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Ocean GeoLoop AS Annual Report 2023
3697_10-k_2024-03-14_02679941-133d-471c-8d38-7430bd04a978.pdf
Annual Report
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Annual Report 2023
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About Ocean GeoLoop Letter from CEO Ocean GeoLoop's technologies Go-to-market strategy Some highlights from 2023 Board of Directors Management Board of Directors´Report Financial Statement Notes to account Auditor´s report
Title: Annual Report 2023 Published date: March 14, 2024 [email protected] +47 48 24 50 01 Neptunvegen 6, 7652 Verdal, Norway The publication can be downloaded on oceangeoloop.no Connect with us on LinkedIn
oceangeoloop.com
Ocean GeoLoop AS uses nature's own way to solve the challenges of our time in a circular way. The company has introduced the GeoLoop CC technology that captures CO2 from point source emissions using natural and harmless processes. Ocean GeoLoop will help companies and countries achieve their goals of reduced emissions and access to renewable electricity for the green transition. The company is listed on the Oslo Stock Exchange Euronext Growth under the ticker OCEAN.
About Ocean GeoLoop
Ocean GeoLoop will help companies and countries achieve their goals of reduced emissions and access to renewable electricity for the green transition.
Letter from CEO
" Ocean GeoLoop is well positioned and aims to become an internationally leading CCUS company in a rapidly expanding carbon market."
A commitment to meeting global challenges
It's urgent! The earth is under increasing stress due to the world´s growing population and an ever-increasing demand for energy, food and resources, and general welfare.
In the last two years, we have seen that globalization has changed. The unrest in several parts of the world has led to stronger regionalization. However, the climate and resource crises are not of regional nature, but fundamental and global. Despite regional differences in the approach to combat these crises, the international agreements have been strengthened and the search for better solutions have intensified during 2023.
EU's ambitious policy on decarbonization and the US Inflation Reduction Act provides solid ground for the international carbon markets, and it works! The request for commercial CCUS studies has exploded, while lack of logistics solutions, geological storage and renewable energy are critical barriers for the deployment of an efficient international CCS market. Alternative CCU pathways are hindered by lack of renewable energy, but also by knowledge barriers and the associated regulatory frameworks. Even if the carbon markets have hurdles, they have come to stay and are increasing rapidly.
We move fast
Our speed is rooted in the way we work, a true power of collaboration, industrial partnerships and devotion. Through our three years of operation, we have built highly advanced installations of our product offerings and verified the robustness of our solutions in harsh environments. We are moving fast, and the Ocean GeoLoop method remains a catalyst for continued performance.
Milestones in carbon capture technology
In August 2023 we successfully passed the 3,000 hour milestone for safe operations of our industrial point source carbon capture pilot at Norske Skog Skogn in Norway. Having an autonomous carbon capture plant with no harmful chemicals or need for residual heat are features that are highly appreciated by our industrial partners. The pilot shows industrial robustness, including when run autonomously over longer periods. We also revealed several means to further optimize the solution.
During 2023 we built an agile test facility within SIN-TEF's CO2 lab in Trondheim, Norway. This test facility is by now a flexible test and optimization tool that improves our core technology, in close collaboration with world-class experts from SINTEF. Ocean Geo-Loop´s two test facilities allow rapid experimental simulation of customer´s flue gas composition and operating conditions and represents a powerful means for our industrial customers to save both time and cost in evaluation and testing of our carbon capture technology.
Targeted market entrance
In this report we´re presenting the most prominent industry partners with whom we work; Yara Norge AS, NorFraKalk AS, a joint venture of Franzefoss Minerals AS and Nordkalk Oy, Norske Skog ASA and Nordural EHF, Iceland. These major companies have ambitious plans and represent global industry segments with large potential and need for carbon capture. As part of the work, we actively engage our shareholder and added-value partner Chevron New Energies, and a set of EPC companies, thus providing a solid base for successful CCUS projects.
Our strategy is to stack a set of commercial projects with the mentioned partners that allows, firstly, to define modularized products and product families, and secondly, to verify and showcase the generic applicability of the underlying basic technology. So far in 2024 we have announced the agreement with NorFraKalk for a potential large-scale CO2 capture project with the ambition to make NorFraKalk climate neutral. The lime and cement industry accounts for approximately 8 % of the world's CO2 emissions and is one of the industries where CO2 capture is necessary to achieve the climate goals. The first phase of the collaboration is to assess an industrial demo plant for carbon capture at NorFraKalk's lime kiln in Verdal Industrial Park. The ongoing study will pave the way for the capture of 10,000 tonnes of CO2 per year to prove that our solution works in quicklime production.
Beyond plans to deliver our first commercial units, we continue to engage partners to close the gaps in efficient CCUS pathways, while we in parallel continue to foster disruptive technology. We look forward to report on the forthcoming developments through 2024!
We are privileged
Ocean GeoLoop is established by and builds upon a set of patents and solutions provided by the company's founder, Hans Gude Gudesen. Even more important is his active involvement to further invent novel solutions and strategies, beyond those possessed by pure-play carbon capture companies.
The future is promising
Access to energy is probably the biggest barrier for large-scale introduction of carbon capture and our ambition is to develop energy solutions making carbon capture independent of access to electricity from the grid. Ocean GeoLoop uphold the ambition to demonstrate the e-Loop technology as an embedded electricity generating unit within the carbon capture system. It is bold, but probably a necessary ambition to get the required pace towards decarbonization of existing industries. We have taken important steps in 2023 and will continue the work in 2024. Our subsidiaries Energi Teknikk AS and Ocean TuniCell AS, provides competence, capacity and synergies to succeed, and we expect critical milestones to be reached in the year ahead. the early stages of our journey. As we navigate through 2024 and onwards, Ocean GeoLoop remains committed to a "show, don't tell" policy. Our technologies, built on innovation and sustainability, will play a central role in helping companies and countries around the world achieve their net zero goals. I'm proud of the hard and diligent work the Ocean GeoLoop team puts in to realize these groundbreaking achievements, and grateful for the open attitude from numerous people that support the daily operations. We look forward to bringing commercial solutions to the market based on our one-of-a-kind technology. Thank you for taking part of our story.
Ocean GeoLoop is well positioned and aims to become an internationally leading CCUS company in a rapidly expanding carbon market. Our technological basis, world-class test facilities, organizational setup, and our strategic and targeted market entrance is the beginning. Success in the planned stacked commercial projects provides an efficient platform for the subsequent stage of international scaling.
Gratitude and optimism
We are grateful for the support we received during
Sincerely,
Odd-Geir Lademo CEO of Ocean GeoLoop
Ocean GeoLoop´s technologies
We push for technologies that can be used with attractiveness everywhere.
Ocean GeoLoop has been established to industrialize disruptive green technology. The technology is developed by and through Hans Gude Gudesen and his research and development project (the "Project Ocean"). It´s addressing the challenges related to global warming and climate change, and in particular the important role of the world's oceans in this context. The technology represents more than 15 years of basic and applied research within a range of fields, involving a significant number of collaborating national and international scientists and R&D institutions.
POINT SOURCE CARBON CAPTURE
CARBON CAPTURE
The key features of our point source carbon capture solution, demonstrated by piloting at Norske Skog Skogn are:
GeoLoop Carbon Capture
Clean and green The carbon capture and separation process is done without toxins, amines and other harmful chemicals providing HSE friendly operations.
- End of pipe solution The "plug in solution" is easily integrated with the emitter, connecting directly into the chimney. This low complexity provides large savings compared to other carbon capture solutions.
- Universal non-toxic absorption technology The robust process is designed to handle all flue gasses with minimal needs for special adoptions.
- Highly stable and safe operations A robust and low risk process combined with minimal need for human interaction gives highly safe and stable operations.
- POINT SOURCE Fully autonomous operations The capture plant is fully automated and can be remotely monitored allowing operations to be run without manual intervention.
Ocean GeoLoop´s overall technology strategy is to deliver disruptive technology to the market making carbon capture applicable in industries that today have demanding conditions for establishing this as a solution for decarbonization. In other words, we push for technologies that can be used with attractiveness everywhere.
Ocean GeoLoop´s baseline technology is an all-electric technology for CO2 separation. Such an approach poses numerous advantages, directly enabling CO2 capture for the many emission points without waste energy. The disruptive part is the planned embedded electricity generation technology, the e-Loop. Successful proof of this technology would support the capture process, thus making CO2 capture possible in areas and regions where there is currently lack of power. Further, access to electricity provides the basis for efficient utilization of CO2 through a variety of existing or emerging utilization technologies as illustrated below.
Ocean GeoLoop´s technology strategy
Norske Skog Skogn
Yara Norge
Franzefoss Minerals
We pursue a selected number of industrial targets, representing global industry segments with large market potential.
Go-to-market strategy
Ocean GeoLoop emphasizes collaboration and strategic partnerships as a means of rapid industrial scaling. The company pursues a selected number of industrial targets, representing global industry segments with large market potential. Such a network model allows for rapid scaling in the global markets, both through strong international presence of the targeted customer cases, through Chevron New Energies as a global reach partner, through our EPC partners, and indirect marketing through our R&D network.
"Franzefoss Minerals AS and its subsidiaries Verdalskalk AS and NorFraKalk AS aim to contribute to the achievement of the national targets for reductions in emissions of greenhouse gases. To achieve this, CO2 capture must be
The most mature solution for CO2 capture is based on amine technology. It is such a facility that is being installed at Norcem Brevik AS. This type of technology is not suitable for our facilities as it requires a lot of thermal energy, which
We want to contribute to developing the most energy-efficient and environmentally friendly technology possible, which is also suitable for capturing CO2 at our lime kilns. This is the background for our partnership with Ocean GeoLoop. We have a common goal to execute testing of Ocean GeoLoop's technology at NorFraKalk AS in 2024."
Hanne Markussen Eek
CEO of Franzefoss Minerals AS and chairman of NorFraKalk AS
Chevron Inc., owner of Chevron New Energies, has a 5% ownership position in Ocean GeoLoop and their website states "Innovative solutions are needed to help address climate change and the world's complex energy challenges. We are collaborating in new ways with extensive capabilities and partnerships to help deliver scalable solutions with measurable impact. Our goal is to help customers meet their lower carbon ambitions and reduce the carbon intensity of our operations". Building on Chevron´s long history of supporting innovation, the company invested to explore ways to develop and commercialize Ocean GeoLoop's carbon capture and storage technology. Chevron New Energies takes an active, collaborative position working closely with Ocean GeoLoop, partners and customers to understand and address complex, lower carbon business opportunities. The Chevron New Energies leadership is on a mission to accelerate progress to a lower carbon future and help customers and partners do the same. Carbon capture, utilization, and storage (CCUS) is a critical enabler of global net zero. By partnering with Chevron New Energies, Ocean GeoLoop will boost its capacity and international reach on the path to commercializing the company´s technology.
KC Littlefield
General Manager of Technology Commercialization in Carbon Capture, Utilization, and Storage, Chevron New Energies.
