Earnings call transcript: Aker BP Q2 2021 sees revenue dip amid expansion plans

Aker BP reported its second-quarter 2021 earnings, revealing a decrease in revenue to $2.6 billion compared to the previous quarter. Despite the dip, the company continues to focus on expansion projects and innovation, which are central to its strategy. The stock saw a decline of 4.36% in pre-market trading, reflecting investor concerns about the revenue drop and its impact on future growth prospects. According to InvestingPro data, the company maintains impressive gross profit margins of 92.52% and a healthy P/E ratio of 9.73, suggesting strong operational efficiency despite market fluctuations.

Key Takeaways

• Aker BP’s Q2 2021 revenue decreased from Q1, totaling $2.6 billion.
• The company sanctioned two major expansion projects: Johan Sverdrup Phase III and Yggdrasil.
• Net production stood at 415,000 barrels per day.
• Pre-market stock price fell by 4.36%, closing at 254.4 compared to the previous close of 266.
• Aker BP maintains a strong liquidity position with $6 billion available.

Company Performance

Aker BP’s performance in Q2 2021 showed a decline in revenue compared to the first quarter, reflecting challenges in maintaining growth amid market fluctuations. The company remains committed to its long-term strategy, focusing on expansion and innovation. Industry trends indicate a competitive landscape, with Aker BP positioning itself through strategic projects and efficiency improvements.

Financial Highlights

• Revenue: $2.6 billion, decreased from Q1 2021.
• Cash flow from operations: $1.2 billion.
• Net production: 415,000 barrels per day.
• Operating cost: $7.3 per barrel.
• Net interest-bearing debt: $4.6 billion.
• Leverage ratio: 0.4x.

Outlook & Guidance

Aker BP has set a full-year production guidance of 400,000 to 425,000 barrels per day. The company anticipates 2025 to be a peak investment year, with capital expenditures reaching approximately $6.5 billion. A commitment to a 5% annual dividend growth underscores its focus on shareholder returns, with a target dividend of $2.52 per share in 2025.

Executive Commentary

CEO Karl emphasized the company’s readiness to achieve its ambitions, citing strong assets, a capable workforce, and a robust digital ecosystem. CFO David Tenner highlighted the company’s track record and resilience in delivering value to shareholders, while also noting the exploration potential in the Yggdrasil area.

Risks and Challenges

• Revenue decline may impact future growth and investor confidence.
• High capital expenditure plans could strain financial resources.
• Market volatility and oil price fluctuations pose ongoing challenges.
• Operational risks associated with large-scale projects like Johan Sverdrup Phase III.
• Regulatory and environmental pressures on emissions and sustainability.

Q&A

During the earnings call, analysts inquired about the increase in capital expenditures and the potential of the Yggdrasil exploration. Executives also addressed questions on the company’s hedging strategy and detailed the development plans for Johan Sverdrup Phase III, emphasizing their commitment to efficient project execution and cost management.

Full transcript - Aker BP ASA (AKRBP) Q2 2025:

Karl, CEO/Presenter, Aker BP: Good morning and welcome to Aker BP’s presentation of our Q2 twenty twenty one results. Today’s agenda reflects a strong quarter with clear momentum across both our operations and our strategic priorities. We will begin with an update on our operational performance, which continues to deliver solid results. Then we’ll move on to our field development portfolio, where we remain firmly on track and where we have sanctioned two new expansion projects this quarter at Johan Sverdrup and at Yggdrasil. We are also pleased to share encouraging news from Yggdrasil on the exploration side, where we have discovered more oil in an ongoing exploration well.

And as always, our CFO, David Tenner, will guide you through the financials later in the presentation. In the second quarter, production averaged 415,000 barrels per day, down 26,000 barrels from the first quarter. This decline was primarily due to one month planned maintenance shutdown at Valhall and Ula. Despite the shutdown, we maintained a portfolio wide production efficiency of 95%. Our other assets, including Johan Sverdrup, continued to perform really well, with a production efficiency ranging from 96% to nearly 100%.

During the Valhall shutdown, we also reached a key milestone on PVPF Henless, the successful installation of the jacket and the connecting bridge for the new platform. Looking ahead, we expect lower production in the second half, driven by scheduled maintenance and natural decline. However, with a solid first half now behind us, forecast uncertainty has been reduced. As a result, we are narrowing our full year production guidance, raising the lower end of the range from three and ninety thousand to 400,000 barrels per day. Unit cost edged up to $7.3 per barrel in the quarter, primarily due to lower production volumes, higher maintenance and a weaker U.

S. Dollar against the Norwegian kroner. Nevertheless, we remain firmly on track to meet our full year production guidance of $7 per barrel, a level that remains highly competitive within the industry. On CO2 emissions, the picture remained consistent. Our emissions intensity held steady at 2.8 kilograms per barrel, an industry leading level that continues to set the benchmark globally.

At the start of the year, we outlined our ambition to sustain production above 500,000 barrels per day beyond 2030 and to pursue further growth. We are working every day to make this a reality. On this illustration, the dark blue area represents our current business plan, covering production from existing fields, ongoing field developments and regular IOR activities. Key growth drivers include the large scale Yggdrasil development, the Valhall PVP Fenris project and a series of tie back projects to Alvheim, Skarv and Grigossen. It also includes the Johan Sverdrup Phase III project and the tie back of the East Frig discovery to Yggdrasil, which have now both been formally sanctioned in the partnerships.

This visible outlook supports our target to produce around five and twenty five thousand barrels per day in 2028. Beyond 2028, the light blue edges illustrate our potential to sustain production above 500,000 barrels per day for infill drilling and tiebacks from known discovery across our portfolio. Progress this year has further strengthened our confidence in this trajectory. Looking even further ahead, we see additional growth potential beyond the current outlook. With continued exploration success and selective M and A, we see a clear path to expanding our production base well into the next decade.

This is our ambition, and we are well equipped to deliver it. We have the people, the assets, the supplier, the digital ecosystem, the capital, and maybe most importantly, the track record to make it happen. Our projects continue to advance steadily with several key milestones being achieved in the recent months. These include the successful offshore installation of the Valhall PVP jacket, the completion of the Fenris drilling campaign and others. And as we speak, we are preparing to install the jacket for the main Yggdrasil platform, the Huguenay.

These achievements reflect the scale, pace and precision of our execution. They are the result of close collaboration across teams and partners, and they mark critical steps towards delivering on our long term value creation plan. And since images speak louder than words, let’s just have a look. This video highlights the scale and complexity of the projects we are delivering and the impressive effort from our teams and alliance partners to make it happen. Offshore project progress through distinct phases: engineering, procurement, construction, offshore installation, commissioning and finally handover to operations.

