Var Energi ASA

Hi everyone and welcome to the Royal Energy's Q1 presentation of 2026. Today's call is being recorded. For the first part of this call, all participants will be and listen only. Afterwards, there will be a question and answer session. To ask a question, please press star 1 on your telephone keypad. I would like to introduce Head of IR, Ida Marie Fulham. Ida, please go ahead.

Thank you, and good morning to everyone. A warm welcome to Bar Energy's first quarter 2026 results presentation. The presentation today will be held by our CEO, Nick Walker, and our CFO, Carla Santopada. Nick and Carla will go through the presentation, and then afterwards we will open up for Q&A. I will now hand the word over to Nick.

Well, thank you, Ida, and good morning to you all, and thank you for joining us today for our first quarter 2026 results presentation. I'm pleased to report we delivered as planned in the quarter, with record high production and strong financial results. And we're strongly leveraged to the current high price environment. Our operations have not been disrupted by the war in the Middle East, demonstrating the strategic importance of Norway as a secure and responsible supplier of energy to Europe. We're continuing to transform as a company, to harness the entrepreneurial energy of our implementing technology to improve outcomes and increasing the pace of value creation. We're showing further progress and incrementally improving the outlook for the company for increased resilience while maintaining flexibility, which I think is key in supporting investments through the cycles. With our high-quality portfolio of high-return early-phase projects, we are targeting to deliver long-term production above 400,000 barrels per day, which will sustain high shareholder returns over time. And underpinned by strong performance and cash flow generation, the company continues to deliver attractive shareholder returns. So now let us look at the highlights for the quarter. As planned, we delivered record high production in the quarter of 406,000 barrels per day. This is supported by strong performance from our operated assets, with 97% production efficiency in the quarter. and all of the new projects we started up during last year are producing according to plan. We delivered strong financial performance, with significant CFFO post-tax in the quarter of $1.1 billion. Available liquidity is stable at $3.5 billion, and our leverage ratio is reduced to 0.7 times at quarter end. And the company is well positioned in volatile markets. The war in the Middle East, I think, amplifies the strategic importance of Norway as a secure, reliable and responsible supplier of energy to Europe. We are leveraged to the high prices, and we will see the North Sea premium prices reflected in the second quarter, with crude liftings priced in the first weeks of April averaging $130 per barrel. We've used this opportunity to lock in high gas prices for a portion of our volumes in the second and third quarters. We continue to unlock long-term future value from our high-quality portfolio. Two projects were sanctioned in the quarter, which develop around 80 million barrels of net reserves. And we made three commercial exploration discoveries. Lastly, we continue to provide attractive long-term shareholder returns. We confirm a dividend distribution for the first quarter of $300 million, which means we've paid stable or growing dividends for the last 17 quarters. and we're providing dividend guidance of $300 million for the second quarter. Delivering attractive and sustainable dividends over the cycles is a top priority of management. Should prices remain elevated through the rest of the year, we'll make a decision at year end for an extraordinary distribution of excess cash to our shareholders. So looking at some of the details. Vore Energy is a leading pure play E&P. and in the quarter I see we've now grown to the second largest oil and gas producer in Norway. We have a high-quality diversified asset base in all areas of the NCS, with interest in around 50% of all producing fields and infrastructure, and a large exploration footprint. It is this opportunity-rich portfolio that will allow us to deliver higher production and value for longer. We also have a balanced commodity mix, with gas being around one-third of our production volumes, making us one of the largest gas exporters from Norway. It also means we're leveraged to the current high gas prices in Europe, which I think are likely to extend beyond the end of the hostilities in the Middle East. In the first quarter, we delivered record high production of 406,000 barrels of oil equivalent per day, which is in line with guidance. All of the new projects we started up last year are producing according to plan. We continue with excellent performance Excellent performance on our operated assets with high production efficiency. And you can see that the second and third quarters will be impacted by some planned turnarounds. However, the annual average reduction is small at around 6,000 barrels per day. During this year, we will start up four new projects, Boulder Phase 6, Jotun FPSO de-bottlenecking, Elphys North and the King development. And we have a large portfolio of 60 new development and infill wells that will start up during the year. So far, we're on track with 11 new wells in production. We've had a strong start to the year and we're on target to deliver annual guidance of 390 to 410,000 barrels per day. Looking now at our operation performance, you can see that we've continued to incrementally improve our outcomes. We've seen strong improvement in safety performance in the quarter across a range of metrics. And so far this year, we've had zero incidents with serious potential. I think this takes hard work every day. We continue our trend of reducing carbon emissions intensity, and we're ranked in the top 15% of the industry globally, and our methane emissions continue at the near zero level. We target to reduce emissions further from three main levers, electrification with power from shore, portfolio optimisation and energy management. When the ongoing Yord and Snowvit electrification projects are complete, approximately 40% of the company's production will be produced with power from shore. Together with Equinor, we have decided to terminate further work to develop an area solution for the electrification of the Boulder-Grana area with power from shore, due to challenging economics. Together with Equinor and the License Partnership, we'll determine how best to mature the development of the remaining resources in the area. In addition to emissions reductions, Vought Energy aims to become carbon neutral in our net equity