"Chevron has decades of operational experience and a proven track record of carbon-capture projects. We are deploying CCUS technologies and investing in the CCUS value chain to lower the carbon intensity of our existing assets while also helping reduce emissions of other essential industries that enable modern society. Developing activity in Norway successfully will be a steppingstone for further global reach for this technology. Chevron brings our experience and capacity to the Ocean GeoLoop partnership. By scoping opportunities and advancing technology together with OGL's other partners, we can progress CCUS as a critical solution to climate change faster."
Chevron New Energies
"As an integral part of the business strategy, Norske Skog Group is committed to reach net zero greenhouse gas emissions by 2050. We share Ocean GeoLoops ambition to develop an efficient system to capture, use and/or store our biogenic CO2 emissions. So far, the partnership with Ocean GeoLoop has resulted in an exciting biogenic carbon capture project by bringing R&D and industry companies together. Norske Skog Skogn AS will going forward create green value from our fibre- and energy processes including biogenic CO2."
Håvard Busklein Managing Director Norske Skog Skogn AS
"Yara AS has high climate ambitions and has reduced its greenhouse gas emissions by 45% since 2005 and has further ambitions of being climate neutral by 2050.* Yara AS and OGL has entered into an agreement to investigate with the intention to start developing CCUS solutions with the goal of generating profitable value chains for CO2 based on OGL´s safe, environmentally friendly and industrially robust technology. Our partnership with OGL and Chevron New Energies is energizing and we will continue to jointly explore how to benefit from OGL´s technology."
Ole-Jacob Siljan Plant Manager Yara Norge AS
"Norðural's aluminum product Natur-Al™, has direct CO2 levels below two tons CO2 per ton of aluminum – one of the lowest CO2 footprints in the business. The aluminum industry is one of the most demanding industrial segments for carbon capture, with very low CO2 concentration in the flue gas. A successful carbon capture solution will bring us closer to true carbon neutrality. Together with Ocean GeoLoop we will conduct a joint study on our complex flue gases and operational conditions at Ocean GeoLoop´s facilities at SINTEF in Trondheim and at Skogn. A natural next step is to implement a project for CO2 capture at our plant at Grundartangi.
The collaboration with Ocean GeoLoop has opened up new ideas and solutions to complex challenges. Building on their network of exciting new partners such as Hans Gude Gudesen, SINTEF and Chevron New Energies, is also of interest to Norðurál´s parent company Century Aluminum, which has a strong focus on reducing its carbon footprint also at its USA plants. "
Gunnar Guðlaugsson CEO of Norðurál EHF
Yara Norge
Norske Skog Skogn
Norðurál
Some highlights from 2023
Developing strong collaboration with EPC partners and recruitment of personnel has strengthened our execution capacity.
During 2023 the company intensified the work on commercial carbon capture projects with industrial partners. Developing strong collaboration with EPC partners and recruitment of personnel has strengthened our execution capacity.
The development program yields solid results. We are maturing the technology into commercial solutions based on the data from the autonomous pilot plant at Skogn, the scaled unit at SINTEF´s CO2 lab and our digital process model, in collaboration with industrial partners. Ocean GeoLoop is progressing the development of our next generation carbon capture offering in line with our technology strategy.
During the first half of 2023 we commissioned a scaled test-rig for Ocean GeoLoop´s carbon capture technology at SINTEF´s CO2 lab in Trondheim. The installation is an agile test and optimization tool, and our development capacity is further increased through access to SINTEF´s expertise within carbon capture. The installation offers a high degree of flexibility to evaluate a range of parameters and operating conditions. Customers can test the Ocean GeoLoop carbon capture solution on their specific flue gas composition and related operating conditions in a time-saving and cost-effective way and have the opportunity to be physically present at the facility.
The Ocean GeoLoop Carbon Capture test facility in Trondheim
August 2023 Ocean GeoLoop reached an important milestone as the industrial pilot at Norske Skog Skogn passed 3,000 hours of robust, stable, autonomous, and safe operations.
The pilot has shown stable operations under various conditions including handling planned and unplanned stops in the delivery of flue gas.
Key innovations demonstrated at the Norske Skog Skogn industry pilot includes simplified and costeffective integration to the emitter, the utilization of a 100 % clean absorbent that prioritizes human and environmental safety, and all-electric operation without the need for residual heat.
The Norske Skog Skogn Industry pilot
During three years of operation, the company has succeeded in building an efficient staff with extensive experience from industry, innovation, R&D and finance. These are highly motivated and dedicated people with a large network and who identify with Ocean GeoLoop´s way of working in strong and wide networks of different players.
Ocean GeoLoop is pleased to have attracted more talents during 2023 strengthening the organization with solid expertise in amongst other process and chemical engineering. We have continued to develop our industrial partnerships with emitters and in parallel strengthened our delivery capacity through collaboration with EPC providers Inrigo AS and Carbon Circle AS. Together with our internal carbon capture team, we possess a strong organizational capacity for further development and commercialization of the company´s carbon capture technology.
Ocean GeoLoop is actively engaged in clusters and industrial environments that are pioneering environments in decarbonization. In 2023 this engagement has focused on Herøya Industrial Park and the industrial clusters in Mid-Norway.
Access to energy is one of the major barriers in the decarbonization of the industrial sector around the world. Ocean GeoLoop stays determined and focused to progress the embedded electricity unit, the e-Loop, to power the carbon capture process. The technology inventor and company founder, Hans Gude Gudesen, is the central resource in the work, while the company has exclusive rights in using the technology for CCUS purposes. for the version being independent of temperature. In parallel, the company is evaluating the location of the pilot installation. The recent developments excite us, motivated by the increasingly uncertain local, regional and global energy situation, and we plan for speed in the further progress.
Two main pathways are being pursued: a version relying on thermal contrasts, and a version being independent of temperature. The company has earlier communicated plans to build a first pilot at Skogn within Q1 2024 but has chosen to document and explore both pathways before the final investment decision is being made. The design basis is in place for the version relying on thermal contrasts, while experimental prototyping has been initiated
During Industriuka (The Industry Week) in Porsgrunn Ocean GeoLoop received the "Powered by Telemark award". The award honored Ocean GeoLoop´s contribution to the collaborative culture, and the company´s work with Yara. The chairman of the board of the Powered by Telemark cluster, Jarann Wold Pettersen, stated: "We believe the company is an excellent example of what the region desires – both in terms of their contribution to the culture of collaboration and the problems they dare to tackle in new ways."
Since 2021 Ocean GeoLoop´s engagement and presence at Herøya Industry Park and in the Grenland region has been unwavering.
Building capacity and strength
The e-Loop development
Ocean GeoLoop in the spotlight
Some highlights from 2023
Subsequent to 2023 Ocean GeoLoop was in January 2024 awarded a feasibility study with lime producer NorFraKalk. The first phase of the collaboration is to assess an industrial demo plant for carbon capture at NorFraKalk's lime kiln in Verdal Industrial Park. The study will pave the way for capture of 10,000 tonnes per annum of a total annual emission of 200,000 tonnes CO2. This will prove that the solution works in quicklime production, an important industry segment where Ocean GeoLoop´s electrically driven capture process has strong competitive advantages.
Signing of contract
The challenging situation in the eutrophicated Oslofjord is still considered to be a potential entrance point in bringing the GeoLoop Column to the market. In 2023 the company engaged in establishing a Joint Stakeholder Initiative to progress the commercialization of the Column.
Maturing the GeoLoop Column
Martha Kold Monclair Board member
Martha Kold Monclair is the founder and managing partner of MKOLD AS and a non-executive director of the
public listed companies, Hexagon Purus ASA, Reach Subsea ASA. Edda Wind ASA as well as CapeOmega AS and BW LPG Ltd. Monclair has extensive experience in strategy and business development, and a broad academic background with a doctor's degree in both technical and business strategical subjects. She holds a PhD from the Norwegian University of Science and Technology (NTNU) and a Doctorate in Economics from BI Norwegian Business School. Monclair has served two years as Chief Executive Officer of Steinsvik Group and ten years as Chief Executive Officer of DeepWell AS.
Lars P. Sørvaag Sperre Board member
Mr. Sperre works as an i n d e p e n d e n t a d v i s o r w i th projec t s related to indus trialization and capitalization and he serves as director i n various green, growth companies. Mr. Sperre has a 17 years career with the Norske Skog group, where he gained extensive experience from international industrial operations and international development projects and large capital projects. Mr. Sperre also has extensive experience with international capital markets and M&A activities. Norske Skog is a leading international paper producer with head office in Oslo and is listed on the Oslo Stock Exchange. In Norske Skog, he served as Senior Vice President Corporate Strategy from December 2014 to October 2023. In the period from May 2017 to December 2018, Mr. Sperre served as Norske Skog ASA's President and Chief Executive Officer. From 2007 to 2014 he was responsible for the group's legal services in the role as Vice President Legal. Prior to this, Mr. Sperre worked as a lawyer at the Norwegian law firm Wikborg Rein Advokatfirma AS in Oslo. Mr. Sperre graduated from the University of Bergen with a Cand. Jur. degree in 2002 and obtained his bar practicing certificate in 2005.
Morten Platou Board member
Morten Platou is currently a partner at the top-tier Scandinavian law firm Advokatfirmaet Schjødt AS and is a specialist in the law firm's tax and capital markets department.
Mr. Platou has over 10 years of experience practicing as a lawyer, and advises clients on a regular basis on tax and corporate matters related to M&A transactions, restructurings and management incentive plans. By virtue of Platou's extensive legal experience, he is also particularly trained in client management and relationship building. Mr. Platou holds a double Masters of Law degree from the University of Oslo in Norway and Georgetown University in Washington D.C., in addition to his business and administration degree from BI Norwegian Business School in Oslo, Norway.
Anders Onarheim is the Chair of the Board of Directors of the Company. He has more than 30 years' experience from the
international capital markets, including 5 years with Goldman Sachs in London and 5 years with Merrill Lynch in New York and London and CEO of Carnegie ASA for 16 years. He has broad experience from board positions in listed companies, and is currently Chairman of the board at North Energy ASA and board member of Reach Subsea ASA. Mr. Onarheim was CEO of BW LPG, a leading shipowner and operator of liquid petroleum gas carriers, up until September 2023. Onarheim holds a BSBA and an MBA from Washington University of St. Louis and graduated in 1986.
In addition to being a member of the Company's board of directors, Ole Rogstad Jørstad is the current CEO of his own
investing company, K4 Invest AS. Since commencing his first job with KPMG, he has held several administrative roles in notable companies such as NOTAR, Veidekke Real Estate division (Startbo) and others. As per date, he is also the Chairman of several companies in Trøndelag, including, inter alia, the ELMAN Group. Currently he is also a member of the executive committee in The Norwegian Olympic and Paralympic Committee and Confederation of Sport (NIF). Mr. Jørstad has educational background from, among other, the Oslo Metropolitan University in Norway.
