Panoro Energy ASA

Earnings Release • Nov 29, 2023

Panoro Energy - Third Quarter 2023 Trading and Financial Update

Panoro Energy - Third Quarter 2023 Trading and Financial Update

Oslo, 29 November 2023 - Panoro Energy ASA ("Panoro" or the "Company") is

pleased to report strong Q3 production and financial performance.

Working interest production from Panoro's well diversified portfolio averaged

just above 10,000 bopd in Q3, a new record for the Company. Revenue of USD 107.3

million in the period was also a new quarterly record and reflects the increased

volumes of crude oil sold and higher oil price realisations. Q3 EBITDA and net

profit were strong at USD 64.8 million and USD 27.9 million respectively.

Consistent with its commitment to delivering sustainable shareholder returns,

Panoro has today declared a Q3 cash distribution of NOK 40 million (NOK 0.342

per share) to be paid as a return of paid in capital.

Having cumulatively paid NOK 140 million including the Q3 cash distribution,

Panoro is moving towards its NOK 200 million targeted 2023 capital return, with

the final 2023 cash distribution to be declared at its Q4 2023 results in

February.

John Hamilton, CEO of Panoro, commented:

"The strong production and financial performance in Q3 underscores the high

quality and cash generative potential of our diversified asset base, which we

are continuing to translate into sustainable and material shareholder returns

with the Q3 cash distribution declared today alongside our framework for

shareholder returns in 2024. We are making good progress towards our organic

production growth targets, and while we are experiencing some volume constraints

arising from electrical issues with ESPs installed in wells at the Hibiscus

field in Gabon we are confident that they will be resolved and the full

production potential of those wells fully unlocked next year. With three

production wells to come in Gabon, the three-well infill drilling campaign due

to start in Q4 at Block G offshore Equatorial Guinea and two high impact E&A

wells planned on the Bourdon and Akeng Deep prospects, in Gabon and Equatorial

Guinea respectively, we have a very exciting organic growth pipeline."

Corporate and Financial Update

Production performance

· Group working interest production averaged 10,000 bopd in Q3 and comprised:

· Equatorial Guinea: ~3,620 bopd

· Gabon: ~4,070 bopd

· Tunisia: ~2,320 bopd

· Group working interest production had been averaging over 11,000 bopd in Q4

and reached levels of up to 12,000 bopd prior to the current electrical

submersible pump ("ESP") diagnostic, repair and replacement work now in progress

at the Hibiscus field

· Panoro remains on track to achieve group production of 13,000 bopd when six

new production wells in the current Gabon drilling campaign are onstream

· Recognising the already communicated amended work programme in Gabon and

aforementioned work on ESPs at the Hibiscus field, average full-year 2023

working interest group production guidance is around 9,000 bopd

Financial performance

· Reported revenue in Q3 was USD 107.3 million (Q2: USD 5.7 million)

· Q3 EBITDA was USD 64.8 million (Q2: USD 3.3 million) with profit before tax

of USD 46.7 million (Q2: USD 10.0 million loss before tax) and net profit for

the period of USD 27.9 million (Q2: 13.4 million net loss)

· Year-to-date reported revenue for the first nine months was USD 173.7

million (9M 2022: USD 117.8 million)

· EBITDA for the first nine months was USD 103.7 million (9M 2022: USD 89.2

million) with profit before tax of USD 61.2 million (9M 2022: USD 44.4 million)

and net profit of USD 28.8 million (9M 2022: 13.9 million)

· During Q3 the Company lifted and sold 1,179,262 barrels of oil at an average

realised price of USD 87.65 per barrel

· Consequently, the aggregate volume lifted and sold by the Company in the

first nine months was 2,015,012 barrels of oil at an average realised price of

USD 82.58 per barrel

· In Q4 to date the Company has lifted and sold an aggregate volume of 554,813

barrels in Gabon and Tunisia at an average realised price of approximately USD

86.20 per barrel

· Expected total crude liftings for full-year 2023 are approximately 3 million

barrels, although the final scheduled 2023 lifting currently expected to occur

around year end may, depending on logistical factors, occur in early January

· Receivable in relation to DMO sales in Tunisia was USD 18.1 million at 30

September. USD 1.3 million of this balance was received in October

· Reported cash at bank at 30 September was USD 47 million, which includes

advances of USD 13.5 million taken against crude inventory position to smooth

working capital. Excluding oil revenue advances cash at bank at 30 September was

USD 33.5 million

· Scheduled principal repayment made in September of USD 13.2 million

resulting in amounts owing under reserve-based loans at 30 September of USD 70.5

million

· Panoro's resultant net debt position at 30 September was USD 35.8 million

(based on cash at bank of USD 33.5 million excluding oil revenue advances)

· 2024 operational guidance for the Company will be provided as usual in

January

Q3 2023 cash distribution

· Panoro today declares a Q3 2023 cash distribution of NOK 40 million (NOK

0.342 per share)

· Panoro expects to declare a final 2023 cash distribution at its Q4 2023

results scheduled for 22 February 2024

· Cash distribution to be paid as a return of paid in capital

2024 shareholder returns policy

· Consistent with our 2023 framework, Panoro continually takes into account

its capital and exploration projects alongside a range of other factors

including the macro environment, current oil prices, exchange rates, cash flow

profile of the asset base, lender considerations, balance sheet and liquidity

requirements of the business. Consistent with its strategy to create and deliver

shareholder value, the Board of Panoro has approved the adoption of a 2024

shareholder returns policy

· Target distribution for 2024 of between NOK 400 and 500 million comprised

of:

· A core cash distribution paid on a quarterly basis, with first declaration

at Q1 2024 results to be announced in May (for payment in June)

