Untitled

ANNUAL

REPORT

2023

Contents

Licence Portfolio Information .............................................................................................................................................................. 5

Message from the CEO .......................................................................................................................................................................... 6

Operational Highlights .......................................................................................................................................................................... 8

Brage ........................................................................................................................................................................................................ 8

Brasse .................................................................................................................................................................................................... 10

Yme ......................................................................................................................................................................................................... 11

Exploration Licenses ............................................................................................................................................................................ 12

PL838...................................................................................................................................................................................................... 12

Sustainability ........................................................................................................................................................................................ 14

Directors’ Report .................................................................................................................................................................................. 18

Annual Financial Statements ............................................................................................................................................................. 32

Accounting principles and notes ....................................................................................................................................................... 37

Auditor’s Report ................................................................................................................................................................................... 68

Front page: Brage platform. OKEA ASA

2023

Brage platform. OKEA ASA

ANNUAL REPORT 2023

LIME PETROLEUM

Page 2 Page 3

Licence Location

Lime

stake

Operator Other Partners Expiry date

North Sea

PL 053 B Brage Unit

Northern North Sea

33,84% OKEA ASA DNO Norge AS, Vår Energy ASA, M Vest Energy AS 06/04/2030

PL 055 Brage Unit

Northern North Sea

33,84% OKEA ASA DNO Norge AS, Vår Energy ASA, M Vest Energy AS 06/04/2030

PL 055 B Brage Unit

Northern North Sea

33,84% OKEA ASA DNO Norge AS, Vår Energy ASA, M Vest Energy AS 06/04/2030

PL 055 D Brage Unit

Northern North Sea

33,84% OKEA ASA DNO Norge AS, Vår Energy ASA, M Vest Energy AS 06/04/2030

PL 055 E Brage Unit

Northern North Sea

33,84% OKEA ASA DNO Norge AS, Vår Energy ASA, M Vest Energy AS 06/04/2030

PL 185 Brage Unit

Northern North Sea

33,84% OKEA ASA DNO Norge AS, Vår Energy ASA, M Vest Energy AS 06/04/2030

PL 316 Yme Field

Egersund Pool

10,00% Repsol Norge AS PGNiG Upstream Norway AS, OKEA ASA 18/06/2030

PL 316 B Yme Field

Egersund Pool

10,00% Repsol Norge AS PGNiG Upstream Norway AS, OKEA ASA 18/06/2030

PL 740 Brasse

Northern North Sea

17,00% OKEA ASA DNO Norge AS, Mvest Energy AS 07.02.2024

(2)

PL 820 S Iving and Evra

Discoveries

Northern Utsira High

30,00% Vår Energi ASA Aker BP ASA, Pandion Energy AS, Wintershall Dea

Norge AS

05/02/2026

PL 820 SB Iving and Evra

Discoveries

Northern Utsira High

30,00% Vår Energi ASA Aker BP ASA, Pandion Energy AS, Wintershall Dea

Norge AS

05/02/2026

PL 1093

(1)

Orion/El Teide

Southern Utsira High

20,00% Harbour Energy

Norge AS

Petoro AS 19/02/2028

PL 1178 Palmehaven

Northern North Sea

50,00% OKEA ASA 17/02/2030

Norwegian Sea

PL 1190

Taco

Grinda Graben

30,00%

Harbour Energy

Norge AS

PGNiG Upstream Norway AS 17/02/2030

PL 838

Shrek

Nordland Ridge

30,00% Aker BP ASA PGNiG Upstream Norway AS 05.08.2023

(2)

Licence Portfolio Information

(1)

Additional acreage awarded in January 2024

(2)

Extension pending

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LIME PETROLEUM

Page 4 Page 5

Message from the CEO

In the context of global geopolitics and the energy picture in

2022, and despite the events in Ukraine and the Middle East

that made headlines in 2023, the energy industry has settled

into a new normal particularly in Norway. For Lime,

this has meant ramping up production from our two

producing assets, finding new reserves and resources to add

to the portfolio, and building a world-class team in an agile

organization.

The Yme field faced challenges during its commissioning

phase in 2022, resulting in delayed progress toward plateau

production levels. However, focused efforts on production

facilities and the addition of new wells in 2023 have signifi-

cantly improved production efficiency. By year-end, Yme was

producing over 25,000 barrels per day. Further drilling is

planned for 2024, leveraging new production data and well

log insights. Based on these, in addition to more experience

with the Yme partnership, we have accumulated a wealth of

data to better understand the subsurface. We will use this

enhanced understanding to make production more efficient

and possibly identify upside potential in the field. With a drilling

rig strategically located on the production platform and a

positive attitude from the operator and partners, Yme is

ideally situated to grow the reserve base further. Through-

out 2023, Lime has been actively involved in following up

operations, conducting our own evaluations, and working

closely with the operator and partners to ensure safe and

efficient operations. We believe that through this work, Yme

has a promising future and will remain a highly important

strategic asset for Lime.

The Brage field has gone through a remarkable transformation

in its 30th year of production. According to the initial

production plan, Brage was expected to shut down in 2007.

Still, Brage’s lifetime has been repeatedly extended over the

years. In late 2022, a new operator took over Brage (OKEA),

and by late 2023, Vår had sold their share in Brage to Petrolia

Noco. Of the original 5 partners in Brage, only 1 company

(DNO) was in existence 12 years ago; this illustrates the

evolving business landscape on the Norwegian Continental

Shelf (NCS). The partnership consists of companies who see

value in mature fields instead of imminent cessation and

abandonment. With a drilling rig on the platform, a recovery

rate lower than its giant neighbor fields, and a partnership

willing to invest, Brage managed to more than double its

production in 2023. And even with its 30-year-old drilling

rig, Brage set a new record for drilling long wells, with the

34/4-A-40 well at a staggering length of 9250m (about the

height of Mount Everest). This was in fact the longest water

injector drilled on the NCS. The well tapped into the Talisker

discovery made in 2021. Moreover, new reserves have been

found in the Brage field, with a successful exploration pilot

well discovering approximately 12 million barrels of oil

equivalent (boe) in the Kim prospect and one of the field’s

best production wells in the slightly deeper Fensfjord formation.

This success is being built upon, alongside new, high-quality,

3D seismic data from CGG that covers the field. We are

confident that we can extract additional reserves from

what has already been found and that new reserves will be

discovered in the field, hopefully extending Brage’s lifetime

well into the 2030s.

A big step toward extending Brage’s lifetime is the Brasse

discovery. Brasse was discovered in 2016, just 13 km south

of the Brage field. Lime acquired a 17% interest in the field

in late 2023 through a farm-in agreement. Work on Lime’s

other discoveries and exploration projects moved along

in 2023. Following the setback of Shrek not going forward

with a Plan for Development and Operation (PDO) in 2022,

Lime has worked closely with the operator, Aker BP, to find a

better concept for developing the Shrek discovery. Similarly,

Lime is working with operator Vår Energi and partners in the

PL820S license to further appraise the Iving/Evra discovery.

Lime participated in a potential play-opening exploration

well, Gjegnalunden, with Aker BP in PL867/B—just west of

the Ivar Aasen field. The well found hydrocarbons, but they

were insufficient for an economic development project. Both

the PL867/B and the neighboring PL818/B licenses were

relinquished. However, new exploration opportunities were

identified: In January 2023, Lime was awarded acreage in

the Norwegian Sea, south of the Heidrun field, as well as a

license just west of the Brage field. Lime is maturing

prospects in these licenses as well as the potentially high

impact Orion and Timanfaya prospects in PL1093, just south of

Johan Sverdrup. In parallel with the oil and gas extraction

projects, Lime has furthered its foray into carbon capture

and storage (CCS). Lime and its partners have nominated an

area for carbon storage on the NCS and look forward to the

prospect of a license award in 2024.

Lars Hübert

CEO

As a small player on the NCS with a business goal of building

an E&P company with an attractive portfolio for future

monetization, Lime must excel at finding value in the

small, mature, and challenging projects. To achieve this

while fulfilling our see-to-it duty as a partner on the NCS,

Lime seeks to build an environment where we are

challenged and inspired to generate new ideas for

creating value. This involves considering all aspects of a

prospect or project, including what we call the Business

and Strategic Frames, in addition to the Technical Frame.

In-depth technical understanding is a highly important

aspect, and is paired with an understanding of business drivers,

alignment with partners, and financial drivers. Being an agile

organization with highly skilled and motivated employees is

the key to achieving this mission.

We look forward to more years of growth for the company

and a world full of energy!

Lars Hübert C.E.O.

ANNUAL REPORT 2023

LIME PETROLEUM

Page 6 Page 7

Brage (33.8434%)

In September 2023, Brage completed 30 productive years

of operation. Since its discovery in 1980, Brage has defied

expectations, continuing to deliver reliable production over

the years.

The field, located in the northern part of the North Sea 10 km

east of the Oseberg field, at a water depth of 140 meters

is developed with an integrated production, drilling, and

accommodation facility with a steel jacket platform with 40

well slots. Oil and gas are separated on the platform. Oil

is piped via the Oseberg platform through the Oseberg

Transport System (OTS) to the Sture terminal. Gas is trans-

ported through Statpipe to Kårstø.

Production efficiency for 2023 was relatively high, at

approximately 93%, which was mostly due to the two

scheduled gas stop months (for power turbine maintenance).

The production efficiency is expected to be above 90% in

the coming years. Throughout 2023, 30 wells were active,

of which 22 were producers, 5 were water injectors, 2 were

water producers used for sourcing Utsira formation water

for water injection, and 1 was a cuttings re-injection well.

In total, four new wells were completed for production in

2023, which not only helped arrest the production decline

but resulted in an increase of reserves due to their exceptional

performance. The extensive drilling program is continuing

into 2024.

A new discovery was made when drilling a sidetrack to the

Brage South production well. An approximately 10m-thick

layer of oil-bearing Sognefjord sandstone was encountered

by well 31/4-A-13 E. This promising new “Sognefjord East”

(Kim) discovery has a preliminary estimated volume of 0.2

to 0.5 million Sm3 recoverable oil. The maturation of

subsurface volumes and a possible appraisal well is ongoing.

Drilling-wise, the year 2023 was record-breaking. We have

witnessed the longest well ever to be successfully drilled

and completed in Brage (9,247m), going beyond the design

limits of the drilling platform. This opens new targets

previously assumed to be too distant for development.

Brage. Credit: Lars B Hübert

Operational Highlights

Credit: OKEA ASA

ANNUAL REPORT 2023

LIME PETROLEUM

Page 8 Page 9

Brasse. Credit: OKEA ASA

Brasse (17%)

At year-end 2023, Lime Petroleum expanded its portfolio

farming into PL740, Brasse, securing a 17% ownership stake

in this promising asset. The field, estimated to contain 24

million boe gross in recoverable reserves, will be developed

as a tie-back to the Brage Field, in which Lime has a 34.8434%

interest.

The field is expected to come on-stream during the first half

of 2027. Plateau production is estimated at around 26,000

barrels of oil equivalent per day (boepd) gross and is expected

within the first year of production.

Various development concepts have been evaluated, and

the license partnership landed on a concept with a two-well

subsea development tied back to the Brage field. The Plan

for Development and Operations (PDO) was submitted to

the government in late April 2024. Brasse is the first field

development project in which Lime will participate,

representing a big milestone for the company. The develop-

ment will add reserves to the Lime portfolio and likely extend

the lifetime of the Brage field, offering significant synergies

with Brage.

Yme (10%)

The Yme field, situated in blocks 9/2 and 9/5 within the

Egersund Basin in the south-eastern part of the North Sea,

boasts a water depth ranging from 77 to 93 meters. The

reservoir contains oil with an API gravity of 39, found in

the Gamma and Beta structures. These structures are

approximately 12 km apart. Beneath the seabed, at a depth

of 3,150 m, lies the Sandnes sandstone formation, dating

back to the Middle Jurassic age.

In 2022, the drilling campaign utilizing a jack-up-rig on the

Beta structure was successfully concluded. Subsequently,

in 2023, drilling operations were carried out by the Mobile

Offshore Drilling & Production Unit (MODPU), resulting in

the addition of wells to production in the latter half of the

year. However, due to delays in the drilling program, drilling

activities will extend into 2024.

Throughout 2023, the Yme field demonstrated consistent

improvement in production efficiency. Production rates

occasionally exceeded 30,000 barrels of oil per day (bopd),

while maintaining a steady output of over 25,000 bopd.

Despite these positive trends, the actual total production

for 2023 fell below expectations, reaching 6.7 million barrels

of oil gross (equivalent to 18,317 bopd net to Lime). These

deviations were primarily attributed to delays in the drilling

schedule and unforeseen shutdowns.

As the current drilling campaign nears completion in early

2024, Lime will collaborate closely with the Yme Operator

and partners to assess field performance. This evaluation

may lead to the identification of additional drilling targets,

cost reduction opportunities, and further initiatives to enhance

production efficiency.

Yme. Credit Repsol

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LIME PETROLEUM

Page 10 Page 11

The Shrek license partnership is currently assessing alter-

native development concepts for the Shrek discovery. Aker

BP, the operator, has developed a cost-effective alternative

concept involving a long reach well drilled from an existing

subsea template on Skarv. Anticipated to reach a project

feasibility milestone in the first quarter of 2024, Shrek will

then progress toward project sanction, likely in late 2024

or early 2025. However, the development plan and timeline

may be influenced by nearby exploration drilling activities.

Additionally, the decision was made to relinquish the PL838B

license due to low chances of success and limited recoverable

resources across various prospects.

View from Brage platform. Photo: OKEA ASA

PL838 (30%)

Exploration Licenses

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LIME PETROLEUM

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Sustainability

Vestfold, Norway Credit: Victoria Fondenær

In 2023, Lime embarked on another year of exploration

and production, remaining steadfast in our commitment

to sustainability. As a responsible partner in the oil and gas

industry, we aim for economic resilience while respecting

the environment and communities we touch.

We acknowledge that the oil industry faces more stringent

requirements due to its environmental impact, but we

firmly believe that responsible practices can coexist with an

abundant energy supply. In our journey toward sustainability,

the company has progressed in various sustainable initiatives,

from human rights to carbon reduction and renewable energy.

Human Rights and Due Diligence Assessment

To comply with the Norwegian Transparency Act, Lime

Petroleum conducted its first due diligence assessment in

accordance with OECD guidelines for multinational enterprises,

evaluating the impact of its operations on human rights and

decent working conditions. The Transparency Act Report,

published in June 2023, accounted for the assessment. The

Transparency Act Report for 2022 is available in Lime’s

webpage; a new report for 2023 will be published on our

website in June 2024.

Drawing upon the outcomes of business mapping, gap

analysis, partner feedback, and desktop research using

publicly available sources, we conducted a risk assessment

for Lime’s business stakeholders. As a critical component of

this evaluation and to inform subsequent prioritization of

mitigation strategies, we thoroughly evaluated our potential

association with, contribution to, and impact on the identified

potential risks.

