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- Q1 EBITDA of USD 109.7 million and net profit of USD 47.4 million
- Q1 gross production of 3.1 million barrels with 2.5 million net to BW Energy
- Three liftings of ~1.9 million barrels (net BWE) at average realised price
of USD ~83 per barrel
- First oil from Hibiscus South in early March, five months after initial
discovery
- Second Hibiscus South well confirms northern extension with good reservoir
quality
- Substantial oil discovery on the northern flank of the Hibiscus field
- Signed USD 150 million sale & leaseback for MaBoMo production facility in
April
- Golfinho prepayment facility extended and increased
- Maintained a strong balance sheet with cash position of USD ~150 million
BW Energy, operator of the Dussafu Marin licence in Gabon and the Golfinho
cluster offshore Brazil, reported EBITDA for the first quarter of 2024 of USD
109.7 million, down from USD 133.4 million in the fourth quarter of 2023, mainly
due to lower oil sales in the quarter.
Net production from the operated assets was ~27,300 barrels of oil per day in
the quarter, slightly up from the previous quarter. This includes production
from the Tortue, Hibiscus and Hibiscus South fields in the Dussafu licence
(73.5% working interest) and the Golfinho field (100% working interest) after
assuming ownership in late August 2023.
“BW Energy continues to progress the Hibiscus / Ruche drilling program,
optimising available rig time to increase production and reserves through low-
cost, low-risk development activity and efficient ESP replacements once
equipment becomes available,” said Carl K. Arnet, the CEO of BW Energy.?“In
Brazil, the Golfinho field is producing in line with expectations as we prepare
for the planned infill drilling campaign, and in Namibia, the potential of the
Orange Basin and our Kudu asset is reaffirmed by another major new oil
discovery.”
DUSSAFU
BW Energy completed two liftings in the first quarter at an average realised
price of USD 83 per barrel. BW Energy’s share of gross production was
approximately 1.66 million barrels of oil. The net sold volume, which is the
basis for revenue recognition in the financial statements, was approximately
1.7 million barrels including 97,500 barrels of DMO deliveries and 203,800
barrels of state profit oil with an over-lift position of 167,800 barrels at the
end of the period. Proceeds in the amount of approximately USD 50 million from
the second lifting in March were received in April 2024.
Net production from the Dussafu licence averaged 18,260 barrels of oil per day
in the?quarter. Production was impacted by the previously communicated
electrical issues affecting the ESPs (electrical submersible pumps) on the
Hibiscus field. First quarter production cost (excluding royalties) was 17%
lower than the prior quarter at approximately USD 23 per barrel. The decrease
reflected improved operational efficiency and production.
In March, production started from the DHBSM-1H well in the Hibiscus South field
five months after the initial discovery in November 2023.
The Company continues the work on resolving the electrical integrity issues
affecting the ESPs. Currently, the DHIBM-6H well is producing on natural flow.
The DHIBM-3H, DHIBM-4H and DHBSM-1H wells are producing on ESP. The programme of
diagnosis, repair and replacement of the ESPs is well underway.
In May and June, the FPSO BW Adolo will undergo annual scheduled maintenance,
resulting in a planned shutdown for approximately three weeks.
GOLFINHO
Net production from the Golfinho field averaged 9,030 barrels of oil per day in
the first quarter, amounting to a total production of 822,500 barrels in the
period. One lifting was carried out in February of 490,000 barrels at a realised
price of USD 82 per barrel. Remaining inventory was approximately 657,900
barrels at the end of the period. Production cost (excluding royalties) averaged
USD 48 per barrel. This compares with Q4 production costs of USD 44 per barrel,
mainly reflecting lower production.
OTHER ITEMS
During the quarter, the Company extended and increased the Golfinho prepayment
facility to USD 120 million from originally USD 80 million. The facility was
fully drawn at the end of the period.
In April, the Company executed a USD 150 million sale and leaseback agreement
with a Minsheng Financial Leasing Co entity for the MaBoMo production facility
with a ten-year term with an option to repurchase the unit from the end of year
seven. The transaction has freed up net USD 110 million of liquidity to BW
Energy and is not reflected in the end of period cash position.
BW Energy had a cash balance of approximately USD 150 million on 31 March 2024,
compared to USD 194 million on 31 December 2023. The decrease reflects the net
impact from oil sold in the period, drawdown on the expanded prepayment facility
and investments, primarily related the ongoing Hibiscus Ruche field development.
The Company had a total drawn debt balance of USD 412.8 million as of 31 March
2024 including the Golfinho prepayment facility.
