Kistos Energy (Norway) AS (“KENAS”) update for the third quarter of 2024

31 Oct 2024 14:11 CET

OPERATIONAL
Production from the Balder Area has been stable during the first nine months of
2024. Production was 2,673 b/d net to KENAS in the third quarter of 2024, with
production efficiency of 85%. This compared to 2,721 b/d and 89% production
efficiency in the second quarter of 2024. The reduction in production efficiency
between the 2nd quarter and the 3rd quarter reflects planned maintenance
activities.

During the third quarter there was a break in drilling from the Ringhorne
platform due to planned maintenance. The drilling program will resume during
November.

BALDER X
As announced by the Operator in August the target production start-up date has
been moved to the second quarter of 2025.

The Jotun FPSO is a key enabler to deliver future value in the Balder Area. The
project will secure production from the Balder Area beyond 2045, unlocking gross
proved plus probable (2P) reserves of around 150 mmboe and gross peak production
of ~90 kboepd with low operating costs of around US$5 per boe.

With all development wells completed and all subsea production systems
installed, the Operator is planning to complete the FPSO vessel inshore. As part
of the decision not to sail, the cost basis for the project has been updated to
reflect a sail-away in the spring of 2025, this represents an additional project
cost of around USD 400 million gross pre-tax, of which approximately 75% will be
incurred in 2025.

The Jotun FPSO will be an area host, enabling future growth opportunities. The
Balder Phase V project has been sanctioned, including the planned drilling of
six production wells. These will utilise the remaining subsea template well
slots to capture gross 2P reserves of over 30 mmboe. Drilling will commence in
the first half of 2025 and first oil from the initial wells is expected towards
the end of 2025.

In addition, the Balder Phase VI project is being matured with an investment
decision anticipated in 2025. There remains significant additional resource
upside in the area and further exploration drilling and tie-back development
phases are being planned.

On 8th February 2024, the operator released its “Annual statement of reserves
2023” in which it estimated gross 2P reserves for the Balder Area at 219 MMboe
(21.9 MMboe net to KENAS).

FINANCIAL
KENAS entered a financing and lifting agreement (a produced quantity or PQ
arrangement) with an international oil major commencing in January 2024. Under
the terms of this arrangement, KENAS is paid for its production on a monthly
basis but the offtaker only lifts KENAS’ entitlement of crude oil once it is
sufficient to fill an offload tanker.

In the third quarter, KENAS offloaded one cargo of crude oil totaling 550 kbbl
from the Balder FPU, at a provisional price of USD 78.14 per bbl. Total revenue
from the sale of hydrocarbons in the third quarter amounted to USD 42.9 million.


At the end of September 2024, KENAS had cash at bank of USD 28.7 million, of
which USD 0.2 million is restricted. KENAS had drawn USD 57.8 million under the
terms of the revolving credit facility from its parent company, Kistos plc, by
the end of the third quarter of 2024.

In early December 2024, the Company expects to receive a total tax refund of
approximately NOK 900 million, excluding interest, for the fiscal year 2023.


For further information please contact:

Olav Haugland
Chief Financial Officer (Kistos Energy (Norway) AS)
Phone: +47 915 41 809
Email: olav.haugland@kistosplc.com

Richard Slape
Chief Financial Officer (Kistos Holdings plc)
Phone: +44 20 4531 2804
Email: richard.slape@kistosplc.com

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