Corporate Presentation - Lundin Energy - February 2021 - The Lundin Group
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Lundin Energy
Corporate
Presentation
February 2021
WF12736 p01
Lundin Energy
A Leading European Independent E&P Company
Production Industry Carbon Neutral
1bn 10
leading Opex from Dividend (1)
barrels of reserves
and resources
200
Mboepd
3.0
USD/boe 2021
2025 USD/boe
FCF breakeven 1.8
by 2023 Industry leading oil price(2) USD/share
guidance
WF12736 p02 01.21
(1)
2020 Proposed dividends to the AGM (2)
Average 2021-2026
Lundin Energy 2
Lundin Energy
Consistent Focused Strategy
Organic production
growth Capital discipline
Low breakeven
Resilience Strong free cash
price projects Sustainability flow generation
Growth
Innovative, efficient, Sustainable dividend
technology driven growth
Decarbonisation
WF12736 p21 01.21
strategy
Lundin Energy 3
Lundin Energy Southern
Growth Strategy Barents Sea
Norway Pure Play
Maximise 7 Core Areas
recovery/
step-outs 101 Licences
(>20% increase(2))
Opportunistic Multiple
acquisitions Mature Lundin
Growth prospective
Opportunities Basin Norwegian Sea
Exploration resources (1)
Northern North Sea
Frontier
Area Alvheim Area ~3
Exploration
Utsira High Area Bn boe
Sele High
Southern North Sea
WF12736 p03 01.21
(1)
Net unrisked prospective resources (2)
Since beginning of 2020
Lundin Energy 4
Lundin Energy
Long-term Production Growth
Sustain
> 200
Mboepd
Full year
guidance
>200 with upsides/
new projects
Mboepd
170–190
165
Mboepd
Mboepd
2020 2021 2023
Delivering guidance or better
>8x increase from 2015 for 22 quarters running
WF12736 p06 01.21
Lundin Energy 5
Lundin Energy
Financial Resilience Average FCF Breakeven (1)
~10 USD/boe 2P
2021–2026 ~15 USD/boe 2P + 2C
HIGH Capital Allocation
MA
GE RG
RA I Resource and
Production
N
VE
BA
Growth
LE
Net Debt/EBITDAX
RR
AINABLE LOW
Dividends
ELS
& Debt
Lundin Energy
A Proven Track Record
Total Shareholder Return
2010–2020
Buy Backs
~1.5
Lundin Energy Share Price
Bn USD
In Kind Dividends
~1.1
Bn USD
~4.0
Bn USD
Cash Dividends
~1.4
Bn USD
2010 2021
CAGR >30% (1)
WF12736 p19 01.21
(1)
From 2001 to 22 January 2021
Lundin Energy 7
Lundin Energy
Carbon Neutral from 2025
Industry leading
low carbon business
...the path to carbon neutrality
~750 MUSD investment (1)
Carbon Reduction Measures
Emissions Reduction/
Starting Energy Efficiency
Point
Electrification using
Power from Shore
Carbon Emissions
>95%
production by 2023
Renewable Energy
Investments
100%
power usage in 2023
Natural Carbon
Capture
Offset remaining
emissions from 2025
Investments in R&D, Governance and Executive Incentives
Lundin Energy's carbon intensity
(kg CO2/boe)
Carbon
Neutral
2 <
2025
(2,3)
~5
Lundin Energy
Key Assets
Production/Development
Johan Sverdrup
Norway
Alvheim Area
Production
Alvheim
Utsira High Area
Production Development
02.20
p07 01.21
Edvard Grieg Edvard Grieg Tie-backs
WF12736 p11
WF12623
Lundin Energy 9
Johan Sverdrup
In a League of its Own
Carbon
OPEX Footprint
> 50% Phase 2 progressing
to scheduleJohan Sverdrup
Increased Oil Capacity
Full field
Oil up to Oil 720 Mbbls/d
535 Mbbls/d (1)
New capacity
Water injection target
Oil 500 Mbbls/d
660 Mbbls/d
Max oil rate achieved
Oil 470 Mbbls/d
535 Mbbls/d
Water injection
Oil 440 Mbbls/d Phase 2
550 Mbbls/d online
Water injection
Water injection Q4 2022
515 Mbbls/d
capacity increase
Mid 2021
Max oil
capacity test
7% increase Nov 2020
Apr 2020
First Oil
Oct 2019
up to 95 Mbopd
increase since First Oil
WF12736 p14 01.21
(1)
from second half 2021 All numbers gross
Lundin Energy 11Greater Edvard Grieg Area Gross Reserves/Resources (MMboe)
Keeping the Facilities Full ~800