Lime is currently experiencing a phase of development and

growth, which inherently involves ongoing fluctuations in our

risk landscape. Consequently, our due diligence focuses on

embedding responsibility into our management system to

ensure that we have processes in place to assist in identifying

and mitigating the risks that can arise from our operations.

Based on the risk mapping and analysis, Lime has not identi-

fied any negative impacts on human rights in our business,

supply chain, or business partners thus far. Nevertheless,

the company has identified some risks and implemented the

following mitigating measurements:

• Enhanced its grievance mechanism by introducing an

external grievance reporting form alongside the existing

internal whistleblower system. This modification enables

third parties to report any grievances or transgressions

confidentially. Interested individuals can download the

contact form from the Lime website and submit it

anonymously.

• Implemented a supplier code of conduct

• Established a Human Rights policy embedded in our

Business Management System (BMS)

Lime continues to monitor, assess, and implement mitigating

measures for potential negative impacts of our operations

on human rights. We will strive to ensure that risks to human

rights and decent working conditions are prioritized in the

same manner as other risks for Lime.

At Lime Petroleum, we recognize the complexity of the energy

production and consumption landscape and are aware of the

critical role that our company plays in shaping the future.

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LIME PETROLEUM

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Double Materiality

Lime has been preparing to comply with the Corporate

Sustainability Reporting Directive (CSRD) that includes the

European Sustainability Reporting Standards (ESRS) and has

taken the first steps to assess the relevant topics that will

constitute the company’s double materiality assessment.

While financial materiality remains crucial for assessing the

impact of economic factors on our organisation, we

recognise that non-financial aspects of our operations

significantly influence long-term sustainability and resilience.

The double materiality assessment expands the scope of

our understanding to include external environmental and

social impacts, as well as internal organisational risks and

opportunities.

We have started by carefully defining the scope of our

operations and the different processes that take place in our

business activities’ value chain. We have mapped our internal

and external stakeholders to assess social impacts and

identified a long list of topics to work on and evaluate using

different sustainability standards, such as the Global

Reporting Standard (GRI), ESRS, and CSRD.

Lime Petroleum Value Chain

All of Lime’s operations are located in Norway. Lime

participates as a partner in the licenses, placing a special

focus on the see-to-it duty requirements with the monitoring

and quality control of the activities undertaken by the

operators of the producing fields, OKEA (Brage) and Repsol

Fig 1: Lime Petroleum Value ChainStavern, Norway. Credit: Adam Spitzmüller

(Yme). Most of Lime’s activities are carried out on the office

premises, representing the gross of Lime’s emissions to the

environment.

While tackling the challenge of addressing Scope 3 emissions

within the complex oil and gas industry, Lime works closely

with license operators and partners to quantify, track, and

monitor Scope 3 emissions, as they are crucial for achieving

sustainability goals. The company participates in energy

management activities and climate change mitigation

initiatives concerning the electrification of installations; in

2023, it also matured its CCS project with industry partners.

The company purchased goods and services in 2023 from

suppliers located in and outside Norway.

The suppliers are generally contracted for engineering, legal,

financial, or consultancy services.

Lime’s produced crude oil and natural gas liquids (NGL)

are sold under long-term agreements on a free-on-board

(FOB) basis. The crude oil is lifted and transported by ship to

terminals for further distribution, generally to the United

Kingdom and Northern Europe. The natural gas is transported

through the Norwegian pipeline grid system and sold at exit

points in Norway and Europe. Lime’s crude oil and gas is

further processed, transported, and distributed by third

parties to the end user.

ANNUAL REPORT 2023

LIME PETROLEUM

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Directors’ Report

The global energy landscape continues to evolve, influenced by geo-

political shifts, technological advancements, and environmental

concerns. Despite volatility, the demand for hydrocarbons remains

robust. Lime Petroleum has adapted to these dynamics, optimizing

production, exploring new reserves, and embracing sustainable practices.

As a fast-growing partner on the NCS, Lime Petroleum has continued

its pace, marked by significant milestones in 2023. These accomplishments

include pre-qualification as an operator, net production exceeding

10,000 boepd from the Brage and Yme fields, participation in a discov

-

ery within a producing asset, acquisition of an extension to PL1093, and

closing the year with a 17% stake in PL740 a notable achievement as

the company’s first development project involvement.

The company actively works to reduce its carbon emissions by participating

in carbon management initiatives such as the Brage climate response

project and carboncapture and storage. Additionally, Lime consistently

strives to enhance energy efficiency and implement sustainable practices.

The company has made significant efforts in our non-operated license

operations to reduce resource consumption, minimize waste, and

address pollution. These initiatives encompass efficient water usage,

recycling programs, and responsible sourcing of materials.

In 2023, Lime Petroleum conducted two tap issues, raising a total of NOK

300 million. This increased the aggregate bond amount to NOK 1,250

million (approximately US$120.2 million). Repayment commenced in

July 2023, and by the end of the year, the outstanding balance stood

at NOK 1,062 million (aprox US$101 million). In 2024, the anticipated

amortization will amount to about NOK 375 million (approximately

US$36.1 million).

Stavern, Norway. Photo: Victoria Fondenær

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LIME PETROLEUM

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Oslo Fjord Winter. Photo: Lars B Hübert

Lime Petroleum AS (hereafter referred to as Lime) is a

Norwegian oil company owned by Rex International

Investment Pte Ltd (91.65% share capital), a wholly owned

subsidiary of the Singapore-listed Rex International Holding

Limited, and Schroeder & Co Banque SA (8.35% share

capital). Lime’s office is located at Skøyen in Oslo, Norway.

Lime’s core business is to explore for, develop, and produce

oil and gas on the NCS. Having acquired ownership in

oil-producing fields, Lime stands out as a full-cycle

exploration and production company.

Operational Review

A major highlight for Lime was its pre-qualification as an

operator on the NCS by the Norwegian Ministry of Petroleum

and Energy in March, following the completion of a

pre-qualification process, which started in April 2022.

The ramp-up of production from the Brage and Yme fields

was another highlight in 2023. In January, Lime’s net average

production level was approximately 3,700 boepd in December,

the average daily production was approximately 10,400

boepd. This was mainly achieved by drilling new wells in Brage

and Yme, but also by increasing production via successful

workovers on existing wells and efficiency in the fields.

Three new wells were drilled in the Yme field, two production

wells and one injection well. The injection well (C-7) was

completed in 2024. The new wells had a significant and

positive impact on production levels once they came on

stream in late 2023.

In total, seven wellbores were drilled in 2023 in Brage, including

one exploration probe, five production wells, and one water

injection well. Production levels rose sharply in Q3 as new

wells started to come on stream. An A-13E exploration probe

encountered hydrocarbons in the Kim prospect area, with

initial estimates of 6 to 12 million boe in place. Further

appraisal will be conducted in this area.

In November, Lime signed agreements with DNO Norge AS

and OKEA ASA to acquire a 10.7212% and 6.2788% interest

respectively, for a total of 17% interest in PL740, the Brasse

discovery. The acquisition was completed in December 2023.

Brasse holds approximately four million boe (net to Lime)

contingent resources and is planned for development with

a subsea tie-back to Brage. The license partnership made a

final investment decision for Brasse in April 2024.

Work was progressed on Lime’s licenses with discoveries,

PL820S/B (Iving/Evra), PL383 (Shrek), and PL1125 Falk/Linerle.

Lime’s partner in PL1125 (OKEA) withdrew from the license

Rock at Gea Norvegica UNESCO Park. Photo: Asam Spitzmüller

early in 2023, and Lime was awarded Operator on the

license on the condition that Lime found a suitable partner by

the end of the year to participate in drilling an appraisal well.

Unfortunately, Lime could not attract a partner to the license,

and it has subsequently been relinquished. Evaluation of

Shrek and Iving/Evra is ongoing.

Lime was awarded two new exploration licenses in January

as part of the APA2022 licensing round. PL1178 was awarded

50%, with OKEA (50%) as the Operator and only partner.

The license is just west of the Brage field, with Jurassic and

Cretaceous prospects. PL1190 lies in the Norwegian Sea, just

south of the Heidrun field. Lime wrote the application and

was awarded a 30% interest, with Harbour as Operator with

40% and PGNiG as a partner with 30%. Both licenses have

"drill or drop” decisions to be made in Q1 2025.

In Q1 2023, Lime participated in the Gjegnalunden exploration

well in PL867/B. Lime had a 20% interest in the license, with

Aker BP as the Operator with 80%. The well targeted a

prospect in the Jurassic section. Oil was encountered in

the well, at the prospect level—however, volumes were

significantly less than expected. The discovery was deemed

too small for commercial development, and the license

partnership decided to relinquish PL867/B.

PL818/B, with the Orkja prospect, lies immediately west of

PL867/B. Lime was awarded a 30% interest in the license

in the APA 2015 license round. The results from drilling on

Gjegnalunden did not succeed in de-risking the prospectivity

in PL818/B, and the license partnership decided to relinquish

the licenses late in 2023.

PL838B is just north of PL383 and the Shrek discovery. Lime

has a 30% share in the license, with PGNiG as the Operator

with 40% and Aker BP with 30%. Thorough analysis of the

seismic data along with the wells drilled in the vicinity did not

uncover significant prospectivity in the license. In late 2023,

the license partnership decided to relinquish the license.

As part of the green transition, Lime is continuing its

participation in a Joint Industry Project aiming at securing

a CCS license on the NCS. Lime sees a growing market for

carbon storage, which aligns with Lime’s technical skills

and business interests. Lime is also actively participating in

projects to reduce CO

2

emissions from operations in which

Lime is involved.

To accommodate the increased portfolio, Lime further

upgraded its Business Management System (BMS) in 2023,

especially in the area of drilling operations. The company

ANNUAL REPORT 2023

LIME PETROLEUM

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has further strengthened the team with additional technical

and financial competency.

In 2023, the energy industry faced considerable uncertainties

due to global political and economic instability. Oil and gas

prices reached unprecedented levels during this period.

AIthough the energy markets seem more stable in 2024, the

outlook for the global economy remains uncertain. Lime

acknowledges that the impact on its results will depend

on upcoming developments, which are difficult to predict.

Despite these challenges, Lime is proactively taking necessary

steps to safeguard its financial stability.

Subsequent Events

On January 16, 2024, it was announced that Lime Petroleum

was awarded an add-on license to PL1093: PL1093B. The

add-on license is designed to cover the full extent of a prospect

identified in PL1093. It follows the license timeline and budget

for PL1093 and has no additional cost associated with it.

Lime was granted an extension on PL1125 to find a partner

until the end of January 2024. By the end of the extension,

Lime had not found a qualified partner, and the license was

relinquished.

In April, the PL740 license partnership announced that the

partnership had made a final investment decision on the

Brasse field development. The Operator (OKEA) intends to

submit the PDO by the end of April 2024.

Rex Virtual Drilling

Lime has a strong focus on technology. Lime has a license

agreement with Rex Technology Investments Pte Ltd, granting

use of their proprietary technology: Rex Virtual Drilling (RVD).

RVD uses standard seismic data to differentiate between

liquid hydrocarbons and water in the subsurface reservoirs

by analyzing the dispersive properties of the resonant seismic

waves. The company uses the RVD technology as a

de-risking tool and, to provide further evidence of the

prospectivity of a given area of prospect. Rex Technology

Investments Pte Ltd is a wholly owned subsidiary of Rex

International Investments Pte Ltd.

Intra-Company Cooperation

The Rex Group has three E&P companies: Lime Petroleum AS

in Norway (91.65%), Masirah Oil Ltd in Oman (91.81%), and

Akrake Petroleum SA in Benin (with 70% indirect interest).

Masirah Oil Ltd is the operator of Block 50, with 100%

participating interest offshore located in the Gulf of Masirah,

east of Oman. The Lime team has provided support on

subsurface mapping and interpretation for Masirah since

before the Yumna field achieved first-oil in 2020. In 2023,

Lime provided subsurface support for reservoir management

and planning the 2024 drilling program. Lime has also provided

support for further exploration in Block 50.

Akrake Petroleum SA is the operator of Block 1 in Benin,

with 76% working interest. The block includes the Sèmè field,

which Rex aims to re-develop. In 2H 2023 and into 2024,

Lime has provided technical support to Rex and Akrake,

mainly in the areas of subsurface analysis and field develop-

ment planning.

Changes to the Management and Board of

Directors

In an Extraordinary General Meeting held on December 20,

2023, Beverley Smith was appointed as Director of Lime

Petroleum. At the signing of this report, the Board of Directors

consist of the following members:

Svein Helge Kjellesvik Executive Chairman

Peter Nikolaus Eckhard Oehms Director

Christopher David Atkinson Director

Beverley Smith Director

Kari Loe Nystog resigned as CFO, effective December 31,

2023. Tore Sekkelsten took over as CFO January 1, 2024.

Health Safety, Environment, and Quality (HSEQ)

Health, safety, environment, and quality (HSEQ) is an

integrated part of all Lime’s business operations, in our day-

to-day work and see-to-it duty activities.

At Lime, our HSEQ practices are guided by a policy that

emphasizes responsible management of all activities, ensuring

no unacceptable impact on people, the environment, or

property.

As a partner in NCS licenses and operations, Lime takes its

see-to-it duty seriously. Operators’ managing and exploration

drillings in which Lime participates are closely monitored,

to ensure compliance with the HSE regulations. Lime has

been an active partner in the Brage field since 2021 and

has closely followed up the drilling and production

operations. Similarly, Lime has closely followed up

operations in Yme and taken an active role in a partner audit

of the Operator’s (Repsol Norge AS) competency and capacity.

Lime follows an incident register as part of its see-to-it

duty of the operator activities. The incidents are classified

according to requirements on severity level, and close

follow-ups actions initiated when needed. During 2023,

Lime met its target of zero serious incidents resulting in

fatality or irreversible illness.

Environment

Lime acknowledges the possibility that its operational

activities may inadvertently lead to adverse environmental

consequences or pollution. In collaboration with its joint

venture partners, Lime proactively implements measures to

prevent and mitigate any potential negative environmental

impacts. The company is also attuned to evolving perspectives

regarding the oil and gas industry and actively engages in

addressing concerns related to climate change, human

rights, and inclusion.

In cooperation with Lime’s parent company, Rex Interna-

tional Holding, climate reporting has been enhanced by

identifying climate-related risks and opportunities. The

transition to a low-carbon economy poses a strategic

challenge to the Group, and steps have been taken to

address such risks and capture opportunities during this

transition. The company also aims to manage the carbon

footprint of its operations by implementing energy efficiency

strategies and innovative technologies. Lime participates in

a carbon, capture and storage project that aims to reduce

CO

2

emissions from industrial processes. The company is

also participating in the Brage climate response project with

the license partners, which aims to reduce CO

2

emissions

by exploring alternative technologies including installing an

offshore wind turbine which will reduce the need for using

gas turbines to power up the Brage facilities and carbon

capture and storage.

