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Update on third quarter 2021 financial results and audiocast details for 29 October 2021

Update on third quarter 2021 financial results and audiocast details for 29 October 2021

Update on third quarter 2021 financial results and audiocast details for 29 October 2021

14 October 2021

Lundin Energy AB (Lundin Energy) will publish its financial report for the third quarter 2021 on Friday, 29 October 2021. For the third quarter 2021, Lundin Energy will expense pre-tax exploration and appraisal costs of approximately MUSD 38 and recognise a net foreign exchange loss of approximately MUSD 97.

Exploration and appraisal costs
It is the Company’s policy to capitalize costs associated with its exploration and appraisal activities and if it is determined that a commercial discovery has not been achieved, the associated costs are charged to the income statement. For the third quarter of 2021, Lundin Energy will incur a pre-tax charge to the income statement of MUSD 38 relating to exploration and appraisal costs. These costs will be offset by a tax credit of approximately MUSD 30. The costs are mainly related to the Merckx well in PL981, the second Iving appraisal well in PL820S and relinquished licences.

Foreign exchange loss
Lundin Energy will recognise a net foreign exchange loss of approximately MUSD 97 for the third quarter of 2021. Both the Norwegian Krone and the Euro weakened against the US Dollar by approximately three percent during the third quarter of 2021. The foreign exchange loss is largely non-cash and mainly relates to the revaluation of loan balances at the prevailing exchange rates at the balance sheet date.

Change in under/overlift balances
Lundin Energy recognises income based on its sold volume (sales method). Consequently, changes in inventory and under/overlift balances are reported as an adjustment to cost, valued at production cost, including depletion. During the third quarter of 2021, Lundin Energy was overlifted by 7.6 Mboepd.

Revenue from crude oil sales from third parties
Lundin Energy markets its own crude oil production and at times markets crude oil from third parties. For the third quarter 2021, revenue from the sale of crude oil from third parties amounted to MUSD 119.8 offset by the purchase of crude oil from third parties of MUSD 118.8, resulting in a gross profit of MUSD 1.0.

Release of report and audiocast on 29 October 2021
Lundin Energy’s financial report for the third quarter 2021 will be published on Friday 29 October at 07:30 CEST, followed by a live audiocast at 14:00 CEST where Nick Walker, President and CEO, and Teitur Poulsen, CFO, will be commenting on the report and the latest developments in Lundin Energy.

Follow the presentation live on www.lundin-energy.com or dial in using the following telephone numbers:

Sweden +46 8 56642651
UK +44 3333000804
United States +1 6319131422
Norway +47 23500243
Access Pin : 73770326
Link : https://edge.media-server.com/mmc/p/egyufnjf

 

Successful refinancing into a USD 5 billion corporate credit facility

Successful refinancing into a USD 5 billion corporate credit facility

Successful refinancing into a USD 5 billion corporate credit facility

14 December 2020

Lundin Energy AB (the ‘Company”) is pleased to announce that is has successfully completed the refinancing of its existing secured USD 4.75 billion Reserves Based Lending facility (“RBL”) and other corporate facilities, into a new, lower margin USD 5 billion five year corporate facility, (the “Facility”).

Highlights
• New USD 1.5 billion five-year Revolving Credit Facility (“RCF”)
• New USD 3.5 billion 2 to 5 year maturity term loans
• Weighted average margin of 1.6 percent above LIBOR(1) which is 0.9 percentage points lower compared to the current RBL margin
• Inclusion of ESG Key Performance Indicators (“KPI”), impacting margin according to performance
• 16 international banks in the Facility
• Additional ‘accordion’ option of up to USD 1 billion

The Facility is a combination of a five-year USD 1.5 billion RCF and USD 3.5 billion term loans, split across two, three, four and five year maturities, replacing the current USD 4.75 billion RBL and USD 500 million of other credit facilities. The average margin across the Facility is significantly improved to 1.6 percent above LIBOR1, from the current RBL rate of 2.5 percent above LIBOR. The Facility also includes the option to bring in additional commitments in an accordion option of up to USD 1 billion. In line with the Company’s best in class environmental profile, ESG KPIs on carbon intensity and renewable electricity generation have been incorporated into the margin payable, providing further financial incentives for the delivery of the Decarbonisation Strategy and 2030 carbon neutrality target. The structure of the Facility is such, that it is compatible with unsecured bond issuances through the debt capital markets at pari passu terms, which could be utilised at an appropriate time to diversify the Company’s capital structure.

