenarios in Equinor's 2018 Energy Perspectives repor
Slide 7: Leveraging our industrial value drivers
uf equinor *: Leveraging our industrial value drivers f Capturing value Operational excellence World class recovery Applying Building a the best of Equinor profitable core area Leading project delivery internationally in Brazil Premium market access Digital leader | by Eldar Seatre President and
Slide 8: Growing cash flow and returns
Growing cash flow and returns Free cash flow positive <5O0 USD per bbl 2019-21 Alter dividend, organic free cash flow, excluding ‘considerations for Danske Commodities, NCS swap, Rosebank Carcara and Roncador. | by Eldar Saatre Pres Free cash flow ~14 bn USD 2019-21 After dividend, based on USD 70 p
Slide 9: Robust and resilient portfolio
Robust and resilient portfolio Projects coming on stream! Break-even Internal rate of return USD per bbl Percent Volume weighted. Volume weighted, based on USD 70 per bb! Resources Production growth 2019-25 bn boe Percent Equinor equity. Compound Annual Growth Rate, adjusted for portfolio measures 1
Slide 10: Strengthening our resource base
Strengthening our resource base Reserve replacement ratio Increasing R/P Percent Years Proved reserves (SEC) divided by entitlement production. Adding high value Accessed high value resources in 2018 projects! * Martin Linge oS 1 6 * Rosebank North Platte bn boe * US Onshore Exploration revisions an
Slide 11: Capturing value: high value transactions
Capturing value High value transactions H 1 bn USD? USD per bbl from cyclicality 7 6 120 Capital gains from transactions 4 100 ~9 2 80 bn USD 201210 2018 () 60 , -2 4 Contracts awarded in ° favourable markets -4 20 >100 bn USD 6 ie) 2012 2013 2014 2015 2016 2017 2018 100% basis, 2015 to 2018 MEE Acq
Slide 12: Building a new energy portfolio
Building a new energy portfolio Leveraging our core competence + Leading project delivery * Operational excellence * Capturing energy market value * Realising value from transactions equinor ** Delivering from quality assets Competitive returns ~10%! * Sheringham Shoal * Dudgeon Hywind Scotland Arko
Slide 13: Creating value from premium market access
equinor ** Creating value from premium market access * Cost-effective infrastructure Growing asset backed trading Average annual MMP + Increasing trades to Asia - capturing margins result Expanding electricity marketing and trading 1 7 ~ bn USD Adjusted earnings from 2015 to 2018. Global and flexibl
Slide 14: Committed to capital distribution
Committed to capital distribution Quarterly cash dividend 26 Cents per share Subject to approval at the ‘Annual General Meeting (AGM) Increased cash dividend 13 Percent ‘Subject to approval at the Annual General Meeting (AGM) LA equinor ** 4, Step-up in 4Q cash dividend Reflects earnings growth from
Slide 15: Highlights
Highlights Growing cash flow and returns * RoACE >14% in 2021 * Free cash flow USD ~14 bn in 2019-21 * Organic free cash flow positive below USD 50 per bbl in 2019-21 Investing in high value projects * Break-even of USD ~30 per bbl for projects coming on stream + Average organic capex USD ~11 bn in
Slide 16: Capturing value
mil vf BE==! i222 2 %e tt equinor Capturing value Lars Christian Bacher Chief Financial Officer
Slide 17: Solid adjusted earnings in 4Q'18
2018 Solid adjusted earnings in 4Q‘18 Adjusted Group? earnings + Higher commodity prices + Increased exploration costs Million USD Pre tax After tax E&P Norway * Solid operational performance + Higher than normal price differential Pre tax After tax E&P International * Record production + High adjus
Slide 18: Strong financial results and deliveries
2018 Strong financial results and deliveries Adjusted earnings 18.0 bn USD Organic free cash flow 6.5 bn USD After dividend, excluding considerations from closed transactions and signature bonuses Net operating income 20.1 bn USD Net debt ratio 22.2 Percent Production growth Organic capex RoACE Expl
Slide 19: All-time high production
equinor’* 2018 All-time high production * Production growth as promised - New wells coming on stream - Start-up of 8 fields - Underlying production growth of 2.1% Equity volume kboe per day 2134 2170 2080 2111 1152 1139 4Q 2017 4Q 2018 FY 2017 FY 2018 B Liquids Gas
Slide 20: Strong cash generation
2018 Strong cash generation Strong cash flow from operations Organic capex USD 9.9 billion Value-adding transactions Net debt ratio reduced from 29.0% to 22.2% Continued strict capital discipline USD million Cash flow from operating activities Taxes paid 27615 (9010) Dividends paid __Q672) Cash flow
Slide 21: Simplification, standardisation and digitalisation