As a partner in Brage and Yme, Lime collaborates with the

operators of the producing fields OKEA (Brage) and Repsol

(Yme), requesting and following up on environmental

reports that help us identify the extent of our carbon emissions.

Lime actively participates in energy management initiatives

in both producing assets.

We envision a net-zero world with abundant energy and are

investing in initiatives to help us achieve this vision, such as

the carbon storage project. We are working on identifying

the extent of the impact of our activities on the environment

so that we can be ready to comply with the regulations.

At this stage, defining specific environmental goals is an

ongoing process.

Social

Throughout 2023, Lime continued to embed respect for

human rights and decent working conditions into its

management system and policies. A human rights policy has

been established, and the Lime code of conduct and whistle-

blowing policies have been updated to include a mechanism

for reporting grievances externally. The human rights due

diligence process described above in the Sustainability

chapter, is being integrated into existing procedures on

HSEQ and risk management. We acknowledge that the

process is ongoing, and we will strive to respect and

support human rights and decent working conditions in all our

operations, partnerships, and supply chain relationships.

As a result of our human rights due diligence process,

Lime became more aware when contracting services from

suppliers. We have implemented the supplier code of

conduct and changed a supplier that did not have clear

policies for respecting human rights.

Equal opportunities

Lime practices equal rights and opportunities between

genders with respect to employment, wages, and

professional development. Factors determining wages

are area of expertise, performance, seniority, skills, and

education. The company follows the provisions of the

Norwegian Equal Opportunities Act. Lime follows policies

that seek to promote equality and prevent discrimination

based on gender, pregnancy, leave in connection with

childbirth or adoption, care responsibilities, ethnicity,

religion, belief, disability, sexual orientation, gender identity,

gender expression, age, and other significant characteristics

of a person.

At the end of 2023, the company counted a workforce of

22 employees, 7 of whom were women and 15 men. This

signifies a 20% growth compared to 2022. As a consequence

of the company’s ambitious expansion plans, we anticipate

a continued increase in the company’s workforce. While

Lime strives for gender balance, the specific competencies

demanded by the nature of our operations result in a higher

number of male applicants than female applicants for

positions at Lime.

Lime’s employees hold eight different nationalities and are

spread across technical disciplines including engineering,

geology, petrophysics, and finance and management.

Accounting, tax, and legal services are outsourced and

contracted by professional providers. In addition. the

company hires support services from consultants on short-

term contracts.

Lime’s Board of Directors in 2023 consisted of four members,

three men and one woman. This is the first time since

Lime was established in 2012 that there is a woman

director at the Board.

ANNUAL REPORT 2023

LIME PETROLEUM

Page 22 Page 23

Working environment

Our workplace guidelines are aligned with the provisions

of the Norwegian Working Environment Act and are

incorporated into our personnel handbook. The

working environment in the company is good and

efforts are being undertaken for continuous improvement.

The company is always possitive to initiatives that prioritize

employee health, safety and work-life-balance. A new

system consisting of a digital application was implemented

to map and monitor the working environment quarterly.

Lime employees practice a combination of working at the

office or working from home. The company ensures that

each employee is provided with optimal ergonomic solutions

at the working place. Absence due to illness during 2023 was

3.7%, compared to 2.0% in 2022. None of the company’s

employees have been injured during work activities or

caused damage to property of any kind.

Governance

The company has implemented a framework for internal

control related to financial reporting. The financial reporting

process is conducted by the company’s finance department

in close cooperation with third-party professional accounting

expertise. All key processes are subject to adequate review

procedures based on the 4 eyes principle. The third-party

accounting firm holds the executing role and the company’s

finance department holds the reviewing role.

The areas in scope for the internal control are:

• Assess impairment of goodwill and tangible and intangible

assets

• Estimates for asset retirement obligations

• Tax assessment and tax calculation

• The financial statement closing process

• Revenue recognition

• Financial modelling and forecasting

The internal control of financial reporting is continuously

considered and adapted.

In accordance with the company’s articles of association (§5)

the board of directors shall consist of 1 to 5 board members

and 1 deputy board member if required by the composition

of the board. The number of board members within the

interval given by the company’s articles of association

is decided by the general meeting. The board members

are elected by the general meeting (company’s articles of

association §6).

The board is currently not authorised neither by the article

of association or by proxy to issue new shares or buy back

existing shares.

Yme. Bitmap Repsol Stavern, Norway. Credit: Adam Spitzmüller

The composition of the board follows the requirements

in Private Limited Liability Companies Act. The company

aims for a composition that secure necessary capacity and

adequate competency to independently evaluate the cases

presented by the senior management team as well as the

company's operations. It is also considered important that

the board can function well as a collegiate body. The company

does not have any formal guidelines for the composition of

the board beyond this.

During 2023, the BMS was extensively updated and further

developed to cover, among other areas, drilling operations

as an operator on the NCS. The BMS contains supporting

processes for finance and reporting, legal and procurement,

risk management, information management, human

resources, and HSEQ. Further, Lime has strengthened its

cybersecurity performance to avoid incidents. Information

and cybersecurity continue to be an area of risk to the

industry and remains a key priority. Lime has further

developed and trained its emergency response team with a

focus on handling emergency situations as a non-operator

on the NCS. Several desktop exercises were held throughout

the year to train for emergency situations.

Lime follows up all activities with a risk-based approach.

Lime has invested in Project Information Management

System software (PIMS) to track risks systematically through-

out the year and ensure that the mitigation of risk is

handled appropriately. Risk assessments include a wide

range of areas, such as strategic, financial, operational,

compliance, HSE, fraud and corruption, litigation, and

cybersecurity risks. Under the Sustainability reporting,

described earlier in this report, Lime has carried out due

diligence activities to ensure that the company is operating

responsibly, respecting both human rights and decent

working conditions in its operations as well as defining

the topics that could have an impact on the environment

throughout the whole value chain.

Reporting of payments to governments

Lime has prepared a report of government payments in

accordance with the Norwegian Accounting Act §3-3d and

the Norwegian Securities Trading Act §5-5a. These regulations

state that companies engaged in activities within the

extractive industries shall on an annual basis prepare

and publish a report containing information about their

payments to governments. The report is provided a as

separate report and published on the company’s homepage.

Annual Financial Statements

(2022 figures in brackets)

ANNUAL REPORT 2023

LIME PETROLEUM

Page 24 Page 25

In addition to the bonds, Lime also has shareholder loan

agreements with a total balance of NOK 169 million, which

NOK 31 million is accrued interests.

The total equity was NOK -4 million at year-end 2023,

compared to NOK 368 million in 2022, following the loss

of NOK 371 in 2023. The Board has conducted a detailed

assessment of the company’s equity and liquidity position

in accordance with Section 3-4 in the Norwegian Accounting

Act and concluded that the current financial position is

acceptable. See further details in the Going Concern section.

Risk Factors and Risk Management

Lime Petroleum AS is subject to controllable and uncontrol-

lable risks associated with the oil and gas industry. Compa-

nies operating in the oil and gas industry are exposed to a

variety of operational, financial, and external risks that may

not be possible to eliminate completely. The company is

focusing on identifying risks and implementing preventive

measures for mitigating effects of such risks. Lime manage-

ment works closely with its main shareholder and parent

company, Rex, to develop a risk management strategy and

framework to enable the management to prevent events

and to handle them effectively.

Lime has established internal procedures and systems for

ethical guidelines and a social responsibility policy. The

company supplemented its ethical guidelines by establishing

its Human Rights policy as a result of the due diligence

assessment carried out to comply with the Transparency

Act in force since June 30, 2023. Lime continues to monitor,

assess, and implement mitigation measurements for potential

risks to human rights and decent working conditions.

Cybersecurity continues to be an area of risk to the industry

and remains a priority. We have conducted training and

emergency response exercises in the event of a cyber-attack.

Additionally, relevant employees have attended workshops

and meetings with cybersecurity experts. Knowledge gained

from the exercises has been implemented and updated

in Lime’s BMS. Furthermore, Lime has attended major

accidents workshops on cybersecurity with the operators of

the producing licenses.

Directors’ and officers’ liability insurance has been secured

by the company to cover the possible personal liability of

directors and officers in accordance with applicable law

Operational Risk

Lime recognizes the risks associated with the operations of

its operational assets. The regulations of activities on the

NCS provides the framework for handling these risks, and

Lime intends to act as an active and responsible partner

offering its technical expertise in all aspects of the opera-

tions. However, drilling, development, production, and de-

commissioning activities will never be risk-free, and there

will always be a risk that a major operational incident will

occur.

Furthermore, there are risks related to the future production

of oil and gas, which is dependent on finding or acquiring

reserves and resources and then developing them. The

company’s assets are non-operated, so there are risks

associated with third-party contractors or operators.

Moreover, costs related to exploration and development

projects are uncertain.

Lime experienced one serious HSE incident on a non-

operated field in 2023. Improving safety performance is

continuously a top priority for Lime, and the company works

actively with its operators and partners to establish risk

mitigation actions to reduce the possibility of operational

incidents.

Lime is focused on active risk management but also

mitigation through adequate insurance. The company has

insured its liabilities related to exploration and production

activities on the NCS in line with industry best practices and

has offshore insurance programs covering the following

risks (non-exhaustive):

• loss of production income

• physical damage to assets

• well control

• third-party liability

Commodity Price Risk

Since becoming a partner of the oil-producing Brage field in

2021 and the oil-producing Yme field in 2022, the company is

exposed to market fluctuations in commodity prices, which

influences the company’s revenues. Commodity price risk

represents one of the most notable risks for the company

going forward. In order to reduce the risk related to oil price

fluctuations, the company established an oil price hedging

program. Effective from February 1, 2023, Lime’s hedging pro-

gram is based on put options that protect the company from

significant reductions in crude oil prices through January

Going Concern

Pursuant to Section 3-3 of the Norwegian Accounting Act,

the Board has performed an assessment of the company’s

cash flows and its financial and liquidity positions. Despite a

slight negative equity position at year-end 2023, the Board

confirms that the conditions for continued operation as a

going concern are present and that the annual financial

statements have been prepared on that basis. The company

delivered 570 kbbl of oil 4 January 2024 which was

produced in 2023. If this delivery had taken place in 2023 the

company’s equity would be positive at year end. It is the

Board’s assessment that the real value of the company’s

assets is higher than the booked values and that these

values exceed the company’s liabilities. Forecasted cash

flows and available liquidity are expected to be sufficient

to finance the company’s commitments in 2024. The Board

confirms that the annual financial statements represent a

true and fair view of the company’s financial position and

that it is not aware of any factors that would materially affect

the assessment of the company on December 31, 2023.

Profit and Loss

In 2023, the company delivered revenues from the sale of

crude oil and gas amounting to NOK 1,605 (948) million.

Although oil and gas prices were reduced in 2023 compared

to 2022, the production performance in terms of volume

sold from both Brage and Yme more than offset this effect

(1,931 thousand boe in 2023 compared to 874 thousand boe

in 2022).

Operating expenses culminated at NOK 1,563 (960) million.

This increase was mainly due to higher production

through greater operating expenses and depreciation. The

impairment of NOK 350 million is a combination of NOK

119 million related to the impairment of exploration

licenses and NOK 231 million related to the impairment of

goodwill from the Yme transaction. The main reason for the

impairment of the goodwill related to Yme is lower

production volumes in the early life of the field compared

to initial assessments. The lower production volumes are

predominantly due to unexpected production shutdowns

due to mechanical issues and unforeseen equipment

failure and unplanned delays in adding new production and

injection wells to the field. The impairment of exploration

licenses consists of PL818 and PL818B (NOK 37 million),

PL838B (NOK 5 million), PL867 and PL867B (NOK 73 million),

and PL1125 (NOK 4 million). These impairments follow

conclusions in the separate licenses that the work conducted

to date does not have any commercial outcome and that the

licenses will be relinquished. Exploration costs culminated

at NOK 71 (31) million. The increase was mainly driven

by purchases of seismic data. Other operating expenses

culminated at NOK 95 (44) million, mainly related to

insurance, the use of external consultants, business

development activities, and legal costs related to the

settlement of an arbitration case.

Net financial costs in 2023 were NOK 283 (134) million. The

increase from 2023 was mainly caused by additional bond

releases, raising the total loan from the initial NOK 500

million in 2022 to NOK 1250 million at the start of 2023.

Loss before taxes was NOK 237 (147) million. Taxes

amounted to NOK 134 (-67) million, bringing the total loss of

the company to NOK 371 (80) million.

The tax refund received in 2023, related to the activity in

2022, amounted to NOK 579 (376) million. The tax refund

earned in 2023 (and expected to be received in 2024) is NOK

48 million.

Cash flow from operating activities was NOK 810 (942)

million compared to the operation profit of NOK 46 (-14)

million. Depreciation (NOK 524 million), impairment

(NOK 350 million), tax refund (NOK 579 million) working

capital changes (NOK - 423 million) and paid interest expenses

(NOK -188 million) make up the main part of the difference.

Investments

During the year, cash flow from investing activities amounted

to NOK 995 (1098) million. The majority of this amount

was linked to the continuous Brage infill drilling (NOK 472

million) and new wells at Yme (NOK 76 million). Additionally,

NOK 303 million was related to the final payment for the Yme

consideration, and NOK 136 was allocated to exploration

investments. Regarding this latter, NOK 61 million was

related to the non-commercial Gjegnalunden well and NOK

24 million to field evaluations and concept studies in the

newly acquired Brasse field.

Financing

As a result of the Yme acquisition, the company reshaped its

financing. The current borrowing base is a three-year senior

secured series of bonds up to a maximum amount of NOK

1250 million, with different issue dates established on July

4, 2022. The size of the bond was NOK 950 at the start of

2023 and, through two tap issues at the beginning of 2023,

the total outstanding amount of NOK 1 250 was reached in

mid-April. First redemptions were conducted in July and

October with a repayment of NOK 188 million, leaving a

remaining balance of NOK 1 063 million at year-end 2023.

ANNUAL REPORT 2023

LIME PETROLEUM

Page 26 Page 27

The Board of Directors of Lime Petroleum AS

Oslo, xx April 2024

Beverley Smith

Director

Lars B. Hübert

CEO

Svein H. Kjellesvik

Executive Chairman

Christopher D. Atkinson

Director

Peter N. Eckhard Oehms

Director

2024. The crude oil production was hedged at a strike price

of USD 35 per barrel with an average cost of USD 0.45 per

barrel, resulting in a total option premium of USD 216,000. A

potential renewal of the program is an ongoing assessment.

Financial Risk

Lime is exposed to exchange rate fluctuations, as the oil and

gas sales agreements are denominated in foreign currency.

The oil sales revenues are in USD and the gas sales are in

GBP. Investments and operational expenses are mainly

denominated in NOK and the outstanding bond debt is

also denominated in NOK. Lime manages currency risk by

making frequent currency exchanges and utilizing hedging

instruments when appropriate. In April 2023, a currency

hedging program was established using put options to

protect the company from substantial, unfavorable

fluctuations in the NOK and USD exchange rates. The

program has a duration of 12 months, and its potential

renewal will be an ongoing assessment.

