Aker BP Registers Strong Growth

Aker BP ASA increased reserves and maintained 'very good' results in exploration, drilling and wells, projects and production.

The company has a view to a continued strong cash flow, and has a robust balance sheet give us freedom. - We are rigged for further growth, says CEO of Aker BP, Karl Johnny Hersvik.

Aker BP's production in 2016 was 118,200 barrels of oil equivalent per day (boepd); 80 percent oil and 20 percent gas. The company expects production in 2017 will increase to between 128,000 and 135,000 boepd, with $ 11 in average production cost per barrel. With the current portfolio, the company has the potential to produce 270,000 boepd in 2023, (from both vedtatte- and non-approved project). This represents an annual average growth rate of 12%.

The Company's book reserves (P50) has risen to 711 million barrels of oil equivalent (boe). Contingent resources in fields are estimated at 600 million boe, an increase of 84% since last year.

Aker BP has a robust balance sheet with $ 2.5 billion in available liquidity, which gives the company considerable financial flexibility. The company's net debt was $ 2.5 billion at the end of 2016. In 2017 the company plans investments (Capex) of between 900 and 950 million dollars. Exploration expenditure (Expex) is expected to be between 280 and 300 million US dollars while the removal costs (Decom) is estimated at 100 to 110 million US dollars in 2017.

Dividend
- I am very pleased with the company's deliveries in a period of low oil prices and a challenging market: We have stable production and high uptime. Ivar Aasen and Viper-Kobra was delivered on time and on budget without any serious incidents, and we have 24 percent of the discoveries made on the Norwegian shelf in 2016, says Hersvik.

- Our financial muscle is strengthened considerably as a result of the merger. We launched a dividend policy in connection with the establishment of Aker BP which continued in 2017, he adds. The ambition is to maintain annual dividend of at least $ 250 million over the coming years and increase the dividend level when Johan Sverdrup comes on stream.

Exploration
Aker BP intends to be a leader in exploration on the Norwegian continental shelf, and aims to find 250 million boe net in the period 2016-2020.

Exploration activity in 2016 resulted in a growth of resources of 83 million boe net. The company will continue the aggressive exploration strategy in 2017 with four egenopererte- and three partner-operated exploration wells on the program.

Development
Ivar Aasen began production on Christmas Eve - on time and within budget total. In November the company announced also the start of production of the Viper-Kobra, a subsea fields connected to the Alvheim FPSO . This project was completed on time and budget.

During 2017 the company plans to mature multiple projects and deliver three PDO -where (Plan for Development and Operation) to MPE ( OED ). It applies Snadd (subsea tie-in to Skarv FPSO ) with expected production start in 2020, Valhall Vestflanken with expected production start in 2021 Storklakken (subsea tie-in to the Alvheim FPSO ) with expected production start in 2020.
The company will have four rigs in operation in 2017; Mærsk Interceptor on Ivar Aasen field and other locations, Transocean (RIG) Arctic on Volund and Boa, commencing drilling activity on the Valhall IP and Resuming plugging of wells at Valhall DP with use Mærsk Invincible.

Production
company increases its value added from the fields by focusing on improved oil recovery ( IOR ), further development of the resource base and continuous improvement in efficiency and use of resources.

On Tam- planned a gas lift project and the drilling of a well. Along with Oda-tie-in project will contribute to the future production Ula area. Preparation for drilling commencement of injection platform (IP) on the Valhall field center starting early in 2017, with plans to drill a total of seven wells - three of which in 2017.

Efforts to start up production from new Ivar Aasen wells continues and drilling Phase 2 field is initiated in the first quarter. Viper Cobra and other infill wells will ensure stable production from the Alvheim FPSO . By Skarv FPSO will test production from Snadd still provide detailed knowledge of the reservoir that will be included in the PDO we plan to deliver in autumn.