The successful execution is defined not just with project progress within each phase, but by the ability to transition smoothly between them. If a project is off track, it typically becomes visible at these transition points. We are now roughly midway through the execution phase, with engineering and procurement largely complete. We are well into the construction phase, and we reached a point where the modules are being assembled into complete platform units. This gives us a clear operational visibility into the remaining work and resource needs in the different projects.

In this context, we have conducted our most comprehensive project review and budget update since sanctioned. The conclusion is reassuring. The plan holds firm. The project remain on schedule for planned startup in 2026 and 2027 as originally communicated. That said, we have naturally faced some challenges along the way.

Some work packages have experienced delays, macroeconomic conditions have impacted prices and currencies, and labor markets have tightened. And finally, the security situation in The Middle East have led to longer sailing distances between Asia and Europe. All these external factors are driving up costs across the industry. While we can’t control global inflation, we can and do respond decisively. We have mobilized the necessary resources to navigate and mitigate these challenges, maintain focus and ensure momentum in the project execution.

Now, taking all of these factors into account, we now project a roughly 6% increase in investments for the ongoing projects. This includes a 10% contingency of the remaining capital, and the adjustment reflects the full scope of what is needed to deliver on time and with quality. Now, importantly, when we look at the value creation plan from 2023 to 2028, the total investment estimate for all the PEO projects sanctioned in 2022 is up by only 3% to 4% on a like for like basis. This signal is a strong signal of disciplined execution in a highly dynamic environment. Let’s now turn to exploration and to what is arguably one of the most exciting wells on the Norwegian continental shelf this year, Umegalfa in the Yggdrasil area.

This well is remarkable, not only because we have discovered oil, which I will return to, but because we are breaking new ground in how we explore. Omega Alpha is pushing the frontiers of what is technically possible, using advanced geosteering to drill ultra long high precision horizontal sections with unprecedented speeds. This enable us to map the subsurface with high accuracy and pinpoint oil accumulations with confidence. Two years ago, with the East Rig well, we set a new benchmark by achieving more than 13 kilometers of reservoir exposure. Since then, we have equipped our rigs with wired pipe technology, a high bandwidth data link between the drill bit and the surface.

This innovation allows us to drill faster, steer with greater precision and access significantly more reservoir in real time. To put it into perspective, a typical exploration well might intersect a few 100 meters of reservoir. Omega Alpha by contrast is on track to exceed 20 kilometers of reservoir exposure at only twice the cost of a conventional well. Moreover, the quality and quantity of the data we are acquiring are vastly superior, substantially reducing uncertainty and accelerating the timeline from discovery to development. The East Frig Well is a prime example, with only two years between the discovery and the final investment decision.

Omega Alpha is a multilateral well targeting five different structures Omega, Alpha, Alpha South, Sigma North East and Pi. The combined pre drill volume estimates ranged from 40,000,000 to 135,000,000 barrels. Drilling started in May and is progressing really well. We have already covered the Alpha structure and parts of the Omega structure, confirming commercial oil volumes in the range of 20,000,000 to 40,000,000 barrels. Operations are now progressing towards the northern part of Omega, as well as the Sigma North East and Pi, which together have a pre drilled volume estimates of 30,000,000 to 70,000,000 barrels.

Geologically, this setting resembles the East Flank discovery, with thin oil zones sealed beneath a shale layer that effectively traps the hydrocarbons. We will of course provide further details once drilling is complete and the data has been more thoroughly analyzed. However, in my view, this is already a success and will contribute valuable additional volumes to the Yggdrasil development. In essence, we are also pioneering a new exploration method, one that paves the way for efficient future exploration in the Frig area West of Yggdrasil. Frig was as many remember originally developed as a gas field in the 1970s and was decommissioned twenty years ago after producing 700,000,000 barrels of oil equivalent exclusively of gas.

The initial exploration well also identified an oil zone with an estimated in place volume of 1,000,000,000 barrels of oil. However, this was never produced as horizontal drilling was still years away at that time. Based on the current geological insight, we see significant potential for further oil discoveries in the Frig area. And this represents a substantial upside for the Yggdrasil development. And that is why we, together with the Yggdrasil partners, have secured this acreage and will be drilling additional exploration wells in the years ahead.

David Tenner, CFO, Aker BP: Good morning. Aker BP has delivered another quarter of strong operational performance. And although commodity prices were down and we had planned maintenance at several fields, the operating cash flow was in line with recent quarters where we paid two tax installments. Our current investment level is high, reflecting strong progress on our field development projects that were sanctioned back in December 2022. As Karl has just mentioned, a thorough project review completed this quarter confirms that the ongoing projects are on schedule, while total investment estimates are up around 6% compared to original guidance.

In sum, this implies a significant derisking of the business cases of these highly profitable projects. Furthermore, we continue to see substantial upsides as exemplified with the ongoing exploration in the Yggdrasil area. At the end of the quarter, Aker BP’s financial position remained strong with ample available liquidity, low leverage and low net debt. Altogether, the quarter marks one more step forward on our value creation plan. We are well positioned to navigate market volatility as we focus on maximizing shareholder returns by maintaining financial flexibility, investing in profitable growth and delivering a resilient dividend that grows in line with value creation.

Let’s now take a closer look at the main drivers behind the results. Net production declined slightly, impacted by a one month planned shutdown at Valhall and Ula for maintenance and project activities. Production in the quarter was 415,000 barrels of oil equivalents per day. And with a very small underlift, sold volumes ended at $414 Operating cost increased to $7.3 per barrel, driven by reduced volumes and a strengthening of the Norwegian kroner. Year to date, our unit cost is $6.9 and we are on track to deliver on our full year guidance of approximately $7 per barrel.

Cash flow from operations reached $1,200,000,000 in the quarter. This is in line with previous quarters where we have paid two tax installments, as can be seen on the illustration down to the left for the second and the fourth quarters last year. Investments in the quarter increased to $1,900,000,000 reflecting high activity across our project portfolio. Within financing cash flow, the main item was the dividend payment of CAD0.63 per share. Zooming in on a few items in the income statement.