The company is also exposed to changes in market interest

rates, as its financing facilities have variable elements based

on the Norwegian Interbank Offered Rate (NIBOR) term.

The company stresses a focus on liquidity, and the

company’s financing needs are continuously monitored to

ensure appropriate funding. Liquidity risk is the risk that the

company will be unable to meet its financial liabilities when

they become due. Lime develops short-term (12 months)

and long-term forecasts to plan its liquidity. These forecasts

are updated regularly for various scenarios and inform

the decision making of the company’s management and

Board. Lime’s future capital requirements depend on many

factors, and the company is closely monitoring the need for

funds to fulfil its commitments related to exploration and

development programs associated with the company’s

license portfolio.

As Lime has stock-listed bonds on the main list at Oslo Børs,

the company must be compliant with the market abuse

regulations (MAR) and their associated obligations. In

October 2022, Lime initiated a project, with KPMG Capital

Market & Transactions as an advisor, to establish routines

to fulfill the regulatory duties in accordance with MAR.

The implementation of internal routines, procedures, and

guidelines as part of the wider Lime BMS was finalized in

2023.

The company considers its credit risk to be low, since its

license partners and customers are creditworthy oil

companies. Cash and cash equivalents are placed with major

banks.

For further information, please refer to the Financial Risk

Management described in Note 23.

External Risks

Lime is a non-operator and not directly involved in the

execution of offshore operations on a day-to-day basis.

However, since becoming a partner in the Brage field in 2021

and a partner in the Yme field in 2022, the company will

take part in dialogues with the operators to ensure that all

necessary steps are taken to protect offshore personnel

against any circumstances that may have an impact on

working conditions.

The business environment in which the company operates

can change rapidly. In light of the lessons learned from the

prolonged global pandemic that began in 2020 and created

challenges for the oil industry, Lime remains vigilant in

monitoring all circumstances to ensure that necessary

measures are taken to protect staff and operations.

Russia’s invasion of Ukraine and the turmoil in the Middle

East are further examples of events that have a material

influence on the oil and gas industry. The industry has

seen significant uncertainties regarding global political and

economic stability in recent years, and the uncertainty that

these events pose for oil and gas prices is significant. Lime

will be impacted by such events, but continues to take

necessary steps to ensure that the company remains

financially sound.

The fiscal regime for the Norwegian petroleum sector has

generally been stable and supportive of the industry. In April

2022, the Ministry of Finance put forward the government’s

new tax proposal to Parliament. The tax proposal was

passed by Parliament before summer 2022 and took

effect as of January 1, 2022. The new regime has had positive

effects for Lime.

Lime has a potential risk exposure from the response to

climate change. Climate related risk can be divided into

two major categories. Transition risk related to anticipated

transition to a lower-carbon economy and physical risk

related to the physical impacts of climate change. Lime

assesses physical risks from climate change as less material

to its business. Transitional risk could however have

material impact on Lime’s strategy and operations.

Transitional risk includes the risk of changed regulatory

framework and intensified taxation of carbon emission

to promote renewable energy sources. Lime is mitigating

these risk through supporting several initiatives that aims to

reduce carbon emissions. This includes among other

initiatives active involvement in the Carbone Capture and

Storage (CCS) project and an offshore wind project looking

into electrification of Brage

Outlook

Lime Petroleum AS continues to stay focused on its business

strategy of increasing its assets portfolio, to achieve an even

stronger position on the Norwegian Continental Shelf. Lime

is continuously looking for new opportunities to expand

its activities for further value creation. Lime Petroleum AS

aims to be an active, responsible partner, performing its see-

to-it duty as a licensee and now ensuring that its business

activities comply with human rights standards by creating

procedures to identify, report, and mitigate transgressions.

The company is actively taking part in initiatives that

mitigate the footprint of its activities by participating in a carbon

storage project. The project matured in 2023, identifying a

full value chain and establishing collaboration with partners

and potential suppliers.

ANNUAL REPORT 2023

LIME PETROLEUM

Page 28 Page 29

The Board of Directors of Lime Petroleum AS

Oslo, xx April 2024

Beverley Smith

Director

Lars B. Hübert

CEO

Svein H. Kjellesvik

Executive Chairman

Christopher D. Atkinson

Director

Peter N. Eckhard Oehms

Director

Confirmation from the Board of

Directors and CEO 2023

We confirm that to the best of our knowledge, the financial

statements for the period from 1 January to 31 December

2023 have been prepared in accordance with IFRS adopted

by EU and give a true and fair view of the company’s assets,

liabilities, financial position and results of operations, and

that the Directors’ Report provides a true and fair view if

the development and performance of the business and the

position of the company together with a description of the

key risks and uncertainty factors that the company is facing.

Brage platform. OKEA ASA

ANNUAL REPORT 2023

LIME PETROLEUM

Page 30 Page 31

(Amounts in TNOK) Note 2023 2022

Revenues from crude oil and gas sales 4 1 604 861 947 527

Other operating income / loss (-) 3 900 -1 221

Total operating income 1 608 762 946 306

Production expenses 5 -664 595 -455 409

Change in over/underlift position and production inventory 188 690 18 746

Exploration expenses 6 -70 766 -31 154

Payroll and related cost 7 -47 426 -36 121

Depreciation and amortisation 13 -524 169 -180 028

Impairment (-) / reversal of impairment 11 -349 654 -232 156

Other operating expenses 8 -95 069 -44 045

Total operating expenses -1 562 989 -960 168

Profit / loss (-) from operating activities 45 772 -13 862

Finance income

*)

9 154 428 54 987

Finance costs

*)

9 -437 535 -188 505

Net financial items -283 107 -133 518

Profit / loss (-) before income tax -237 335 -147 380

Taxes (-) / tax income (+) 10 -133 787 66 876

Profit / loss (-) for the period / year -371 122 -80 505

Income Statement

(Amounts in TNOK) Note 2023 2022

Profit (loss) for the period -371 122 -80 505

Other comprehensive income, net of tax: 0 0

Total comprehensive income for the year -371 122 -80 505

Statement of

comprehensive income

*)

Finance income and finance costs in 2022 have been reclassified to conform with current year's classification. See note 9.

ANNUAL REPORT 2023

LIME PETROLEUM

Page 32 Page 33

(Amounts in TNOK) Note 31/12/2023 31/12/2022

ASSETS

Non-current assets

Goodwill 11 83 481 313 486

Exploration and evaluation assets 11 262 399 240 360

Oil and gas properties 12, 13 1 816 125 1 518 202

Property, plant and equipment 13 899 775

Right-of-use assets 14 5 749 7 282

Non-current receivables 15 1 475 791 1 331 363

Total non-current assets 3 644 444 3 411 468

Current assets

Prepayments and other receivables 16 541 242 257 234

Spareparts, equipment and inventory 17 335 245 134 918

Tax refund receivable 10 47 595 556 235

Other current assets - restricted cash 18 92 053 87 500

Cash and cash equivalents 18 332 083 405 898

Total current assets 1 348 218 1 441 784

Total assets 4 992 662 4 853 253

EQUITY AND LIABILITIES

Equity

Share capital 19 216 900 216 900

Other paid-in capital 125 471 125 471

Retained earnings/Uncovered loss (-) -345 976 25 145

Total equity -3 605 367 517

Liabilities

Non-current liabilities

Asset retirement obligations and other provisions 20 2 087 080 1 790 703

Deferred tax liabilities 10 862 035 657 109

Leasing liabilities 14 4 078 5 396

Interest-bearing loans and borrowings 21 823 389 918 289

Total non-current liabilities 3 776 583 3 371 497

Current liabilities

Interest-bearing loans and borrowings 21 375 000 137 156

Trade creditors 32 284 43 713

Other current liabilities 24 812 400 933 369

Total current liabilities 1 219 684 1 114 238

Total liabilities 4 996 267 4 485 736

Total equity and liabilities 4 992 662 4 853 253

Balance Sheet as at 31 December

Statement of changes in equity

(Amounts in TNOK)

Share capital

Not

registered

capital

increase

Other paid

in capital

Retained

earnings /

Uncovered

loss

Total equity

Equity at 1 January 2022 130 320 200 000 12 052 105 650 448 022

Profit / loss (-) for the year -80 505 -80 505

Other comprehensive income for the year 0 0 0

Total comprehensive income for the year -80 505 -80 505

Shares issued in 2021, registered in 2022 86 580 -200 000 113 420 0

Equity at 31 December 2022 216 900 0 125 471 25 145 367 517

Equity at 1 January 2023 216 900 0 125 471 25 145 367 517

Profit / loss (-) for the year -371 122 -371 122

Other comprehensive income for the year 0 0 0

Total comprehensive income for the year -371 122 -371 122

Equity at 31 December 2023 216 900 0 125 471 -345 976 -3 605

The Board of Directors of Lime Petroleum AS

Oslo, xx April 2024

Beverley Smith

Director

Lars B. Hübert

CEO

Svein H. Kjellesvik

Executive Chairman

Christopher D. Atkinson

Director

Peter N. Eckhard Oehms

Director

ANNUAL REPORT 2023

LIME PETROLEUM

Page 34 Page 35

Cash Flow Statement

Note 1 Corporate information

Note 2 Summary of material accounting policies

The Financial Statements of Lime Petroleum AS were approved

by the Board of Directors and CEO on 30 April 2024 and will be

presented for approval at the Annual General Meeting 7 May

2024.

Lime Petroleum AS (“the company”) is a private limited company

incorporated and domiciled in Norway, with its main office at

Drammensveien 145A 0277 Oslo, Norway. The company is a part

of the Rex International Holding Ltd. Group. The consolidated

Financial Statements for the Rex Group can be retrieved from

http://rex.listedcompany.com. Lime Petroleum AS was incorporated

18 August 2012.

The company’s only business segment is exploration for,

development and production of oil and gas on the Norwegian

Continental Shelf.

Basis for preparation

The financial statements have been prepared in accordance with

International Financial Reporting Standards

®

as adopted by the

European Union (EU) (IFRS) and in accordance with the additional

requirements following the Norwegian Accounting Act.

Pursuant to Section 3-3 of the Norwegian Accounting Act,

the Board has performed an assessment of the company’s cash

flows and its financial and liquidity positions. Despite a slight

negative equity position at year-end 2023, the Board confirms

that the conditions for continued operation as a going concern

are present and that the annual financialstatements have been

prepared on that basis. The company delivered 570 kbbl of oil 4

January 2024 which was produced in 2023. If this delivery had

taken place in 2023 the company’s equity would be positive at

year end. It is the Board’s assessment that the real value of the

company’s assets is higher than the booked values and that these

values exceed the company’s liabilities. Forecasted cash flows

and available liquidity are expected to be sufficient to finance the

company’s commitments in 2024. The Board confirms that the

annual financial statements represent a true and fair view of the

company’s financial position and that it is not aware of any factors

that would materially affect the assessment of the company on

December 31, 2023

Balance sheet classification

Current assets and current liabilities include items due less than a

year from the balance sheet date, and items related to the operating

cycle. Other assets and liabilities are classified as noncurrent.

Interest in oil and gas licenses

The company accounts for its interest in oil and gas licenses

based on its ownership interest in the license. The company

recognises its share of each license’s income, expenses, assets,

liabilities and cash flows, on a line-by-line basis in the company’s

financial statements.

Foreign currency

Functional currency and presentation currency

The company’s functional and presentation currency is Norwegian

kroner (NOK).

Transactions in foreign currency

Foreign currency transactions are translated into NOK using the

exchange rates at the transaction date. Monetary balances in

foreign currencies are translated into NOK at the exchange rates

on the date of the balance sheet. Foreign exchange gains and

losses resulting from the settlement of such transactions and

from the translation of monetary assets and liabilities denominated

in foreign currencies are recognised in the income statement.

Revenue recognition

Revenue from the sale of petroleum products is recognised when

the company’s contractual performance obligation has been

fulfilled and control is transferred to the customer, which will

ordinarily be at the point of delivery when the title passes (sales

method). This is normally at the time of loading oil or NGL on

vessels used for transport, or at agreed point of delivery for dry

gas. The lifting schedule and allocation of lifts to the company will

vary with the production profiles and commercial arrangements

for the various petroleum products and assets. The company’s

share of crude oil from from Brage is lifted infrequently, approxi-

mately two to four times a year, while crude oil from Yme is lifted

monthly. The company’s sale of petroleum products is to large

international oil companies with investment grade credit rating.

The pricing of the sales of petroleum products is determined

based on market pricing for each product.

Overlift and underlift of petroleum products

Overlift and underlift is calculated as the difference between the

company’s share of production and its actual sales and are classified

as current assets and current liabilities respectively. If accumulated

production exceeds accumulated sales, there is an underlift

(asset) and if accumulated sales exceed accumulated production

(Amounts in TNOK) Note 2023 2022

Cash flow from operating activities

Profit / loss (-) before income tax -237 335 -147 380

Adjustments:

Tax refunded 10 579 115 375 393

Depreciation 524 169 180 028

Impairment of exploration assets and goodwill 11 349 654 232 705

Net finance costs/income 9 283 107 133 518

Interest expense paid -187 556 -64 603

Interest income received 20 475 5 446

Other finance cost paid -86 361 -58 989

Changes in trade creditors -11 429 19 061

Changes in other current receivables and liabilities -423 496 267 310

Net cash flow from operating activities 810 343 942 489

Cash flow from investing activities

Investment in exploration and evaluation assets 11 -136 102 -121 130

Net cash paid in business combination 12 -303 219 -538 582

Investment in oil and gas properties 13 -550 214 -428 462

Brage abandonment liability - restricted cash 17 -4 553 -3 000

Purchase of property, plant and equipment 13 -588 -6 903

Net cash flow from investing activities -994 676 -1 098 077

Cash flow from financing activities

Proceeds from borrowings 20 349 086 903 335

Repayments of borrowings 20 -236 586 -460 462

Repayments of lease liabilities 14 -1 982 -1 685

Net cash flow from financing activities 110 518 415 224

Net change in cash and cash equivalents -73 815 259 636

Cash and cash equivalents at 1st January 405 898 146 262

Cash and cash equivalents at 31st of December 332 083 405 898

Interest paid 187 556 64 603

Notes

ANNUAL REPORT 2023

LIME PETROLEUM

Page 36 Page 37

there is an overlift (liability). Over/underlift balances are measured

at the lower of production cost including depreciation and net

realisable value. Changes in over/ underlift balances are presented

as part of operating expense in the income statement.

Spare parts, equipment and inventory

Inventories of petroleum products are stated at the lower of cost

and net realisable value. Cost is determined by the first-in first-out

method and comprises production costs, including depreciation

charge. Inventories of spare parts and consumables are valued at

the lower of cost price (based on weighted average cost) and net

realisable value. Capital spare parts are accounted for under the

same principles as property, plant and equipment.

