Ithaca Energy plc

Good morning all and thank you for joining us on today's Ithaca Energy Q3 2025 results. My name is Drew and I'll be the operator on the call today. After today's prepared remarks, we will have a Q&A session. If you would like to ask a question, please press Start followed by 1 on your telephone keypad and to withdraw your question, it's Start followed by 2. With that, it's my pleasure to hand over to Eunice Friedman, Executive Chairman. Please go ahead when you're ready.

Thank you and good morning everyone from a snowy Aberdeen and a very cold London. And welcome to our Q3 2025 results. My name is Yanni Friedman and I'm the executive chairman of Ithaca Energy. Today with me on the call, my colleagues Luciana Vasquez, our chief executive officer, and Ian Lewis, our chief financial officer. If you'll move to slide three on today's agenda, we'll cover highlights of our year to date in Q3 The channel will speak to our strategic and operational highlights. Ian will give us a financial overview, and we'll finish with closing remarks and, of course, as always, open up for questions and answers. Two or three highlights, if you'd be kind to move to slide five. So we had another very good quarter with strong strategic Delivery, supporting our vision for scale, stability, and strength. Production with 150,000 barrels of oil equivalent a day, average production year to date. We've had a material, some would say unprecedented summer shutdown, and Luciana will talk about this later, and we're on track to deliver full year production guidance supported by an upgraded Q4 exit rate, of 145,000 barrels of oil equivalent per day from 140,000 a day. Adjusted EBITDAX of 1.5 billion for the nine months ending on September 30th. Enhanced financial performance, substantial cash generation that's supporting our cash allocation flexibility and attractive shareholders' returns. We're reaffirming our 2025 dividend targets of $500 million and announcing this morning a payment of $133 million dividend that we accelerated from April 2026 through December of 2025. A strong balance sheet, $1.7 billion of available liquidity. We've had a very successful bond issuance a couple of months ago, 450 million euros with a 5.5 and we upsize our reserve-based lending facility. This gives us material financial firepower for our next phase of growth, as we like to call it, with a low leverage of 0.5x of EBITDAX. If you'll move to slide six, so we're really delivering on all pillars and on our improved 2025 outlook. and continued strategic execution, reaffirming our upgraded management guidance that we've issued in August, with production trending to the bottom range of the range, primarily due to our informed decision to extend the captain shutdown period to allow us to do more unplanned investment that will further support longer-term environmental operational performance. And at the same time, with a slightly production wells, high production wells that will come online very, very soon. Cash tax, and I'm sure Ian will mention this as well, trending to the bottom of the range of the $230 million to $270 million that we gave in August. At the same time, and also due to the unprecedented tar season, we're seeing increased installed total production capacity in Q4 and trending into 2026 with an uplift in Ithaca's exit production rates in Q4 from 140,000 barrels a day to 140,000 barrels of oil equivalent per day expected. And we've announced this morning, this is on the strategy section, 50% farm-in into shills, torpor mori, and gas fields, forming part of our wider West of Shetland strategy and really positioning Ithaca as the strategic partner in the region. If we'll move to slide seven, we thought it would be good a year into our business combination with E&I just to kind of show performance. So we're focused on delivering attractive shareholder returns while continuing to execute on our growth, both organic and inorganic. Strong cash flow generation that supports the accelerated dividend payment that we've announced today. and our full-year dividend target of $500 million. But if you look over the past three years, you know, from 2023 till today, $1.2 billion of shareholder distribution, a billion dollars just in 24 and in 25. And if you look at total return, since there's this combination, dividend adjusted, about 150% return to both share price and dividends. I'll hand over to Luciano to talk about strategic and operational highlights. Luciano, please.