Total production net to BW Energy from Gabon and Brazil for 2024 is projected to
be between 10 and 12 million barrels, based on the current Hibiscus / Ruche
development plan and ESP work-over schedule. Full-year production cost
(excluding royalties) is expected to be USD 30 to 35 per barrel. Net capital
expenditures are expected in the range USD 280 to 330 million. The increase is
directly related to the successful exploration activities and added reserves in
Dussafu.
DEVELOPMENT PLANS
The ongoing Hibiscus / Ruche drilling campaign has the potential to bring total
oil production on the Dussafu licence up to the FPSO capacity of approximately
40,000 barrels per day gross when all wells are on-stream.
Drilling of the DRM-3H well in the Ruche field has been completed with
production start pending delivery of a new conventional ESP (electrical
submersible pump). This is expected during the second quarter. Following
completion, the Borr Norve jackup drilled the DHBSM-2P pilot well, which
confirmed that the Hibiscus South deposit extends into the northern part of the
field with good reservoir quality, increasing reserve estimates. Preliminary
evaluation indicates gross recoverable reserves of 5 to 6 million barrels of oil
and approximately 14 million barrels of oil in place.
In May, the Company made a substantial oil discovery with good reservoir quality
in the DHIBM-7P pilot, appraising the northern flank of the Hibiscus field.
Evaluation of well data confirm approximately 24 metres of pay in an overall
hydrocarbon column of 37 metres and the first example of a common Gamba-Dentale
hydrocarbon accumulation in Hibiscus field. Preliminary evaluation indicates a
notable increase in both the volume of oil in place and gross recoverable
reserves.
The Hibiscus / Ruche Phase 1 drilling campaign has been expanded to nine wells.
In addition to the four Hibiscus wells, one Hibiscus South well and one Ruche
well, drilled to date, the updated plan includes the second Hibiscus South well,
a fifth Hibiscus well and a Bourdon prospect test well.
In Brazil, BW Energy continued preparations for the two planned Golfinho infill
wells (GLF-51 oil well and GLF-50 gas well) which are expected to double
production in 2027. This included filing of permitting documents with the
environmental regulator IBAMA. Final Investment Decision (FID) is planned later
this year.
Also in Brazil, the Maromba development plan progressed with completion of the
revised concept expected in the second quarter of 2024. Total oil production
from Maromba at peak annual average is expected between 30-40,000 barrels of oil
per day. In April, BW Energy paid the second and last instalment of USD 20
million for FPSO Polvo, renamed BW Maromba. The FPSO is at the COSCO yard in
China where it is being prepared for upgrades. The final investment decision for
the Maromba development is subject to completion of the project financing.
In Namibia, BW Energy is progressing the revised development plan for the gas-
to-power project and analysing data from the 3D seismic survey completed in May
2023. Interpretation of the initial data has enhanced the depositional model and
de-risked potential targets?with additional prospects identified, and the
Company continued the work on securing long-lead items for a future exploration
program.
REPORTS AND PRESENTATION
Please find the first-quarter earnings presentation attached. The reports are
also available at:
www.bwenergy.no/investors/reports-and-presentations
(http://www.bwenergy.no/investors/reports-and-presentations)
BW Energy will today hold a conference call followed by a Q&A hosted by CEO Carl
K. Arnet, CFO Knut R. Sæthre and COO Lin G. Espey at 14:00 CEST.
You can follow the presentation via webcast with supporting slides, available
on:
Viewer Registration ? Q1 2024 (WN Event
registration/bd2imvvY/register)
Call-in information:
Participants dial in numbers:
DK: +45 7876 8490
SE: +46 8 1241 0952
NO: +47 2195 6342
UK: +44 203 769 6819
US: +1 646-787-0157
Singapore: 65-3-1591097
France: 33-1-81221259
PIN code: 980877
Please note, that if you follow the webcast via the above URL, you will
experience a 30 second delay compared to the main conference call. The web page
works best in an updated browser - Chrome is recommended.
For further information, please contact:
Knut R. Sæthre, CFO BW Energy, +47 91 11 78 76
ir@bwenergy.no (mailto:ir@bwenergy.no)
About BW Energy:
BW Energy is a growth E&P company with a differentiated strategy targeting
proven offshore oil and gas reservoirs through low risk phased developments. The
Company has access to existing production facilities to reduce time to first oil
and cashflow with lower investments than traditional offshore developments. The
Company’s assets are 73.5% of the producing Dussafu Marin licence offshore
Gabon, 100% interest in the Golfinho and Camarupim fields, a 76.5% interest in
the BM-ES-23 block, a 95% interest in the Maromba field in Brazil and a 95%
interest in the Kudu field in Namibia, all operated by BW Energy. Total net
2P+2C reserves and resources were 580 million barrels of oil equivalent at the
start of 2024.
This information is subject to the disclosure requirements pursuant to section
5-12 of the Norwegian Securities Trading Act?
Kilde