With lower volumes and realized prices versus the first quarter, revenues decreased to $2,600,000,000 in the second quarter. As mentioned, production cost per barrel increased due to lower volume and stronger NOK, but remained relatively flat on an absolute level. Net financial items were impacted by currency losses on non dollar denominated balance sheet items, mainly from the revaluation of our euro denominated bonds. While our Norwegian kroner hedging program covering current tax liabilities and investment plans generated a solid gain this quarter. As shown in the notes to the balance sheet, our derivatives positions are now valued at around $200,000,000 Impairments totaled $717,000,000 in the second quarter, consisting of technical goodwill on Johan Sverdrup, Valhall, Griggs Ossen and Alvheim, mainly driven by lower forward prices for oil and gas.

Since goodwill impairment has no tax impact, this leads to an artificially high reported tax rate of 138%. Adjusted for impairments, earnings per share was $0.62 in the quarter, and the effective tax rate was 75%, which should be more in line with expectations. For more information on technical goodwill and impairments, I recommend watching the explanatory video that our IR team has published on our website. Let me also briefly comment on cash flows. Taxes paid was relatively high and was, as mentioned, impacted by two installments this quarter compared to one in the first quarter.

These payments are for taxes accrued in 2024. Taxes accrued in the second quarter was significantly lower than the taxes paid, which materially reduces tax payables in the balance sheet. For the quarter in isolation, this lowers free cash flow, but as taxes payable is reduced, we also expect lower tax payments in the coming quarters. The observant reader may also have noticed a new line in this statement, investment in financial assets of $300,000,000 This is short term financial placements in liquid notes to enhance returns on surplus cash while maintaining liquidity. While this is formally classified as an investment, it is considered as cash equivalents under our bank facilities and by rating agencies and is also included in the net debt and leverage ratio calculations.

With the strong operational performance flowing through to the financial performance, we exit the second quarter with a continued strong financial position. Net interest bearing debt increased to PHP4.6 billion, but as we illustrate to the left, the main driver was the high tax payment in the second quarter, which reduced tax payables with an almost equal amount. Our leverage ratio remains at a low level, now marginally up to 0.4 times net debt to EBITDAX. Total available liquidity remains conservative at $6,000,000,000 providing a lot of flexibility. The decrease quarter on quarter is driven by the tax payments and a planned step down in our undrawn RCF facility from 3,400,000,000.0 to $3,000,000,000 Following the completion of our comprehensive project review this quarter, we have also updated our total investment plan for 2025 to 2028.

The approximate 6% increase in investments for our ongoing field development projects is now reflected in this updated plan. We continue to expect 2025 to be the peak investment year with capital expenditures reaching approximately $6,500,000,000 before tapering off from 2026 and onwards. In aggregate, the updated net estimates for the ongoing PDO project reflect an upward revision of around $1,200,000,000 As all of these projects fall under the 2020 tax system with approximate 87% tax deduction, the after tax effect of this increase is between 150,000,000 and $200,000,000 One additional thing to note is that although this investment profile is sensitive to future changes in foreign exchange rate, the actual financial exposure to a further strengthening of the Norwegian kroner is limited as we have over 75% of the planned NOK expenditures for the next three years hedged at an average dollar NOK rate between NOK10.5 and NOK11. The updated investment estimates have a marginal impact on project economics, our value creation plan and the financial metrics for the period up to 2028 that we presented back in February. The impact on estimated cumulative free cash flow generated across oil price scenarios largely follows the after tax effect of the increased CapEx with some variations due to phasing of tax and financing costs.

Consequently, our financial metrics remain very robust across most plausible oil price scenarios. Assuming a continued 5% annual increase in dividends, our leverage remains comfortably below the internal threshold of 1.5 times and well within the bank covenant limit of 3.5 times. And even in a prolonged $50 oil price environment, where we have conservatively assumed $50 per barrel from the beginning of twenty twenty five, as we also did back in February, our modeling indicates that leverage only temporarily exceeds 1.5 times in 2026 before declining again in 2027. In summary, our value creation plan is on track, and we have the capacity and resilience for attractive shareholder distributions in the years to come. Now on the topic of shareholder distributions, our guiding principle is to maintain a resilient dividend that reflects our financial strength and outlook.

And to be clear, our ambition to grow the dividend by at least 5% annually through this investment cycle remains firm. For 2025, our plan is to distribute a total dividend of $2.52 per share. We have already paid two of the four quarterly installments and the Board of Directors has resolved to distribute the third installment of $0.63 in the third quarter. Now let me round off with a few comments to the main elements of our 2025 guidance, starting with near term tax payments. As mentioned, the tax payments in the second quarter were relatively high at around $1,500,000,000 and is the result of taxes accrued last year.

Now in the third quarter, we will start paying taxes related to 2025, which will be significantly lower as the high investment level this year leads to higher tax deductions. This is a key feature of the Norwegian tax system. It provides resilience to market volatility when investing in profitable growth. Moving on to the key operational parameters. Production averaged four and twenty eight thousand barrels of oil equivalent per day in the first half of the year, above the top end of our full year guidance range, but in line with our expectations.

We still anticipate some natural decline as the year progresses, along with planned maintenance shutdowns in the third quarter. But with half of the year now behind us, we lift the low end of the guidance range and update the full year estimate to 400,000 to four and twenty thousand barrels per day. Production cost is $6.9 per barrel year to date. And although the recent strengthening of the Norwegian kroner adds some risk to the full year estimate before accounting for the financial effects of our hedging program, we maintain strong cost control and still expect to end at roughly $7 per barrel for the full year. Investment activities are currently at peak levels with construction activity at full speed and drilling campaigns ramping up.

We invested $3,100,000,000 in the first half of the year, and we lift our full year guidance to approximately $6,500,000,000 The increase in 2025 is a combination of very good progress across the projects, updated investment estimates and the cost impact of the strengthening of the Norwegian kroner. While most of the after tax financial impact of the latter is hedged, the reported investment levels on a pre tax basis is still impacted. Exploration is progressing in line with plan. The program is somewhat front loaded in 2025. So we still expect exploration spend of around $450,000,000 pretax for the full year.

Abandonment activities are also on track, but we lowered the cost estimate to around $100,000,000 reflecting good execution, but also some phasing of plugging and abandonment activities to 2028. And with that, I leave the word back to Karl for some concluding remarks.

Karl, CEO/Presenter, Aker BP: Thank you, David. So to sum up, we have delivered a solid second quarter operationally, financially and strategically. Our projects are progressing well. Our exploration efforts are breaking new ground and remain firmly on track to deliver on our long term ambitions. We continue to navigate a complex external environment with discipline and resilience.

