Panoro Energy ASA

Good morning, everybody. This is John Hamilton. Thank you for participating in our first quarter 2025 conference call. I'm joined today by our CFO, Qazi Qadir, our technical director, Richard Morton, our head of engineering, Kim Hansen, and actually some board members as well. So we're well represented here today. I'll take you through a few slides. And as usual, we will leave some time for some Q&A at the end. I do note that we do have our annual general meeting of shareholders following this call, so we will terminate the call reasonably timely today to make sure that we get prepared for the annual general meeting. As a reminder, today's conference call contains certain statements that are or may be deemed to be forward-looking statements, which include all statements other than statements of historical fact. Forward-looking statements involve making certain assumptions based on the company's experience and perception of historical trends, current conditions, expected future developments and other factors we believe are appropriate under the circumstances. Although we believe the expectations reflected in these forward-looking statements are reasonable, actual events or results may differ materially from those projected or implied in such forward-looking statements due to known or unknown risks, uncertainties and other factors. Next slide, please. As a reminder, The technology we use allows you to raise your hand if you have a question, and we'll endeavor to answer that. Or you can type in a question, which we'll endeavor to answer. Sometimes we get similar questions. We'll aggregate those into a single question, and I'll remind you of how to do this at the end of the call as well. Next slide, please. So the quarter was reasonably uneventful from a P&L perspective as broadcast. We had revenue of $19 million, APTF $15 million, and that was in line with guidance. We produce approximately 12,000 barrels a day with a crude lifting in the quarter of only 189 million barrels. Again, our liftings are weighted to the second, third, and fourth quarters. We'll touch a little bit more on that. We have very positive developments on the 2P reserves, 42 million barrels of 2P reserves, which I'll come back to as well. And on the balance sheet, we remained very, very strong on the balance sheet with over $50 million of cash. against gross debt following the bond issue of $150 million. On the right-hand side of the slide, we're today also reiterated our cash distribution, NOC 80 million to be paid in June as a return of paid-in capital. rather than dividend. We've also yesterday announced the completion of the original 100 million kroner buyback program. We bought back 99.7 million shares ahead of our general meeting. The general meeting will seek to renew the authority for the company to buy back its own shares. And the general meeting will also allow the company to cancel the shares that it has purchased. We've purchased 3.5 million shares to date, and we will cancel those following the annual general meeting. That brings us to a cumulative cash distribution since we commenced distributing cash of 500 million kroner. So well on track there in that respect. Next slide, please. This is just a production update. We produce about 12,000 barrels a day in line with our guidance of between 11 and 13 for the year. The data on the right-hand side of the slide gives us against current production a reserve to production ratio of 10 years based on our 2P reserves and a reserve to production ratio of 16 years based on our 2P and our 2C. So we have a very, very long-dated portfolio of reserves here that should be able to maintain production at decent levels for many years to come. Next slide, please. We had very positive developments on our annual statement of reserves. If people didn't follow it, we announced an over 300% reserve replacement ratio. That's kind of a mark of reserve health in the company. We were able to replace more than three times the barrels that we produce in the year. And that is also just year on year, a 22% increase. So that's a very, very healthy development for the company, bringing our 2P and 2C reserves to about 68 million barrels. The reserve improvement was based on improved recovery factors, particularly in the Hibiscus area and Dusafu, but also material upward revision in our Equatorial Guinea position. Next slide, please. So a reminder of our distribution. We've targeting NOC 500 million, $45 million equivalent in NOC during the cycle 2025. We've today, again, announced an 80 million kroner return of paid-in capital cash distribution, and we've renewed the authorities. We're renewing the authorities in the upcoming AGM to continue on the buybacks where we've completed, again, the 100 million kroner program that we initially set out. Next slide, please. A little something on our debt profile and our capex. We, on the left, have our debt profile, which is our bond issue with the amortization profile that we have in there. And on the right is our capex over the years. People who followed us know that we had a couple of very heavy years. This year is lighter. We've slightly nudged up our guidance for the year from $35 to $40 million of capex this year. That is the success case in the Bourdon discovery, where we ended up doing some side tracks and an extensive logging program, which has resulted in a material discovery of 25 million barrels gross in that particular area, which is probably going to lead eventually to a sanction on a development of that particular area. So it's very positive use of capital. Next slide, please. Our crude lifting schedule, this is our current best view of the world, which shows us, again, with the first quarter having a very light lifting schedule, which has now increased. We've lifted in April. 993,000 barrels, realizing approximately post-hedging and other transaction costs on those barrels of around $67 a barrel. And then the next lifting we have is not until early July, and then the lifting program continues from Q3 and Q4. Next slide, please. So, Gabon operations update. There have been quite a few things going on. I'll touch briefly on Bourdon, which was the well that we drilled. We found 34 meters of net oil pails, the largest column discovered to date on this license. We had successful sidetrack, which encountered another decent oil column. The current estimate from the operator and Bonoro is around 56 million barrels in place. 