The Board believes Aker BP is well positioned to take advantage of the challenges facing the industry. The company is benefitting from a diversified production base, a strong balance sheet and an attractive portfolio of high quality development projects.

Aker BP has established a strong platform for further value creation through an effective business model built on lean principles, strong technological competence and industrial cooperation to ensure safe and efficient operations. The company’s first priority is to ensure the highest degree of safety in our operations. The company is working diligently with its improvement agenda in order to reduce costs and improve efficiency across all disciplines to enable sanctioning of new stand-alone projects at break-even prices below 35 USD/boe. The Board will closely monitor the company’s improvement agenda going forward, which comprise reorganisation of the value chain, digitalisation, Lean and a flexible business model to sustain growth.

The Alvheim area will continue to be developed in 2017 by adding production from the Volund and Boa infill wells. Production is set to ramp up at Ivar Aasen throughout 2017 and concept selection for phase 2 of the Johan Sverdrup development is planned in the first half of 2017. With a breakeven price of under 25 USD/boe for the full field development, this field will generate great value and ensure solid cash flows for Aker BP for many decades to come.

The company has a visible organic growth path to production in excess of 270 mboepd from after 2023 (from both sanctioned and non-sanctioned projects), representing a compound annual growth rate of approximately 12 percent from 2016.

The company will have up to four drilling rigs in operation in 2017. Drilling operations include production drilling at Valhall and Ivar Aasen, infill drilling at Volund, Boa and Tambar and P&A activity at Valhall. During 2017, the company plans to drill seven exploration wells in total, four operated wells and three as partner.  Aker BP plans to submit three PDO’s during 2017, relating to the Valhall West Flank, Snadd and Storklakken projects.

Going forward, the company will pursue further growth opportunities both to enhance production and increase dividend capacity, while maintaining the highest standards of HSE. The ambition to sustain a dividend level of minimum USD 250 million in the medium term and to increase this level once Johan Sverdrup is in production, is reiterated.

The company has a robust balance sheet with USD 2.5 billion in available liquidity, providing the company with ample financial flexibility. Going forward, the company will work to improve the efficiency and effectiveness of its capital and debt structure.

The Board of Directors of Aker BP ASA

Akerkvartalet, 2 March 2017