And we’re confident in the strength of our portfolio, our people and our partnerships. We will now take a short pause before opening the Q and A session. To participate, please use the Teams link provided on the webpage or if you prefer to listen only, please stay tuned and we will resume in one minute. Welcome back, everybody. And as usual, Cetel Bakken, our eminent Head of IR is running the queue of the questions today.

And Cettel, I assume we have a first question here or a first caller.

Cetel Bakken, Head of Investor Relations, Aker BP: We certainly do, Karl. And the first question is from Matt Smith from Bank of America. Please go ahead, Your line is open.

Matt Smith, Analyst, Bank of America: Hey, there. Good morning, Thank you for taking my questions. A couple, please. The first one would be touching on the capital increases of the ongoing projects. I just wondered if you could give us some sort of sense in terms of the contract structures and really trying to sort of reconcile what proportion of the project costs still are exposed to price inflation or price variation from here.

And that would also give us a sort of a sense of what the current rate of inflation today actually is, if we have an appreciation for what costs were already locked. And then the second question would be moving on to Johan Sverdrup and Phase three. With that project now FID ed expecting production in 2027. Just to give us a bit of a broader understanding of what you expect in terms of performance and contribution from that phase by the time that project starts to contribute.

Karl, CEO/Presenter, Aker BP: Excellent. Thank you, Matt. We’ll start with CapEx question. All these projects, they go through different phases, right? So you start with feasibility, then you move into early phase engineering, and then you have detailed engineering and ultimately, you get into procurement, prefabrication and then construction and assembly and then finally commissioning and then towards the end hand over to operations.

And as these projects progress, you get better and better clarity of both scope, volume, prices, etcetera. So you have some sort of estimation going in and then you have some sort of realization as you transit from one phase to another. So what’s happened now is that we have gone from basically we’re done with engineering, we’re basically done with procurement, we’ve done most of the pre fabrication, there are only three preassembled units yet to be delivered until we’re done completely done with also the prefabrication. So now we’re moving into construction. So what we’ve done is basically a new bottom up provision, where we’ve taken everything that’s behind us, which is basically the earlier phases, and then had a new look at what we had to do.

And obviously, as we are on time, there’s not a lot of movement in terms of timing costs. So what you’re basically seeing that there is some price increase outside of what we expected it to be. There is some movement because of things we cannot control. For example, the security situation in The Middle East has increased the sailing routes from Asia to Norway by about four to six weeks, which means that we had to find work or actually accelerate work to compensate for that time. There has been some FX movements outside what we’ve had, etcetera.

So it’s a lots of smaller things actually leading up to this change. Now basically, would say the price there’s very, very little scope variation. So there’s almost no scope change inside the structure. This is quite different from what you normally see with scope variations are the main driving change in terms of CapEx. So this is basically us just updating the estimates that we had going into the main construction phase.

This also means that what is ahead of us now is basically assembly, commissioning and then hand over to operations, which is far easier for us to control as it’s essentially ours as an input factor because both engineering and procurement is essentially behind us. So we felt it was prudent to update the market on where we were in CapEx at this point in time. Now the good news is that the plan still holds, right. So with all these variations, with all these changes we’ve seen in the market since we sanctioned it back in 2022, maybe I’m pushing the point here, but I still believe that if you look at the totality of that value creation plan and a price variation in the range of three to 40%, that’s actually pretty good performance when you look across the quite fundamental changes we’ve seen both in capital markets, but also in retail markets in those three or four years or five years since we sanctioned the project. Now moving on to Johan Sverdrup Phase three, do you want to do that, David?

David Tenner, CFO, Aker BP: Yes, I can definitely do that. So as you mentioned, we have sanctioned Phase three this quarter, two subsea templates. Initial scope is eight new wells. And then there is an additional four available well slots that could be leveraged for additional IOR drilling. Startup time, 2027.

This will, of course, not only add the additional resources of roughly 40,000,000 to 50,000,000 barrels gross terms, but it will also of course, also accelerate production. So that’s a part of the business case of sanctioning Phase three. In terms of the exact contribution on production, I think I’ll refrain from trying to give a detailed estimate on that. That of course is linked to the optimization of the full field. But of course, this is included in our production profile up until 2028.

And we’re very happy to have this milestone behind us now and moving into execution. Yes, I’ll stop there.

Karl, CEO/Presenter, Aker BP: Yes. Thanks, Matt.

Matt Smith, Analyst, Bank of America: Well, thanks for all the details. Happy to pass it on.

Karl, CEO/Presenter, Aker BP: Thank you. Have a great day. And then I think we’ll move on.

Cetel Bakken, Head of Investor Relations, Aker BP: Next question comes from Christian B of Citi. Please go ahead, Chris.

Christian B, Analyst, Citi: Hi, morning guys. Thanks for taking my questions. I’ve two please. The first one is on hedging. We’ve seen your U.

S. Peers across the Atlantic hedge quite aggressively this quarter taking advantage of the war premium to lock in high oil prices through 2026. So it’s a bit surprising to see that your hedge position hasn’t changed materially and only limited to just 2025, especially given your policy allows hedging up to 100% of your production over the next twelve months and 75% for the subsequent six months, if I remember correctly. Could you please share your thinking here? Have you considered increasing your hedging to support cash flow through the production trough in 2026?

The second question is on exploration. I’m sure there will be plenty of questions on Omega Alpha, but I’d like to shift your focus to Frontier exploration first. With both Bounty and now Wunder Slaughter returning dry results in the first half and both having been positioned as high potential opportunities, should we expect a reset of expectations around your frontier exploration strategy? Specifically, you looking more towards near field or lower risk prospects? And given potentially lower complexity, are you also considering how much you spend on exploration going forward?

I’ll leave it there. Thank you.

Karl, CEO/Presenter, Aker BP: Excellent. Let’s start with hedging, David.

David Tenner, CFO, Aker BP: Yes, I can do that. So you are correct. When you look at our current hedging positions, we have roughly 18% of the after tax exposure hedged for the second half of this year using put options. And then we have policies in place that allows us to hedge further out in time using different instruments. I think when we look at hedging, we look at the totality of the business profile, but also the fiscal system that we are in.

So comparing us against sort of U. S. Peers is not necessarily the right way to think about it, given that we have a tax system, which makes it, call it, less relevant to some extent to protect liquidity to hedge. But that being said, we are constantly sort of evaluating our hedge positions, also given the recent volatility that we have seen. So this is something that we are consciously considering as we progress this in towards 2026.