Simplification, standardisation and digitalisation Peer leading unit production cost Equinor Source: IHS Markit USD/boe, 3-year weighted average. Field of the future - facility capex reduction ~30 Percent New concept compared to conventional facility Unit production cost 2020 aon Level USD per boe E
Slide 22: Consistent value creation
Consistent value creation First quartile corporate RoOACE Equinor ¢:Borclays:~ ROACE Rolling 12-month at end of 3G Leading TSR last five years Equinor Source: FactSet. As of 31 December 2018. TSR: Total Shareholder Return In USD. Peers include: Anadarko, Eni, BP, Shell, ConocoPhillips, Repsol, Chevr
Slide 23: Continuing to add high value barrels
2018 Continuing to add high value barrels bn boe 19 (0.8) a ca — (1) | GI) Non-sanctioned 3 Unconventional Producing, sanctioned & IOR 7? — (0.0) 2017 Production _Divestments __ Discoveries, 2018 Acquisitions, Revisions ™Provedreserves(SEC) m™ Reserves and resources Reserve replacement ratio (RRR) 2
Slide 24: Strong cash flow and production growth
2018-2025 Strong cash flow and production growth Equity production kboe per day ~3% CAGR! 2500 Around f same level | on 2017 2018 2019 2021 2025 ™Norway International conventional US onshore 1. Compound Annual Growth Rate adjusted for portfolio measures Strong cash flow from operations? bn USD. 2019
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Slide 26: Non-sanctioned portfolio continues to improve
2019 Non-sanctioned' portfolio continues to improve Break-even 2017 USD per bbl — 2018 —2019 100 80 60 40 Q Q 2 fe} fey 2 fey 2 2 ‘ fe) fe) roy S fo} 3 fo} fe) § Volumes 3 fs) I fs} o is) 5 35 rr) a a a N m 9 + ~ Million boe Increased value since CMU 2017 >] bnUSD Based on USD 70 per bbl Internal ra
Slide 27: Growing returns, increasing dividend and strengthening balance sheet
2019-2021 Growing returns, increasing dividend and strengthening balance sheet Improving ROACE Strengthening balance sheet 2* World class portfolio enhances returns Long term net debt ambition 15-30% 14% 30% 25% 12% 20% 15% 9% 10% 5% 70 USD/bbI . 0% 2017 2018 2021 2017 2018 2021 1. Based on USD 70 p
Slide 28: Guidance & outlook
equinor *° 2019 A | Guidance & outlook a === Outlook 2019 5 = Organic capex ~l11 bn USD! : = 2018-2019 Around same level = Production growth 2019-2025 ~ S Percent? Exploration ~l 7 bn USD! 1 Based on USD/NOK exchange rate of 8.25. 2. Compound Annual Growth Rate.
Slide 29: Highlights
Highlights Growing cash flow and returns * RoACE >14% in 2021 * Free cash flow USD ~14 bn in 2019-21 * Organic free cash flow positive below USD 50 per bbl in 2019-21 Investing in high value projects * Break-even of USD ~30 per bbl for projects coming on stream + Average organic capex USD ~11 bn in
Slide 30: Supplementary information
Supplementary information
Slide 31: Long term debt maturity profile
equinor ** Long term debt maturity profile USD millions 3000 2500 2000 1500 link. bh! 2019 2021 2023 2025 2027 2029 2031 2033 2035 2037 2039 2041 2043 mEUR ™GBP NOK =USD
Slide 32: Sensitivities - indicative effects on 2019 results
equinor 2019 Sensitivities! - indicative effects on 2019 results Oil/Condensate price: +10 USD/bbl Gas price: + 1,5 USD/mmBTU Currency: USD/NOK +050 "Net income effect = Net operating income effect 1. Based on USD/NOK of 8.25. 321 Open 06 February 2019
Slide 33: Investing for profitable growth
2019-2020 Investing for profitable growth + ~60% on the NCS + ~65% in operated assets + ~50% in new assets + ~90% in upstream 100% 80% 60% 40% 20% 0% Rest of the world Upstream by region MMP and other Non-operated Operated Operatorship equinor ** New assets US onshore and exploration Producing asset
Slide 34: IFRS 16 - Impact for Equinor
IFRS 16 - Impact for Equinor?! Impact of implementing IFRS 16 Leases to be reflected in the Other segment Net debt “w~ ~4 bn “A Balance sheet effects Allleases, excluding short term leases and non- lease components, to be recognised on the balance sheet from 11.2019 Leases mainly related to driling
Slide 35: Investor Relations in Equinor
equinor ** Investor Relations in Equinor E-mail: [email protected] Investor Relations Europe Peter Hutton Senior Vice President [email protected] +44 7881 918792 Lars Valdresbraten IR Officer [email protected] +47 40 281789 Erik Gonder IR Officer [email protected] +47 99 56 26 11 Ida Marie Fjellheim
Slide 36: Capital markets update
equinor Capital markets update February 06, 2019 © Equinor ASA This presentation, incading the contents and crrangement ofthe contents of each ncvual page or the colecton ofthe pages is ned by Equnor. Copyright to oll material ncucng, but nt iit to, writen material photographs drawings. mages, table