Maren Hjorth Bauer is an active investor, board member and advisor in the blue economy through her private investment company
Fynd. She has played a key role in building a global ecosystem for blue economy startups globally. Bauer has invested into and supported 30+ blue economy startups with strategy, business development and fundraising leveraging her global network. She is the co-founder and former CEO of Katapult Ocean, Co-chair Seaweed for Europe, part of a working group for the UN Ocean Decade and advisor to several venture funds. Bauer has more than 15 years experience with background from McKinsey, Wallenius Wilhelmsen and Orkla. She holds a MSc from London School of Economics and a Bachelor from the Norwegian School of Economics.
Maren Hjort Bauer Board member
Anders Onarheim Chairman
Board of Directors
Maria Hosen Chief Financial Officer
Maria Hosen has 18 years experience in auditing, accounting and operational management from
PricewaterhouseCoopers AS, Selvaag Bolig ASA, Western Bulk Chartering AS and Mestergruppen AS. Maria Hosen holds both an M.Sc in Economics, an M.Sc in Accounting from the Norwegian School of Economics and Business Administration and the title Certified Public Accountant.
Carlos J. Delgado Chief Technology Officer
Carlos Javier Delgado began his career with Schlumberger, the world leading supplier to the oil and gas industry. For 16 years he held positions as field engineer, business development and management across in South America, West Africa and the North Sea. During this period, he served as manager of drilling operations in high volume markets as well as in an engineering and manufacturing center of novel drilling equipment. Delgado is graduated in electronic engineering.
Lars Strøm Chief Project Officer
Lars Strøm has more than 20 years´ experience in the chemical and process industries from Borregaard, Norske
Skog, NorFraKalk and Aibel. He has leadership experience in international process and product development, and holds a degree in Chemical and Process Engineering from the University of Surrey, UK, and an MBA from Griffith University in Australia.
Odd-Geir Lademo Chief Executive Officer
Odd-Geir Lademo has more than 25 years of experience in SINTEF and the Norwegian University of
Science and Technology (NTNU). He has also worked as a Research Manager in Department of Materials and nanotechnology in SINTEF Industry. Additionally, Lademo has held a position as Adjunct Professor at NTNU. Lademo has broad national and international R&D and industry networks and has been member in the core team of the well-ranked research centers, SFI SIMLab and SFI CASA. He holds an M.Sc. and PhD from Department of Structural Engineering, NTNU.
Jan Arne Berg Chief Construction Officer
Jan Arne Berg has over 30 years' experience in the oil & gas industry. Further, Berg is a former General Manager of Aker/ Kværner
Piping Technology – a prominent product- and technology company and Vice President at Kværner in Verdal. Berg has a broad skill set in business development, sales & marketing, management and construction management. Berg also enjoys an extensive network and has pronounced relationship-building skills, which is particulary valuable in his company role. Jan Arne Berg holds a B.Sc. in Mechanical Engineering from the Trondheim College of Engineering.
Ove Lande Chief Commercial Officer
Ove Lande has 15 years' experience in investment management and capital markets from Skeie Alpha Invest and Terra Securities. As
such, Ove Lande has acquired an overview and understanding of multiple industry sectors. Moreover, Lande has experience as a former Senior Consultant at BearingPoint. He holds an M.Sc. in Financial from The Norwegian School of Economics and Business Administration.
Viggo Iversen has extensive renewable energy experience from NVE, Enova SF and Proneo, both nationally and internationally. Iversen has served in several leadership and board positions since 2007. From 2014, Iversen managed Proneo's advisory business providing business development and innovation services to over 40 companies annually. Iversen holds a Cand. Agric. in Resource Economics from the Norwegian University of Life Sciences.
Viggo Iversen Chief Operating Officer
Management
Overview
Ocean GeoLoop is a private limited liability company incorporated and domiciled in Norway. The Company was incorporated in Norway on 20 January 2020. The Company's registered address is Neptunvegen 6, 7652 Verdal, Norway.
The Company has been established to industrialize disruptive green technologies. The main technologies are developed by and through Hans Gude Gudesen and his research and development project (the "Project Ocean"), addressing the challenges related to global warming and climate change, and particularly the important role of the world's oceans in this context. The technologies represent more than 15 years of basic and applied research within a range of fields, involving a significant number of collaborating, national and international, scientists and R&D institutions. The Company approaches man-made emissions as misplaced resources. This means that man-made emissions can be considered as valuable sources of revenue which represents business opportunities, rather than expenses and challenging problems. The Company's solutions are designed to assist nature's rebalancing, using nature's own processes.
Highlights
• August: Successful 3000-hour carbon capture operation milestone. The long-term testing of the carbon capture pilot at Norske Skog Skogn provided further proof that the carbon capture
technology is highly robust at industrial scale and conditions. The pilot showed solid performance related to industrial robustness, including autonomous operation over extended periods.
- June: Established an agile test- and optimization facility at SINTEF´s premises in Trondheim, Norway, enabling a high degree of flexibility to evaluate a range of parameters and operating conditions.
- March: Our long-term collaboration with industrial partners in the Grenland and Herøya region, Norway, was recognized by the industry cluster Powered by Telemark. The Yara – Ocean GeoLoop cooperation received the "Powered by Telemark award". The award honored Ocean GeoLoop´s contribution to the collaborative culture to solve a challenge, and the work with Yara International.
Subsequent
• January 2024: Awarded feasibility study for a demo plant for carbon capture at NorFraKalk at their lime kiln in Verdal Industrial Park. The plant currently emits around 200,000 tonnes of CO2 per year. The demo plant, which will now be assessed, will capture 10,000 tonnes of CO2, to prove that the solution works in quicklime production.
Organization, Equality and Work Environment
Of the parent company's 14 employees, there are
two women. Of the Group's 47 employees, there are 8 women. The board of directors consists of 4 men and 2 women. The board will always strive for the best possible gender balance and work for diversity within the company.
The Group is actively working to reduce sick leave and improve its working environment. During the year, no serious accidents or injuries have been reported. Total leave of absence due to illness in the parent company equals 3,5% (7.6% in 2022).
No incidents or work-related accidents, resulting in significant material damage or personal injury, have occurred during the year.
The working environment is considered to be good, and efforts for improvements are made on an ongoing basis.
In 2023, the company has established an ESG task force consisting of members from the company's board and management. The mission of the ESG task force is to ensure targeted efforts on material sustainability topics, and make sure that Ocean GeoLoop is reporting in accordance with relevant sustainability frameworks. In the first half of 2024, the task force has conducted systematic stakeholder dialogue with key stakeholders, which will form the basis of the company's double materiality assessment (in line with the Corporate Sustainability Reporting Directive (CSRD) requirements). The goal is to identify our actual and potential impact and evaluate risks and opportunities.
In compliance with The Norwegian Transparency Act a publication of the statement has been made available on the parent company's website.
Environment
1.5°C. To reach the ambitious CO2 emission reduction targets as laid out in the Paris Agreement, the global energy systems are reliant on three main measures: energy efficiency, renewable energy and carbon capture utilization and storage. Carbon capture is considered by many to be essential to meet the target reduction from the Paris Agreement.
The parent company has introduced the GeoLoop CC technology that captures point source CO2 emissions, using natural and harmless processes. In 2024 the company will pilot test the e-Loop, a new technology for electricity production. The GeoLoop CC and the e-Loop can help companies and countries to reach their goals of reduced emissions and to get access to renewable electricity for the green transition.
The parent company and its subsidiaries do not pollute the external environment.
As a result of the aggravated climate change, substantial efforts and resources have in the last decades been spent on combatting global warming and climate crisis. One of the biggest events is the Paris Agreement, which is a global framework to avoid dangerous climate change by limiting global warming to well below 2°C and pursuing efforts to limit it to Negative cash flow from operating activities was NOK 34 758 796 in 2023, and the operating loss
Financial Review
The Group's revenues were NOK 172 853 613, an increase from NOK 128 093 923 in 2022, mainly driven by revenue from construction – and service contracts performed by Energi Teknikk.
Since its inception, the parent company has had significant development costs. This is linked to the development and piloting of the company´s technologies. Costs are related to external R&D competence and capacity, physical constructions and installations, and internal costs.
During 2023 research and development costs amounted to NOK 28 865 386. Expenditure on development is recognized in the balance sheet to the extent a future financial benefit can be identified associated with an identifiable intangible asset and the expenditure can be measured reliably.
Further development of the technologies both in terms of design, efficiency and costs will continue to be a priority. To the extent possible, this will be done in cooperation with industry partners, to ensure relevance and to shorten the way to commercial activity on the basis of Ocean GeoLoop´s technologies. constituted NOK 47 385 716. The difference mainly concerns ordinary depreciation and effects from business combinations.
The Group's capital investments during 2023 amounted to NOK 29 875 481, of which NOK 27 580 964 reflects capitalized development costs related to Ocean GeoLoop´s pilot units. The Group's liquidity reserve as of 31.12.2023 amounted to NOK 114 282 456. The Group's ability to self-finance investments is good.
The Group's financial position is sound and adequate to settle short-term debt as of 31.12.2023 with the Group's most liquid assets.
Total assets at year-end amounted to NOK 307 411 359, compared to NOK 363 201 873 last year. The equity ratio was 77 % as of 31.12.2023, compared to 77 % the year before.
Negative cash flow effect from financing activities was 913 962 NOK, which in majority relates to downpayment in bank overdraft.
The board believes that the annual accounts give a true and fair view of the parent company and group's assets, liabilities, financial position and result.
Allocation of net loss and dividends
Allocation of net loss and dividends Ocean GeoLoop AS has a net loss of NOK 28 894 977 from January 1 to December 31 2023.
The Board of Directors propose the net loss to be allocated to loss brought forward.
Risks
The company's business activities entail exposure to various types of risk. Ocean GeoLoop proactively manages such risks, and the board of directors regularly analyses its operations and potential risk factors and takes steps to reduce risk exposure.
Ocean GeoLoop places a strong emphasis on quality assurance and has quality systems implemented, or under implementation, in line with the requirements applicable to its business operations.
The key risks associated with the company, include:
• Financial risks: In connection with commercialization of the company's business, it may require large amounts of capital in the future to adequately pursue its business plan and may require further additional capital due to unforeseen liabilities, delayed or failed technical or commercial launch of its products or in order for it to take advantage of opportunities that may be presented to it. Adequate sources of capital funding may not be available when needed or may not be available on favourable terms. If the company raises additional funds by issuing additional equity securities, holdings and voting interests of existing shareholders could be diluted. If funding is insufficient at any time in the future, the company may be unable to fund maintenance requirements and acquisitions, further tests and development of its technology, take advantage of business opportunities or respond to competitive pressures, any of which could adversely impact the company's financial condition and results of operations.
