Norwegian Energy Company ('Noreco') has announced its first quarter 2022 results. The quarter delivered both strong production of 28.5 mboepd and financial results with revenues of USD 179 million and EBITDA of USD 107 million.
- Hydrocarbon production of 28.5 mboepd
- Total Revenues of USD 179 million, which compares to USD 105 million in Q1 2021
- EBITDA of USD 107 million, compared to USD 29 million in the same period in 2021
- Net cash flow of USD 87 million and cash on balance sheet of USD 147 million
Net hydrocarbon production for the quarter of 28.5 mboepd is above the annual guidance range of 23.5 - 25.5 mboepd. The strong production was mainly driven by higher than expected performance on Dan and Gorm and a continued overall positive development of all the producing hubs with operating efficiency of 92.6%. Well interventions and optimisation initiatives will continue in 2022, and as such the Company raised its yearly production guidance to 24.5 - 26.5 mboepd.
The Tyra Redevelopment project made significant progress during first quarter, with sail away of the Tyra West topsides and the Tyra Utility- and Living quarters (the "accommodation unit" or "TEH") and a successful offshore lift- and installation campaign. Seven out of eight platforms are now in place moving the project closer to first gas expected in Q2 2023.
The financial result for first quarter shows a continued strong development over the previous quarter, with revenues of USD 179 million, and EBITDA of USD 107 million. The Company had total liquidity of USD 247 million at the end of the quarter, with cash on balance sheet of USD 147 million and available undrawn RBL capacity of USD 100 million.
During Q1, Noreco's financial position has strengthened significantly. In addition, the Tyra Redevelopment project continues to progress on schedule which further increases confidence regarding the start-up date in Q2 2023. Share price performance and volumes have also been strong. In addition to its RBL financing, Noreco's capital structure includes both the NOR14 senior unsecured bond and the NOR13 convertible bond. In light of the improved financial position and outlook of the Company, Noreco intends to in due course engage with investors in order to investigate measures to simplify and enhance its capital structure, involving inter alia making necessary bond amendments to facilitate a refinancing of NOR13, and has engaged Arctic Securities and Pareto Securities in relation thereto.