Karl, CEO/Presenter, Aker BP: Thank you, David. And then moving on to exploration. Let’s start with the strategy part of your question first, Chris. So for quite a few years now, we’ve basically had this balanced view on exploration where we spend roughly 80% of the expects budget on what you could call near field exploration. And then near field for us is anything that’s 50 kilometers or less away from our own infrastructures.

So it’s a pretty big area. And then we spent 20% on frontier exploration. I don’t really foresee that changing going forward. I still believe that we will spend the majority of our capital building up on the devaluquation plans inside our assets and we’ll spend 20% or so, of course, dependent on what kind of prospects we’ll see. Now Bounty and Ornishlott are two very, very different place, right.

So Bounty is a classical high risk, high potential play opener type of prospect. And you will of course see the majority of these play openers fail. Now that’s the nature of the game. The exploration potential here in terms of probability is probably around the 20% mark of discovering a barrel of oil, right. So there’s a certain risk element associated with this activity that’s also reflected in our strategy.

Now Wanderlot is a very different animal. For us that is the first dip of our toes into this high potential play of tight oil on the Norwegian continental shelf. As I said last quarter, I don’t believe this is going to be a sprint. Believe this is going to be a marathon. And I do believe that there will be lots of these wells in the future before we crack that code.

Randerslotto also was a bit of a different one, right, because the first Randerslotto well drilled by Elida drilled by Equinor called Elida back in the day discovered oil. Now we had in this hypothesis that because of the depositional environment, you would see better porosity and permeability higher up on the structure. We don’t know exactly what happened, but at that position, there was little or no reservoir. So there might be some erosion event that have happened in geological time between these two geological positions. So that’s a very they’re two very different cases.

So no, there won’t be a fundamental reset of our strategy based on those two wells.

Christian B, Analyst, Citi: Sorry, just one follow-up. Is there any intention to revisit Rondeslot through further drilling?

Karl, CEO/Presenter, Aker BP: First, I think we’ll have to make up our minds about what actually happened here. So right now, I think that option is paused. There might be a comeback if the geological evaluation tells us that that is an opportunity. But for the moment, we do not have any such plans.

Christian B, Analyst, Citi: Okay, thank you. Thanks so much.

Cetel Bakken, Head of Investor Relations, Aker BP: All right. Then the next question comes from John Olaisen from ABG.

John Olaisen, Analyst, ABG: Yeah, good morning and thanks for taking my question. A little bit on the increased CapEx. You mentioned that you have a 10% contingency on the CapEx for new projects. I just wonder if you could specify, is this contingency for the increased CapEx? Or is there a 10% contingency for the whole budget for those projects?

Karl, CEO/Presenter, Aker BP: Yes. So what we’ve done now is that we have done a new bottom up estimate. So what I’m saying 10% contingency, it’s a 10% contingency on top of a new estimate on the going forward expenditure, right? So there is some of these expenditure that’s behind you. And then the estimates, you correctly point out, going up about 6%.

And of those remaining CapEx in the future, 10% is contingency.

John Olaisen, Analyst, ABG: So 10% of what is left on the total projects from here is contingency?

Karl, CEO/Presenter, Aker BP: Absolutely.

John Olaisen, Analyst, ABG: Right. Does that mean that you used the 10% contingency for the CapEx that you spend up to now?

Karl, CEO/Presenter, Aker BP: No, a little less. So the total we’re about, I don’t know, 45%, 50% into the total CapEx program. And some of the contingency that’s behind us has been consumed and some of this has been transferred into the future contingency amount.

John Olaisen, Analyst, ABG: Okay. Then a little bit on the Yggdrasil development. I like the video. It’s always nice to see it actually how it works. But could you tell us a little bit more about which modules that are being constructed in Asia?

It seems that all the projects going on in Norway seem to be going on track. But could you tell a little bit about the key risk you have towards Asian aerospace?

Karl, CEO/Presenter, Aker BP: Yes. So we have two primary Asian prefabrication yards, so what you call preassembled units. NOV in Batam is producing MEG TEG regeneration and sulfur producing units as basically taking the sulfur out of the seawater before you’re injecting it. And then Dubai Dry Dogs is constructing more, call it, preassembled units with basically steel works with piping and valves, which is used to stack up as you saw in the video before we finalize the construction at Stord. Yes, I think that the activity in both these yards has actually been pretty good.

It’s not what we’re used to in Norway, of course, but I would say that we’ve been able to sail away on time for all the power that’s been or preassembled units that’s been delivered out of Dubai. And it looks good also in Malaysia. But the sailing time is increased, right? So we can’t go no longer go direct via the Sinai Channel. We have to go around The Cape.

That means that we have to spend some additional money both on sailing, but also on catching up those weeks that we lose in transit. And then you’re absolutely right, we spend a little bit of resources monitoring and following up these yards to make sure that we have the quality we need when it gets to Norway. I think you’re muted for some reason, at least we lost the sound.

John Olaisen, Analyst, ABG: Sorry, I think I was muted. Sorry, I think I was muted. When will all the key components being constructed in Asia? When will they have left the yards in Asia? What’s the plan for that?

Karl, CEO/Presenter, Aker BP: The last departure, I think is one of the last weeks in October, everything will be en route to Norway.

John Olaisen, Analyst, ABG: All right, good. Then my final question, with the increased CapEx and also taking into consideration the exploration success at Yggdrasil in the Yggdrasil area, what do you estimate to be the NPV breakeven for Yggdrasil as it stands for now, including exploration success, if that’s the number you have?

Karl, CEO/Presenter, Aker BP: Yes, I don’t think we’ve done that. That’s the estimation. But I think last in Q2 in Q1, we talked about sub 25. And then it doesn’t fundamentally because of the CapEx before tax doesn’t fundamentally change the after tax. So it doesn’t necessarily impact the breakeven that much.

And then we have one quarter left. So I would probably say that we’re still sub $25 maybe even sub $20 And

David Tenner, CFO, Aker BP: just to be clear, Yun, that’s on a point forward basis. When we look at the full portfolio, the adjusted the CapEx estimates, we’re still between $35 and $40 full life cycle breakeven on the projects. And this does not include the latest discoveries in the Yggdrasil area. So we keep adding to the profitability of the project. So I think one additional point from my side here is that I think where we are now in the phasing of the project, this sort of updated baseline, including the milestones that are completed marks sort of a significant derisking of the projects.

And of course, we keep adding to the profitability as we add additional resources.