• Market risks: The company competes in markets that are new, largely unexplored and rapidly changing. As of today, in the company's view, no known competitor has access to the same carbon capture technology. Further, the company's carbon capture technology has been developed through years of research, and the process is time consuming and likely difficult to replicate. Nevertheless, no assurance can be made that no similar solutions may be sold or delivered by a competitor, which may have a significant adverse impact on the company's competitive position and earnings. Further, the company face competition from other providers of carbon capture and/or similar solutions/technologies. The company may experience increased competition from current and potential competitors, some of which may be better established and have significantly greater financial, technical, marketing and distribution resources. Any materialization of these risks may have material adverse effects on the company's business, future revenues and scaling and commercialization plans.
• Credit risks: The company has currently no interestbearing debt, and a solid financial position to implement the strategy at this stage of the company's development. When moving into growth and commercialization, the company may consider debt
presented on the company's investor relations website.
Directors & Officers Liability Insurance
Ocean GeoLoop Group maintains a Directors & Officers liability insurance issued by Tryg Forsikring AS and Ryan Speciality Nordics AB which covers subsidiaries owned or controlled by Ocean GeoLoop AS. The insurance indemnifies directors and officers for defence costs and incurred legal liability arising out of claims made against them for actual or alleged acts or omissions while serving on a board of directors and/or as an officer. The insurance renews annually and covers claims made in relation to civil claims, employment practices, regulatory investigations and proceedings, criminal proceedings and the company's securities.
as a part of the financial profile, but Ocean GeoLoop cannot provide assurances that debt will be available for the company, or to what extent external debt financing will be relevant. • Liquidity risks: The company has a solid cash position and no interest-bearing debt, and short-term liquidity risk is considered low. Generally, the company provides a risk overview based on three categories: • Risks related to the business and the industry • Risks related to laws, legislation and regulations • Financial risks The completed overview of the risks is presented in the Information Document dated 8 March 2022, and is Ocean GeoLoop has continuously worked with determination to establish partnerships with strategically important industry players linked to the company's technical and commercial strategies. The fertilizer company Yara, the mineral company Franzefoss Minerals and their associated company NorFraKalk, the pulp & paper producer Norske Skog, and the aluminum producer Nordural represents a range of industries and emission sources with extensive market potential. Each on their own they bring ambitious climate targets to the table and bring opportunities for both utilization and storage of CO2. The company has continued to build on the partnership with Chevron, leveraging their market insight to strengthen both our technical and commercial development. These partners international presence represent a global reach for Ocean GeoLoop´s solutions.
-
Going Concern
In accordance with §3-3a of the Norwegian Accounting Act, the Board confirms that the financial statements have been prepared under the assumption of going concern. The assumption is based on estimates and expectations for 2024 and the group's long-term strategy.
Outlook
Ocean GeoLoop has systematically strengthened its supply chain capacity through strategic partnerships with EPC partners Inrigo AS and Carbon Circle AS during 2023.
Ownership Structure As of 31.12.2023 Ocean GeoLoop AS is listed on Euronext Growth Oslo, with 553 shareholders. Hans Gude Gudesen controls about 55 % of the shares. The market outlook for Ocean GeoLoop's technologies is bright. The European Union (EU) has set ambitious climate targets aimed at reducing greenhouse gas (GHG) emissions to combat climate change. The EU´s target of at least 55% reduction in GHG emissions by 2030 compared to 1990 levels, stimulates a demand for carbon capture solutions. In the United States, the Inflation Reduction Act (IRA) from 2022 is coming into full force. This legislative package will contribute to a
Through our majority position in Energi Teknikk AS, Ocean GeoLoop sees clear synergies for development of the next generation carbon capture technology including the e-Loop technology. As the main shareholder of Ocean Tunicell, Ocean GeoLoop has access to highly skilled personnel within marine biology and low-trophic ecosystems, and with relevant experience within production and processing of the sea animal tunicates. Of particular importance to Ocean GeoLoop is the enabling technology in nanofibrillated cellulose that Ocean TuniCell extracts from the tunic of this animal. In this way Ocean GeoLoop equips itself with partners and capacity to take the next steps in the company´s commercial roadmap.
Verdal, 13 Mars 2024
Anders Onarheim Chairman of the Board
Morten Platou Board member
Maren Hjort Bauer Board member
Martha Kold Monclair Board member
Ole Rogstad Jørstad Board member
Lars Sperre Board member
Odd-Geir Lademo CEO
green transition and emission cuts in the USA over a 10-year period due to its significant subsidies. The IRA is described by several as a turning point for the green transition. COP28 reiterated the focus on technology development and implementation as key to achieving climate policy targets.
The introduction of new climate technology will thus be of great importance in reaching ambitious global climate goals as the industry experiences barriers linked to available carbon capture solutions today, such as:
- High cost
- Energy cost and availability
- Integration costs for emitters at existing plants
- HSE concerns
- Robustness of solutions
- Non-existing or immature CCUS value chains
The company provides the following high level 2024 guidance for its commercial rollout:
GeoLoop Carbon Capture
• Execution of joint study with NorFraKalk for carbon capture at their quicklime facility in Verdal, Norway. The study will generate the knowledge basis for scale-up to an industrial demo plant in a hard to abate industry, where other carbon
capture technologies fall short due to lack of residual heat.
- Commercial customer campaigns run at our established experimental test facilities. These installations allow rapid experimental simulation of customer´s flue gas composition and operating conditions.
- Further feasibility studies with targeted industrial partners.
- The above activities put Ocean GeoLoop in the position to contract deliveries of carbon capture facilities for targeted industrial partners and other other incoming customer cases.
e-Loop
• Construction and testing of an e-Loop pilot, with purpose to power the company´s carbon capture offerings, lowering the costs and increasing the attractivity of industrial CCUS-projects.
GeoLoop Column
• Upholding the ambition to contribute to a joint stakeholder initiative with purpose to showcase, mature and document the GeoLoop Column as a possible commercial solution to the national challenge with the eutrophicated Oslo Fjord.
INCOME STATEMENT PARENT COMPANY AND CONSOLIDATED INCOME STATEMENT
| Ocean GeoLoop AS | Ocean GeoLoop Group | |||||
|---|---|---|---|---|---|---|
| 2023 | 2022 | Notes | Notes | 2023 | 2022 | |
| REVENUE | ||||||
| - | - | 2 | Revenue | 2 | 169 835 | 128 143 |
| 221 | 50 | 2 | Other income | 2 | 3 018 | |
| 221 | 50 | Revenue | 172 854 | 128 093 | ||
| OPERATING EXPENSES | ||||||
| - | - | Cost of goods sold | 113 500 | 103 305 | ||
| 17 495 | 13 144 | 3, 4, 5 | Employee benefits expenses | 3, 4, 5 | 52 321 | 30 550 |
| 6 425 | 3 915 | 6, 7 | Depreciation and amortisation expenses | 6, 7 | 19 470 | 20 206 |
| 11 866 | 25 739 | 3, 4 | Other operating expenses | 3, 4 | 34 948 | 26 504 |
| 35 785 | 42 798 | Total operating expenses | 220 239 | 180 565 | ||
| -35 564 | -42 748 | OPERATING PROFIT/ (LOSS) | -47 386 | -52 472 | ||
| FINANCIAL INCOME AND EXPENSE | ||||||
| - | - | Share of the profit/ (loss) of associates | 38 | |||
| 748 | - | Interest income from group companies | - | |||
| 6 387 | 29 | Other finance income | 6 126 | 210 | ||
| -466 | -43 | Other finance expense | -9 739 | -1 658 | ||
| 6 669 | -14 | 8 | Net finance | 8 | -3 576 | -1 449 |
| -28 895 | -42 762 | PROFIT/ (LOSS) BEFORE INCOME TAX | -50 961 | -53 921 | ||
| - | - | 9 | Income tax expense | 9 | -1 538 | -2 193 |
| -28 895 | -42 762 | NET PROFIT/ (LOSS) | -49 423 | -51 728 | ||
| Attributable to: | ||||||
| -28 895 | -42 762 | 10 | Other equity | 10 | -49 423 | -51 728 |
| -28 895 | -42 762 | Total | -49 423 | -51 728 | ||
| - | - | 10 | Equity holders of the parent company | 10 | - 43 804 | -48 120 |
| - | - | 10 | Non-controlling interests | 10 | -5 619 | -3 608 |
Financial statement
BALANCE SHEET PARENT COMPANY AND CONSOLIDATED BALANCE SHEET
| Amount in NOK 1000 | ||||||
|---|---|---|---|---|---|---|
| Ocean GeoLoop AS | Ocean GeoLoop Group | |||||
| 2023 | 2022 Notes | Notes | 2023 | 2022 | ||
| NON CURRENT ASSETS | ||||||
| Intangible assets | ||||||
| 3 567 | 1 556 | 6 | Other intangible assets | 6 | 55 039 | 59 870 |
| - | - | 6 | Goodwill | 6 | 8 220 | 11 352 |
| 3 567 | 1 556 | Total intangible assets | 63 259 | 71 223 | ||
| Tangible assets | ||||||
| 263 | 224 | 7 | Operating property, tools, office machines | 7 | 4 694 | 4 392 |
| 52 111 | 33 923 | 7 | Machinery and equipment | 7 | 56 989 | 27 264 |
| 5 914 | 4 995 | 7 | Machinery and plant under construction | 7 | 9 629 | 21 286 |
| 58 287 | 39 142 | Total tangible assets | 71 312 | 52 942 | ||
| Financial assets | ||||||
| 84 709 | 44 512 | 11 | Investments in subsidiaries | 11 | - | - |
| - | 12 512 | 12 | Loans to group companies | 12 | - | - |
| 84 709 | 57 024 | Total financial assets | - | - | ||
| 146 563 | 97 722 | Total non current assets | 134 571 | 124 165 | ||
| CURRENT ASSETS | ||||||
| - | Inventories | 13 | 5 327 | 4 487 | ||
| Receivables | ||||||
| 277 | - | Accounts receivable | 46 870 | 45 860 | ||
| - | 2 506 | 12 | Receivable group companies | 12 | - | - |
| 5 113 | 6 578 | Other receivables | 6 356 | 8 854 | ||
| 5 390 | 9 084 | Total receivables | 53 226 | 54 714 | ||
| Investments | ||||||
| - | - | Other quoted financial instruments | 5 | 5 | ||
| - | - | Total investments | 5 | 5 | ||
| 106 319 | 174 182 | 14 | Cash and cash equivalents | 14 | 114 282 | 179 831 |
| 111 709 | 183 266 | Total current assets | 172 840 | 239 036 | ||
| 258 271 | 280 988 | TOTAL ASSETS | 307 411 | 363 202 |
BALANCE SHEET PARENT COMPANY AND CONSOLIDATED BALANCE SHEET
| Amount in NOK 1000 Ocean GeoLoop AS |
Ocean GeoLoop Group | |||||
|---|---|---|---|---|---|---|
| 2023 | 2022 Notes | Notes | 2023 | 2022 | ||
| EQUITY | ||||||
| Owners equity | ||||||
| 527 | 527 10, 16 Issued capital | 10, 16 | 527 | 527 | ||
| 363 494 | 363 494 | 10 | Share premium | 10 | 363 494 | 363 494 |
| -10 262 | -16 101 | 10 | Other paid-in capital | 10 | -10 262 | -16 101 |
| 353 759 | 347 921 | Total owners equity | 353 759 | 347 921 | ||
| Accumulated profits | ||||||
| -116 344 | -87 449 | 10 | Other equity | 10 | -145 734 | -75 680 |
| - | - | Non controlling interests | 27 746 | 7 113 | ||
| -116 344 | -87 449 | Total accumulated profits | -117 988 | -68 568 | ||
| 237 416 | 260 472 | Total equity | 235 771 | 279 353 | ||
| LIABILITIES | ||||||
| Provisions | ||||||
| - | - | Deferred tax liability | 9 | 9 023 | 10 604 | |
