OKEA ASA

Earnings Release • Jul 14, 2020

OKEA ASA second quarter results 2020

OKEA ASA second quarter results 2020

OKEA ASA second quarter results 2020

(amounts in parentheses refer to corresponding period previous year)

Trondheim 14 July - The first half of 2020 has been challenging for the entire

oil industry due to the combination of the Covid-19 pandemic coupled with a

dramatic fall in petroleum prices. OKEA's financial statements for the second

quarter reflects the market turmoil and are significantly impacted by the low

petroleum prices as well as one-off and non-cash items.

OKEA delivered yet another quarter with no serious incidents at the operated

asset, Draugen, where operation has continued without disturbances to

production. Despite strong operational performance combined with high production

regularity, total net production was reduced to 16,047 (20,045) boepd in the

quarter due to planned shutdowns at both Draugen and Gjøa (non-operated asset).

During the quarter, OKEA rescheduled the planned maintenance shutdown at Draugen

to re-optimise the operation for the production restriction measures implemented

by the Norwegian Government.

"By optimizing the timing of the maintenance turnaround at Draugen we have

managed to stay within the reduced production permit for the asset and still

maintain our production guiding for the year", says Erik Haugane, CEO of OKEA.

Operating income for the quarter amounted to NOK 275 (1,039) million. The lower

income was due to significantly lower market prices and lower sold volumes

mainly due fewer liftings from Draugen. Delays in the Yme project, revised

reserve estimates for the Gjøa P1 project and foreign exchange effects resulted

in non-cash impairments of NOK 298 million. EBITDA for the quarter amounted to

NOK  210 (594) million.

"Despite weak financial results for the quarter, I am pleased with how OKEA has

managed a challenging situation and believe we are in a good position to further

develop the company. We have been able to continue production without

operational disturbances and have reached agreement to amend the bond terms to

better suit the current outlook. I am also very satisfied with the temporary

changes to the petroleum tax legislation implemented by the Norwegian

Parliament, particularly the negative tax instalments which supports equal

treatment of E&P companies on the Norwegian Continental Shelf (NCS). The new

regulation improves the liquidity position of OKEA significantly and enables us

to revisit the profitable projects that were put on hold earlier this year",

says Mr. Haugane.

The second quarter results will be presented by Erik Haugane (CEO) and Birte

Norheim (CFO) today at 10:00 CET in a webcast on www.okea.no and as a conference

call. Following the presentation there will be a Q&A session. To participate in

the conference call please use the following dial-in numbers:

Norway: +47 2195 6342

UK: +44 203 769 6819

PIN Code: 681934

For further info please contact:

CEO, Erik Haugane, +47 907 21 655

CFO, Birte Norheim, +47 952 93 321

VP IR, Ståle Myhre, +47 917 51 878

About OKEA

OKEA ASA is an Exploration and Production (E&P) company and operator on the

Norwegian Continental Shelf (NCS) with production of ~19,000 boe per day. OKEA

is one of few E&P companies on the NCS with production operating capabilities.

OKEA targets to grow organically through low-cost field developments of

discoveries with reserves up to 100 million boe as well as to take advantage of

inorganic opportunities.

OKEA ASA is listed on Oslo Stock Exchange under the ticker "OKEA". More

information on www.okea.no