Oil and gas properties and other property, plant and equipment

Oil and gas properties and other property, plant and equipment

are stated at cost less accumulated depreciation and any impair-

ment charges. Capitalised costs for oil and gas fields in production

are depreciated individually for each field using the unit-of-

production method. The depreciation is calculated based on

proved and probable reserves. The rate of depreciation is equal

to the ratio of oil and gas production for the period over the

estimated remaining proved and probable reserves expected to

be recovered at the beginning of the period. The rate of depreciation

is multiplied with the carrying value plus estimated future capital

expenditure necessary to develop any undeveloped reserves

included in the reserve basis. Any changes in the reserves

estimate that affect unit-of-production calculations, are accounted

for prospectively over the revised remaining reserves.

Depreciations of other property plant and equipment are calculated

on a straight-line basis over the assets expected useful life and

adjusted for any impairment charges. Expected useful lives of

long-lived assets are reviewed annually and where they differ

from previous estimates, depreciation periods are changed

accordingly.

Oil and gas properties are reviewed for potential impairment

whenever events or changes in circumstances indicate that the

carrying amount of an asset exceeds its recoverable amount.

Right-of-use assets represent the right to use the underlying

leased asset during the lease term according to IFRS 16. Refer-

ence is made to section “Leases” below for further details.

Intangible assets

Goodwill

Goodwill arise from acquisitions of interests in oil and gas licenses

accounted for in accordance with the principles in IFRS 3 Business

Combination. Goodwill is not amortised, but it is tested for

impairment at each balance date, or more frequently if an

impairment indicator exists, for example by events or changes in

circumstances. Goodwill is carried at cost less accumulated

impairment losses. The value in use of the company's licenses,

are based on cash flows after tax. This is because these licenses

are only sold in an after-tax market as stipulated in the Petroleum

Taxation Act Section 10. The purchaser is therefore not entitled to

a tax deduction for the consideration paid over and above the

seller’s tax values. In accordance with IAS 12 paragraphs 15 and

24, a provision is made for deferred tax corresponding to the

difference between the acquisition cost and the transferred tax

depreciation basis. The offsetting entry is goodwill. Hence, good-

will arises mainly as a technical effect of deferred tax.

Exploration and evaluation assets

The company uses a “modified full cost method” to account for

exploration costs. All exploration costs directly related to areas

where Lime holds an interest are capitalized. As a rule, each

license constitutes one cost area, but in areas where two or more

licenses have boundaries against each other, it may be natural to

view multiple licenses together as a separate cost area. A cost

area will be tested for impairment if facts and circumstances

suggest that the carrying amount of the asset(s) on the area may

exceed its recoverable amount. Typical facts and circumstances

that would indicate that a cost area should be tested for impair-

ment are:

• the right to explore in the specific area has expired or will expire

in the near future and is not expected to be renewed.

• further exploration in the specific area is neither budgeted nor

planned.

• commercially viable reserves have not been discovered and the

company plans to discontinue activities in the specific area, and

• existing data shows that the carrying amount of the asset(s) will

not be recovered in full through development activity.

Interests in joint arrangements

The company applies IFRS 11 to all joint arrangements. Under

IFRS 11 investments in joint arrangements are classified as either

joint operations or joint ventures depending on the contractual

rights and obligations each investor. The company has assets in

licenses which are not incorporated entities. All of these are

related to licenses on the Norwegian Continental Shelf. The

company has classified these joint arrangements as joint

operations. The company accounts for its share of assets, liabilities,

income and expenses, debt and cash flow under the respective

items in the company’s financial statements.

Impairment of assets

Property, plant and equipment and other non-current assets are

subject to impairment testing when there is an indication that the

assets may be impaired. The company makes such assessment

on each reporting date. If an indication exists, an impairment test

where the company estimates the recoverable amount of the

asset is performed.

The recoverable amount is the higher of fair value less expected

cost to sell and value in use. If the carrying amount of an asset

is higher than the recoverable amount, an impairment loss is

recognised in the income statement. The impairment loss is the

amount by which the carrying amount of the asset exceeds the

recoverable amount.

The value in use is determined as the discounted future net cash

flows expected to be generated by the asset. For the purposes of

assessing impairment, assets are grouped at the lowest levels for

which there are separately identifiable cash inflows. For oil and

gas properties, the field or license is typically considered as one

cash generating unit. All other assets are assessed separately. An

impairment loss on assets will be reversed when the recoverable

amount exceeds the carrying amount.

Acquisitions of interests in oil and gas licenses

Acquisitions of interests in oil and gas licenses or similar joint

operations are accounted for according to IFRS 11. Where the

joint operation constitutes a business, then this is accounted for

in accordance with the principles in IFRS 3 Business Combinations

(acquisition method). Identifiable assets acquired and liabilities

and contingent liabilities assumed are measured initially at their

fair values at the acquisition date. Acquisition-related costs are

expensed as incurred. The excess of the consideration

transferred over the fair value of the net identifiable assets

acquired is recorded as goodwill. If, following careful consideration,

the consideration transferred is less than the fair value of the net

identifiable assets of the joint operation acquired, such difference

is recognised directly in profit or loss. Acquisitions of interests in

oil and gas licenses or similar joint operations where the joint

operation is not considered to be a business, are accounted for as

acquisitions of assets. The consideration for the interest is

allocated to individual assets and liabilities acquired.

Asset swaps

Swaps of assets are calculated at the fair value of the asset being

surrendered, unless the transaction lacks commercial substance,

or neither the fair value of the asset received, nor the fair value

of the asset surrendered, can be effectively measured. In the

exploration phase, the company normally recognizes asset swaps

based on carrying value of the asset being surrendered, as the

fair value cannot be reliably measured.

Leases (as lessee)

IFRS 16 defines a lease as a contract that conveys the right to

control the use of an identified asset for a period of time in

exchange for consideration. For each contract that meets this

definition, IFRS 16 requires lessees to recognize a right-of-use

asset and a lease liability in the balance sheet with certain

exemptions for short term and low value leases. Lease payments

are to be reflected as interest expense and a reduction of lease

liabilities, while the right-of-use assets are to be depreciated over

the shorter of the lease term and the assets’ useful life. Lease

liabilities are measured at the present value of remaining lease

payments, discounted using the company’s calculated borrowing

rate. Right-of-use assets are measured at an amount equal to the

lease liability at initial recognition. Extension options are included

when management judges their exercise to be reasonably certain.

Lime Petroleum is a non-operator and recognises its proportionate

share of a lease when the company is considered to share

primary responsibility for a license-committed liability. This

includes contracts where Lime Petroleum has co-signed a lease

contract, or external lease contracts for which the operator has

been given a legally binding mandate to sign on behalf of the

license partners.

Receivables

Trade receivables are recognized in the Balance Sheet at their

transaction price after a deduction for the provision for credit

losses. Historically there have been no significant credit losses.

Cash and cash equivalents

Cash and the equivalents include cash on hand, deposits with

banks and other short-term highly liquid investments with original

maturities of three months or less.

Borrowings

All loans and borrowings are initially recognised at cost, being the

fair value of the consideration received net of transaction/issue

costs associated with the borrowing. After initial recognition,

interests bearing loans and borrowings are subsequently

measured at amortised cost using the effective interest method.

Any difference between the consideration received net of

transaction/issue costs associated with the borrowing and the

redemption value, is recognised in the income statement over

the term of the loan.

Income taxes

Income taxes for the period comprise tax payable, refundable tax

from refund tax value of petroleum expenses and other refunds

as presented in note 9 and changes in deferred tax.

Tax is recognised in the income statement, except to the extent

that it relates to items recognised in other comprehensive

income or directly in equity. In this case the tax is also recognised

in other comprehensive income or directly in equity.

Deferred tax assets and liabilities are calculated on the basis of

existing temporary differences between the carrying amounts of

assets and liabilities in the financial statement and their tax bases,

together with tax losses carried forward at the balance sheet

date. Deferred tax assets and liabilities are calculated based on

the tax rates and tax legislation that are expected to exist when

the assets are realised or the liabilities are settled, based on the

tax rates and tax legislation that have been enacted or substantially

ANNUAL REPORT 2023

LIME PETROLEUM

Page 38 Page 39

enacted on the balance sheet date. Deferred tax assets are

recognised only to the extent that it is probable that future

taxable profits will be available against which the assets can be

utilised.

Provisions

A provision is recognised when the company has a present legal

or constructive obligation as a result of past events, it is probable

(i.e. more likely than not) that an outflow of resources will be

required to settle the obligation, and the amount has been reliably

estimated. Provisions are reviewed at each balance sheet date

and adjusted to reflect the current best estimate. Provisions are

measured at the present value of the expenditures expected to

be required to settle the obligation. The increase in the provision

due to passage of time is recognised as finance cost.

The company recognises a provision and an expense for severance

payment when there exists a legal obligation to pay severance

payment.

Asset retirement obligations and reimbursements

The company recognises an asset retirement obligation when the

oil and gas installations are installed or at the later date when the

obligation is incurred. The obligation is measured at the present

value of the estimated future expenditures determined in

accordance with current technology, local conditions and

requirements for the dismantlement or removal of oil and gas

installations. Applicable asset retirement costs are capitalised as

part of the carrying value of the tangible fixed asset and are

depreciated over the useful life of the asset (i.e., unit-of-

production method). The liability is accreted for the change in its

present value on each balance sheet date. The accretion effect is

classified as financial expense. The asset retirement provision

and the discount rate are reviewed at each balance sheet date.

Where some or all of the expenditure required to settle an asset

retirement obligation is expected to be reimbursed by another

party, the company is recognising an asset when it is virtually

certain that reimbursement will be received if the company

settles the obligation. The reimbursement is recognised as a

separate asset and is measured at present value at each balance

sheet date.

Trade creditors

Trade creditors are recognised initially at fair value and

subsequently measured at amortised cost using the effective

interest method.

Contingent liabilities

Contingent liabilities are not recognised in the financial

statements. Significant contingent liabilities are disclosed, with

the exception of contingent liabilities where the probability of the

liability occurring is remote.

Employee benefits - pensions

According to Norwegian law employees are mandatory members

of the company’s Pension Scheme (“obligatorisk tjenestepensjon”).

The scheme is based on a contribution plan. Contributions are

paid to pension insurance plans and charged to the income

statement in the period to which the contributions relate. Once

the contributions have been paid, there are no further payment

obligations.

Segment reporting

The company has identified its reportable segment based on the

nature of the risk and return within its business. The company’s

only business segment is exploration for and development/

production of oil and gas on the Norwegian Continental Shelf.

Based on this no segment note is presented and this is in

accordance with management’s reporting.

Cost of equity transactions

Transaction costs directly linked to an equity transaction are

recognised directly in equity, net after deducting tax.

Cash flow statement

The cash flow statement is prepared by using the indirect method.

Events after the balance sheet date

The financial statements are adjusted to reflect events after the

balance sheet date that provide evidence of conditions that

existed at the balance sheet date (adjusting events). The financial

statements are not adjusted to reflect events after the balance

sheet date that are indicative of conditions that arose after the

balance sheet date (non-adjusting events). Non-adjusting events

are disclosed if significant.

New and amended standards and interpretations adopted by

the company

New standards and amendments to standards and interpretations

effective from 1 January 2023 did not have any significant impact

on the financial statements.

New and amended standards and interpretations issued but

not adopted

New standards and amendments to standards and interpretations

are effective for annual periods beginning on or after 1 January

2024 and have not been applied in preparing these financial

statements. None of these are expected to have any significant

impact on the company’s financial statements.

The preparation of the financial statements in accordance with

IFRS, requires management to make accounting judgements, and

to use estimates and assumptions that affect the reported

amounts of assets and liabilities, income and expenses.

3.1 Estimation uncertainty

The estimates and associated assumptions are based on historical

experience and various other factors that are considered to be

reasonable under the circumstances. The estimates and underlying

assumptions are reviewed on an ongoing basis.

Estimates and assumptions which represent a considerable risk

for material changes in carrying amounts of assets and liabilities

during the next fiscal year, are presented below.

Impairment

The company reviews whether its non-financial assets have

suffered any impairment whenever events or changes in

circumstances indicate that the carrying amount may not be

recoverable. An asset is written down to its recoverable amount

when the recoverable amount is lower than the carrying value of

the asset. The recoverable amount is the higher of fair value less

expected cost to sell and value in use (present value based on the

future use of the asset).

All impairment assessments require a high degree of estimation,

including assessments of expected future cash flows from the

cash generating unit and the estimation of applicable discount

rates. Impairment testing requires long-term assumptions to be

made concerning a number of economic factors such as future

production levels, market conditions, production expense,

discount rates and political risk among others, in order to establish

relevant future cash flow estimates. There is a high degree of

reasoned judgement involved in establishing these assumptions

and in determining other relevant factors. In these assessments,

climate risk is an underlying factor being considered by the

company. This type of risks have been evalauated as part of the

impairment valuation of assets with a balance value. Due to the

limited number of years before cease of production for both

Brage and Yme climate risks are not expected to have material

adverese effects in the remaining life time for these fields.

More competitive pricing on renewable energy sources in the

future is likely to reduce the pricing on oil and gas. In addition,

there is a risk of changed regulatory framework and intensified

taxation of carbon emission to promote renewable energy sources.

These trends may adversely impact the valuation of the assets

involved. See note 23 for further discussion of the company’s

assessment of climate risk.

Goodwill is tested for impairment at each balance sheet date. The

term “technical goodwill” is used to describe a category of good-

will arising as an offsetting account to deferred tax recognised in

business combinations. All of the company’s goodwill is related to

the Yme acquisition in 2022 and has been allocated to the Yme

CGU.

The assets that have been assessed for impairment are described

further in notes 11 and 13. In note 11 the company’s assessment

of impairment sensitivity is described.

Asset retirement obligations

Production of oil and gas is subject to statutory requirements

relating to decommissioning and removal. Provisions to cover

such future asset retirement obligations is recognised at the time

the statutory requirement arises, which is defined as when the

equipment has been installed or a well has been drilled. The

estimates are uncertain and may vary in response to many factors

including changes to relevant legal requirements, the emergence

of new restoration techniques or experience at other production

sites. The expected timing and amount of expenditure can also

change, for example in response the changes in reserves or

changes in laws and regulations or their interpretation. A premise

in the estimation for the future obligations is current technology

and market conditions. As such, there is also inherent risk related

to future developments in technology and market prices. Further-

more, future price levels, market conditions and development in

technology can impact the timing of the closing of production and

thus the timing of abandonment. The company is reviewing

the estimates and assumptions related to asset retirement

obligations to ensure the financial statements reflect the

company’s best estimate at any reporting date. The asset

retirement obligation is further described in note 20.

3.2 Accounting judgement

Information about judgements made in applying the accounting

policies that have the most significant effects on the amounts

recognised in the financial statements is described below.

Accounting policy for exploration costs

The company uses a “modified full cost method” to account for

exploration costs. All exploration costs directly related to areas

where the company holds an interest are initially capitalised in

cost centres by well, field or exploration area, as appropriate.