| 11 687 11 687 |
7 000 7 000 |
17 | Other provisions for liabilities and charges Total provisions |
17 | 11 687 20 710 |
7 000 17 604 |
| Other non current liabilities | ||||||
| - - |
- - |
Liabilities to financial institutions Total other non current liabilities |
18 | 2 615 2 615 |
2 427 2 427 |
|
| Current liabilities | ||||||
| - | - | Liabilities to financial institutions | 18 | - | 914 | |
| 3 134 | 9 985 | Accounts payable | 23 690 | 39 907 | ||
| - | - | Income tax payable | 9 | 12 | 4 | |
| 533 | 1 426 | Public duties payable | 9 438 | 6 789 | ||
| 5 502 | 2 105 | Other current liabilities | 19 | 15 176 | 16 205 | |
| 9 169 | 13 516 | Total current liabilities | 48 316 | 63 819 | ||
| 20 856 | 20 516 | Total Liabilities | 71 641 | 83 849 | ||
| 258 271 | 280 988 | TOTAL EQUITY AND LIABILITIES | 307 411 | 363 202 |
Verdal, 13 Mars 2024
Anders Onarheim Chairman of the Board
Morten Platou Board member
Maren Hjort Bauer Board member
Martha Kold Monclair Board member
Ole Rogstad Jørstad Board member
Lars Sperre Board member
Odd-Geir Lademo CEO
| Amount in NOK 1000 | ||||||
|---|---|---|---|---|---|---|
| Ocean GeoLoop AS | Ocean GeoLoop Group | |||||
| 2023 | 2022 Notes | Notes | 2023 | 2022 | ||
| Cash flow from operating activities | ||||||
| -28 895 | -42 762 | Profit/ (loss) before income taxes | -50 961 | -53 921 | ||
| - | - | Income tax payable | - | - | ||
| 6 425 | 3 915 | Depreciation and amortisation expenses | 19 470 | 20 206 | ||
| -3 156 | 3 859 | Changes in inventories, accounts receivables and accounts payable | -15 569 | -37 021 | ||
| -15 012 | -2 119 | Changes in other accruals | 12 301 | 16 169 | ||
| -40 638 | -37 107 | Net cash flow from operating activities | -34 759 | -54 567 | ||
| Cash flow from investing activities | ||||||
| -27 581 | -31 415 | Purchase of intangible and tangible assets | -29 875 | -31 529 | ||
| - | -15 612 | Net cash effect from business combination | - | -5 715 | ||
| 355 | -12 512 | Net purchase and proceeds from other investments | - | 5 | ||
| -27 225 | -59 539 | Net cash flow from investing activities | -29 875 | -37 239 | ||
| Cash flow from financing activities | ||||||
| - | - | Proceeds from recent borrowings (long term and short term) | - | 809 | ||
| - | - | Changes in bank overdraft | -914 | - | ||
| - | 128 314 | Equity issue | - | 128 314 | ||
| - | 128 314 | Net cash flow from financing activities | -914 | 129 123 | ||
| -67 863 | 31 668 | Net change in cash and cash equivalents | -65 548 | 37 317 | ||
| 174 182 | 142 515 | Cash and cash equivalents at 01.01 | 179 831 | 142 515 | ||
| 106 319 | 174 182 | 14 | Cash and cash equivalents at 31.12 | 14 | 114 282 | 179 831 |
STATEMENT OF CASHFLOW PARENT COMPANY AND CONSOLIDATED STATEMENT OF CASHFLOW
Included in the Group is the parent company Ocean GeoLoop AS (the "Company") and companies where Ocean GeoLoop AS directly or indirectly has a majority of the voting capital. All intercompany balances and transactions between the companies have been eliminated in the consolidated accounts.
Use of estimates
statement.
Revenue recognition
The accounts have been prepared in accordance with the Accounting Act of 1998 and generally accepted accounting principles in Norway. The main accounting principles are described below. The annual accounts have been prepared on a going concern basis. recognised at nominal value. The first year's instalments on long-term receivables and long-term debt are nevertheless classified as current assets and short-term liabilities.
Reporting currency and functional currency The company accounts are reported in NOK and the functional currency is also NOK. Consolidation principles Expenditure on development is recognized in the balance sheet to the extent a future financial benefit can be identified associated with an identifiable intangible asset and the expenditure can be measured reliably. In the opposite case such expenses are expensed on an ongoing basis. Capitalized development is depreciated linearly over its economic life.
Construction contracts
The cost price of shares and partnership shares are eliminated against the equity in the underlying companies at the time of purchase. Any excess of purchase consideration over fair value of assets and liabilities acquired is recorded as goodwill. Goodwill is not amortized. The accounts of foreign subsidiaries are kept in local currency. The Group's consolidated accounts are prepared based on uniform accounting principles. the asset's cost price and written off in line with the asset. Plots are not depreciated. Assets under construction are not depreciated until completed and ready for their intended use.
In accordance with generally accepted accounting principles, the Group's management must make estimates and assumptions that influence the value of assets and liabilities in the balance sheet and the amount of revenues and expenses included in the accounts during the accounting period. The actual figures may vary from these estimates. Rented (leased) operating assets are entered on the balance sheet as operating assets if the lease is considered financial. Expenses for renting other operating assets are expensed as operational. Advance payments are entered in the balance sheet as a prepaid cost, and distributed over the rental period.
Classification of assets and liabilities
When preparing the accounts, best estimates are used based on information available at the time the accounts are prepared. Foreign currency Monetary items, receivables and liabilities in the balance sheet denominated in other than NOK are recorded at the year-end exchange rates. Profit and loss items in foreign currency are recorded at exchange rates prevailing at the time of the transaction. Both realised and unrealised gains and losses are included under financial items in the profit and loss Impairment tests are carried out if there is an indication that the carrying amount of an asset exceeds the estimated recoverable amount. The test is carried out for the lowest level of fixed assets at which independent cash flows can be identified. If carrying amount is higher than the fair value less cost to sell and value in use (net present value of future use/ ownership), the asset is written down to the highest of fair value less cost to sell and the value in use. Previous write-downs, except for goodwill write-downs, are reversed if the basis for the write-down is no longer present.
Intangible assets
Income from sale of goods and services is recognized at the fair value of the consideration, net of deductions for VAT, returns and discounts. Subsidiaries and investments in associates are valued by the cost method in the company accounts. The cost price is increased when funds are added in case of capital expansion, or when group contributions are given to subsidiaries.
Sales of goods are recognized as income when risk and control have essentially been transferred to the buyer. By risk is meant the asset's gain and loss potential, while control is defined as decision-making and right of disposal. Experience figures are used to estimate and account for provisions for quantity discounts and returns at the time of sale. Dividends/group contributions from subsidiaries are accounted for in the same year as the subsidiary makes a provision for the amount. Dividends from other companies is accounted for as financial income when the dividend has been approved.
Fixed assets
Fixed assets are entered on the balance sheet and depreciated on a straight-line basis to the residual value above the fixed asset's expected value useful life. In the event of a change in the depreciation plan, the effect is spread over the remaining depreciation period (the "breaking point method"). Expenditures for maintenance and repairs are charged to other expenses in the period incurred. Expenses or improvements is added to
Sales of services are recognized as income as they are delivered. The share of sales revenue that relates to future service payments are entered in the balance sheet as unearned income at the time of sale and entered as income then in step with the delivery of the services. Write down to fair value will be carried out if the reduction in value is caused by circumstances which may not be regarded as incidental and deemed necessary by generally accepted accounting principles. Write downs are reversed when the cause of the initial write down is no longer present.
Work in progress linked to fixed-price contracts with a long lead time is recognized on an ongoing basis settlement method where revenue recognition takes place in step with the progress of the project. The degree of completion calculated as accrued costs as a percentage of the expected total cost. The total cost is continuously reassessed. When the outcome of the contract cannot be estimated reliably, only revenues corresponding incurred project costs will recognize as income. For projects that are assumed to result in a loss, the entire calculated loss is expensed immediately. Stock of purchased goods is recognized at the lowest of acquisition cost according to the FIFO principle, and net sales value. Acquisition costs for self-made finished goods and goods in progress are direct costs and a proportional share of indirect variable costs and fixed manufacturing costs. The proportion of fixed costs is limited to the proportion of normal capacity utilization. When calculating fair value is future sale price deducted selling costs and manufacturing costs incurred to bring goods in work in saleable condition.
Impairment of intangible assets and investments
Assets intended for permanent ownership or use are classified as fixed assets. Fixed assets are valued at cost, less depreciation and impairment losses. Current assets and current liabilities include items that fall due within one year as well as items associated with the inventory cycle. Current assets are valued at the lower of cost and fair value. Short term liabilities are recognized at nominal value. Long term liabilities are fair value (net sales value) Accounts receivable and other receivables Accounts receivable and other current receivables are recorded in the balance sheet at nominal value less provisions for doubtful accounts. Provisions for doubtful accounts are based on an individual assessment of
Investment in subsidiaries and associated companies
Inventory
Self-made finished goods are assessed at the lower of acquisition cost and
NOTES TO THE ACCOUNTS
Notes Note 1 – Accounting Principles
| Note 2 Revenue | |||||
|---|---|---|---|---|---|
| Amounts in NOK 1000 | |||||
| Parent company | Ocean GeoLoop Group | ||||
| 2023 | 2022 | 2023 | 2022 | ||
| By business area | |||||
| Construction contracts | 104 464 | 95 870 | |||
| Service contracts | 64 900 | 32 273 | |||
| Other | 221 | 50 | 3 490 | -50 | |
| Total | 221 | 50 | 172 854 128 093 | ||
| Geographical distribution | |||||
| Norway | 221 | 50 | 172 854 128 093 | ||
| Total | 221 | 50 | 172 854 128 093 |
| Note 3 Public grants | ||||
|---|---|---|---|---|
| Amounts in NOK 1000 | ||||
| Parent company | Ocean GeoLoop Group | |||
| 2023 | 2022 | 2023 | 2022 | |
| Public grants | ||||
| Innovation Norway | 1 840 | 7 360 | 1 840 | 7 360 |
| The Research Council of Norway | - | - | 2 370 | 3 896 |
| SkatteFUNN | 4 750 | 3 861 | 4 750 | 3 861 |
| Total | 6 590 | 11 221 | 8 960 | 15 117 |
Ocean GeoLoop has received NOK 9.2 million in investment grants for project Carbon Capture Pilot from Innovation Norway Environmental technology scheme. The grant is received in equal part over the lifetime of the project, with NOK 1.8 in 2023. The grant is contingent of a progress in accordance with the agreement. The grant is recognised in P&L in accordance with the depreciation of the project investment.
the different receivables.
