BW Offshore

Contemplated amendments to BWO06

October 2025

Disclaimer (1/2)

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This presentation (the "Presentation") has been produced by BW Offshore Limited (the "Issuer" or the "Company") solely for information purposes for use in presentations to the bondholders (the "Bondholders") in the Issuer's senior unsecured bonds 2023/2028 with ISIN NO0013077560 (the "Bonds") in connection with the proposed waiver and amendments to the terms of the Bonds (the "Amendments").

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Disclaimer (2/2)

The content of this Presentation shall not be construed as financial, legal, business, investment, tax or other professional advice. Each Recipient should consult with its own professional advisers for any such advice.

Unless stated therein, the information contained in this Presentation has been obtained from the Issuer or its Representatives. While the information herein is believed to be in all material respects correct, the Issuer and their respective Representatives (the "Covered Persons"), make no representation or warranty, expressed or implied, as to the fairness, accuracy or completeness of the information contained in this Presentation, or regarding any other additional information which has or will be made available to the Recipients in connection with the Amendment and a continued investment in the Bonds. Accordingly, no Covered Person accepts any liability whatsoever for any loss of any nature arising from use of this Presentation or its contents or the additional information referred to above or otherwise arising in connection therewith, except as may follow from mandatory law.

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Executive Summary

BW Offshore (the "Issuer") has been / is contemplating to amend certain financial covenants / restrictions across its existing financing facilities, including certain covenants in BWO06 (ISIN: NO0013077560).
For existing bondholders, the contemplated changes relates to the:
1. Equity ratio; and
1. Distributions (herein "Dividend covenant").
The contemplated amendments have already been approved by the existing syndicate banks across the company's banking facilities including the corporate RCF and Catcher Facility. The amendments remain subject to final approval by the Barossa facilities, which is anticipated to be received imminently.

1 Equity ratio – explanation

The Parent shall procure that the Equity Ratio of the Group shall not fall below 25 %.

Background

Conventionally, FPSO projects are funded by a mix of straight equity and debt financing.
As a result of the Covid-era inflation and supply chain pressures, capex on FPSO projects has increased dramatically in recent years. Coupled with increased financing costs faced by FPSO contractors with little corresponding fluctuation in oil price, clients often struggle to achieve the economic benefits from their E&P business that they would have had before such increases and need to use the various tools in their toolboxes to lower the ongoing cost of FPSO projects. One of these tools is to provide part of the funding themselves due to lower cost of capital and the FPSO contractors not needing to pass on interest cost on part of that capex.
As a result, we experience that most projects include some element of upfront payments and/or advance charter payments (ACP) from the client (like BWO had from Santos for the Barossa project where Santos funded ~\$1bn and debt finance is ~\$1.15bn). Providing financing to the FPSO contractors will likely benefit the overall economics of the project for the client.
Different projects will have such upfront payments or ACP structured in different ways depending on the jurisdiction, contract type, tax implications, client
preference and accounting requirements, so it will be difficult to prescribe specific types of funding, although we and our project lenders would require that any
repayment of that funding to be subordinated to other debt provided to the relevant group company. Any funding would need to have a refundable nature to it,
however that would only happen in catastrophic circumstances where a client cancels a project during construction, which has not happened in the FPSO
industry.
From BWO and lenders' perspectives, client funding helps align interests between clients and FPSO contractors in achieving operational readiness and final acceptance.
The challenge is that these upfront payments and/or ACP would be likely classified as liabilities in BWO's balance sheet according to IFRS.

Request

• To carve out client funding (including prepayments and/or ACPs) from the definition of total assets to better reflect the true debt position of BWO, ie. third party financial institution borrowings.

1 Equity ratio – change to be made

Before

Clause:

The Issuer shall ensure that the Equity Ratio of the Group shall not fall below 25 %.

Definitions:

"Equity Ratio" means the ratio of Equity to Total Assets.

"Equity" means the Issuer's (on a consolidated basis) nominal book value of equity treated as equity in accordance with the Accounting Principles.

"Total Assets" means the Issuer's (on a consolidated basis) book value of assets in accordance with the Accounting Principles.

After

Clause:

The Issuer shall procure that the Equity Ratio of the Group shall not fall below 25 %.

Definitions:

"Equity Ratio" means the ratio of Equity to Total Assets.

"Equity" means the Issuer's (on a consolidated basis) nominal book value of equity treated as equity in accordance with the Accounting Principles.

"Total Assets" means the Issuer's (on a consolidated basis) book value of assets in accordance with the Accounting Principles, adjusted to exclude any amounts corresponding to payment in advance, or prepayment, of charter hire or any form of funding or finance received by a Group Company from a client of the Group that is subordinated to the specific financing provided by lenders to that relevant Group Company (however defined and structured).

1 Equity ratio – illustration of impact

The above illustration is based on a hypothetical ("stress test") scenario in which BWO undertakes a construction project of ~USD 2.6 billion, starting in January 2026. Of this amount, 50% is assumed funded through client prepayments and 35% through debt financing. The right-hand graph depicts how the equity ratio would evolve if the covenant was amended as proposed. BWO will not breach the covenant at current structure within the lifespan of the bond