Karl, CEO/Presenter, Aker BP: And I think one additional point, when we constructed the Drosil, we always thought of this as a hub. So that means that the both the topside, but also the subsea infrastructure is all prepared to do exactly what we’ve now done in the East Frig. And with now the Omega, this will be another bolt on. We have standardized subsea equipment, standardized wellhead, standardized well technology, etcetera, etcetera. So this is basically add on.

So the additional CapEx will be limited and that’s of course increasing the NPV as we continue to add resources without, let’s say, buying the infrastructure that you normally do in these tiebacks.

John Olaisen, Analyst, ABG: So when you say 35,000,000 to 40,000,000 that excludes both East Frig and the other potential exploration success that you

Karl, CEO/Presenter, Aker BP: might That was the starting point.

John Olaisen, Analyst, ABG: And Omega and everything?

Karl, CEO/Presenter, Aker BP: Absolutely. That was a starting point back in 2022, yes.

John Olaisen, Analyst, ABG: And what kind of NPV breakeven would you need for East Frig and Omega and for future X-ray success you think?

Karl, CEO/Presenter, Aker BP: So we haven’t really updated the estimates. So we are still using $35 as kind of a benchmark for these kind of decision basis. But obviously, both is Frig and also Omega when the times comes will be significantly lower than that.

John Olaisen, Analyst, ABG: Right. Thanks a lot. That’s all for me. Have a nice day and a nice summer.

Karl, CEO/Presenter, Aker BP: Thank you, John. Thank you, John.

Cetel Bakken, Head of Investor Relations, Aker BP: Okay. Then the next question comes from Nash Kui from Barclays.

Nash Kui, Analyst, Barclays: Hey, good morning, everyone. Thanks for taking my questions. I have two, if that’s okay. So the first one is just to get some clarification on CapEx, especially for next year, 2026. I wonder, given the increased level of activities this year, your ForEx change, hedging, can you provide some color on where we will land on CapEx next year?

Then my second question is more on leverage and the working capital. Let me see. I’m just looking at Slide 18 of your presentation because leverage leverage ratio has reached 0.4 this quarter, kind of the highest level for the last two years. And this quarter, we also had a very positive working capital movement. I wonder where do you see leverage ratio by the end of the year and how should we think about working capital evolution as well?

Thank you.

Karl, CEO/Presenter, Aker BP: Yeah, let’s take CapEx first and let’s start with 2025 then, right. I think in the last quarterly presentation, said that I would be very happy if we reached the upper end of the CapEx estimates for 2025. And now we have obviously increased those quite a little bit. So that basically means that as we’re taking delivery of quite a lot of these procurement items, we’re also closing out those accounts. So in a way, you can say that the more we spend in 2026, the better it is because it actually proves that we have taken delivery of a lot of these procurement items and are now shipping them back to our site as I went through both of my presentation and my answer to John.

And then for 2026, I don’t think we have guided specifically apart from what is in the deck. But the way I would think about this is that the majority of the CapEx in front of us is basically a result of construction activities, meaning that we’ve passed procurement, we’ve passed engineering. So you shouldn’t expect that kind of increase in 2026 that you’ve seen in 2025, because that’s basically catching up with price increases and other out of control effects. Leverage rate. Yes.

David Tenner, CFO, Aker BP: Let me just add one additional point to Carlos comment around the 2026 CapEx. Just to be clear for everybody, as I also said in my presentation, the updated investment profile that we now have in the slide deck includes also adjustments to the other years, not only 2025.

Karl, CEO/Presenter, Aker BP: Yes, which is Slide 19 for your reference, Nash.

David Tenner, CFO, Aker BP: And then when it comes to leverage ratio, Nash, it’s the same. So we have a slide in the deck, which illustrates our leverage ratio development across various oil price scenarios. So and that’s also been updated with the latest estimates on CapEx. So I’ll refrain from giving a point estimate with regards to leverage ratio because it obviously depends on commodity price and But so I think that will give a very good outlook for where we expect to end depending on ranges of outcomes in commodity prices.

Nash Kui, Analyst, Barclays: Okay. Thank you so much. It’s very helpful.

Karl, CEO/Presenter, Aker BP: Thank you. Have a good summer, Anas.

Cetel Bakken, Head of Investor Relations, Aker BP: Okay. Next question is from Victoria McCulloch from RBC.

Victoria McCulloch, Analyst, RBC: Morning. Thanks very much for your time to take some questions this morning. So maybe first of all on Yidrisil. Can you give us an idea of how much the East Frig, now that it’s added to the development, has been able to add to the plateau at Yidrisil, to give us an idea of the impact that Omega Alpha could have if it characterizes in the same sort of size and way as that development has? And secondly, could you give us an idea of some of the maintenance that’s scheduled for Q3 that’s helping I guess is driving your guidance for lower production in the second half of the year?

And finally, it looks like you’ve given us quite a few wells into 2026 in this part of your the exploration schedule on Slide 11. All of that, it looks like there’s fewer wells being drilled. Should we see that as just a preliminary estimate and the exploration sort of budget is broadly remaining flat into next year, given the sort of opportunities that you’re clearly unlocking in Yggdrasil as well as other geographies? Or is that a reflection of a slightly lower sort of schedule for next year as it stands at the moment? Thanks very much.

Karl, CEO/Presenter, Aker BP: Yes, let’s start with the last question. I think my it will be a fair assessment to say that the expects next year is broadly in line with what we delivered in 2025. The fact of the matter is that we are at this point in time, rig constrained. So that means that even if we wanted to drill more wells, we would have to take on additional rig capacity, which we obviously don’t want to do simply because we are trying to make these rigs into performance machines. And every time you shift rigs in out of the portfolio, you get some sort of startup issues that happens every single time.

Moving on to Yggdrasil. One way to think about this is and will of course depend on the phasing of these reservoirs because Yggdrasil consists now of eight to 10 different reservoirs. There are three production systems at Huguenot in terms of oil, gas and water separation. So it will depend on the phasing of the different reservoirs. But an easy way to think about it is that roughly 50,000,000 barrels should equate to approximately a year in extended plateau, if you were to very simply simplify the way to think about it, right.

And if you remember correctly, that’s about the size of East Rig. And then depending on how much you find in the remaining part of Omega, this could now range from, let’s call it the midpoint between twenty and forty is 30. And then you have 30 to 70 in the remaining part. So you could easily end up anywhere in the range of, let’s call it, to 100. Obviously, 100 would be quite a big development for this area.