589
EDVARD GRIEG 3P(2)
410 2C(3)
2P(1)
Online 186
2021 Programme
2P(1) Produced
Reserves
Resources PDO Reserves Upside Prospective(4)
Lille Prinsen
Edvard Grieg
Tellus East Jorvik
3 infill wells in 2021
Potential for additional capacity
Power from shore online end 2022
Ivar Aasen Tie back projects - online Q3 2021
Solveig Phase 1, Rolvsnes Extended Well Test (EWT)
Edvard Grieg
Future tie backs and exploration upsides
Full EWT Phase 1 Phase 2 D-Segment
Field
WF12736 p08 01.21
Merckx
Rolvsnes Solveig
(1)
2P proved plus probable reserves (3)
2C best estimate contingent resources
(2)
3P possible reserves (4)
Unrisked
Lundin Energy 12Greater Edvard Grieg Area
Solveig Phase 1 and Rolvsnes EWT
Solveig Phase 1 adds Solveig breakeven oil priceGreater Edvard Grieg Area Production
Extending Plateau Production
PDO1 Latest
2 yrs 7 yrs
Plateau production
>5 year plateau extension since PDO
140
2P Reserves Year End 2019
120 t
ci e
y
a
p n Exploration
l Ca ecli and further
a
i t i o n en d
A d d A as upsides
100 Ivar
Gross (Mboepd)
80
3P
Re
2C
ser
60
C
nt
ve
o
in
s
PDO Profile ge
n tr
es
40 ou
rc
2P Reserves e s
20
0
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029
WF12736 p17 01.21
(1)
Original Edvard Grieg PDO excluding tie-back projects Note: 2P/3P reserves includes Edvard Grieg, Solveig Phase 1 and Rolvsnes EWT
Lundin Energy 14Gross Reserves/Resources
Alvheim Area (MMboe) 616
3P(2)
Continuous Reserves Growth 508 2C(3)
+98%
257 Produced
ALVHEIM FPSO
Online
2P(1)
2021 Programme
2P(1)
Reserves
Resources PDO 2020 Upside
2021 Activity
Frosk
Full
Boa 3 infill wells
Field
Alvheim
Future projects
Frosk
Infill
Lyderhorn
Bøyla Kobra East and Gekko
Further exploration upsides
Infill Viper Kobra Kobra East /
Gekko
WF12736 p10 01.21
Volund
(1)
2P proved plus probable reserves
(2)
3P possible reserves
(3)
2C best estimate contingent resources
Lundin Energy 15Lundin Energy
Track Record of Growing Reserves
Total Resource Replacement Ratio (%) (1)
Resources
Growth
210%
150%
100%
2P 2P + 2C
Reserves Resources
2020 2016–2020
671 946
MMboe MMboe
WF12736 p11 01.21
(1)
2P reserves + 2C Contingent Resources. Includes asset transactions
Lundin Energy 16Lundin Energy Wisting
Sustaining over 200 Mboepd Southern
Barents Sea
Alta
4 projects under development Harstad
9 potential new projects
Targeting ~200 MMboe(1)
Adding up to 30 Mboepd
(2)
Kobra East / Gekko
Frosk
Taking advantage of tax benefits Alvheim Area
Lille Prinsen
Oslo
Iving
Breakeven reduced ~10 USD/boe
Utsira High Area
Edvard Grieg Infills Johan Sverdrup Phase 2
IRR enhanced up to 2X Solveig Phase 1
Rolvsnes EWT
Solveig Phase 2 Projects
Rolvsnes Full Field
WF12736 p15 01.21
Segment D Under development
Moving towards PDO
(1)
Net resources (2)
Net from 2025 onwards (3)
Require
Net unrisked derisking
resources
Lundin Energy 17Lundin Energy Shenzhou
2021 Exploration and Appraisal Programme Southern Barents Sea
Barents Sea
Remaining 7 wells targeting
400
>300 MMboe
net unrisked resources
>60 MMboe
net risked resources
Net unrisked prospective resources (MMboe)
300
Norwegian Sea
Norwegian Sea
200
Norway
Dovregubben
Norway
Lille Prinsen
North Sea
Segment D
100
Lyderhorn
Shenzhou
Iving (Appraisal)
Merckx
Lyderhorn
Alvheim Area
Iving
Lille Prinsen (Appraisal)
Utsira High
Sele High
Segment D
0
WF12736 p12 01.21
Merckx Dovregubben
Q1 Q2 Q3 Q4 2021 wells
Lundin Energy Licences
2021 2020 APA Award
Operated
Non-operated
Lundin Energy 18Lundin Energy
Focused Value Creation
Growth Resilience Sustainability
Production Long-term Opex Average Carbon Neutral
>200 3–4 FCF breakeven
2025
Mboepd by 2023 USD/boe ~10 USD/bbl (1)
