Aker BP

Earnings Release • Feb 10, 2023

Fourth quarter 2022 & strategy update

10 February 2023 Aker BP ASA

Disclaimer

This Document includes and is based, inter alia, on forward-looking information and statements that are subject to risks and uncertainties that could cause actual results to differ.

These statements and this Document are based on current expectations, estimates and projections about global economic conditions, the economic conditions of the regions and industries that are major markets for Aker BP ASA's lines of business.

These expectations, estimates and projections are generally identifiable by statements containing words such as "expects", "believes", "estimates" or similar expressions.

Important factors that could cause actual results to differ materially from those expectations include, among others, economic and market conditions in the geographic areas and industries that are or will be major markets for Aker BP ASA's businesses, oil prices, market acceptance of new products and services, changes in governmental regulations, interest rates, fluctuations in currency exchange rates and such other factors as may be discussed from time to time in the Document.

Although Aker BP ASA believes that its expectations and the Document are based upon reasonable assumptions, it can give no assurance that those expectations will be achieved or that the actual results will be as set out in the Document.

Aker BP ASA is making no representation or warranty, expressed or implied, as to the accuracy, reliability or completeness of the Document, and neither Aker BP ASA nor any of its directors, officers or employees will have any liability to you or any other persons resulting from your use.

2022 – a transformational year for Aker BP

The E&P company of the future

Highlights fourth quarter 2022

High production 432 mboepd above guidance

Low cost 7.2 USD/boe in line with guidance

Johan Sverdrup Phase 2 First oil achieved 15 December

Low emissions 3.1kg CO2/boe lowest in the industry

Production efficiency 95 %

across operated assets

High prices 96 USD/boe avg. realized hydrocarbon price New projects

10 PDOs submitted in December

Lundin integration #OneTeam From 1 October 2022

Dividend 0.525 USD/share in Q4 – USD 2.0 in 2022

4

Aker BP – a reliable energy supplier

Gas production operated by Aker BP billion cubic metres (gross)

Aker BP oil sales to European buyers million barrels (net)

Our strategic priorities

Aker BP leads the industry transformation as the E&P company of the future

Return maximum value to our shareholders and our society

Operate safely and efficiently

Safety is our priority number one

Injury frequency (TRIF)

Q1-20 Q2-20 Q3-20 Q4-20 Q1-21 Q2-21 Q3-21 Q4-21 Q1-22 Q2-22 Q3-22 Q4-22

Strong operational performance

Oil and gas production per area

1,000 barrels oil equivalent per day (mboepd)

Production efficiency

Capacity utilisation (operated assets)

Production cost in line with guidance

Targeting USD ~7 per boe Breakdown of Q4-22 production cost

Decarbonise our business

Aker BP's decarbonization strategy to net zero

Net zero across operations by 2030 Aker BP's targets

	Scope 1 + 2		Scope 3
Avoid	Reduce	Neutralise	Upstream scope 3	Carbon intensity <4 kg CO e/boe 1. 2
			reduction through procurement	Methane intensity < 0.1 % 2.
Electrification of	Improve energy	Carbon removal	Support new industries and drive technology development	Scope 2 emissions ~0 from 2023 3.
brownfield assets	efficiency in rigs	offsets for hard		Absolute CO emissions reduced with 4. 2
and portfolio rotation	and operated to-abate assets emissions		Explore potential of CCS	50% by 2030 and ~100% by 2050
				Net zero across operations by 2030 5.

Create value through decarbonisation

Strong progress on decarbonisation in 2022

Emission intensity

Kg CO² /boe

Main drivers for the reduction

• Increased ownership in low-emission assets following the Lundin transaction
• Edvard Grieg and Ivar Aasen electrified as part of Johan Sverdrup Phase 2 project
• Only partially reflected in Q4-22
• Full-year reduction expected to be >200 000 tonnes
• Successful energy efficiency projects
• Delivered reductions of 73 000 tonnes (target was 10 000)

Aker BP – a global leader in low CO² emissions

Net emission intensity, 2022

Kg CO² /boe equity share

Clear pathway to reduce absolute emissions close to zero

Aker BP high level CO² emissions forecast of operated assets

Gross operated scope 1&2 emissions Million t CO²

1) Relative to our baseline 2) Based on current business plan and could change based on economic cut-off 15

Deliver high-return projects on quality, time and cost

Strong 2022 project deliveries

Hod delivered in record speed

▪ First oil in April – less than two years after FID

Production start Johan Sverdrup Phase 2

▪ Increases gross plateau production capacity from 535 to 720 mboepd with an aim increase to 755 mboepd