operational emissions by 2030 through removals in the voluntary carbon market. We continue to be recognised for our ESG leadership and are ranked by both Sustainalytics and S&P Global in the top 15% of the global oil and gas industry. For production efficiency on our operating assets, you can see we have a strong improving trend, and we achieved a high 97% in the first quarter ahead of target. On production costs, we achieved $10.4 per barrel in the first quarter. This is slightly higher than target due to the impact of the strengthening Norwegian kroner. And going forward, we expect to maintain production costs at around $10 long term. I think these elements go hand in hand. Strong safety and environmental focus drives good operational discipline, and we aim to deliver continuous improvement, which over time creates significant value. EnvoEnergy has an amazing portfolio, which is opportunity rich, where we have a track record of continuously growing reserves and resources organically. You can see our 2p reserves stand at 1.3 billion barrels, which underpins our current production levels. But we are much more than that. We have 2C contingent resources of around 900 million barrels. These resources are undeveloped. And we're moving forward over 30 early phase projects to develop around two thirds of these volumes. We also have an exciting exploration portfolio of around 1 billion barrels of net risk resources. So putting this together, we have around 3 billion barrels of resource potential, with 60% of this yet to be developed. Developing this opportunity is how we will deliver higher production for longer and meet our target of over 400,000 barrels per day. The levers that will drive this are, firstly, through maximising recovery from our high-quality producing assets. Secondly, delivering on our portfolio of 15 projects in execution. Thirdly, we're progressing over 30 early phase projects towards sanction. And finally, we're unlocking more value with our focused exploration programme, that is adding new projects all the time. For this programme we are progressing activity to create value from around 70% of the undeveloped resource upside in our portfolio. And on top of this, we continue to take an opportunistic approach to further M&A, where there is a strategic fit and we can create value. Looking now at how we will deliver this. We have 15 high value projects in execution. These are all subsea tiebacks or facility enhancement projects. You can see developing around 290 million barrels net with strong economics where the average break-even is around $30 per barrel and rates of return are over 30%. Because these projects all leverage existing facilities, the average unit cost is very low at around $3 per barrel. All of these projects are progressing on track as communicated. and during the quarter we sanctioned two new projects, Goliath Gas Export, with more on that in a moment, and the King Development. The first phase of the King Development is an extended reach well from the Ringhorn platform. The well is developing 2p reserves around 9 million barrels gross, and with a low break-even of below $15 a barrel. The well is currently drilling as expected to start up around mid-year. Success will drive further King Development phases. And last week we announced the sanction of the Goliath gas export project. This value-creating project secures the lifetime of the Goliath assets in the Barents Sea to around 2050 and unlocks future area developments. The project is increasing oil production from the Goliath field and allows the gas reserves that are currently being re-injected to be exported via the Hammerfest LNG plant and a gas banking arrangement and to be sold when processing capacity is available. The project comprises a 12km gas export line to connect the Goliath FPSO to the Snovik pipeline and is expected to come on stream in the third quarter of 2029. and this project is developing 2P reserves of 112 million barrels of oil equivalent, of which around 15% is oil. The project has robust economics with a break-even in line with the company's target, and provides significant upside potential from optimisation of the Goliath's operations. The project is also an enabler for the Goliath Ridge development, where the resource potential is over 200 million barrels. We are working at pace to also move that project towards sanctions. And we have a large portfolio of over 30 high-return, early-phase projects that we are moving towards sanction. All are subsea tiebacks to existing infrastructure or facilities enhancement projects, with low costs, short time to market, and high returns, with average break-evens of around $35 per barrel and rates of return above 25%. We've built significant momentum with our subsea project factory approach and an entrepreneurial focus on value creation. We sanctioned 10 projects in 2025 and have sanctioned a further two projects so far this year. And you can see that we're working towards a total of 13 possible sanctions in 2026. And so I'm confident we'll deliver on our guidance of eight project sanctions in the year. During the quarter, we secured a contract for a high specification harsh environment drilling rig to allow us to do some of the more complex wells we are planning. And we have the people. the equipment and the contracts in place to deliver the planned project programme. Delivering on this project portfolio will develop around 500 million barrels of contingent resources and will achieve our targets of over 400,000 barrels per day long term. And we're continuing to add new projects as we further de-risk the potential of our exciting portfolio. Turning now to our exploration programme where we have a leading track record. Since 2021, we've added 290 million barrels of contingent resources at a success rate of 45% and over 70% of these volumes are already in production or in the development process. We've continued this success this year with three commercial infrastructure-led discoveries out of six wells drilled so far in a year. These discoveries are already being turned into value. Frida Kahlo will start production through the Sleipner this quarter. and Omegasaur is expected to sanction as a tie-back to Snora by year-end. Most of our high-impact exploration programme in 2026 is in the second half of the year. We have seven wells remaining, with key prospects to be drilled in the Boulder, Yoa and Asgard areas. Looking ahead, we have a significant exploration position in all areas of the NCS. and we're already lining up an exciting program for 2027 and 2028 with some important high-impact wells. That rounds off my operational update, and I'll now hand over to Carlo to review the financials. Thank you very much.