Sustain with Industry leading FCF 2021–2026 Safe and
upsides and Responsible
new projects
low operating
costs 4–6 Bn USD (2)
operations
Sustainable Dividend
1.8 USD/share in 2021
80% increase
WF12736 p20 01.21
Nominal figures
(1)
Pre-dividend, 2P reserves, 2021–2026
(2)
(1)
Average
Pre-dividend, 2020–2026
Dated 2PUSD/bbl in 2021 and 45–65 from 2022 onwards (real 2021)
Brent 40–60
Lundin Energy 19Further information available
on
www.lundin-energy.com
and
the Lundin Energy App
Access Lundin Energy’s
latest information
by downloading the
Lundin Energy App
and
Social media
WF12623 p30 02.20
Lundin Energy 20Disclaimer
Forward-looking Statements
Certain statements made and information contained herein constitute “forward-looking information” (within the meaning of applicable securities legislation). Such statements and information
(together, “forward-looking statements”) relate to future events, including Lundin Energy’s future performance, business prospects or opportunities. Forward-looking statements include, but are
not limited to, statements with respect to estimates of reserves and/or resources, future production levels, future capital expenditures and their allocation to exploration and development
activities, future drilling and other exploration and development activities. Ultimate recovery of reserves or resources are based on forecasts of future results, estimates of amounts not yet
determinable and assumptions of management.
All statements other than statements of historical fact may be forward-looking statements. Statements concerning proven and probable reserves and resource estimates may also be deemed to
constitute forward-looking statements and reflect conclusions that are based on certain assumptions that the reserves and resources can be economically exploited. Any statements that express
or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases
such as “seek”, “anticipate”, “plan”, “continue”, “estimate”, “expect”, “may”, “will”, “project”, “predict”, “potential”, “targeting”, “intend”, “could”, “might”, “should”, “believe” and similar
expressions) are not statements of historical fact and may be “forward-looking statements”. Forward-looking statements involve known and unknown risks, uncertainties and other factors that
may cause actual results or events to differ materially from those anticipated in such forward-looking statements. No assurance can be given that these expectations and assumptions will prove
to be correct and such forward-looking statements should not be relied upon. These statements speak only as on the date of the information and Lundin Energy does not intend, and does not
assume any obligation, to update these forward-looking statements, except as required by applicable laws. These forward-looking statements involve risks and uncertainties relating to, among
other things, operational risks (including exploration and development risks), productions costs, availability of drilling equipment, reliance on key personnel, reserve estimates, health, safety
and environmental issues, legal risks and regulatory changes, competition, geopolitical risk, and financial risks. These risks and uncertainties are described in more detail under the heading
“Risk management” and elsewhere in Lundin Energy’s Annual Report. Readers are cautioned that the foregoing list of risk factors should not be construed as exhaustive. Actual results may
differ materially from those expressed or implied by such forward-looking statements. Forward-looking statements are expressly qualified by this cautionary statement.
WF8278 p1 03.20
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