OKEA ASA

Earnings Release • Nov 1, 2019

OKEA third quarter 2019 results

OKEA third quarter 2019 results

OKEA third quarter 2019 results

The third quarter result is characterized by solid operational performance on

Draugen, strong net cash flow contribution, lower volumes sold, cost related to

exploration activities and exchange rate loss. Total net production in the

quarter was 18 125 boepd while operating profit was NOK 227 million, down from

NOK 367 million in Q2 2019.

Total operating income in the quarter was NOK 622 million, a decrease from NOK 1

039 million in Q2 2019 mainly caused by one lifting on Draugen compared to two

in the previous quarter, lower production volumes on Gjøa and lower liquids and

gas prices. Correspondingly, net sold volumes in Q3 2019 were 16,696, down by

33% since the previous quarter.

OKEA produced 18 125 boepd in Q3 2019, down from 20 045 boepd in Q2 2019. The

production decrease is mainly explained by modifications and export constraints

on Gjøa. Production from Draugen increased by 4% in the quarter. The average

realized liquid price was USD 56.4 per barrel, while gas revenues were

recognized at market value of USD 0.11 per standard cubic meter.

"Our operated asset Draugen has no serious safety incidents and a production

regularity as high as 97% this quarter. This demonstrates that OKEA is an

operator dedicated to safe and efficient operations. OKEA has in 2019

revitalised the operations at Draugen, with focus on safety, decision lead time,

simplifications and use of new technology, digitalisation and collaboration with

partners. Although the financial result is impacted by lower volumes, prices and

exchange rates, I am very pleased to see that we generate a strong cash flow

from our operations", says Erik Haugane, CEO of OKEA.

"OKEA's ambition is to lift near-term production. We initiated as planned the

drilling of two wells as operator in October. Late October, OKEA reported that

volumes discovered in the Infill-Ø well, do not require a new producer to this

area. The results from ongoing drilling of Skumnisse are expected mid-November.

We are progressing as planned on the Gjøa P1 project and the Yme New Development

project is on schedule for first oil in Q2 2020", Mr. Haugane continues.

OKEA is also pleased to announce that, on 31 October 2019, Birte Norheim

accepted the position as CFO in OKEA. Start date in OKEA to be announced later.

The results will be presented by Erik Haugane, CEO and Kjersti Hovdal, SVP

Accounting and Controlling today at 08:15 CET at Felix Conference Center at

Bryggetorget 3 in Oslo. The presentation and Q&A session may also be followed

through a live webcast from www.okea.no.

For further information:

CEO Erik Haugane, +47 907 21 655

VP Investor Relations Ståle Myhre, +47 917 51 878

About OKEA

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

Norwegian Continental Shelf with production of ~20 000 boe per day. OKEA aims to

grow through low-cost field developments of discoveries with reserves up to 100

million boe and mergers and acquisitions (M&A). The operating organisation is

built on the acquisition of the producing field Draugen in 2018.

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

More information on www.okea.no