The application of the company’s accounting policy for exploration

and evaluation expenditure requires judgement in determining

whether it is likely that future economic benefits are likely either

from future exploitation or sale or where activities have not

reached a stage which permits a reasonable assessment of the

existence of reserves. These estimates directly impact the point of

deferral of exploration and evaluation expenditure. The deferral

policy requires management to make certain estimates and

assumptions as to future events and circumstances, in particular

whether an economically viable extraction operation can be

established. Any such estimates and assumptions may change as

new information becomes available. Circumstances may suggest

that the carrying amount may exceed the recoverable value of

the asset, and such assessment of circumstances involves

judgment as to likely future commerciality of the asset and also

when such commerciality should be determined. The exploration

and evaluation assets are further described in note 11.

Note 3 Critical accounting judgements and estimates

ANNUAL REPORT 2023

LIME PETROLEUM

Page 40 Page 41

Production costs, excl. DD&A:

(Amounts in TNOK) 2023 2022

From licences 618 260 422 301

Tariffs and other production costs 46 335 33 108

Total production costs 664 595 455 409

Production costs per barrel of oil equivalents (boe): 2023 2022

Production costs (TNOK) 664 595 455 409

Depreciation and amortisation producing fields (TNOK) 522 172 178 356

Total production cost including depreciation and amortisation (TNOK) 1 186 766 633 765

Produced volumes (boe) 2 388 090 899 691

Production costs per boe (NOK) (1) 497 704

(1)

Barrels of oil equivalents (=boe)

Changes in over-/underlift and inventory positions:

(Volumes in boe) 2023 2022

Over-/underlift and inventory, opening balance 52 554 -30 599

Produced volumes 2 388 090 899 691

Acquisition through business combination 0 57 070

Net sold volumes -1 931 015 -873 607

Over-/underlift and inventory, closing balance 509 630 52 554

Note 4 Revenue from crude oil and gas sales

(Amounts in TNOK) 2023 2022

Sale of oil 1 311 472 751 351

Sale of gas and NGL 293 389 196 176

Total revenues from crude oil and gas sale 1 604 861 947 527

Note 5 Production cost and changes in

over-/underlift position

(Amounts in TNOK) 2023 2022

Direct seismic costs and field evaluation 43 267 7 546

G&G costs, Virtual Drilling 10 586 15 044

Consultants exploration 14 649 3 063

Other operating exploration expenses 2 264 5 502

Total exploration expenses 70 766 31 154

Note 6 Exploration Expenses

(Amounts in TNOK) 2023 2022

Salaries employees 34 034 24 909

Director's fee 4 390 4 498

Consultancy fees, hours invoiced to other companies -2 107 -1 461

Social security 6 942 4 553

Pension costs 3 130 2 804

Other employee related expenses 1 038 819

Total 47 426 36 121

Average number of employees 21 17

Note 7 Payroll and related cost

Remuneration to board of directors and management:

See information in note 25 Related party disclosure regarding remuneration of key management.

Pensions

The Company has a defined contribution pension plan for its employees which satisfies the statutory requirements in the Norwegian

law on required occupational pension ("lov om obligatorisk tjenestepensjon").

All revenues are generated from activities on the Norwegian Continental Shelf (NCS), and derive from the sale of oil, gas and NGL.

ANNUAL REPORT 2023

LIME PETROLEUM

Page 42 Page 43

Note 8 Other operating expenses

Other operating expenses include:

(Amounts in TNOK) 2023 2022

Travelling expenses 655 182

Consultant's and other fees

1)

56 918 23 427

Other administrative expenses 37 497 20 436

Total 95 069 44 045

1)

Fees includes payments to related parties. See note 24 for further information.

Remuneration to auditor is allocated as specified below:

(Amounts in TNOK) 2023 2022

Audit 2022 annual report (KPMG) 3 901 837

Audit 2023 annual report (Deloitte) 849 0

Attestations (KPMG) 300 156

Attestations (Deloitte) 16 0

Other assistance (KPMG) 0 1 137

Total, excl. VAT 5 066 2 129

Note 9 Finance income and costs

Finance income:

(Amounts in TNOK) 2023 2022

Interest income 20 475 5 446

Foreign exchange income, realized

1)

0 8 197

Unwinding of discount, asset retirement non-current receivable

2)

59 152 41 691

Total finance income 79 628 55 334

Finance costs:

(Amounts in TNOK) 2023 2022

Interest expense on loan from group companies 15 422 9 662

Interest expenses other loans and borrowings 178 325 98 875

Foreign exchange costs, realized 33 680 0

Foreign exchange costs, unrealized

1)

16 462 347

Unwinding of discount, asset retirement obligation

2)

57 710 33 497

Other finance costs 61 135 46 471

Total finance costs 362 735 188 852

Net financial items -283 107 -133 518

1)

Realized and unrealized foreign exchange income and foreign exchange cost was presented net in 2022. This has been reclassified

to conform with current year's classification.

2)

The effects of unwinding of discount on non-current receivable and non-current obligation related to asset retirement was in 2022

presented net. This has been reclassified to conform with current year's classification.

ANNUAL REPORT 2023

LIME PETROLEUM

Page 44 Page 45

2023 2022

Calculated refund tax this year 47 595 556 235

Of this refund not recognised in income statement (acquisition of licences recognised net

of tax)

0 -192 650

Correction refund previous years 22 880 15 615

Change deferred tax -204 262 -312 324

Total income tax (-)/tax credit (+) -133 787 66 876

Note 10 Tax

Specification of tax receivable refund:

(Amounts in TNOK) 2023 2022

Calculated refund tax this year 47 595 556 235

Total tax receivable refund 47 595 556 235

Reconciliation of effective tax rate:

(Amounts in TNOK) 2023 2022

Profit (loss) before tax -237 335 -147 380

Expected income tax at tax rate 78.004% 185 131 114 962

Adjusted for tax effects (22%-78%) of the following items:

Permanent differences; Non taxable items -210 764 -5 781

Permanent differences; capitalized deferred tax as part of acquisition cost 665 -3 075

Effect of uplift 17 389 17 274

Finance and onshore items -153 486 -68 168

Adjustment previous years and other 27 278 11 686

Effect of new tax rates on deferred tax 0 -23

Total income tax credit -133 787 66 876

Specification of tax effects on temporary differences, tax losses carried forward and deferred tax:

(Amounts in TNOK)

2023 2022

Capitalised exploration and licence costs -190 142 -212 301

Capitalised fields in production -1 147 046 -508 179

Temporay differences other non current assets 392 201

Temporay differences current assets -173 543 -141 507

Provisions, ARO, leasing liabilities 474 693 155 168

Non-current borrowings -7 363 -10 266

Tax losses carried forward, onshore 3 055 165

Tax losses carried forward, offshore 22 % basis 179 446 59 776

Deferred tax liability (-) / tax asset (+) -860 508 -656 944

Not capitalised deferred tax asset (valuation allowance) -1 527 -165

Deferred tax liability (-) / tax asset (+) in balance sheet -862 035 -657 109

Change in deferred taxes:

Correction refund previous years, assessed but not settled (amounts in TNOK) 2023 2022

Deferred taxes recorded in income statement -204 262 -312 324

Deferred taxes recorded in balance sheet on acquisition of licences -665 0

Tax refund for previous years due to change in tax rules in 2022 0 14 992

Total change in deferred taxes -204 926 -297 332

Specification of income tax:

(Amounts in TNOK)

In 2022, the Norwegian Parliament enacted changes in the Norwegian Petroleum Tax Act and a new tax loss refund was introduced.

The tax loss refund is based on offshore tax losses multiplied with a special tax rate of 71.8%.

Deferred tax is calculated based on tax rates applicable on the balance sheet date. Ordinary income tax is 22%, to which is added a

special petroleum tax rate of 71.8% with a deduction in the special tax basis of a calculated corporate tax. With this deduction the total

effective tax rate is 78.004%.

ANNUAL REPORT 2023

LIME PETROLEUM

Page 46 Page 47

Note 11 Goodwill, exploration and evaluation assets

(Amounts in TNOK)

Exploration and

evaluation

assets

Technical

goodwill

Ordinary

goodwill

Total

goodwill

2023

Cost:

At 1 January 2023 1 052 739 177 257 136 229 313 486

Additions 140 855 833 0 833

Change in estimate, asset retirement 0 0 0 0

Disposals 0 0 0 0

Cost at 31 December 2023 1 193 594 178 090 136 229 314 320

Depreciation and impairment:

At 1 January 2023 812 379 0 0 0

Depreciation this year 0 0 0

Impairment this year

(1)

118 816 94 609 136 229 230 839

Disposals 0 0 0 0

Accumulated amortisation and impairment at

31 December 2023

931 195 94 609 136 229 230 839

Carrying amount at 31 December 2023 262 399 83 481 0 83 481

(1)

Impairment of Exploration and evaluation asset in 2023 is related to impairment of the licences PL818, PL838B, PL867 and PL1125.

Impairment of goodwill in 2023 is related to Yme.

The main reason for the impairment of the goodwill related to the Yme Field is lower production volumes in the early life of the field

compared to initial assessments. The lower production volumes are predominantly due to unexpected production shutdowns due to

mechanical issues and unforeseen equipment failure and unplanned delays in adding new production and injection wells to the field.

Key assumptions used in the calculation of Yme impairment in 2023: (i) Real time oil price (2023) ranging between USD 88-79 per bbl for

the years 2024 -2035; (ii) NOK/USD currency rate of 10,2; (iii) After tax discount rate of 13.0%. Assumed inflation is 4% in 2024, 2,8% in

2025 and 2% for all years after. Yme is assumed to produce until 2035 in the above-mentioned calculations.

If the impairment calculation had been based on +-10% change in prices or volume the recognized impairment loss had been MNOK

+-65 different than the booked loss. The impairment calculation is not sensitive to changed discount rate. A rate of 8% will increase the

impairment with MNOK 6 and a rate of 18% will reduce the impairment with MNOK 1 .

As discussed in note 23, Lime may be impacted by transitional effects of moving into a low-carbone economy and hence have exposure

to climate related risks like changed regulatory framework and intensified taxation of carbon emission. This type of risks have been

evaluated as part of the impairment valuation of assets with a balance value. Due to the limited number of years before cease of

production for both Brage and Yme transitional climate risks are not expcted to have material adverse effects in the remaining life time

for these fields.

(Amounts in TNOK)

Exploration and

evaluation

assets

Technical

goodwill

Ordinary

goodwill

Total

goodwill

2022

Cost:

At 1 January 2022 934 683 0 0 0

Additions 118 055 0 0 0

Business combination

(1)

0 177 257 136 229 313 486

Disposals 0 0 0 0

Cost at 31 December 2022 1 052 739 177 257 136 229 313 486

Depreciation and impairment:

At 1 January 2022 579 674 0 0 0

Depreciation this year 0 0 0 0

Impairment this year

(2)

232 705 0 0 0

Disposals 0 0 0 0

Accumulated amortisation and impairment at

31 December 2022

812 379 0 0 0

Carrying amount at 31 December 2022 240 360 177 257 136 229 313 486

(1)

Reference is made to Note 12 Business Combination IFRS 3.

(2)

Impairment in 2022 is related to impairment of the licences PL433, PL937, PL937B and PL1111.

ANNUAL REPORT 2023

LIME PETROLEUM

Page 48 Page 49

Note 12 Business combination IFRS 3

(1)

The ordinary goodwill consists largely of elements from the existing business plan and expected future development of the acquired

oilfield. Technical goodwill arising from the special tax rules for oilfields.

Goodwill related to the Yme acqusition was impaired in H2 2023 with TNOK 230 839.

(2)

TNOK 289 940 of the consideration was paid 3 February 2023.

(Amounts in TNOK)

Preliminary PPA Changes in 2023 Updated final PPA

Consideration

(2)

828 522 3 882 832 404

Yme oil field 540 426 540 426

Abandonment retirement obligation (221 244) (221 244)

Deferred tax asset 14 992 (665) 14 328

Tax receivable 189 575 189 575

Stocks 38 994 38 994

Prepayments 1 254 1 254

A/P, VAT and Accruals (113 856) 3 714 (110 143)

Over-/undercall 16 564 16 564

Over/Underlift 48 330 48 330

Total allocated to assets and liabilities 515 035 3 049 518 084

Goodwill (residual) (1) 313 486 833 314 320

"Ordinary" goodwill 136 229 136 229

"Technical" goodwill 177 257 833 178 090

Acquisitions in 2022

Acquisition of a 10.00% interest in Yme

On 23 December 2022 the Company completed the acquisition of a 10.00% working interest in Yme from KUFPEC Norway AS.

The acquisition was financed through the issuance of a NOK 950 million secured bond loan in July 2022 and additional bond raise of a

total of NOK 300 in 2023.

The transaction has been determined to constitute a business combination and has been accounted for using the acquisition method

of accounting as required by IFRS 3. The economic date of the transaction, which will be used for tax purposes, is 1 January 2022.

The acquisition date for accounting purposes (transfer of control) has been determined to be 31 December 2022.

A preliminary purchase price allocation (PPA) was performed in 2022 and all identified assets and liabilities were measured at their

acquisition date fair values in accordance with the requirements of IFRS 3. The agreed purchase price was USD 68.1 million (NOK 670.8

million). Adjusted for interim period adjustments and working capital, the total cash consideration was estimated to USD 84.1 million

(NOK 828.5 million).

The purchase price allocation (PPA) presented below is a final PPA based on an updated completion statement received in 2023

compared to the PPA presented at year end 2022.

The fair values of the identifiable assets and liabilities in the transaction as at the date of the acquisition have been estimated as follows:

ANNUAL REPORT 2023

LIME PETROLEUM

Page 50 Page 51

Note 13 Oil and gas properties, furniture, fixtures

and office machines

(Amounts in TNOK)

Oil and gas

properties in

production

Furniture,

fixtures and

office machines

2023

Cost:

At 1 January 2023 1 696 558 4 917

Additions 548 512 588

Change in estimate ARO 271 583 0

Disposals 0 0

Cost at 31 December 2023 2 516 653 5 505

Depreciation and impairment:

At 1 January 2023 -178 356 -4 142

Depreciation this year -522 172 -465

Impairment this year 0 0

Disposals 0 0

Accumulated amortisation and impairment at 31 December 2023 -700 528 -4 606

Carrying amount at 31 December 2023 1 816 125 899

(Amounts in TNOK)

Oil and gas

properties in

production

Furniture,

fixtures and

office machines

2022

Cost:

At 1 January 2022 727 670 4 391

Additions 428 462 526

Business combination

(1)

540 426 0

Disposals 0 0

Cost at 31 December 2022 1 696 558 4 917

Depreciation and impairment:

At 1 January 2022 0 -3 729

Depreciation this year

(2)

-178 356 -412

Impairment this year 0 0

Disposals 0 0

Accumulated amortisation and impairment at 31 December 2022 -178 356 -4 142

Carrying amount at 31 December 2022 1 518 202 775

(1)

Reference is made to Note 12 Business Combination IFRS 3.

