Noreco Announces Second Quarter 2022 Results

OSLO, Norway, July 12, 2022 /PRNewswire/ -- Norwegian Energy Company ASA ("Noreco" or the "Company") announces record quarterly results for Q2 2022.

Noreco today published its second quarter 2022 results, with the quarter delivering strong underlying asset performance and production at top end of the Company's annual guidance, and the strongest financial results since the acquisition of Shell's Danish upstream assets in 2019.

 Highlights:

• Hydrocarbon production of 26.5 mboepd
• Total Revenues of USD 265 million, compared to USD 179 million in Q1 2022
• EBITDA of USD 167 million, compared to USD 107 million in previous quarter
• Cash flow from operating activities of USD 183 million, with Free Cash Flow (Pre-Investments) of USD 156 million
• Total liquidity of USD 342 million at the end of the quarter with cash on balance sheet of USD 242 million

Net hydrocarbon production for the quarter of 26.5 mboepd is at top end of the annual guidance range of 24.5 - 26.5 mboepd.  The strong production trend of 2022 continues in second quarter, with Noreco's currently producing hubs delivering overall operating efficiency of 91%. 

The Tyra Redevelopment project made significant progress during the quarter, and in April Noreco announced the successful offshore lift and installation campaign of the three Tyra West wellhead and riser platforms, the TEH Accommodation module and two bridges. Over a period of ten days, the world's largest crane vessel, Sleipnir, safely lifted and installed the units in position at the Tyra field. This concluded the 2022 spring offshore campaign moved the project closer to first gas with seven out of eight platforms in position. 

In May, the board of directors of Noreco appointed Euan Shirlaw as Chief Executive Officer. Mr Shirlaw joined Noreco in 2019 as Chief Financial Officer, and had previously served as Acting Managing Director since November 2021. 

The financial result for second quarter shows a continued strong development with revenues of USD 265 million, and EBITDA of USD 167 million. Noreco in the period generated Free Cash Flow (Pre-Investments) of USD 156 million and total Free Cash Flow of USD 95 million.  The Company had total liquidity of USD 343 million at the end of the quarter, with cash on balance sheet of USD 243 million and available undrawn RBL capacity of USD 100 million. The cash flow generation from the producing assets is the strongest since the closing the acquisition of Shell's Danish upstream assets in 2019 and Noreco continues to be fully funded to deliver Tyra II, with significant headroom based on current commodity price levels.

"During the first half of 2022 we demonstrated the significant value proposition of our underlying business with positive operational delivery translating into some of the strongest financial performance since we closed the acquisition of Shell's Danish upstream interests in 2019.  While we continue to focus on delivering the start-up of Tyra II mid next year, the results this quarter show the material contribution from our three hubs currently on production. The current commodity price environment is expected to continue to enhance the robust position of Noreco, and this will see a further positive step-change once Tyra II is onstream.  As a gas hub that will produce approximately 60mboepd and unlock more than 200 mmboe of gas-weighted potential, Tyra II not only supports the next stage of Noreco's delivery, but also has an important role to play in safeguarding energy security in the EU for decades to come," said Euan Shirlaw, Chief Executive Officer of Noreco.

The report and investor presentation may be downloaded from the Company's website www.noreco.com or www.newsweb.no.

The Company will host an earnings call today at 11:00 CEST.
To join audiocast: https://channel.royalcast.com/hegnarmedia/#!/hegnarmedia/20220712_4

Contact:
Cathrine Torgersen, EVP Investor Relations & ESG
Phone: +47 91 52 85 01
Email: [email protected]

This information is considered to be inside information pursuant to the EU Market Abuse Regulation, and is subject to the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act. The stock exchange announcement was published by Cathrine Torgersen, Executive Vice President Investor Relations & ESG, Norwegian Energy Company ASA, at the date and time as set out above.

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