Pensions
The company has a pension scheme for all employees, assessed as contribution plan. The pension scheme is financed through payments to an insurance company. After the contribution has been made the company has no further commitment to pay. The contribution is recognised as payroll expenses.
Income tax
The tax expense in the profit and loss accounts includes both taxes payable for the period and changes in deferred taxes. The change in deferred tax reflects changes in future liabilities and assets as a result of timing differences between the tax and the accounts. Deferred tax is the tax that relates to the accumulated result but is paid in a subsequent period. Deferred tax/deferred tax assets have been calculated as 22 percent of temporary differences and the tax effect of tax losses carried forward. Deferred tax asset is recorded only if the future utilisation is probable.
Deferred tax liabilities/deferred tax assets is recorded on a net basis.
Share based compensation
The Company provides incentives to employees in the form of equitysettled share-based instruments. Equity-settled share options are measured at fair value at grant date and recognised in the income statement under salary and personnel expenses over the period in which the final right of the options vest. The balancing item is recognised directly in equity. On initial recognition of share options,
the number of options expected to vest at expiry is estimated. Subsequently the estimated number of vested options is revised for changes, so that the total recognition is based on the actual number of vested options. The fair value of the options granted is estimated using the Black-Scholes model.
Cash flow statements
The cash flow statements are based on the indirect method. Cash and cash equivalents includes cash, bank deposits and other shortterm, liquid investments which immediate and with insignificant exchange rate risk can be converted into known cash amounts and with a remaining term of less than three months from the date of acquisition. Restricted bank deposits are recorded as cash equivalents. Shares are considered to have a high price risk and are not classified as cash equivalents.
Changes in accounting principles
There are no material changes in the accounting principles for the periods presented.
Note 4 Salary and personnel costs, number of employees, loans to employees and auditor's fee Amounts in NOK 1000
| Parent company | Ocean GeoLoop Group | ||||
|---|---|---|---|---|---|
| 2023 | 2022 | 2023 | 2022 | ||
| Salary and personnel costs | |||||
| Salaries | 13 736 | 12 831 | 42 685 | 27 183 | |
| Payroll recognized in balance sheet | -7 048 | -2 652 | -7 048 | -2 652 | |
| Payroll tax | 2 522 | 1 925 | 6 576 | 3 704 | |
| Pension costs | 1 078 | 874 | 2 695 | 2 008 | |
| Other benefits | 1 369 | 165 | 1 576 | 308 | |
| Share based payments | 5 839 | - | 5 839 | - | |
| Total | 17 495 | 13 144 | 52 321 | 30 550 | |
| Average full-time employees | 10 | 8 | 45 | 41 |
| 2023 | 2024 | 2025 | Total | ||
|---|---|---|---|---|---|
| Share options vesting | 1 233 375 | 710 125 | 37 375 | 1 980 875 | |
| Of which held by Chief executive officer | 299 000 | 149 500 | 448 500 | ||
| Auditor | Parent company | Ocean GeoLoop Group | |||
| Specification of auditor's fee: | 2023 | 2022 | 2023 | 2022 | |
| Statutory audit fee group auditor | 444 | 130 | 473 | 157 | |
| Assurance services group auditor | 28 | 71 | 28 | 71 | |
| Statutory audit fee other auditor | - | - | 257 | 114 | |
| Other services | 17 | - | 17 | - | |
| Sum | 489 | 201 | 775 | 342 |
Management remuneration
| Salary | Board remuneration | Pension costs | Other benefits | Total | |
|---|---|---|---|---|---|
| Chief Executive Officer | 2 563 | 135 | - | 2 698 | |
| Board of Directors | 1447 | 1 447 |
Pension costs
The groups companies are liable to maintain an occupational pension scheme under the Mandatory Occupational Pension Act. The group's pension schemes satisfy the requirements of this act. The pension cost is presented in the table above.
The Chief Executive Officer has an agreement of three months salary in case of resignation.
Loans and guarantees to management and employees No loans or guarantees have been provided to management or other employees.
Options to key employees
The Company has established a share option plan for key employees. The plan was approved by the Company's shareholders in an extraordinary general meeting held on 15 March 2021 and required (i) share options being split in three tranches with vesting periods of 12 months, 24 months and 36 months from the date of grant, (ii) a strike price of NOK 30 per share, and (iii) regular good leaver/bad leaver provisions restricting the exercise of share options.
As per date a total of 2,197,650 share options have been awarded to management during 2021 and 2022 under the share option plan. Each share option provides the holder a right to subscribe for or acquire one share against payment of NOK 30 per share. The Company has a right to settle share options with cash payment. Simultaneous exercise of all outstanding options will result in an immediate dilution for the existing shareholders of approximately 4.0 %, based on the Company's current amount of outstanding shares. Under the vesting schedule for the share options granted in 2021 and 2022, the following amounts of share options will vest during 2023-2025:
VAT is not included in the fee specified above.
| ns to employees and auditor's fee | |||||||
|---|---|---|---|---|---|---|---|
| -- | -- | -- | -- | -- | ----------------------------------- | -- | -- |
Note 6 Intangible assets
Amounts in NOK 1000
| Parent company | Patents | Total |
|---|---|---|
| Acquisition cost 01.01.2023 | 1 582 | 1 582 |
| Additions | 2 094 | 2 094 |
| Disposals | - | - |
| Acquisition cost 31.12.2023 | 3 677 | 3 677 |
| Accumulated amortisation 31.12.2023 | -109 | -109 |
| Accumulated impairment loss 31.12.2023 | - | - |
| Reversed impairments 31.12.2023 | - | - |
| Net carrying value 31.12.2023 | 3 567 | 3567 |
| Amortisation for the year | 83 | 83 |
| Impairment loss for the year | - | - |
| Reversed impairments for the year | - | - |
| Useful economic life | 30 years | |
| Amortisation plan | Linear |
| Ocean GeoLoop Group | Goodwill | Resarch, patents and technolog |
Trade-marks and customer base |
Other | Total |
|---|---|---|---|---|---|
| Acquisition cost 01.01.2023 | 15 661 | 39 224 | 33 446 | 8 297 | 96 628 |
| Acquisitions through business combinations | |||||
| Additions | - | 2 094 | - | 833 | 2 928 |
| Disposals | - | - | - | - | - |
| Acquisition cost 31.12.2023 | 15 661 | 41 318 | 33 446 | 9 130 | 99 555 |
| Accumulated amortisation 31.12.2023 | -7 441 | -15 759 | -6 184 | -6 912 | -36 296 |
| Accumulated impairment loss 31.12.2023 | - | - | - | - | - |
| Reversed impairments 31.12.2023 | - | - | - | - | - |
| Net carrying value 31.12.2023 | 8 220 | 25 559 | 27 262 | 2 218 | 63 259 |
| Amortisation for the year | 3 132 | 3 339 | 3 345 | 1 075 | 10 891 |
| Impairment loss for the year | - | - | - | - | - |
| Reversed impairments for the year | - | - | - | - | - |
| Useful economic life | 5 years | 10 - 30 years | 10 years | 1 year | |
| Amortisation plan | linear | Linear | Linear | Linear |
| Goodwill for each acquisition | Net carrying value at 31.12.2023 | Useful economic life | Amortization method |
|
|---|---|---|---|---|
| Energi Teknikk AS | 15 996 | 5 years | Linear | |
| Ocean TuniCell AS | -7 776 | 5 years | Linear | |
| Total | 8 220 |
| Goodwill for each acquisition | Net carrying value at 31.12.2023 | Useful economic life | Amortization method |
|---|---|---|---|
| Energi Teknikk AS | 15 996 | 5 years | Linear |
| Ocean TuniCell AS | -7 776 | 5 years | Linear |
| Total | 8 220 |
The cash generating unit for goodwill is Energi Teknikk AS. The recoverable amount is measured by calculating the present value of the estimated future cash flows before tax from Energi Teknikk AS. The calculation has been done by using a weighted average cost of capital at 11,2 % before tax. The basis for estimating future cash flows has been management approved budgets/forecasts for the next five years. Cash flows for the period beyond the period covered by the budgets/forecasts are estimated by extrapolating the cash flows based on budgets/forecasts.
The research and development costs are related to costs in connection with expenses for initial patenting. A total of NOK 2,1 mill has been accrued in developing costs for the year. It is expected that the total earnings from on-going development will be equivalent to the total accrued costs.
Note 5 Share based payments
Amounts in 1000 NOK
Reconciliation of outstanding Performance share units Year to date ended December 31, 2023
| Number of instruments | Number of options Weighted average strike price | |
|---|---|---|
| Outstanding at 01.01.2023 | 2 130 375 | 30 |
| Granted during the year | - | - |
| Exercised during the year * | - | - |
| Released during the year | - | - |
| Adjusted during the year | - | - |
| Performance Adjusted | - | - |
| Cancelled during the year | - | - |
| Terminated during the year | - | - |
| Expired during the year | -149 500 | 30 |
| Outstanding at 31.12.2023 | 1 980 875 | 30 |
| Exercisable at 31.12.2023 (vested) | 1 233 375 | 30 |
*) No shares have been exercised in 2023
The weighted average remaing contractual life for the share options outstanding at 31 December 2023 was 0.77 years. The weighted average fair value of options granted during 2023 was NOK 3.86
| Assumptions and inputs in model | 2023 |
|---|---|
| Instrument | Option |
| Quantity 31.12.2023 (shares) | 1 980 875 |
| Contractual life | 3,5 |
| Strike price | 30 |
| Share price | 21,37 |
| Expected lifetime | 1,87 |
| Volatility | 50,74 % |
| Interest rate | 2,957 % |
| FV per instrument | 3,86 |
| Dividended | - |
| Vesting conditions | N/A |
Weighted average parameters at grant of instrument
| 2023 | |
|---|---|
| Total recognized cost | 5 839 |
| Total Social security provisions* | - |
* All options out of money at 31.12.2023. No social security provision required
Note 8 Finance income and expenses
Amounts in NOK 1000
| Amounts in NOK 1000 | |||||
|---|---|---|---|---|---|
| Parent company | Ocean GeoLoop Group | ||||
| Finance income | 2023 | 2022 | 2023 | 2022 | |
| Interest income from group companies | 748 | 12 | - | - | |
| Other interest income | 5 092 | 10 | 5 242 | 101 | |
| Other financial income and agio | 1 295 | 8 | 922 | 109 | |
| Total finance income | 7 135 | 29 | 6 164 | 210 | |
| Parent company | Ocean GeoLoop Group | ||||
| Finance expenses | 2023 | 2022 | 2023 | 2022 | |
| Other interest expenses | 466 | 2 | 887 | 105 | |
| Recognized effect change in provision Earn Out * | - | - | 6 762 | - | |
| Other financial expenses and disagio | - | 41 | 2 090 | 1 553 | |
| Total finance expenses | 466 | 43 | 9 739 | 1 658 |
* See note 17 Provisions for liabilities for further description of the Earn Out provision.