Four tie-back projects in execution

• Frosk first oil 2023
• Hanz first oil 2024
• Kobra East & Gekko first oil 2024
• Tyrving1) PDO submitted first oil 2025

Ten PDOs and one PIO submitted in December

Aker BP project overview

Asset area	Field development	Aker BP ownership	Gross/net volume	Net capex estimate	PDO submission	Production start
	Kobra East & Gekko	80.0%	50/40 mmboe	USD 0.9bn	2021	2024
Alvheim	Frosk	80.0%	10/8 mmboe	USD 0.2bn	2021	2023
	Tyrving	61.3%	25/15 mmboe	USD 0.4bn	2022	2025
	Hanz	35.0%	20/7 mmboe	USD 0.2bn	2021	2024
Edvard Grieg &	Symra	50.0%		USD 1.8bn	Dec-22	2027
Ivar Aasen	Troldhaugen	80.0%	124/79 mmboe			2026
	Solveig Phase II	65.0%				2026
	Alve North	68.1%	119/51 mmboe	USD 1.0bn	Dec-22	2027
Skarv	Idun North	23.8%				2027
	Ørn	30.0%				2027
	Valhall PWP	90.0%		USD 5.5bn	Dec-22	2027
Valhall	Fenris	77.8%	230/187 mmboe			2027
	Hugin	87.7%		USD 10.7bn	Dec-22	2027
Yggdrasil	Munin	50.0%	650/413 mmboe			2027
	Fulla	47.7%				2027

Grow production by executing our projects

Planning to produce around 525 mboepd in 2028

Production outlook

mboepd

Ten PDOs submitted in December

• Net resources of 730 mmboe
• The projects lift Aker BP's production by 250-300 mboepd in 2028
• Low CO² emission intensity
• Full-cycle portfolio break even oil price of USD 35-40 per barrel 1)
• Average payback time of 1-2 years at an oil price of USD 65 per barrel

Alliances with leading suppliers – with proven track record

The cornerstone of project planning and execution

Alliances established with leading suppliers

• Covering majority of capital spend
• Subsea, Fixed Facilities, Modifications and Drilling
• One team Common goals Shared incentives

Proven track record of alliance model since 2016

• 14 subsea tie-backs
• Two fixed platforms
• More than 100 wells completed
• Significant modifications scope

Key benefits

• Access to capacity and competence
• Improved efficiency
• Drive continuous improvement

Aker BP's key principles for successful project execution

Execution through alliances and incentive-based contracts

Capacity secured with alliance partners

Signed contracts with all major yards in Norway

Close and early collaboration to ensure capacity, construction quality and efficiency

• PWP Topside Fabrication/Integration

• Hugin A Topside Fabrication/ Integration

• Fenris Topside and Jacket

• Hugin B Topside and Jacket

• Hugin A and PWP Jackets

• Hugin A Utility Module Lower Part

• Fulla Subsea Manifolds

• PWP Pre-fab Modifications

• Hugin A and PWP Flares

• SSP Subsea Manifolds
• SSP Pre-Fab Modifications

▪ Munin Topside Fabrication/ ▪ PWP Bridge Integration

Aibel Haugesund Rosenberg Worley Stavanger Leirvik Stord Nymo Grimstad/Eydehavn

▪ PWP Utility Module ▪ PWP Wellbay Module

• Hugin A Living Quarter
• Hugin B Helideck
• Hugin B Emergency Shelter

Establish the next wave of profitable growth options

Exploration strategy

Uniquely positioned on the NCS

• 2 nd largest in Norway with ~200 licences
• Operator for ~70%

Targeting 250 mmboe by 2027

• Drill 10-15 exploration wells per year
• 80/20 near-field/new areas

New ways of working

• Combining two strong teams
• Investing in technology and digitalisation

2022 – a successful exploration year

Aker BP discovered most resources on the NCS in 2022

Preliminary estimates of 2022 discoveries*

mmboe (Aker BP share)