(2)

TNOK 90 of depreciation is included in Exploration expenses.

Depreciation plan Unit of Production linear

Estimated useful life (years) N/A 3 - 5

ANNUAL REPORT 2023

LIME PETROLEUM

Page 52 Page 53

Note 14 Right-of-use assets and leasing liabilities

Break down of lease debt:

Short-term 1 982 1 982

Long-term 4 078 5 396

Total lease debt 6 061 7 378

Maturity of future undiscounted lease payments under non-cancellable lease agreements:

2023 2022

Within 1 year 1 982 1 982

1 to 5 years 5 286 7 269

After 5 years 0 0

Total 7 269 9 251

Right-of-use assets:

The Company leases office facilities. The Company's right-of-use assets and leasing liabilities are presented in the tables below:

(Amounts in TNOK)

Right-of-use assets 2023 2022

Acquisition cost 1 January 7 665 6 123

Addition of right-of-use assets 0 7 665

Disposal of right-of-use assets 0 -6 123

Acquisition cost 31 December 7 665 7 665

Accumulated depreciation and impairment 1 January -383 -3 867

Depreciation -1 533 -1 350

Impairment 0 0

Disposal 0 4 834

Accumulated depreciation and impairment 31 December -1 916 -383

Carrying amount of right-of-use assets 31 December 5 749 7 282

Lower of remaining lease term or economic life 4.75 years

Depreciation method Linear

Leasing liabilities: 2023 2022

Lease liabilities 1 January 2023 7 378 2 340

Additions new lease contracts 0 7 665

Disposal 0 -2 340

Accretion lease liabilities 665 370

Payments of lease liabilities -1 982 -657

Total leasing liabilities 31 December 2023 6 061 7 378

Note 15 Non-current receivables

(Amounts in TNOK) 2023 2022

Non-current receivables at 1 January 1 331 363 1 473 184

Changes in estimates 76 908 -183 512

Effect of change in discount rate 8 367 0

Unwinding of discount 59 152 41 691

Total 1 475 791 1 331 363

The non-current receivable is related to the Acquisition of 33.8434 per cent share in Brage field in 2021 from Repsol Norge AS. The

parties have agreed that the seller shall cover 95% of the costs of the final decommissioning, plugging and abandonment (ABEX) cap-

ped at NOK 2 260 million. The net present value of the estimated reimbursement is calculated using a discount rate of 4.37% (year end

2022: 4.44%). See also note 20.

Note 16 Prepayments and other receivables

Prepayments and other receivables include:

(Amounts in TNOK) 2023 2022

Accounts receivable 202 047 33 766

Accrued revenue 104 460 14 306

Underlift of petroleum products 107 336 43 827

Working capital and overcall, joint venture 100 339 161 383

Prepaid expenses 2 390 1 909

VAT receivables 9 671 2 027

Other short term receivables 15 000 15

Total 541 242 257 234

Note 17 Spareparts, equipment and inventory

(Amounts in TNOK) 2023 2022

Inventory of oil 161 525 0

Spare parts and equipment 173 720 134 918

Total 335 245 134 918

ANNUAL REPORT 2023

LIME PETROLEUM

Page 54 Page 55

Note 18 Cash, cash equivalents and restricted cash

Of this:

Restricted cash for withheld taxes from employees' salaries 2 037 1 772

Restricted cash for deposit office lease 883 869

Other financial asset - restricted cash 92 053 87 500

The amount is related to Brage abandonment liability.

(Amounts in TNOK) 2023 2022

Bank deposits 332 083 405 898

Total cash and cash equivalents 332 083 405 898

The share capital is denominated in NOK, and the nominal value per share as of 31 December 2023 was NOK 1. All issued shares

are of equal rights.

Rex International Investments Pte. Ltd is a wholly owned subsidiary of Rex International Holding Ltd. Chairman of the Board Svein

Helge Kjellesvik is a shareholder in Rex International Holding Ltd.

Note 19 Share capital and shareholder information

Movements in share capital (amounts in NOK)

Number of

shares

Share capital

Share capital at 1 January 2022 130 320 000 130 320 000

Capital increase in 2022 86 580 087 86 580 087

End balance at 31 December 2022 216 900 087 216 900 087

Share capital at 1 January 2023 216 900 087 216 900 087

Capital increase in 2023 0 0

End balance at 31 December 2023 216 900 087 216 900 087

Shareholders as of 31 December 2023 Shares Ownership

Schroder & Co Banque SA 18 107 068 8,35%

Rex International Investments Pte. Ltd 198 793 019 91,65%

Total number of shares 216 900 087 100,00%

(Amounts in TNOK) 2023 2022

Asset retirement obligation at 1 January 1 790 703 1 674 828

Changes in estimates 386 010 -138 866

Effect of change in discount rate -29 152 0

Unwinding of discount 57 710 33 497

Asset retirement costs from billing -121 243 0

Business combination 0 221 244

Total asset retirement obligation 2 084 029 1 790 703

Other provisions 3 052 0

Total asset retirement obligation and other provisions 2 087 080 1 790 703

Provisions for asset retirement obligations represent the future expected costs for close-down and removal of oil equipment and

production facilities. The provision is based on the company's best estimate. The net present value of the estimated obligation is

calculated using a discount rate of 3.4% (year end 2022: 3.2%). The assumptions are based on the economic environment at the

balance sheet date. Actual asset retirement costs will ultimately depend upon future market prices for the necessary works which will

reflect market conditions at the relevant time. Furthermore, the timing of the close-down is likely to depend on when the field ceases

to produce at economically viable rates. This in turn will depend upon future oil and gas prices, which are inherently uncertain.

See also note 15 regarding the decommissioning receivable regarding the acquisition of Brage field in 2021.

Note 20 Asset retirement obligations and

other provisions

ANNUAL REPORT 2023

LIME PETROLEUM

Page 56 Page 57

Senior Secured NOK 1,250,000 Bonds 2022/2025 ISIN NO0012559246

In July 2022 Lime Petroleum AS ("Lime") resolved to issue a series of bonds up to a maximum issue amount of NOK 1,250,000 with

different issue dates The latest issues took place in 2023 and were in aggregate NOK 300 million. The bonds issued in 2023 were issued

at 99.0 and 99.25 per cent of the nominal amount.The bonds bear an interest rate of 3 months Norwegian interbank offered rate

("NIBOR") plus margin of 9.25 per annum. The bonds issued in 2022 were issued at 97 per cent of the nominal amount. Interests and

redemption of bonds are repayable in quarterly instalments, with first repayment in July 2023. The final maturity date of the bonds is

7 July 2025.

Redemption of Bonds:

On each Interest Payment Date from and including the Interest Payment Date in July 2023 to and including the Interest Payment Date

in April 2025 (i.e., 8 consecutive quarterly instalments) with an amount equal to 7.5 per cent of the Net Issued Amount; and on the

Maturity Date, the remaining Outstanding Bonds will be redeemed in full, in each case at a price of 100.00 percent of Nominal Amount

of Bonds being redeemed (plus, accrued interest on the redeemed Bonds).

Covenants

Covenants related to the senior secured bond issue 2022/2024 ISIN NO0012559246:

(i) Minimum Liquidity: The Issuer shall at all times maintain a minimum Liquidity of no less than 10 % of the outstanding debt.

Minimum liquidity: MNOK 1 062,5 x 10% = MNOK 106,25

Net debt means the aggregate amount of all obligations of the company excluding shareholder loans and any liquidity of the company.

Assets pledged as security

The Bond loan is for the lender secured by a first priority assignment of all shares issued by the Company, monetary claims under the

Shareholder Loan Agreement, mortage over the interest in the hydrocarbon licenses, monetary claims under the Company`s insurances,

first priority charge over the bank accounts including Charged Account and floating charges over the trade receivables, operating assets

and inventory.

Shareholder loan

Lime has a shareholder loan agreements with Rex International Investments Pte.Ltd. Conditional to the bond, the shareholder loan

agreements still stands. By amendment of shareholder loan facility agreements dated 20 December 2022, the maturity date was extended

to 25 July 2025.

Guarantee

Rex International Investments Pte. Ltd has provided a parent company guarantee to the Ministry of Petroleum and Energy on basis of

the Norwegian Petroleum Act sec. 10-7.

Lime Petroleum AS has provided a Letter of Credit issued by Skandinaviska Enskilda Banken AB of the amount of NOK 87,500,000 to

Repsol Norge AS according to the Decommissioning Security Agreement (DSA /Charged Account) dated 15.06.2021. The amount was

increased from NOK 84,500,000 to NOK 87,500,000 in 2022.

(ii) Maximum Leverage Ratio: The Issuer shall in respect of any Calculation Date maintain a Leverage Ratio not exceeding 2.25:1.

“Calculation Date” means each 30 June and 31 December.

EBITDA 31.12.2023

MNOK

Operating profit 45,8

Depreciation and amortisation 524,2

Impairment 349,7

EBITDA 919,6

Net debt 31.12.2023 MNOK

Bond loan 1 062,5

Cash deposit Decomm. Security Agreement -92,1

Total cash and cash equivalents -332,1

Net debt 31.12.2023 638,3

Leverage ratio: Net debt/EBITDA < 2.25 0,69

Note 21 Interest-bearing loans and borrowings

(Amounts in TNOK)

Presentation in

balance

31/12/2023 31/12/2022

Bond loan, nominal amount drawn Non-current 1 062 500 950 000

Bond loan, short-term Non-current -375 000 -137 156

Bond loan; Capitalised arrangement fee (subject to amortisation) Non-current -33 470 -46 665

Shareholder loan incl. capitalized interest Non-current 169 359 152 111

Carrying amount 823 389 918 290

(Amounts in TNOK)

Presentation in

balance

31/12/2023 31/12/2022

Bond loan, short-term Current 375 000 137 156

Carrying amount 375 000 137 156

MNOK

Bank at the end of the period: 424,1

Restricted cash Brage LoC: -92,1

Witholding tax -2,0

Office lease deposit -0,9

Aggregated amount excluding restricted cash 329,2

ANNUAL REPORT 2023

LIME PETROLEUM

Page 58 Page 59

At 31 December 2022

1)

Public duties payable, prepayments from customer and accruals are not included.

1)

Prepayments, VAT receivables, accrued receivables and tax receivables are not included.

Financial instruments by category

(Amounts in TNOK)

At 31 December 2023

1)

Public duties payable, prepayments from customer and accrued expenses are not included.

Fair value of financial instruments

It is assessed that the carrying amounts of financial instruments recognized at amortized cost in the financial statements approximate

their fair values.

Financial assets

Amortized cost

Total carrying

amount

Trade and other receivables

1)

33 781 33 781

Other financial asset - restricted cash 87 500 87 500

Cash and cash equivalents 405 898 405 898

Total

527 179 527 179

1)

Prepayments and VAT receivables are not included.

Financial liabilities

Amortized cost

Total carrying

amount

Borrowings, long term 918 289 918 289

Borrowings, short term 137 156 137 156

Trade creditors 43 713 43 713

Other current liabilities

1)

3 478 3 478

Total 1 102 637 1 102 637

Note 22 Financial instruments

Financial assets

Amortized cost

Total carrying

amount

Trade and other receivables

1)

202 047 202 047

Other financial asset - restricted cash 92 053 92 053

Cash and cash equivalents 332 083 332 083

Total 626 183 626 183

Financial liabilities

Amortized cost

Total carrying

amount

Borrowings, non-current 823 389 823 389

Borrowings, current 375 000 375 000

Trade creditors 32 284 32 284

Other current liabilities

1)

6 870 6 870

Total

1 237 542 1 237 542

ANNUAL REPORT 2023

LIME PETROLEUM

Page 60 Page 61

Overview

The company is exposed to a variety of risks, including credit risk, liquidity risk, interest rate risk, foreign currency risk, climate related

risk and oil and gas price risk. This note presents information about the company's exposure to each of the above mentioned risks, and

the company's objectives, policies and processes for managing such risks. The note also presents the company's objectives, policies

and processes for managing capital.

Credit risk

The counterparty to the cash and cash equivalents and other financial assets are large banks and oil majors with solid credit ratings.

The company monitors the credit ratings of its main counterparties on a regular basis.

Liquidity risk

Liquidity risk is the risk of being unable to pay financial liabilities as they fall due. The company’s approach to managing liquidity risk is

to ensure that it will always have sufficient liquidity to meet its financial liabilities as they fall due, under normal as well as extraordinary

circumstances, without incurring unacceptable losses or risking damage to the company's reputation. Prudent liquidity risk management

implies maintaining sufficient cash and the availability of appropriate funding.

Lime develops short-term (12 months) and long-term forecasts to plan its liquidity. These forecasts are updated regularly for various

scenarios, and form part of the decision basis for the company’s management and board. The company’s future capital requirements

depend on many factors, and the company is closely monitoring the need for funds to fulfil its commitments related to exploration and

development programs associated with the company`s license portfolio. It is a possibility to reduce future commitment by withdrawing

from a license.

The following table details the contractual maturities for the company's financial liabilities. The tables include amounts for both principal

and interest payments. The contractual amounts were estimated based on closing exchange rate at balance sheet date.

Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market

interest rates. The company's interest risk arises from its bond loan which has variable rates terms. As at 31 December 2023, if the interest

rate had been 0,5% higher, the interest cost before tax would have been TNOK 5.313 higher (TNOK 4.750 in 2022).

Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in

foreign exchange rates. The Company is primarily exposed to foreign exchange risk arising from currency exposure with respect to USD

related to oil sales and cash calls and other commitments in foreign currency. To reduce the risk related to currency fluctuation the

company has established a hedging program based on put options that is protecting the company from significant adverse changes in

foreign exchange rates. The currency hedge is based on put options with strike price 9.25 Asian style and a monthly volume of USD 4.3

million 12 months coupons. The currency options expire in March 2024. Hedge accounting is not applied.

The company has limited exposure to currency risk from assets and liabilities recognised as at 31 December 2023, through trade

receivables and payables denominated in USD. An increase in the exchange rate of 10 % would have resulted in an additional finance

income pre-tax of TNOK 16 498 (2022: pre-tax loss of TNOK 911).

Capital management

A key objective in relation to capital management is to ensure that the company maintains a sufficient capital structure in order to support

its business development. The company evaluates its capital structure in light of current and projected cash flows, potential new business

opportunities and the company's financial commitments. In order to maintain or adjust the capital structure, the company may issue new

shares or obtain new loans. The company is assessing such financing opportunities on an ongoing basis.

Climate related risk

Climate related risk can be divided into two major categories. Transition risk related to anticipated transition to a lower-carbon economy

and physical risk related to the physical impacts of climate change. Lime assesses physical risks from climate change as less material to its

business. Transitional risk could however have material impact on Lime’s strategy and operations. Transitional risk includes the risk of

changed regulatory framework and intensified taxation of carbon emission to promote renewable energy sources. Lime is mitigation these

risk through supporting several initiatives that aims to reduce carbon emissions. This includes among other initiatives active involvement

in the Carbone Capture and Storage (CCS) project and an offshore wind project looking into electrification of Brage.