Note 9 Income taxes
Amounts in NOK 1000
Tax base calculation:
| Parent company | Ocean GeoLoop Group | ||||
|---|---|---|---|---|---|
| Income tax expense | 2023 | 2022 | 2023 | 2022 | |
| Tax payable | - | - | -12 | -4 | |
| Correction of tax payable from prior period | - | - | -31 | - | |
| Changes in deferred tax | - | - | 1 581 | 2 197 | |
| Total income tax expense | - | - | 1 538 | 2 193 | |
| Tax base calculation: | |||||
| Profit before income tax | -28 895 | -42 762 | -50 961 | -53 921 | |
| Permanent differences * | -4 713 | -3 660 | 1 506 | -3 010 | |
| Temporary differences | -1 237 | -15 832 | -3 212 | 996 | |
| Loss carry forward | - | - | - | -20 097 | |
| Taxable income (basis for payable taxes in the balance sheet) | -34 846 | -62 254 | -52 667 | -76 032 | |
| Temporary differences: | |||||
| Receivables | - | - | -350 | -350 | |
| Inventories | - | - | -100 | 22 | |
| Non current assets | 4 622 | 4 534 | 52 288 | 58 461 | |
| Contract asset/liability | - | - | 26 238 | 10 751 | |
| Provisions | - | - | -3 500 | -700 | |
| Loss carry forward | -146 321 | -111 476 | -231 343 -178 694 | ||
| Total temporary differences | -141 699 | -106 942 | -156 768 | -110 480 | |
| Loss not included in deferred tax | 141 699 | 106 942 | 197 781 | 158 675 | |
| Total | - | - | 41 014 | 48 195 | |
| Deferred tax liability (asset) 22% | - | - | 9 023 | 10 604 |
Temporary differences:
| Receivables |
|---|
| Inventories |
| Non current assets |
| Contract asset/liability |
| Provisions |
| Loss carry forward |
| Total temporary differences |
| Loss not included in deferred tax |
| Total |
Note 7 Tangible assets Amounts in NOK 1000
| Parent company | ||||
|---|---|---|---|---|
| Property, plant and equipment | Machinery and plant under construction |
Machinery and equipment |
Operating property, tools, office machines |
Total |
| Acquisition cost 01.01.2023 | 4 995 | 39 008 | 344 | 44 347 |
| Additions | 20 246 | 5 083 | 158 | 25 487 |
| Moval between asset groups | -19 327 | 19 327 | - | |
| Disposals | - | |||
| Acquisition cost 31.12.2023 | 5 914 | 63 419 | 501 | 69 834 |
| Accumulated depreciation 31.12.2023 | -11 308 | -238 | -11 547 | |
| Accumulated impairment loss 31.12.2023 | - | - | ||
| Reversed impairments 31.12.2023 | - | - | ||
| Net carrying value 31.12.2023 | 5 914 | 52 111 | 263 | 58 287 |
| Depreciation for the year | - | 6 223 | 119 | 6 342 |
| Impairment loss for the year | - | - | - | - |
| Reversed impairments for the year | - | - | - | - |
| Useful economic life | 5-10 years | 1-10 years | ||
| Amortisation plan | Linear | Linear |
Ocean GeoLoop Group
| Property, plant and equipment | Machinery and plant under construction |
Machinery and equipment |
Operating property, tools, office machines |
Total |
|---|---|---|---|---|
| Acquisition cost 01.01.2023 | 21 286 | 33 473 | 11 281 | 66 040 |
| Additions | 20 246 | 5 473 | 1 226 | 26 945 |
| Moval between asset groups | -31 904 | 31 904 | - | - |
| Disposals | - | - | - | - |
| Acquisition cost 31.12.2023 | 9 629 | 70 850 | 12 507 | 92 986 |
| Accumulated depreciation 31.12.2023 | - | -13 865 | -7 812 | -21 677 |
| Accumulated impairment loss 31.12.2023 | - | - | - | - |
| Reversed impairments 31.12.2023 | - | - | - | - |
| Net carrying value 31.12.2023 | 9 629 | 56 989 | 4 695 | 71 312 |
| Depreciation for the year | 7 039 | 1 541 | 8 579 | |
| Impairment loss for the year (incl. reversals) | - | - | - | |
| Reversed impairments for the year | - | - | - | |
| Useful economic life | 5-20 years | 1-10 years | ||
| Amortisation plan | Linear | Linear | ||
| Reversed impairments for the year |
Received support from the Skattefunn scheme related to development projects is grossed up against capitalized amounts, and income is recognized in line with the depreciation.
Note 13 Inventories
| Amounts in NOK 1000 | ||||
|---|---|---|---|---|
| Parent company | ||||
| Inventories | 2023 | 2022 | 2023 | 2022 |
| Finished goods | - | - | 5 427 | 4 587 |
| Provisions | - | - | -100 | -100 |
| Total | - | - | 5 327 | 4 487 |
Note 14 Bank deposits and liquidity funds
Amounts in NOK 1000
| Amounts in NOK 1000 | |||||
|---|---|---|---|---|---|
| Parent company | Ocean GeoLoop Group | ||||
| 2023 | 2022 | 2023 | 2022 | ||
| 752 | 870 | 2 836 | 2 866 | ||
| - | - | 2 721 | 2 642 | ||
| 5 299 | 173 312 | 8 459 | 174 322 | ||
| 6 051 | 174 182 | 14 016 | 179 831 | ||
| Parent company | ||||
|---|---|---|---|---|
| Liquidity funds | 2023 | 2022 | 2023 | 2022 |
| Interest fund administrated by DnB* | 100 268 | - | 100 268 | - |
| Total liquidity funds | 100 268 | - | 100 268 | - |
*) Recognized in balance sheet at acqusition cost, equal to purchased price deducted purchased interest.
Notes Notes
Note 11 Investment in subsidiaries
Amounts in NOK 1000
| 2023 | 2022 | |||||
|---|---|---|---|---|---|---|
| Company name | Acquisition date | Location | Share ownership |
Voting rights |
Share ownership |
Voting rights |
| Energi Teknikk AS | 23.02.2022 | Kvinnherad | 67,00 % | 67,00 % | 61,50 % 61,50 % | |
| Brekke Turbiner AS* | 23.02.2022 | Kvinnherad | - | - | 61,50 % 61,50 % | |
| Ocean M AB** | 14.11.2022 | Fårö | - | - | 51,00 % 51,00 % | |
| Ocean Tunicell AS | 14.11.2022 | Bergen | 60,30 % | 60,30 % | 54,00 % 54,00 % | |
| Ocean Bergen AS | 14.11.2022 | Bergen | 60,30 % | 60,30 % | 54,00 % 54,00 % | |
| Ocean Tunifeed AS | 14.11.2022 | Bergen | 60,30 % | 60,30 % | 54,00 % 54,00 % |
Investments valued at cost (parent company)
| Company name | Share capital Number of shares | Book value | Equity | Net profit 2023 | |
|---|---|---|---|---|---|
| Energi Teknikk AS | 3 591 | 24 061 | 54 511 | 25 995 | 12 618 |
| Ocean Tunicell | 37 | 222 798 | 23 369 | 12 846 | -16 720 |
Note 12 Intercompany balances with group companies
Amounts in NOK 1000
| Parent company | |||
|---|---|---|---|
| Receivables | 2023 | 2022 | |
| Loans to group companies | - | 2 511 * | |
| Convertible loan to group companies | - | 10 000 ** | |
| Accounts receivable | - | 2 506 | |
| Other receivables | - | - | |
| Total | - | 15 017 | |
| Receivables maturing > 1 year | - | 2 506 |
*) This interest-bearing loan with 3 months nibor + 2% was part of an convertible of debt in December 2023.
**) The convertible loan of NOK 9 999 345 was converted into 5,130 shares in ET for a subscription price of NOK 1 949.19 in June 2023.
*) Brekke Turbiner AS has merged with Energi Teknikk AS in June 2023. **) Ocean M AB has merged with Ocean Tunicell AS in December 2023.
| Note 10 Equity | |||||
|---|---|---|---|---|---|
| Amounts in NOK 1000 | |||||
| Parent company | |||||
| Issued capital | Share premium | Other paid-in capital | Other equity | Total equity | |
| Equity 01.01.2023 | 527 | 363 494 | - 16 101 | -87 449 | 260 472 |
|---|---|---|---|---|---|
| Profit/Loss for the period | - | - | - | -28 895 | -28 895 |
| Share based payments | - | - | 5 839 | - | 5 839 |
| Equity 31.12.2023 | 527 | 363 494 | - 10 262 | -116 344 | 237 416 |
| Ocean GeoLoop Group | |||||
|---|---|---|---|---|---|
| Issued capital | Share premium | Other equity | Minority | Total equity | |
| Equity 01.01.2023 | 527 | 363 494 | -91 781 | 7 113 | 279 353 |
| Correction of previous year | -17 115 | 17 115 | - | ||
| Profit/Loss for the period | -43 804 | -5 619 | -49 423 | ||
| Share based payments | 5 839 | - | 5 839 | ||
| Issue of shares | -9 138 | 9 137 | - | ||
| Other, exchange rate differences | 2 | - | 2 | ||
| Equity 31.12.2023 | 527 | 363 494 | -155 996 | 27 746 | 235 771 |
Note 15 Rental agreements and leasing Amounts in NOK 1000
The Group as lessee – operating lease agreements
The Group has entered into several different operating lease agreements for machines, offices and other facilities. The majority of these agreements includes a warrant for renewal at the end og the agreement period.
| Rental object | Agreement period | This year´s rent |
|---|---|---|
| Buildings and other real estate | Until the year 2030 | 5 076 |
| Computer equipment, copier etc | Annual lease agreements of less than 3 years' duration | 146 |
| Means of transport | Until the year 2027 | 348 |
| Total | 5 570 |
Note 19 Long-term construction contracts
Amounts in NOK 1000
Parts of the company's activities is related to development and production of products and systems by orders. The projects are treated in accordance with the percentage of completion method. The revenue is recognised in accordance with the calculated progress (stage of completion). The stage of completion is calculated as accrued production costs in relation to expected total production costs (cost-to-cost method). The revenue is agreed in the agreement. Expected total development costs are estimated based on a combination of experience of numbers, systematic estimation procedures, follow-up of performance measurements and follow up of efficiency measurements and best estimates.