· A combination of share buybacks and special cash distribution at the

discretion of the Board

· Amounts to be weighted towards the second half of the year as production

milestones are achieved

· Cash distributions to be paid as a return of paid in capital

· The range will be dependent on:

· The timing and de-risking of the major production operations ongoing in

both Gabon and Equatorial Guinea

· A realised oil price of USD 85 per barrel (representing the average 2024

oil price assumption of equity analysts) and current exchange rates

· The Board will consider upward or downward revisions of the framework as

production de-risking occurs and should oil prices be higher or lower than USD

85 per barrel

Liability management and capital allocation

· Panoro will continue to make its scheduled debt principal repayments during

2024. Should oil price realisations exceed USD 85 per barrel acceleration of

debt repayment through additional repayments is anticipated

· In line with its strategy Panoro will continue to selectively undertake

exploration and appraisal activities that can offer meaningful upside with a

modest financial exposure and will maintain an opportunistic stance in pursuit

of value accretive acquisitions in the future

Production operations update

Equatorial Guinea - Block G (Panoro 14.25%)

· Rig contracted for the upcoming drilling campaign has arrived in country and

is undertaking two planned workovers before commencing drilling of three new

infill wells which are expected onstream in 2024 and will deliver additional new

production volumes

· Numerous field life extension and asset integrity projects continued at the

Ceiba and Okume Complex fields during the period

Gabon - Dussafu Marin Permit (Panoro 17.5%)

· Four production wells at the Hibiscus field have been safely drilled,

completed and put onstream in the current campaign to date. Each new well was

put onstream at gross rates of between 6,000 bopd and 6,500 bopd. The results of

these wells have confirmed excellent reservoir quality in the Gamba sandstones

with potential positive implications for recoverable oil volume

· In light of these encouraging subsurface results, the partners have elected

to accelerate development of the Hibiscus field in the current campaign and plan

to spud the DHIBM-7H production well in 2024

· Following the previously communicated electrical integrity issues with ESPs

on the Hibiscus field, full production on ESP was re-started in mid-October with

subsequent production ranges of up to almost 40,000 bopd achieved. In order to

resolve the continuing electrical integrity issues over the longer term a

programme of diagnosis, repair and replacement of the ESPs is underway

· The partners plan to fast-track the recent Hibiscus South oil discovery into

production, meaning the current drilling campaign offshore Gabon will now result

in a total of seven new production wells compared to previously communicated

plans for six new production wells

Tunisia - TPS Assets (Panoro 29.4%)

· New production opportunities include a workover campaign comprising ESP

replacement and stimulation of three wells at the Cercina field (CER-1, CER-6A

and CER-7) scheduled to commence in Q1 2024

· Detailed planning for development drilling campaign on the Rhemoura and

Guebiba fields with operations expected to start late 2024

Exploration and appraisal

· At the Dussafu Marin Permit offshore Gabon the Hibiscus South exploration

well has made a new oil discovery. Preliminary estimates of recoverable volumes

are six to seven million barrels of oil (in line with pre-drill expectations)

· The Dussafu partners have agreed to drill the Bourdon Prospect ("Prospect

B"), which has an estimated mid-case potential of 29 million barrels recoverable

oil in the Gamba and Dentale formations, in the current campaign

· At Block S offshore Equatorial Guinea the partners are planning to drill the

Kosmos Energy operated Akeng Deep exploration well in 2024 to test a play in the

Albian, targeting an estimated gross mean resource of approximately 180 million

barrels of oil equivalent in close proximity to existing infrastructure at Block

G

· At the Panoro operated Block EG-01, offshore Equatorial Guinea, subsurface

studies based on existing seismic data are being undertaken to further define

and evaluate the prospectivity of the block

· Application for an Exploration Right covering part of TCP 218 located

onshore in Free State, South Africa, is currently in progress

Webinar presentation

The company will hold a live webinar presentation at 09:00 a.m. CEST today,

Wednesday 29 November 2023, during which management will discuss the results and

operations followed by a Q&A session.

The webinar presentation can be accessed through registering at the link below

and the online event will be equipped with features to ask live questions.

Joining instructions for participating online or through using local dial-in

numbers will be available upon completion of registration. The webinar details

are as follows:

+-------------+---------------------------------------------------------------+

|Date and |29 November 2023, 09:00 .a.m. CEST |

|Time: | |

+-------------+---------------------------------------------------------------+

|Registration:|https://attendee.gotowebinar.com/register/1498705151863473246 |

| | |

| |After registering, participants will receive a confirmation |

| |email containing information about joining the webinar. |

| | |

| |Participants can use their telephone or computer microphone and|

| |speakers (VoIP). |

+-------------+---------------------------------------------------------------+

Please join the event at least ten minutes before the scheduled start time.

A replay of the webinar will be available shortly after the event is finished

and will remain on our website (www.panoroenergy.com) for approximately 7 days.

Enquiries

Qazi Qadeer, Chief Financial Officer

Tel: +44 203 405 1060

Email: investors@panoroenergy.com

About Panoro Energy

Panoro Energy ASA is an independent exploration and production company based in

London and listed on the main board of the Oslo Stock Exchange with the ticker

PEN. Panoro holds production, exploration and development assets in Africa,

namely interests in Block-G, Block S and Block EG-01 offshore Equatorial Guinea,

the Dussafu Marin License offshore southern Gabon, the TPS operated assets, Sfax

Offshore Exploration Permit and Ras El Besh Concession, offshore Tunisia, and

interests in offshore exploration Block 2B and onshore Technical Co-operation

Permit 218 in South Africa.

Visit us at www.panoroenergy.com.

Follow us on LinkedIn (https://www.linkedin.com/company/panoro-energy)