Now this is exciting enough, Victoria, but what’s really making Omega exciting is that we have proven that we have an ability to explore oil without penetrating these oil zones. So that means that as we are moving next year into the Frig main, we can actually now drill a trajectory into Frig and control the top of the bottom of the reservoir and understand the saturation profile in that whole trajectory. This it’s actually groundbreaking in terms of exploring for these oil pockets. So that’s what’s really making this exciting. This could be a significant upside for the grocery area.

David Tenner, CFO, Aker BP: Then maintenance in Q3?

Karl, CEO/Presenter, Aker BP: And then maintenance in Q3. So the way to think about this is that there’s a lot of smaller stuff like ESDs and or emergency shutdown tests and different tests of safety equipment. The majority of the activity is related to about a month stop at the Griggs Ossen infrastructure and then we have about two weeks at Alhab if memory serves me right. So I would very simply, I would basically look at the Q2 maintenance program as similar to the Q2 maintenance program in terms of production effect.

Victoria McCulloch, Analyst, RBC: Super. Thanks very much. And just to confirm the production profile that you’ve provided on Slide seven, that does already include East Frig extend or opportunity within it, Yes, doesn’t absolutely.

Karl, CEO/Presenter, Aker BP: And as we said, this now includes East Frig, it includes the Johan Sverdrup Phase three and then includes some of the IOR activities that is inside the base business plan.

Victoria McCulloch, Analyst, RBC: Super. Thanks for confirming. Thanks for your time today.

David Tenner, CFO, Aker BP: Thank you.

Cetel Bakken, Head of Investor Relations, Aker BP: Next caller is Chris Wheaton from Stifel.

Chris Wheaton, Analyst, Stifel: Good morning, guys. Thanks very much indeed. Three questions, if I may. Firstly, strategically, I would think you’re starting to think about what happens next after Iqqa Sill in terms of project sanctions. Because if you’re going to say if you want to get this production on in 2829 and maintain that plateau above 500,000 barrels a day, you need to be thinking about sanctioning them next year, I would think.

And I’m interested in your thoughts as to what’s front of the queue for the next set of project sanctions, being able to keep the conveyor belt, the manufacturing process, continuing to keep that going as production activity or sorry, development activity starts to ramp down the dig for sale over the next eighteen to twenty four months. My second question was on conjoining the Omega Rees discovery. If you’ve really found a way of tapping into tight oil here, I’m interested in how much of ’26 exploration campaign could be changed at this point to try and focus on that because it feels like that ought to be some of your lowest incremental cost to develop, so your highest incremental return resources given the Hub at Igloosel. And therefore, you should be focusing on those. I’m interested in your sort of capital allocation thoughts there.

And lastly, a question for David. Your result accounts are always extremely beautifully easy to read. The one number that leapt out at me was the 350,000,000 of other working capital inflow that wasn’t inventory or trade payables. And I wondered if you could explain what that was because I thought at first that was derivatives, given you’ve talked about your hedging of currency and but that doesn’t seem to show up in the balance sheet. So I wondered if you could explain what that SEK $350,000,000 was, please.

Thank you very much.

Karl, CEO/Presenter, Aker BP: Thank you, Chris. Really good questions. So let me start with the strategy. I think you’re absolutely right. We are already starting to think about what’s post 2027.

So maybe two avenues of how to think about that. The first one is basically the portfolio. So a lot of the stuff that will happen post 2027 will, to be honest, be you could call it tiebacks or series of tiebacks or lifetime executive projects, etcetera, etcetera. So we are already kind of doing a lot of the prep work while we are executing. So in a way, there’s a balance between keeping focus on the execution in this critical phase and then of course starting to think about the future.

So what we’ve done from an organizational perspective is we have split those two organizations. So I have now one project organization who is only focusing on executing what we’ve already committed to and decided. And then we’re setting down a new team, which is taking all the beautiful learnings and all the good things that we’ve done in this, call it, generation of execution and then turbocharging that into the next generation of execution. So next generation that will be digital and native, there won’t be any documents. We are looking at the new generation of commercial models with the alliance partners, etcetera, etcetera, long, long list of activities.

Then quite a bit of this is flowing in either through the drill bit or through the existing portfolio or through possible M and As. And the way I would think about this is that in the future and post-twenty twenty seven, you won’t necessarily see the big topside projects that you’ve seen now with PVP and Yggdrasil. You will see much more of these tiebacks going at high speed where the game is to get from discovery to production in a short as possible time. So that’s what we’re basically focusing on going forward, if you wanted a bit of a broad stroke. Changes to 2026 program.

The reality is that for 2026, maybe even for parts of 2027, we will be constrained by rig activity. So even if we wanted to fundamentally change that program, we will be very disciplined because we know that any changes to these exercises comes with an execution risk and an execution cost. What we have demonstrated now with Omega is that we have an ability to fundamentally change the way exploration is done on the Norwegian continental shelf. We have drilled reservoir sections at unprecedented speeds that is outside the normal, you could call it, parameters of drilling. And we’ve proven that that is safe and we can actually steer and we can actually monitor the whole reservoir in one go in real time.

It’s quite a fundamental change. Now, while we are acquiring all these data, we also want to go back and have a look at what that actually means. What does it mean in terms of our drill out strategy? What does it mean in terms of do we stop drilling exploration wells and go directly for keeper wells? So how do we actually think about this?

So my view on this, Chris, is that as exciting as it is, it’s worth taking a little bit of a breather and having a look at what we’ve actually done and how that will impact our strategy. So I don’t foresee big changes for the 2026 program, because one, I’m very constrained and two, I really want to think about how we can actually leverage that possibility to the maximum of its capability. Then you want to talk about financial items and working capital?

David Tenner, CFO, Aker BP: Unless you want to go into the nitty gritties of the notes. You want to switch places? No, no, no. So first

Karl, CEO/Presenter, Aker BP: of all, Chris, of course,

David Tenner, CFO, Aker BP: thank you for the kind words with regards to how we position the accounts. So the $350,000,000 that you’re talking about, it can be split in two things, and then you find more details also in the notes. So it’s other short term receivables and other current liabilities that change. And on short term receivables, one of the key things that we see a positive impact from is a reduction in prepayments. So this is actually an effect of the progress on the projects.

And then the other one actually with regards to current liabilities is also linked actually to the increase in investment level. So as we increase the spending that typically also have a positive effect on working capital as we typically pay the bills slightly after where the work has been executed. So but more information in Note eight and fourteen.