Two discoveries in the Skarv area

• Newt and Storjo East
• Follow-up potential
• Future tie-backs to Skarv FPSO

Lupa – large discovery in the Barents sea

• 50% ownership
• Long-term development solution
• Could unlock area potential

2023 exploration program

Licence	Prospect	Operator	Aker BP share	Pre-drill mmboe	Status
PL867	Gjegnalunden	Aker BP	80%	3 - 124	Tech. disc
PL265	P-Graben	Equinor	27%	8 - 33	Dry
PL1141	Styggehøe	Aker BP	70%	10 - 41	Q1
PL554	Angulata	Equinor	30%	8 - 64	Drilling
PL919	Ve	Aker BP	80%	6 - 14	Q1
PL211CS	Dvalin N	Wintershall Dea	15%	29 - 66	Q1
PL873/442	Øst Frigg Beta/Epsilon	Aker BP	44%	18 - 45	Q2
PL1005	Rondeslottet*	Aker BP	40%		Q2
PL442	Frigg Gamma Delta / Ypsilon	Aker BP	88%	9 - 22	Q2
PL1148	Carmen	Wellesley	10%	22 - 172	Q3
PL929	Ofelia	Neptune	10%	28 - 45	Q3
PL956	Ringhornet Ty	Vår	20%	7 - 39	Q3
PL272B	Krafla Mid Statfjord	Equinor	50%	10 - 59	Q3
PL261	Storjo West	Aker BP	70%	10 - 20	Q4
PL1170	Ferdinand	Aker BP	35%	49 - 117	Q4
PL932	Kaldafjell	Aker BP	40%	19 - 145	Q4
PL917	Magellan	Vår	40%	16 - 54	Q4

Significant upside potential around existing assets

Reserves and resources billion boe

• Skarv: Exploration opportunities (ILX) and development of tight reservoirs
• Edvard Grieg/Ivar Aasen: Infills, ILX and basement upside enabled by 4D seismic
• Johan Sverdrup: Infill drilling to extend plateau and accelerate production
• Valhall: Infill enabled by lower drilling cost and new completion technology
• Alvheim & Yggdrasil: Infill and ILX enabled by 4D seismic and lower drilling costs
• Wisting: Exploring for upside potential

Value creation through M&A and organic growth

The making of a NCS champion

* Average daily production Q4 2022

Return maximum value to our shareholders and our society

Financial highlights fourth quarter 2022

Sales of oil and gas

Volume sold mboepd

Total income USD million

Realised prices USD/boe

Q4-21 Q1-22 Q2-22 Q3-22 Q4-22

Production cost

Based on produced volumes

Capital spend below guidance

Capex, expex and abex, USD billion

• Stronger USD than anticipated
• Some activities phased to 2023
• Strong cost performance in execution

Income statement

Fourth quarter 2022

USD million	Q4 2022	Q3 2022	Change	Comment	Comments
Total income	3 826	restated 4 866	-1 040	1
Production costs	286	236	50	2
Other operating expenses	16	9	7
EBITDAX	3 523	4 621	-1 098
Exploration expenses	32	85	-53
EBITDA	3 491	4 536	-1 045
Depreciation	641	594	47	3
Impairments	636	55	581	4
Operating profit (EBIT)	2 214	3 887	-1 673
Net financial items	(37)	(174)	137
Profit/loss before taxes	2 177	3 713	-1 536
Tax (+) / Tax income (-)	2 064	2 949	-885	5, 6
Net profit / loss	112	763	-651
EPS (USD)	0.18	1.21	-1.03

• 1. Realised prices down ~25% from Q3
• 1. USD 7.2 (7.3) per boe produced
• 1. USD 16.1 (15.7) per boe
• 1. Wisting USD 499 million and Edvard Grieg USD 137 million (of which USD 377 million in goodwill)
• 1. High effective tax rate 95% due to impairment of goodwill without deferred tax
• 1. Tax payable USD 2 170 million, deferred tax USD -112 million

In addition, other comprehensive income (OCI) includes a positive forex translation effect of USD 1 308 million

Statement of financial position

Assets	31.12.22	30.09.22 restated	31.12.21 restated	Comment
PP&E	15 887	15 307	10 214	1
Goodwill	13 935	13 193	1 647
Other non-current assets	2 984	3 057	1 863
Cash and equivalent	2 756	3 042	1 971
Other current assets	2 000	2 015	1 012
Total Assets	37 562	36 613	16 708	2
Equity and liabilities
Equity	12 428	11 320	2 197
Financial debt	5 279	5 198	3 577
Abandonment provisions	4 166	4 185	5 172	1
Other long-term liabilities	9 557	9 193	3 385
Tax payable	5 084	5 419	1 497	3
Other current liabilities	1 049	1 299	879
Total Equity and liabilities	37 562	36 613	16 708

Comments

• 1. Change in accounting principle for Abandonment provisions increases the present value of the liability, with an offsetting entry on PP&E (previous periods have been restated accordingly)
• 1. Total assets have generally increased due to the consolidation of ABP Norway in NOK functional currency (including PPA values) and the weakening of USD against NOK during Q4
• 1. Tax payments of USD 2 955 million in the quarter

Cash flow

Fourth quarter 2022

USD million

Actual performance vs guidance

Second half 2022 – post Lundin completion

	Guidance	Actual
Production (mboped)	410-4201)	422
Opex (USD/boe)	~7	7.2
Capex (USDbn)	1.2	1.0
Exploration (USDbn)	0.3	0.2
Abandonment (USDbn)	0.1	0.03

1) Original production guidance was 410-435 mboepd. This was narrowed in to 410-420 mboepd in October due to more precise estimate for startup of Johan Sverdrup Phase 2.