Teitur Poulsen, CFO of Lundin Energy comments:
“I am very pleased to announce the successful completion of the refinancing of our credit facilities into a simplified and more flexible structure of RCF and term loans, on significantly better terms. For the first time we are also including ESG KPIs into our debt framework, which will serve to offer an economic incentive to continue improving our Carbon emissions performance. This further demonstrates the financial value which can be realised from industry leading sustainable operations. I believe it is a sign of the resilience of the business, quality of the asset base and future growth profile that we were able to secure continued support from our key lenders on enhanced terms. This was achieved while successfully trading through one of the most challenging oil markets in recent years. The Facility gives us additional flexibility in terms of our financial framework and improved liquidity headroom, which alongside our BBB– (2) credit rating, positions the Company’s balance sheet well, as we continue to pursue our organic growth strategy.

“I would like to take this opportunity to thank all of our existing lenders who continue to support us in this new Facility and also welcome the new faces into the bank syndicate.”

1) LIBOR: London Inter-Bank Offered Rate
2) S&P Global Inc.

Lundin Petroleum announces its 2020 budget, production guidance and capital markets day information

Lundin Petroleum announces its 2020 budget, production guidance and capital markets day information

Lundin Petroleum announces its 2020 budget, production guidance and capital markets day information

31 January 2020

Lundin Petroleum AB (Lundin Petroleum) is pleased to announce its 2020 development, appraisal, exploration and abandonment budget which totals USD 1.27 billion and represents a 30 percent increase on 2019 capital expenditure. The production guidance for 2020 is between 145 to 165 thousand barrels of oil equivalent per day (Mboepd) and the long-term production guidance is increased to 160 – 170 Mboepd from 2021 with a target of over 200 Mboepd.

2020 guidance2019 results
Production145 to 165 Mboepd93.3 Mboepd
Operating costUSD 3.4 per boeUSD 4.03 per boe
Development expenditureMUSD 895MUSD 672
Exploration & Appraisal expenditureMUSD 225MUSD 298
Abandonment expenditureMUSD 50MUSD 4
Renewables InvestmentsMUSD 100
Long-term guidanceUpdated guidancePrevious guidance
Production160 to 170 Mboepd (2021 onwards)>150 Mboepd from Johan Sverdrup Phase 1 plateau (2020)
Target >200 Mboepd~170 Mboepd from Johan Sverdrup full field plateau (2023)
Operating costUSD 3.2 to 4.2 per boeUSD 3.4 to 4.4 per boe from 2020 onwards

2020 Production Guidance
The average production in 2019 was 93.3 Mboepd, which was above the mid-point of the upgraded 2019 production guidance of between 90 and 95 Mboepd, and 10 percent above the mid-point of the original guidance of 75 to 95 Mboepd. Lundin Petroleum’s production guidance for 2020 is between 145 to 165 Mboepd, reflecting the ramp-up of Johan Sverdrup Phase 1 to plateau levels by the summer of 2020 and a planned two-week maintenance shutdown at Edvard Grieg in the second quarter of 2020. The production contribution is split approximately 50 percent from the Johan Sverdrup field, 40 percent from the Edvard Grieg field and the remainder from the other assets.

The long-term production guidance for the Company has been increased to between 160 and 170 Mboepd from 2021 onwards, with a target of over 200 Mboepd from upsides from existing fields. The updated long-term guidance reflects the sale of a 2.6 percent interest in Johan Sverdrup during 2019, which is offset by an extension of the Edvard Grieg plateau period.

Development Budget
The 2020 development expenditure is budgeted at USD 895 million, which is an increase of one-third over 2019 levels. The Edvard Grieg tie-back projects, Solveig and Rolvsnes EWT will see increased activity compared to last year, and drilling will start on the Edvard Grieg infill campaign.

Approximately 40 percent of the 2020 budgeted development expenditure relates to the non-operated Johan Sverdrup field (WI 20%). The remaining spend for the Phase 1 project relates mainly to the drilling of additional development wells, while the Phase 2 project will see another active year of construction ahead of scheduled start-up in Q4 2022.

Approximately 35 percent of the budgeted development expenditure relates to the operated Solveig project (WI 65%) and the Rolvsnes Extended Well Test (WI 80%). Both projects will be subsea tie-backs to Edvard Grieg and are being implemented together. In 2020, offshore construction activities will take place, which include the installation of the subsea equipment and pipelines. On Solveig, drilling will start on the first development wells during the year and the project remains on track for first oil in Q1 2021.

The Edvard Grieg field (WI 65%) 2020 programme, includes drilling of the first of the three infill wells sanctioned in 2019, as well as contribution to the Utsira High Area power from shore system.

Budgeted expenditure at the non-operated Alvheim area involves the drilling of two infill wells.

Exploration and Appraisal Budget
The exploration and appraisal budget for 2020 is USD 225 million and involves the drilling of 10 wells, of which five are operated, and is targeting over 650 MMboe of net unrisked resources.