Chris Wheaton, Analyst, Stifel: Thanks very much indeed. But I have just one follow-up, if I may, just on your answer. Given the cost inflation we’re seeing, are you back at the CMD, you talked about $15 a barrel for incremental project breakeven for incremental projects. So you’re still happy with that number despite the inflation you’re seeing? Because it sounds like all the the manufacturing process improvements you can put in place that you’ve just talked about, which you’re clearly super excited about, that feels like that could offset some of that inflation.

Are you still happy with that $15 number?

Karl, CEO/Presenter, Aker BP: If you talk about CapEx per barrel, is that what you’re talking about, 15 yes, I think I’m actually quite happy with that number. Some of these will be lower and some of these will be higher. But on an average, think that will be a fair assessment. And then that being said, I think you’re on to a point there that I don’t think a lot of captured is that we have actually offset quite a lot of the price increase by a basic increase in productivity in preassembly and prefabrication. And a lot of these, call it, early phase investments, both in as an alliance, but also into technologies like digital machining and fiber lasers and all of that stuff.

There’s a long, long list have basically ensured that we are able to catch up even as prices has increased and sailing times has increased and all this stuff we’ve been able to kind of safeguard the times of these projects. So if we hadn’t made those investments, you would have seen different numbers.

Chris Wheaton, Analyst, Stifel: That’s very clear. No, I look at what you’re doing in the North Sea and think it’s amazing. And I compare it to The UK and think it makes me want to cry. But anyway, I’ll stop there. Thanks very much indeed.

Have a great summer holiday, guys. Thank you.

Karl, CEO/Presenter, Aker BP: Likewise, Chris. Thank you.

Cetel Bakken, Head of Investor Relations, Aker BP: Next question comes from Mark Wilson from Jefferies.

Mark Wilson, Analyst, Jefferies: Okay. Good morning, gents. Just checking if can hear me.

Karl, CEO/Presenter, Aker BP: Yes, we can. Absolutely, Mark. Go ahead.

Mark Wilson, Analyst, Jefferies: Okay. Very good. Okay. Thank you. Okay.

So all the questions are focused on Yggdrasil and the developments and yes, great job going on there. But I’d just like to switch and just ask some final questions on Johan Sverdrup, the first of which ties in a little bit to what you’re just saying about development costs. Haven’t saved up Phase three, 40 million to 50,000,000 barrels and NOK1.3 billion NOK13 billion or NOK1.3 billion, it’s quite a high unit CapEx. I would calculate that about $29 a barrel. Maybe you could just speak to that in terms of the relative cost there to add 40,000,000 to 50,000,000 barrels at Johan Sverdrup?

That’s the first question. And the second would be whether you’ve started drilling those multilaterals yet and if there’s any update on your expectations of the plateau length at Johan Sverdrup? Thank you.

Karl, CEO/Presenter, Aker BP: Yeah. Do you want to do the CapEx per barrel? Yeah, yeah. We’re discussing this quite a lot. Yeah.

That’s a good catch, Mark.

David Tenner, CFO, Aker BP: Yes, I agree, Mark. So if you just look at the CapEx per barrel number, I agree that’s high. But remember that the investment in Phase three is also linked to acceleration. So that’s an important part of the business case, which drives the profitability of the project. And then in addition, the initial phase of Phase three is drilling eight out of the 12 well slots.

In addition, we also have room for more IOR and infill drilling out of those templates. So although the CapEx per barrel number is high, the profitability of the project is also very high. So this is one of the reasons why we need to look at a lot of different parameters when evaluating the profitability of our investment decisions.

Karl, CEO/Presenter, Aker BP: So what you’re basically doing, Mark, is that you’re investing a little bit now because the investments, if you were to drill these last four wells at the later stage would be significantly higher. That, of course, pushes the CapEx per barrel up beyond what you would normally see if you were just investing in the infrastructure necessary for the first four wells. And then as David said, a lot of this is also about exploration and not necessarily about net reserves.

Mark Wilson, Analyst, Jefferies: So is it fair to say then there’s additional contingent resources that could come from the additional wells, IOR or even multilaterals out of those same templates?

Karl, CEO/Presenter, Aker BP: Yes, that’s exactly why we’re doing this. So we have a tendency in the oil and gas industry to kind of over predict and not necessarily understand the kind of outcome space that you can have following these resources. And as we’ve talked about before, these kind of reservoirs, they have a tendency of getting bigger. We have the tendency of needing more wells to extract at optimal rates, etcetera, etcetera. So that kind of experience from a philosophical perspective that’s been baked into also Johan Sverdrup Phase two.

Yggdrasil is a bit the same, right? We’ve built almost twice the number of well slots that we will initially set into production. And now you see what’s happening with Istreig and now with Omega and the other exploration wells to come is that this is actually necessary and brings down the ultimate cost of project in a life cycle perspective. On to the MLTs. Yes, we’ve done the first one.

It’s just set into production. And I don’t want to share too much details. Think the operator should do that. But I’m very happy. Think I’ll

Mark Wilson, Analyst, Jefferies: In which case, I will leave it there. Thank you very much.

Karl, CEO/Presenter, Aker BP: Thank you.

Cetel Bakken, Head of Investor Relations, Aker BP: Good that you are happy, Karl. The final question for today comes from James Carmichael from Berenberg.

David Tenner, CFO, Aker BP0: Hi. Good morning, guys. Just one quick one. Just as a follow-up to one of your answers earlier. Karla, you mentioned that from 2027 onwards, the expectation shouldn’t be around sort of major topside projects.

It’s going to be more sort of near field or ILX type activity. I was just wondering if that or if there are any implications from that statement with regard to listing or if that is still sort of ongoing in the background? Thanks.

Karl, CEO/Presenter, Aker BP: Yes. I was referring to what we are operating in Aker BP and obviously we are partners in listing. So there are of course projects on Norwegian Continental Shelf that will require large topside construction activities. Listing is one of them. From an Aker BP perspective, our view is that quite a few of the projects going forward now will be either of the lifetime extension type of project or they will be tiebacks or they will be a combination of these.

You might also see quite a few of these, call it, copycats of unmanned production profiles of production platforms. We also see a little bit of a quite a few actually of potential for reusing that technology in the future, right? So I’m not going to disregard that there will be topside activities in the Norwegian yards, but quite a few other projects in the Nakamibi portfolio will be dominated by subsea tiebacks.

John Olaisen, Analyst, ABG: Perfect. Thank you.

Karl, CEO/Presenter, Aker BP: Then I have no further questions. So then I think we say thank you so much from David and Tiete and myself. And we wish you all a very, very good and safe summer.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.