Capital allocation priorities

Aker BP's financial frame – designed to drive value creation and shareholder return

Maintain financial flexibility

Net interest-bearing debt

BBB Baa2 BBB

Grow production with robust high return projects

Production outlook

Robust and profitable project portfolio

\$35-40/bbl

Project portfolio break-even oil price

~25%

Project portfolio IRR at \$65/bbl oil price

1-2 years

Project portfolio payback at \$65/bbl oil price

Investing in robust and profitable projects

In an investment-friendly tax system

Aker BP est. capex after tax

• Around 85% of the planned capex is related to projects subject to the temporary tax system with 86.9% tax deduction
• The rest is subject to ordinary tax system with 78% tax deduction

The Norwegian petroleum tax system

Supportive for investments

Ordinary tax system Temporary tax system

Capex Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Total Capex Tax deduction

• The temporary tax system was introduced summer 2020 to stimulate investments1)
• Applicable for projects with PDO submitted by end-2022
• Involves a capex uplift which is deducted from special petroleum tax
• Hence 86.9% of capex is deductible, while marginal tax on income remains 78%

Strong and resilient cash flow as basis for dividend growth

Financing cost 0 5 10 15 20 Sources Uses USD billion, accumulated \$90/bbl \$65/bbl Dividend capacity and debt repayment Cash flow from operations after tax Investments¹ \$40/bbl

Aker BP value creation plan 2023-2028

• Low cost production gives resilient dividend capacity
• Distributions shall reflect the capacity through the cycle
• ~10% dividend growth in 2023
• Quarterly USD 0.55 per share
• Ambition to grow dividend by minimum 5% per year

2023 guidance

	2022 actuals	2023 guidance
Production (mboped)	309 (H2-22: 422)	430-460
Opex (USD/boe)	8.7 (H2-22: 7.2)	7.0-8.0
Capex (USDbn)	1.6	3.0-3.5
Exploration (USDbn)	0.4	0.4-0.5
Abandonment (USDbn)	0.1	0.1-0.2

Tax guidance

Tax payments - Sensitivity for 2023 USD million

Process for tax payments

• Tax for the year is paid in six bimonthly instalments, starting in August, plus final settlement
• Initial tax estimate for the year is made in Q2, the Aug-Dec instalments are then fixed in NOK
• Option for voluntary additional payment in October normally only relevant if the initial estimate was too low
• At year-end, the upcoming Feb-Jun instalments may be adjusted to reflect latest estimate
• Final settlement in December the following year

Assumptions for H2-23 sensitivity analysis

• Brent price assumption reflects average for 2023
• Gas prices fixed at 25 \$/mmbtu
• USDNOK 9.5

Summary – Executing on our strategic priorities

Return maximum value to our shareholders and our society

Appendix

World-class oil and gas portfolio

Large scale, low risk assets on the Norwegian Continental Shelf

Yggdrasil Hugin, Fulla and Munin

Gross volume estimate 650 mmboe

Aker BP (operator) 87.7% / 47.7% / 50.0%

Production start est. 2027

Net capex est. (nominal) USD 10.7bn

Valhall PWP-Fenris

Gross volume estimate	230 mmboe
Aker BP (operator)	90.0% / 77.8%
Production start est.	2027
Net capex est. (nominal)	USD 5.5bn

Skarv satelites

Alve Nord, Idun Nord and Ørn

Gross volume estimate 119 mmboe Aker BP (operator) 68.1% / 23.8% / 30.0% Production start est. 2027 Net capex est. (nominal) USD 1.0bn

Utsira High

Symra, Solveig fase 2 and Troldhaugen

Gross volume estimate	124 mmboe
Aker BP (operator)	50.0% / 65.0% / 80.0%
Production start est.	2026/27
Net capex est. (nominal)	USD 1.8bn

53

Alvheim projects

Kobra East & Gekko, Frosk and Tyrving

Gross volume estimate	85 mmboe
Aker BP (operator)	80.0% / 80.0% / 61.3%
Production start est.	2023-25
Net capex est. (nominal)	USD 1.5bn

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