Equinor Asa · OSL:EQNR

Equinor Asa — Statoil — Q4 2014 Earnings Presentation

21 slides from Equinor Asa's earnings presentation, Feb 6, 2015

  1. Slide 1: Enhancing value

    Enhancing value London, 6 February 2015 Classification: Internal 2012-10-24 Torgrim Reitan, Executive Vice President and Chief Financial Officer

  2. Slide 2: Forward-looking statements

    Forward-looking statements This presentation contains certain forward-looking statements that involve risks and uncertainties. In some These forward-looking statements reflect current views about future events and are, by their nature, subject cases, we use words such as "ambition", "continue", "cou

  3. Slide 3: 2014 | Strong operational quality

    2014 | Strong operational quality Earnings Stable cost level, earnings impacted by prices and impairments Production Higher than expected due to strong regularity Capex USD 19.6 bn Reserves 96% organic RRR Resources 540 million boe added from exploration Projects On cost and schedule Portfolio USD 4

  4. Slide 4: Financial results negatively impacted by prices

    Financial results negatively impacted by prices Full year 2014 Fourth quarter 2014 NOK bn NOK bn 22.0 109.5 26.6 136.1 (97.0) 39.1 -8.9 9.0 17.9 26.9 (22.6) 4.3 ( 44%) (30%) ( 17%) (16%) >(100%) (79%) (36%) (61%) Net income Reported Adjustments Adjusted Tax on adj. Adjusted Net income Reported Adjus

  5. Slide 5: Cost focus across the business

    Cost focus across the business Statoil Group1) D&P Norway D&P International MPR Strong operational High operational Impacted by exploration Solid results from quality efficiency and US onshore gas value chains Johan Sverdrup: Statoil Valemon: New field on stream Peregrino: High production Good resul

  6. Slide 6: Strong production above guided level

    Strong production above guided level Equity production  4% organic growth YoY mboe/d  Record operational efficiency 2103 1945 1927 1940 on NCS  Record international production 925 858 801 825 1179 1127 1115 1087 4Q2014 4Q2013 YTD2014 YTD2013 Liquids Gas 6

  7. Slide 7: Cash flow 2014 in line with expectations

    Cash flow 2014 in line with expectations NOK bn  Dividends paid for both 2013 and first two quarters Cash flow from of 2014 operating activities Taxes paid 209 1) (97)  Investments in line with guiding Dividend paid Proceeds from Cash flow to investments  Net debt to capital (34) sale of assets 2

  8. Slide 8: Organic RRR ~1

    Organic RRR ~1 bn boe  Solid organic RRR in 2014; total RRR 1.3 22 (0.7) 22 impacted by divestments (0.7) − 96% organic RRR, 62% total RRR − Both organic and total RRR for liquids above 100% − 117% three-year average organic 0.6 RRR 5.6 5.4 (0.6) (0.2)  IOR, revisions and extensions remain importa

  9. Slide 9: Firm priorities, stepping up commitments

    Capital markets update Firm priorities, stepping up commitments  ~2% organic production growth 2014-16  Reducing organic capex level to USD 18 bn in 2015 High value growth  FCF to cover dividend in 2016@100, 2017@80 and 2018@60  Robust financials: Maintaining 15-30% net debt to capital employed

  10. Slide 10: Prepared to use material flexibility

    Prepared to use material flexibility Material flexibility in portfolio Flexibility from onshore and non-sanctioned projects 1) Capital expenditure Flexibility US onshore Bay du Nord Snorre 2040 Tanzania LNG Johan Castberg Pão de Açúcar Opportunity to enhance value 20 • Prioritising high value projec

  11. Slide 11: Steering through volatility with strong cash flow

    Steering through volatility with strong cash flow Strong cash flow from operations (CFFO) Well positioned across scenarios 30 30 2015/16 2017/18 $100/bbl 25 $100/bbl 25 $80/bbl $80/bbl 20 $100/bbl 20 $100/bbl Flexibility USD bn USD bn 17.9 17.8 $80/bbl $80/bbl 15 15 5-7 10 $60/bbl 10 $60/bbl $60/bbl

  12. Slide 12: Robust financial framework: net debt to capital employed

    Robust financial framework  Strong balance sheet to be maintained 30%  A-category rating on stand- alone basis Net debt to capital employed $60/bbl 25% 26%  Net debt to capital employed at 15-30% 20% 21% $80/bbl $60/bbl 20%  Long term financing 15%  Average ~9 years to maturity 15% 12% $80/bbl

  13. Slide 13: USD 5 bn in cash improvements

    USD 5 bn in cash improvements Efficiency Activity Operational quality Stepping up 2016 deliveries Using flexibility (2015) Stepping up production efficiency USD bn USD bn USD bn CMU 2014 CMU 2015 0.4 ~1.7 0.2 ~2.2 +5 %- ~1.1 2.0 points 0.3 1.3 1.0 0.3 Capex Opex/SG&A Total Step-up Total Capex Expens

  14. Slide 14: Efficiency improvements on track

    Efficiency improvements on track  USD 0.6 bn realised in 2014  Stepping up 2016 ambition by 30%  Efficiency programme covers full operated cost base  Strong momentum across organisation 14

  15. Slide 15: Production growth from 2014-18 from projects in execution

    Production growth from 2014-18 from projects in execution Equity production mboe/d 2200 ~3% CAGR 2100 ~2% 2000 +4% CAGR  4% organic growth YoY in 2014 +2% 1900 1927  ~2% production CAGR for 1800 1850 Divestments 1868 1868 2014-16 1700  Johan Sverdrup start-up 2019 1600 1500 2013 2014 2014 2014 20

  16. Slide 16: Enhancing value

    Enhancing value Period Outlook Key messages  USD ~2 bn reduction Capex 2015 USD ~18 bn1)  Prepared to use flexibility ~2% annual organic Production 2014-16  Improved regularity growth  Reducing cash flow Cash 2016 USD 5 bn (total) neutrality by USD 30 per improvements barrel Maintaining returns

  17. Slide 17: Thank you

    Thank you

  18. Slide 18: Supplementary Information

    Supplementary Information Classification: Internal 2012-10-24

  19. Slide 19: Investing for profitable growth

    Investing for profitable growth Investment profile 2015-16 100 % Exploration MPR and MPR and MPR and Other Other Non-OECD Other  65% in liquids Rest of 80 % world Gas  55% in new assets Non- operated New assets E&P INT  60% in operated assets North 60 % America  90% upstream related OECD 40 % Li

  20. Slide 20: Sensitivities – Indicative effects on 2015 results

    Sensitivities1) – Indicative effects on 2015 results NOK bn Oil price: 8 + USD 10/bbl 20 Gas price: + NOK 0.50/scm 7 21 Exchange rate: USDNOK +0.50 8 20 Net income effect Net operating income effect before tax The sensitivity analysis shows analysis 1) The sensitivity the estimated shows the12 month

  21. Slide 21: Long term debt portfolio

    Long term debt portfolio Redemption profile 31.12.2014 21

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