Okay. Good morning, everybody. And if we can now switch to slide number nine. We're proud to continue our excellent safety and environmental performance, in particular We consistently reported zero incidents, serious incidents, both in process, personal safety, as well as in the environmental space. That means that we had two full years with no significant event. And so our metrics, as you can see, continue on a positive trend with 1.6 incident per million man hours versus the 2.9 of Q3 of last year, and emissions at 17.3 kilogram of CO2 per barrel equivalent. which is about 25% lower than the average in the basin. This is, of course, the result of the combination of asset quality, post-distance combination, and also the steady operation. And, like I said, it's a strong indication of good performance as we've just gone, as Janice said, through a material-tired season, which inherently is a challenging one, both in terms of safety and environmental space. And so we still maintain our excellent safety records thanks to our crews offshore and onshore. If we can move to slide number 10, and we move to production, we closed the Q3 with a year-to-date production of around 115,000 barrels a day, as we said, and had a Q3 contribution of 97.9 thousand barrels per day, which of course reflected our TAR campaign in 2025, which saw an unprecedented level of summer shutdowns. with more than 500 days delivered and 15 assets involved, both operated and non-operated. Of these, 15, 12 were delivered on time and budget, which is a remarkable achievement. As I said, the time activity has been exceptional and somewhat unavoidable in 2025 with the timing of the business combination, which impacted our ability to optimize the activity sequence. This, in fact, has been possible now for 2026, which will see a 55% deferment risk reduction in our further planning. And a captain, as Enid mentioned, the decision was made to extend the shutdown to invest further into safeguarding our longer-term environmental and operational performance. This is a prudent decision because we want to support life extension activity for this asset. And with the successful completion of the tar season and three new assets, high producing wells, which are coming on stream in December. So now we are entering the new year with an increase in total production capacity, as we said. So that is the basis of the uplift that Yannick just talked about, 245,000 barrels expected as an exit rate. So it's been nearly a timing issue on new production delivery towards the end of Moving on to slide 11. Again, just to say that on Captain, we progressed with the delivery of the 13th campaign. So there are now four construction wells which have been completed. There are two left to go. And we have also matured the planning of the 14th campaign, which we intend to sanction in Q4-25. Fundamentals campaign, I said already, but of course, this has required an extension of the TAR shutdown period. If we move now to slide 12, we go into Segal. At the end of October, we handed over to the operator the J4 well, which is the fourth and last well of the Segal development. As you may remember, J4 has experienced technical issues in the first half of the year. which had required dedicated and rather technologically advanced operation to safely finalize the completion of the well. We're pleased to report that J4 has been completed and is currently being cleaned up, and flow rates are in line with the pre-drill expectations. This is one of the three wells that I mentioned earlier, which had a start-up in December of this year. If we can now move to the next slide, which is slide 13. And you may remember that at the end of our results, we presented a similar slide highlighting the importance of waste of Shetland in our long-term organic growth strategy. And, of course, the one of the United Kingdom as a whole. in the next slides, but let me touch on two further fields in this area. This morning, as Yannis said, we announced the signing of a farming agreement with Shell for 50% working interest in licenses P2629 and P2630, which are located in the West of Shetland Basin and that contain the Tobermory Disclosure. estimated to be a gross 2C resources of around 60-65 million barrel, which adds to the significant reserves and resources that we already hold in the west of Shetland. And following completion of the farming, Shed UK will continue to hold 50% stake in Tobermory Discovery and will be the operator of the licenses. The announcement of this farming together with partner in the area and provides the ability to unlock synergies between discoveries which are infrastructure-led. The tornado project, by the way, is progressing towards FID, of course, subject to fiscal and regulatory clarity, and tendering is ongoing, and we are advancing also the environmental statement on the regulatory step. move to the next slide, slide 13, you can see from the map why this is a strategic basin and it's important for our long-term growth plans. Not only we have, of course, the Rosebank field, which is the development ongoing, and we are continuing progression on the largest pre-EFT discovery, Campbell, towards an investment decision. But also this area has the potential to allow further exploration and further near-field connect tiebacks. And so positions as a key player in the northern gas hub with significant prospectivity in terms of resources that can, in fact, benefit from the infrastructures that can be shared and allow for relatively quick turnaround connections new fields and new disruptions are there. So we can achieve, we believe we can achieve significant synergy with the greater tornado area. And so our investment in the rest of Shetland is critical for us and is also critical for the UK energy security. Also supporting skills, job and our supply chain, which as you know is vital for the entire economy. Moving to the next slide, go and talk about the Rosbank and our slide 15, pleased to report that material progress has been achieved in respect to the refreshed consents. The operator, with our support, ACTIV, has submitted the updated environmental statement in Q3, which included, as you remember, the assessment of the scope three emissions associated with the project, came after the guidelines issued by the government in June 25 following last year's consultation. And after the submission offered advice that there were no objections to proceed with the public consultation process in relation to the amended submission and now this consultation process is in fact at the phase of concluding. And so we expect And if we move to the project side of things, to the next slide, slide 16, the 2025 Offshore Substance Installation Scope will deliver on time and budget an excellent HSE statistics. The drilling activities are scheduled to commence in Q126 as it was planned. The SPSO refurbishment activity are progressing at pace. A third dry dock has been completed and project progresses with a target to sail away early 2026, so to allow the mooring in the field during 2026. We are supporting the operator in its effort to maintain the FPSO sail away date, which is a critical milestone together with drilling and hookup and commissioning works to achieving the first production. On costs, the updates from operator indicate that based on the achievement of the schema as I mentioned, which include limited carryover activities post the FPSO sell-away, the total project at-home forecast don't need to be materially updated at this time and will be revisited after the FPSO sell-away. And if we can move to Campbell, that is slide 17, completing our resume into the west of Shetland. Our project is continuing its maturation towards the final investment decision and potential fund down, which will require fiscal and regulatory clarity, an outcome that we expect in the coming weeks. efforts into maturing the project in the quarter and throughout the year, actually. We have all main tenders for the key project packages. Of course, this is through the FPSO engineering, but also its procurement, construction, and commissioning, but also the tenders for the subsea, the umbilical risers, and flow lines. They are all commands, and they are intended to be completed by mid-2026. So we have a consolidated project cost and schedule, which will be at the basis of the risk final investment decision. We've also progressed speedily on the regulatory side, and we've also leveraged, of course, on the experience of Rossbank, and we're now pointing at a submission of an updated field development plan and environmental statement before the end of 2025, which will, of course, reflect all our optimizations of the last year in the project. So that concludes the strategic and operational highlights and hand over to for the financial overview.