TRONDHEIM, Norway, Jan. 17, 2019 /PRNewswire/ -- Strong performance in 2018 puts Aker BP in a good position to raise its growth ambition to organically triple its production by 2025, to cut production costs from USD 12 to USD 7 per barrel and to significantly increase the dividend payments to shareholders.
? Excellent execution and rapid change towards lower cost, lower emissions and improved efficiency are key ingredients to value creation in Aker BP. As we deliver profitable projects and grow the company, we also increase our ambitions for cash dividends to our shareholders, says Karl Johnny Hersvik, Chief Executive Officer of Aker BP.
He continues: ? The future of the E&P industry belongs to the most competitive and efficient oil companies.
Aker BP also reports increased reserves and resources and maintains excellent results in exploration, drilling and wells, projects and production. The company has a strong cash flow outlook and a robust balance sheet.
Main messages at the Capital Markets Day:
USD 1.20 billion
USD 1.6 billion
USD 359 million
USD 500 million
USD 243 million
USD 150 million
Production cost per boe
USD 450 million
USD 750 million
Low carbon operator at the forefront of digitalization
Aker BP continues to be an operator with low carbon emissions intensity; less than half the global average, and below the average for the Norwegian Continental Shelf.
? In cooperation with other great companies, we are going to reduce emissions, improve safety and increase efficiency through the entire value chain, says Hersvik.
Leveraging strong industrial alliances and enabling new business models with its partners continues to be an important part of Aker BP's strategy going forward.
The company is developing and adopting industry-leading digital solutions. Effective from 16 January 2019, Aker BP is the first company in Norway to control a manned platform from shore after the successful onshoring of the Ivar Aasen control room. Both on the Ivar Aasen platform and on Skarv FPSO, operators are using hand-held tablets connecting them with live data in Aker BP's Industrial Data Platform. The roll-out continues on the company's remaining assets.
? Sharing of industrial data will help us drive innovation in all areas of the E&P industry. We are already seeing design improvements and onshore monitoring of our equipment. This has facilitated smarter contracts with suppliers, enabling new business models for the future. This is only the beginning, says Karl Johnny Hersvik, Chief Executive Officer of Aker BP.
Strong performance in 2018 ? a foundation for continued growth
Aker BP produced 155.7 mboepd, in line with the guidance for 2018. Production costs in 2018 were USD 12 per boe. Capital spending amounted to USD 1.2 billion, USD 100 million below plan, and all current field developments remain on track.
- We have delivered on the goals we set for 2018. Aker BP is well positioned to deliver on our high ambitions for the coming years, says Hersvik.
Aker BP increased its reserves to 917 mmboe in 2018, driven by conversion of resources to reserves, especially in the Valhall area. Through license acquisitions and discoveries, the company's contingent resources increased to 946 mmboe.
Strong organic growth from existing portfolio
The company has a large and robust opportunity set in its existing portfolio. These opportunities represent a potential to triple Aker BP's production by 2025.
- We see large opportunities for value creation from all our assets. Digital innovations and industrial alliances will help us achieve our growth ambitions in an efficient manner, says Hersvik.
Increasing value creation yields increasing dividends
The profitable growth projections and the strong balance sheet facilitate a higher dividend payout from the company. The Board proposes dividends for 2019 of USD 750 million, up from USD 450 million in 2018, with an ambition to increase the dividend payments by USD 100 million per year to 2023.
- Aker BP's ambition is to return the value creation to the shareholders. The dividend ambition is a reflection of the company's growth, value creation and strong financial position, Hersvik says.
Large and promising exploration program for 2019
The company has a large and promising exploration program for 2019. In total, Aker BP plans to participate in 15 exploration wells, targeting 500 mmboe of net prospective resources.
- This is a very exciting exploration program. We are investing to find profitable barrels around our hubs, test new plays and to generate new potential stand-alone development opportunities for Aker BP, says Hersvik.
Presentation and webcast
The Capital Markets Day presentations will be given today at Fornebuporten (Grand Hall, building B), Oksenøyveien 10, Lysaker, Norway. Registration from 08:30 (CET).
A live webcast of the presentations will be available on our website www.akerbp.com, and will start at 09:00 (CET) today.
VP Investor Relations
Lars Mattis Hanssen
Senior IR Professional
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CMD2019 Aker BP
SOURCE Aker BP ASA
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