Oil and gas price risk

The company’s revenue comes from oil and gas sales, which are exposed to fluctuations in the oil and gas price level.

To reduce the risk related to oil price fluctuations the company has established a hedging program based on put options that is protecting

the company from significant adverse changes in oil prices. The oil production was hedged at a strike price of 35 USD per bbl and USD 0.45

average cost per barrel. The oil options expired in January 2024. Hedge accounting is not applied.

At 31 December 2023

At 31 December 2022

(Amounts in TNOK)

Carrying

amount

Cash flow <1 year

1 to 5

years

>5 year

Shareholder loan 169 359 204 924 0 204 924 0

Bond loan 1 029 030 1 236 282 503 970 732 312 0

Trade creditors and other short term liabilities 39 153 39 153 39 153 0 0

Total liabilities 1 237 542 1 480 360 543 124 937 236 0

Note 23 Financial risk management

(Amounts in TNOK)

Carrying

amount

Cash flow <1 year

1 to 5

years

>5 year

Shareholder loan 152 111 167 322 0 167 322 0

Bond loan 903 335 1 207 433 254 196 953 237 0

Trade creditors and other short term liabilities 47 192 47 192 47 192 0 0

Total liabilities 1 102 637 1 421 948 301 388 1 120 559 0

ANNUAL REPORT 2023

LIME PETROLEUM

Page 62 Page 63

Note 25 Related party disclosure

(Amounts in TNOK)

a) Purchases from related parties

Purchase of services from Description of services 2023 2022

Rex International Holding Ltd

(1)

Consulting services 13 289 1 143

Rex International Holding Ltd

(1)

Parent company guarantee 3 000 0

Rex Technology Management Ltd

(2)

Rex Virtual Drilling analysis 10 586 15 044

c) Balances with related parties (trade payables)

Related party 2023 2022

Group companies under control of Rex International Holding Ltd 1 594 624

b) Sales to related parties

Sales of consulting services to (see also note 7 Payroll) 2023 2022

Group companies under control of Rex International Holding Ltd 2 107 1 458

d) Balances with related parties (trade payables)

Related party 2023 2022

Group companies under control of Rex International Holding Ltd 16 182 8 608

e) Balances with related parties (non-current liabilities)

See note 20, Interest-bearing loans and borrowings.

Compensation to key management 2023

(Amounts in TNOK)

Position Salary/ Board fee Pension contribution Total 2023

Lars B. Hübert, CEO

4 235 201 4 435

Svein Helge Kjellesvik, Chairman of the Board

4 003 0 4 003

Peter Nikolaus Echard Oehms, Board Member

254 0 254

Christopher David Atkinson, Board Member

254 0 254

Compensation to key management 2022

(Amounts in TNOK)

Position Salary/ Board fee Pension contribution Total 2022

Lars B. Hübert, CEO

3 953 213 4 166

Svein Helge Kjellesvik, Chairman of the Board

4 003 0 4 003

Peter Nikolaus Echard Oehms, Board Member

248 0 248

Christopher David Atkinson, Board Member

248 0 248

Note 24 Other current liabilities

(Amounts in TNOK) 2023 2022

Working capital and undercall, joint venture 285 050 294 715

Overlift of petroleum products 36 342 0

Accrued interest bond loans 35 922 28 610

Prepayments from customers 401 119 296 784

Accrued consideration from acquisitions of interests in licences 0 299 337

Public duties payable 4 077 2 870

Salary and vacation payable 6 870 3 478

Short-term leasing debt 1 982 1 982

Other accruals for incurred costs 41 037 5 592

Total 812 400 933 369

The pricing of all transactions with related parties are based on the principle of ‘arm’s length’, which is the estimated market price.

(1)

Rex International Holding Ltd owns 100 % of the shares in Rex International Investments Pte. Ltd which owns 91.65 % of the shares

in Lime Petroleum AS.

(2)

Rex Technology Management Ltd is owned 100 % by Rex International Investments Pte. Ltd.

The CEO has an agreement of 7 months severance pay on termination of employment. All employees, including the CEO, have

agreements regarding bonus, given certain criteria.

ANNUAL REPORT 2023

LIME PETROLEUM

Page 64 Page 65

Note 27 Shares in licences and obligations

Note 29 Events after the balance sheet date

The company's 2024 capital commitments related to the license portfolio as at year end is estimated to a total of NOK 657 million. This

forecast is based on operator's license budgets. Subsequent to year end, the Brasse field reached a final decision for development and the

company is thus committed to an additional NOK 138 million. See note 29.

Following its participation in the APA 2023 licencing round, Lime was awarded one license, announced in January 2024, a 20% participating

share in PL1093B.

Subsequent to year end the partners in the licenses PL838B and PL1125 have decided to relinquish the licenses. These licenses were

therefore written off in 2023.

In April 2024, the partners in the Brasse license reached a final decision for development of the field. The development will be a tie-back

to the Brage field. See also note 27.

Note 26 Contingent liabilities

The company has not been involved in any legal or financial disputes in 2023 where adversely outcome is considered more likely than

remote.

Note 28 Reserves and resources (un-audited)

1000 Boe Brage Yme Total

Opening balance 1 January 2023 11 028 5 476 16 504

Acqusitions or sales 0

Production -1 709 -679 -2 388

Revisions -2 124 -850 -2 974

31 December 2023 7 195 3 947 11 142

Opening balance 1 January 2022 13 540 0 13 540

Acqusitions or sales 0 5 476 5 476

Production -900 -900

Revisions -1 613 -1 613

31 December 2022 11 028 5 476 16 504

The following table reflects the company’s net entitlement proven and probable reserves and resources (2P and 2C) as reported by the

operators:

ANNUAL REPORT 2023

LIME PETROLEUM

Page 66 Page 67

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providing audit, consulting,

financial advisory and risk management services, and Deloitte Advokatfirma AS, providing tax and legal services.

Registrert i Foretaksregisteret

Medlemmer av Den norske Revisorforening

Organisasjonsnummer: 980 211 282

To the General Meeting of Lime Petroleum AS

INDEPENDENT AUDITOR’S REPORT

Report on the Audit of the Financial Statements

Opinion

We have audited the financial statements of Lime Petroleum AS (the Company), which comprise the balance sheet as

at 31 December 2023, income statement, statement of comprehensive income, statement of changes in equity and

cash flow statement for the year then ended, and notes to the financial statements, including material accounting

policy information.

In our opinion

• the financial statements comply with applicable statutory requirements,

• the financial statements give a true and fair view of the financial position of the Company as at 31

December 2023, and its financial performance and its cash flows for the year then ended in accordance

with IFRS Accounting Standards as adopted by the EU.

Our opinion is consistent with our additional report to the Board of Directors.

Basis for Opinion

We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under

those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements

section of our report. We are independent of the Company as required by relevant laws and regulations in Norway

and the International Ethics Standards Board for Accountants’ International Code of Ethics for Professional

Accountants (including International Independence Standards) (IESBA Code), and we have fulfilled our other ethical

responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is

sufficient and appropriate to provide a basis for our opinion.

To the best of our knowledge and belief, no prohibited non-audit services referred to in the Audit Regulation

(537/2014) Article 5.1 have been provided.

We have been the auditor of Lime Petroleum AS for one year from the election by the general meeting of the

shareholders on 12 June 2023 for the accounting year 2023.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the

financial statements of 2023. These matters were addressed in the context of our audit of the financial statements as

a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Independent auditor’s report

Lime Petroleum AS

2

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Lime Petroleum AS has oil and gas properties with a

carrying amount of NOK 1 816 126 thousand at 31

December 2023. In addition, the carrying value of

goodwill was NOK 83 481 thousand at 31 December

2023.

In line with Lime Petroleum’s accounting policies for

impairment of non-financial assets, management

assessed whether there were impairment indicators.

Based on identified impairment indicators, a calculation

of recoverable amount by each CGU was prepared. We

refer to note 11 for a description of management’s

assessment of impairment.

Based on the results of the assessment of impairment

indicators and the corresponding calculation of

recoverable amounts, a total impairment charge of

NOK 230 839 thousand related to the Yme field was

recognized in 2023.

Management’s assessment of recoverable amounts of

goodwill and oil & gas properties requires estimates

and assumptions relating to operational and market

factors and involves a significant amount of judgement.

In addition, the calculation of recoverable amounts

requires financial modeling of cash flows related to

cash generating units, which can be inherently

complex, and may also require use of judgement.

Furthermore, the valuation of oil & gas properties and

goodwill are inherently uncertain due to the

judgmental nature of the underlying estimates.

We focused on this area because goodwill and oil & gas

properties constitute a significant share of total assets

in the balance sheet, and because the assessment of

recoverable amounts is complex and involves

significant management judgement which may have a

direct impact on net profit.

We assessed Lime Petroleum’s impairment process and

tested the design and implementation of relevant

internal controls.

We assessed management’s identification of

impairment indicators and agreed that indicators were

present.

We obtained management’s recoverable amount

calculation as of 31 December 2023. For relevant cash

generating units, including allocated goodwill, we

assessed and challenged the key inputs in

managements calculation of recoverable amount by:

• comparing management´s price assumptions

against external price forward curves, analysts’

expectations, peers, and other publicly

available sources,

• comparing expected production profiles

towards information reported by the field

operator in the 2024 RNB (reporting to

Revised National Budget) numbers and

towards third party reserve audit,

• comparing estimated future operating costs

and capital expenditures towards information

reported by the field operator in the 2024 RNB

(reporting to Revised National Budget)

numbers,

• benchmarking inflation and discount rates

applied against external market data, with

support from Deloitte Valuation specialists.

We utilized Deloitte valuation specialists to assess the

appropriateness, mathematical and methodological

integrity of management’s impairment model.

We evaluated the appropriateness and completeness

of the related note disclosures and found that they

satisfied IFRS requirements.

Other Information

The Board of Directors and the Managing Director (management) are responsible for the information in the Board of

Directors’ report and the other information accompanying the financial statements. The other information comprises

information in the annual report, but does not include the financial statements and our auditor’s report thereon. Our

opinion on the financial statements does not cover the information in the Board of Directors’ report nor the other

information accompanying the financial statements.

In connection with our audit of the financial statements, our responsibility is to read the Board of Directors’ report

and the other information accompanying the financial statements. The purpose is to consider if there is material

inconsistency between the Board of Directors’ report and the other information accompanying the financial

statements and the financial statements or our knowledge obtained in the audit, or whether the Board of Directors’

ANNUAL REPORT 2023

LIME PETROLEUM

Page 68 Page 69

Independent auditor’s report

Lime Petroleum AS

3

report and the other information accompanying the financial statements otherwise appear to be materially

misstated. We are required to report if there is a material misstatement in the Board of Directors’ report or the

other information accompanying the financial statements. We have nothing to report in this regard.

Based on our knowledge obtained in the audit, it is our opinion that the Board of Directors’ report

• is consistent with the financial statements and

• contains the information required by applicable statutory requirements.

Our opinion on the Board of Directors’ report applies correspondingly to the statements on Corporate Governance

and Corporate Social Responsibility, and to the report on payments to governments.

Responsibilities of Management for the Financial Statements

Management is responsible for the preparation of financial statements that give a true and fair view in accordance

with IFRS Accounting Standards as adopted by the EU, and for such internal control as management determines is

necessary to enable the preparation of financial statements that are free from material misstatement, whether due

to fraud or error.

In preparing the financial statements, management is responsible for assessing the Company’s ability to continue as

a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of

accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic

alternative but to do so.

Auditor’s Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from

material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion.

Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with

ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are

considered material if, individually or in aggregate, they could reasonably be expected to influence the economic

decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional scepticism

throughout the audit. We also:

• identify and assess the risks of material misstatement of the financial statements, whether due to fraud or

error. We design and perform audit procedures responsive to those risks, and obtain audit evidence that is

sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material

misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve

collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

• obtain an understanding of internal control relevant to the audit in order to design audit procedures that

are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness

of the Company’s internal control.

• evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates

and related disclosures made by management.

• conclude on the appropriateness of management’s use of the going concern basis of accounting, and, based

on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that

may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a

material uncertainty exists, we are required to draw attention in our auditor’s report to the related

disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our

conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However,

future events or conditions may cause the Company to cease to continue as a going concern.

• evaluate the overall presentation, structure and content of the financial statements, including the

disclosures, and whether the financial statements represent the underlying transactions and events in a

manner that achieves a true and fair view.

Independent auditor’s report

Lime Petroleum AS

4

We communicate with the Board of Directors regarding, among other matters, the planned scope and timing of the

audit and significant audit findings, including any significant deficiencies in internal control that we identify during

our audit.

We also provide the Board of Directors with a statement that we have complied with relevant ethical requirements

regarding independence, and to communicate with them all relationships and other matters that may reasonably be

thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with the Board of Directors, we determine those matters that were of most

significance in the audit of the financial statements of the current period and are therefore the key audit matters.

We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the

matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our

report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest

benefits of such communication.

Report on Other Legal and Regulatory Requirements

Report on Compliance with Requirement on European Single Electronic Format (ESEF)

Opinion

As part of the audit of the financial statements of Lime Petroleum AS, we have performed an assurance engagement

to obtain reasonable assurance about whether the financial statements included in the annual report, with the file

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, have been prepared, in all material respects, in compliance with

the requirements of the Commission Delegated Regulation (EU) 2019/815 on the European Single Electronic Format

(ESEF Regulation) and regulation pursuant to Section 5-5 of the Norwegian Securities Trading Act, which includes

requirements related to the preparation of the annual report in XHTML format.

In our opinion, the financial statements, included in the annual report, have been prepared, in all material respects,

in compliance with the ESEF regulation.

Management’s Responsibilities

Management is responsible for the preparation of the annual report in compliance with the ESEF regulation. This

responsibility comprises an adequate process and such internal control as management determines is necessary.

Auditor’s Responsibilities

Our responsibility, based on audit evidence obtained, is to express an opinion on whether, in all material respects,

the financial statements included in the annual report have been prepared in compliance with ESEF. We conduct our

work in compliance with the International Standard for Assurance Engagements (ISAE) 3000 – “Assurance

engagements other than audits or reviews of historical financial information”. The standard requires us to plan and

perform procedures to obtain reasonable assurance about whether the financial statements included in the annual

report have been prepared in compliance with the ESEF Regulation.

As part of our work, we have performed procedures to obtain an understanding of the Company’s processes for

preparing the financial statements in compliance with the ESEF Regulation. We examine whether the financial

statements are presented in XHTML-format. We believe that the evidence we have obtained is sufficient and

appropriate to provide a basis for our opinion.

Oslo, 30 April 2024

Deloitte AS

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State Authorised Public Accountant

This document is signed electronically

ANNUAL REPORT 2023

LIME PETROLEUM

Page 70 Page 71

LIME PETROLEUM AS

Drammensveien 145A | 0277 Oslo, Norway

www.limepetroleum.com

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