Projects in progress appears as the net amount of total earned revenue minus invoiced / payments from customers. In cases where invoiced and payments from customers exceed earned revenue, it is presented as "prepayments from customers".
| Result of work in progress | 2023 | 2022 |
|---|---|---|
| Total income ongoing projects | 147 677 | 90 172 |
| Total costs ongoing projects | 121 440 | 78 601 |
| Net projects in progress | -26 238 | -11 571 |
| Remaining production on projects with losses | - | - |
| Earn invoiced income from ongoing construction contracts, including accounts receivable | 37 659 | 21 728 |
| Advance invoiced production includes other short-term debt | 21 242 | 9 190 |
Note 18 Collaterals and guaranties
Amounts in NOK 1000
| Guarantee liabilities | |
|---|---|
| Guaranties pledged as security | |
| Total guarantee liabilities | |
| 2023 | 2022 |
|---|---|
| 48 492 | 21 124 |
| 48 492 | 21 124 |
| 917 | 1 724 |
| - | 1 546 |
| 1 905 | 6 978 |
| 4 450 | 3 679 |
| 67 456 | 44 864 |
| 2 721 | 2 642 |
| 76 531 | 59 709 |
Note 16 Share capital and shareholder information
Amounts in NOK 1000
At 31.12.2023, the share capital of Ocean GeoLoop AS was NOK 527 155 divided into 52 715 477 shares, each with a nominal value of NOK 0.01. At 31.12.2023 Ocean Geoloop AS had 585 shareholders.
Largest shareholders at 31.12.2023:
| Ownership | ||||
|---|---|---|---|---|
| Shareholder | Number of shares | interest | Voting rights | |
| Hans Gude Gudesen | 29 250 000 | 55,50 % | 55,50 % | |
| AB Investment AS | 3 623 000 | 6,90 % | 6,90 % | |
| Pershing LLC | 2 745 656 | 5,20 % | 5,20 % | |
| Norske Skog ASA | 1 083 333 | 2,10 % | 2,10 % | |
| Verdipapirfondet First Generator | 1 072 719 | 2,00 % | 2,00 % | |
| Verdipapirfondet First Globalt | 909 486 | 1,70 % | 1,40 % | |
| MP Pensjon PK | 856 608 | 1,60 % | 1,60 % | |
| GLS Real Estate AS | 675 818 | 1,30 % | 1,40 % | |
| Bank Pictet & Cie (Europe) AG | 653 208 | 1,20 % | 1,50 % | |
| E.T. Holding AS | 591 895 | 1,10 % | 1,10 % | |
| Total | 41 461 723 | 78,70 % | 78,70 % | |
| Other (less than 1% ownership) | 11 253 754 | 21,30 % | 21,30 % | |
| Total number of shares | 52 715 477 | 100,00 % | 100,00 % |
Shareholdings by Board of Directors and management of 31.12.2023:
| Title | Name | Number of shares |
|---|---|---|
| Chief Executive Officer | Odd-Geir Lademo | 103 250 |
| Chief Financial Officer | Maria Hosen | 10 000 |
| Chief Commercial Officer | Ove Lande | 159 000 |
| Chief Construction Officer | Jan Arne Berg | 85 500 |
| Chief Technology Officer | Carlos Delgado | 6 703 |
| Chief Project Officer | Lars Strøm | 62 000 |
| Chief Operation Officer | Viggo Iversen | 17 500 |
| Chairman Of The Board | Anders Onarheim | 3 623 000 |
| Board Member | Morten Platou | 348 000 |
| Board Member | Lars Sperre | 10 000 |
| Board Member | Ole Rogstad Jørstad | 429 666 |
| Sum | 4 854 619 |
Note 17 Provisions for liabilities
Amounts in NOK 1000
| Provisions for liabilties | Guarantees | Provisions | Total |
|---|---|---|---|
| Balance 01.01.2023 | 700 | 7 000 | 7 700 |
| Allocated in 2023 | 2 800 | 4 687 | 7 487 |
| Reversed provisions in 2023 | - | ||
| Utilized provisions in 2023 | - | ||
| Balance 31.12.2023 | 3 500* | 11 687** | 15 187 |
*) A general provision is made for guarantees in Energi Teknikk AS. Based on previous years' experience, an expected guarantee obligation is allocated to delivered contracts.
**) The earn-out agreement, which include three separate instalments, is based on EBITDA targets for the years 2022 to 2025. First instalment of 2.5 million to be paid first half of 2024. Remaining maximum payment of NOK 13.5 million is gradually reduced with lower EBITDA levels until zero payment. The estimated earn-out obligation of NOK 11.7 million is based on the managements probability-adjusted EBITDA outcome.
Cont. of note 20 Business combination
Amounts in NOK 1000
Acquisition of Ocean TuniCell AS
On 14 November 2022, Ocean GeoLoop entered into an agreement with Hans Gude Gudesen to transfer his holding of approximately 55% of Ocean Tunicell, including his shares in Ocean M AB. The shares in Ocean Tunicell and Ocean M AB were transferred and assigned to Ocean GeoLoop against no consideration. The acquisition has been accounted for by using the purchase method.
Allocation of excess value from the Ocean TuniCell AS acquisition:
| Booked value in Ocean TuniCell AS |
Excess value | Recognised value | |
|---|---|---|---|
| Cash and cash equivalent | 1 415 | - | 1 415 |
| Accounts receivables | 1 803 | - | 1 803 |
| Inventory | 769 | - | 769 |
| Fixed assets | 13 716 | - | 13 716 |
| Patents | - | - | - |
| Non-interest bearing liabilities | -3 853 | - | -3 853 |
| Interest-bearing liabilities | -4 129 | - | -4 129 |
| Net identified assets and liabilities | 9 720 | - | 9 720 |
| Badwill from acquisition | - | -9 720 | -9 720 |
| Total value | 9 720 | -9 720 | - |
| Capital increase | - | ||
| Cash | - | ||
| Direct expense | - | ||
| Purchase price | - | ||
| Paid in cash | - | ||
| Cash received | 1 415 | ||
| Net cash out | 1 415 |
Note 20 Business combination
Amounts in NOK 1000
Acquisition of Energi Teknikk
On 23 February 2022, Ocean GeoLoop AS acquired 63,5 % of the shares in Energi Teknikk AS for MNOK 44,5. The acquisition was financed in cash and by issuing shares at fair value (591 895 shares, nominal value NOK 37, and share premium totalling MNOK 21,9). The fair value of the shares was set at observed market prices as traded on the stock exchange at the acquisition date. Energi Teknikk AS is a limited company located in Kvinnherad, Norway. Energi Teknikk AS is a total supplier of equipment and services for the development of small power plants. The company offers self-produced turbines, switchboards and control systems and has its own service department for operation and maintenance. The company offers a 24-hour on-call service including remote diagnosis of the control system. The acquisition has been accounted for by using the purchase method.
Allocation of excess value from the Energi Teknikk AS acquisition:
| Booked value in Energi Teknikk AS |
Excess value | Recognised value | |
|---|---|---|---|
| Cash and cash equivalent | 8 482 | - | 8 482 |
| Accounts receivables | 38 508 | - | 38 508 |
| Inventory | 1 650 | - | 1 650 |
| Fixed assets | 2 144 | - | 2 144 |
| Patents and technology | 4 659 | 23 353 | 28 012 |
| Trade marks and customer relationship | - | 33 446 | 33 446 |
| Other intangible assets | - | 6 611 | 6 611 |
| Deferred tax asset | 1 149 | - | 1 149 |
| Deferred tax obligation | - | -13 950 | -13 950 |
| Non-interest bearing liabilities | -11 019 | - | -11 019 |
| Interest-bearing liabilities | -48 036 | - | -48 036 |
| Net identified assets and liabilities | -2 463 | 49 460 | 46 996 |
| Goodwill from acquisition | - | 25 381 | 25 381 |
| Total value | -2 463 | 74 841 | 72 377 |
| Capital increase | 21 900 | ||
| Cash | 15 000 | ||
| Conditional consideration | 7 000 | ||
| Direct expense | 612 | ||
| Purchase price | 44 512 | ||
| Paid in cash | 8 482 | ||
| Cash received | -15 000 | ||
| Net cash out | -6 518 |
To the General Meeting of Ocean Geoloop AS
Independent Auditor's Report
Opinion
We have audited the financial statements of Ocean Geoloop AS showing a loss of NOK 28 895 000 in the financial statements of the parent company and a loss of NOK 49 423 000 in the financial statements of the group. The financial statements comprise:
- the financial statements of the parent company Ocean Geoloop AS (the Company), which comprise the balance sheet as at 31 December 2023, the income statement and cash flow statement for the year then ended, and notes to the financial statements, including a summary of significant accounting policies, and
- the consolidated financial statements of Ocean Geoloop AS and its subsidiaries (the Group), which comprise the balance sheet as at 31 December 2023, the income statement and cash flow statement for the year then ended, and notes to the financial statements, including a summary of significant accounting policies.
In our opinion
- the financial statements comply with applicable statutory requirements,
- the financial statements give a true and fair view of the financial position of the Company as at 31 December 2023, and its financial performance and its cash flows for the year then ended in accordance with the Norwegian Accounting Act and accounting standards and practices generally accepted in Norway, and
- the consolidated financial statements give a true and fair view of the financial position of the Group as at 31 December 2023, and its financial performance and its cash flows for the year then ended in accordance with the Norwegian Accounting Act and accounting standards and practices generally accepted in Norway.
Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company and the Group as required by relevant laws and regulations in Norway and the International Ethics Standards Board for Accountants' International Code of Ethics for Professional Accountants (including International Independence Standards) (IESBA Code), and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Ocean Geoloop AS - Auditor's Report 2023
Other Information
The Board of Directors and the Managing Director (management) are responsible for the information in the Board of Directors' report. The other information comprises information in the annual report, but does not include the financial statements and our auditor's report thereon. Our opinion on the financial statements does not cover the information in the Board of Directors' report.
In connection with our audit of the financial statements, our responsibility is to read the Board of Directors' report. The purpose is to consider if there is material inconsistency between the Board of Directors' report and the financial statements or our knowledge obtained in the audit, or whether the Board of Directors' report otherwise appears to be materially misstated. We are required to report if there is a material misstatement in the Board of Directors' report. We have nothing to report in this regard.
Based on our knowledge obtained in the audit, it is our opinion that the Board of Directors' report
- is consistent with the financial statements and
- contains the information required by applicable statutory requirements.
Responsibilities of Management for the Financial Statements
Management is responsible for the preparation of financial statements that give a true and fair view in accordance with the Norwegian Accounting Act and accounting standards and practices generally accepted in Norway, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing the Company's and the Group's ability to continue as a going concern, disclosing, as applicable, matters related to going concern. The financial statements use the going concern basis of accounting insofar as it is not likely that the enterprise will cease operations.
Auditor's Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
For further description of Auditor's Responsibilities for the Audit of the Financial Statements reference is made to: https://revisorforeningen.no/revisjonsberetninger
Oslo, 13 March 2024 RSM Norge AS
Per-Henning Lie State Authorised Public Accountant
Auditor´s Report
Title: Annual Report 2023 Published date: March 14, 2024 [email protected] +47 48 24 50 01 Neptunvegen 6, 7652 Verdal, Norway The publication can be downloaded on oceangeoloop.no Connect with us on LinkedIn
oceangeoloop.com