Four exploration wells are planned in the Southern Barents Sea. Two wells will be drilled on the Loppa high area close to the Alta/Gohta discoveries, targeting the Polmak prospect in PL609 (WI 40%) and the Bask prospect in PL533B (WI 40%). The other wells to be drilled are Schenzhou in PL722 (WI 20%) close to the Wisting oil discovery, and Spissa in PL960 (WI 20%).

In the Norwegian Sea two wells are planned, an appraisal well on the Balderbrå gas discovery made in 2018 in PL894 (WI 10%) estimated to contain between 50 and 140 MMboe of gross resources and an exploration well on the Melstein prospect in PL886 (WI 60%).

Four exploration wells are planned to be drilled in the Norwegian North Sea, Iving in PL820S (WI 40%) and Hasselbaink in PL917 (WI 20%) both located east of the Alvheim area, Merckx in PL981 (WI 60%) in the greater Utsira High area within tie-back distance to Edvard Grieg, and the Dovregubben prospect in PL976 (WI 50%) on the Sele High southeast of the Utsira High.

Abandonment Expenditure
The 2020 abandonment expenditure budget is USD 50 million for abandonment of the Brynhild development wells, representing the bulk of the field abandonment costs, and with the subsea facilities scheduled to be decommissioned in 2021.

Renewables Power Investments
Investments in the Leikanger hydropower and Metsälamminkangas windfarm renewables power projects in 2020 is USD 100 million, representing approximately eight percent of the Company’s total capital spend, which also reflects the intention to farm-down 50% of the 100% acquired interest in the Metsälamminkangas project.

2020 Capital Markets Day information
Lundin Petroleum will be hosting its 2020 Capital Markets Day on 31 January 2020 at 11.00 CET (10.00 GMT) at the London Stock Exchange. The Capital Markets Day will include presentations by the Company’s management team on its fourth quarter 2019 financial results, the business strategy, the 2020 budgeted development campaign and its exploration and appraisal programme.

Details for the live webcast:
Sweden +46 8 56642651
UK +44 3333000804
United States +1 6319131422
Norway +47 23500243

Access Pin : 58812582

Link : https://lundinpetroleum.videosync.fi/2020-01-31-q4_cmd

 

Update on third quarter 2019 financial results and audiocast details for 31 October 2019


Update on third quarter 2019 financial results and audiocast details for 31 October 2019

16 October 2019

Lundin Petroleum AB (Lundin Petroleum) will publish its financial report for the third quarter 2019 on Thursday 31 October 2019. For the third quarter 2019, Lundin Petroleum will recognise a post-tax accounting gain of approximately MUSD 757 in relation to the sale of a 2.6 percent working interest in the Johan Sverdrup project. Lundin Petroleum will also expense pre-tax exploration costs of approximately MUSD 14 and recognise a largely non-cash net foreign exchange loss of approximately MUSD 272.

Exploration costs
For the third quarter of 2019, Lundin Petroleum will incur pre-tax exploration costs of approximately MUSD 14 which will be charged to the income statement and offset by a tax credit of approximately MUSD 11. The exploration costs are mainly related to the dry well on the Rumpetroll prospect located in PL869.

Foreign exchange
Lundin Petroleum will recognise a net foreign exchange loss of approximately MUSD 272 for the third quarter of 2019. The Norwegian Krone weakened against the US Dollar by approximately 7 percent and the Euro weakened against the US Dollar by approximately 4 percent during the third quarter of 2019. The foreign exchange loss is largely non-cash and mainly relates to the revaluation of loan balances at the prevailing exchange rates at the balance sheet date.

Accounting gain on sale of 2.6 percent working interest in Johan Sverdrup
Lundin Petroleum completed the sale of a 2.6 percent working interest in the Johan Sverdrup development project during the third quarter and will recognise a post-tax accounting gain on the transaction of approximately MUSD 757.

Change in under/overlift balances
Lundin Petroleum recognises income based on its sold volume (sales method). Consequently, changes in under/overlift balances are reported as an adjustment to cost valued at production cost including depletion. During the third quarter of 2019, Lundin Petroleum was overlifted by 2.3 Mboepd.

Release of report and audiocast on 31 October 2019
Lundin Petroleum’s financial report for the third quarter 2019 will be published on Thursday 31 October at 07:30 CET, followed by a live audiocast at 09:00 CET where Alex Schneiter, President and CEO, and Teitur Poulsen, CFO, will be commenting on the report and the latest developments in Lundin Petroleum.

Follow the presentation live on www.lundin-petroleum.com or dial in using the following telephone numbers:

Sweden: +46 8 519 993 55
Norway: +47 23 500 211
UK: +44 203 194 05 50
International Toll Free: +1 855 269 26 05

Link : https://lundinpetroleum.videosync.fi/2019-10-31-q3

 

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Update on third quarter 2019 financial results and audiocast details for 31 October 2019 (regulatory)