25 million barrels recoverable. We believe in the area that there are further objects that could yield further reserves in due course, subject to some additional drilling there. We've now released the rig. The rig is released and it's on its way to Equatorial Guinea to drill for Marathon. And that concludes the drilling program that we commenced last year. All the wells are on stream. Production in the quarter was around 39,000 barrels a day, which is the highest quarterly rate since inception. BW Energy also announced last night the taking over of the O&M contract on the FPSO Adolo. That is expected to yield a lot of operational synergies and cost savings as compared to the previous contract, which was held with BW Offshore. This is now being undertaken by BW Energy. So there's a lot of also positive operational developments on the asset. Next slide, please. In Gabon, we've also announced recently the finalization of the two new blocks, Nyosi and Gunduba. You can see Dusafu in the orange, and you can see the light blue and the light yellow being the surrounding acreage, together with BW Energy and Valco Energy, who operate the Atai blocks. We have now more or less surrounded this southern part of Gabon, which is just following this Gamba trend that you can very clearly see even in this cartoon. And we believe that this will continue to yield further upside in this general area for Panoro and all of its stakeholders. The planning is now underway. The next step on these particular blocks is the acquisition of new seismic data, which will probably be a 2026 event. But nonetheless, there are plans to advance the prospectivity on this acreage. Next slide, please. So in Equatorial Guinea, we have a number of blocks. We have our production block, block G, with gross production around 25,000 barrels a day on average. There's a lot of optimization projects ongoing there. The joint venture is evaluating future infill drilling campaigns here. The production in the quarter was a little bit soft to our internal budget expectations. We're working together with the operator to improve uptime on the assets there. But things are going pretty well there. And then the new exciting thing that we have is Block EG23, which you'll start hearing us talk a little bit more about. That's in the small window in the upper left there. You can see EG23 in the light blue, and you can see all the greens and the reds around there. Those are discovered material oil and gas fields, and we sit right in the middle of it. We have very, very high... Thoughts about this about this particular block and you're going to start seeing us talk a little bit more about it We've just entered the license. So we're just now getting the data and Reworking the seismic coming up with a fresh prospect inventory So you see us start to talk more and more about this very very exciting block and an eg-01 Which is our other exploration block which is operated with by us with cosmos as partners we sit just in board of seven Akuma block G the production assets there and And we are currently reprocessing the data there, looking at several interesting objects which could be tied back into the infrastructure at Block G. So Equator Guinea is a really kind of exciting full cycle asset for us as well. Next slide, please. In Tunisia, we've had some recent successes. There's not been... Terribly much activity, if you followed us over the past year or two, where we've been, activity has slowed down, but we've had some recent successes there. Current gross production is approximately 3,500 barrels a day, which is a good level compared to where we've been. So we're pleasantly surprised, pleased with the uptick in activity here. We continue to have very good HSE performance here. We recently brought the well back online around a couple hundred barrels a day following a workover, and we have additional opportunities coming up on specifically the Remora field where we have a workover that's pending and obviously some drilling, a potential drilling campaign as well in 2026. Next slide, please. So, again, looking at – zooming out, looking at the big picture of Panora with 42 million barrels of 2P reserves. We've made the Bordon discovery, which has not been included in the annual statement of reserves that we touched on earlier, plus minus 4 million barrels additional to Panora and 2C resources of 26 million barrels. In Equatorial Guinea, Block EG23, we have probably somewhere around 100 million barrels of 2C resources. Now, that's unaudited. That's an internal view, which will have to be validated in time. But it gives you a feeling for the context of that asset in our portfolio with both gas and oil and condensate prospectivity, existing discoveries, which we believe can be tied back to infrastructure reasonably simply. Then in DUSIFU, we have another 25 million barrels of unrisked prospective resource, and we have potentially much more there. So through our production activities, through our exploration and appraisal activities, we have created a portfolio here which has a meaningful upside from here as well. Next slide, please. So the conclusion slide, just touching on again the themes where we've got production in around 12,000 barrels a day. CapEx has come down. We have positioned the company with material reserves and production. These are long-life assets, 100% oil-weighted at the moment. We're diversified across countries. That really has benefited us when one asset may be doing less well than the other. The other ones step up, and we're seeing that today as well. We have all catalysts through our infrastructure-led exploration program. We have the new discovery in Bordeaux, of course, but we have the new blocks that we've added in Gabon and Equatorial Guinea. And we have diversified our access to capital in support of our growth. The bond issue for us was a real statement of intent with our respect to access to capital going forward. And we have maintained cash distributions and share buybacks in this period. Quarterly cash distribution established and share buybacks ongoing. We've been buying back shares pretty much every day since January 2nd. And we're subject to the general meeting coming up. We intend to continue that trend as well. So I'd like to open it up for questions. Again, we will probably cut this off at around 9.30 Oslo time just to be able to prepare for the annual general meeting. But we do have some time for some questions.

Thank you very much, John. The first question will be from Stéphane Foucault. Stéphane, you're self-muted. Please unmute yourself.

Good morning, guys, and thanks for taking my questions. I would have three. The first one is around this 112 million barrel to see in EEG. And I wonder whether you'd perhaps put a bit more color on maybe the most important opportunities, the timing, et cetera. It would be great. That's my first one. Second, you talk about cost-saving opportunities, OPEC-saving opportunities in Gabon. uh with the new operatorship and i was wondering whether you could quantify that on the dollar player power and last one part more accounting question i saw that there is um it seemed the the the cash tax excluding profit sharing is quite high in q1 compared to say last year and i was wondering again whether you could find some column what is high this quarter thank you