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Report for the three months ended 31 March 2022

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Lundin Energy AB
Lundin Energy AB

THESE MATERIALS DO NOT CONSTITUTE AN OFFER OF SECURITIES FOR SALE OR A SOLICITATION OF AN OFFER TO PURCHASE THE SECURITIES DESCRIBED IN SUCH MATERIALS IN THE UNITED STATES. IN PARTICULAR, ANY SECURITIES REFERRED TO IN THESE MATERIALS HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933 (THE “SECURITIES ACT”), OR UNDER THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES AND MAY NOT BE OFFERED, SOLD OR DELIVERED, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES EXCEPT PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN COMPLIANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES. THERE WILL BE NO PUBLIC OFFERING OF SECURITIES IN THE UNITED STATES.


  • Combination of Lundin Energy’s E&P business with Aker BP, to create the leading European independent E&P company, approved by shareholders from both companies, with completion of the transaction anticipated on 30 June 2022

  • Johan Sverdrup Phase 2 processing platform successfully installed, with first oil firmly on track for the fourth quarter of 2022

  • Record quarterly revenue of BUSD 1.98 with an achieved oil price of USD 104 per barrel

  • Strong free cash flow of MUSD 822, operating costs in line with guidance at USD 3.7 per boe and net debt reduced to BUSD 2.1

  • Quarterly dividend increased by 25 percent to USD 0.5625 per share, payable until completion of the Aker BP transaction, approved by the 2022 AGM

  • Strong production performance of 191 Mboepd, towards the top of the guidance range for the quarter

  • Five new projects, including the large Wisting development, heading towards sanction by the end of 2022

  • Delivering on Lundin Energy’s Decarbonisation Plan with the recent completion of the Company’s first wind farm and electrification of Edvard Grieg on track for end 2022

  • Launch of Lundin Energy Renewables business, which is positioned for growth, with Daniel Fitzgerald as the proposed CEO

Financial summary1

1 Jan 2022-
31 Mar 2022
3 months

1 Jan 2021-
31 Mar 2021
3 months

1 Jan 2021-
31 Dec 2021
12 months

Production in Mboepd

191.4

182.9

190.3

Revenue and other income in MUSD

1,976.9

1,111.9

5,484.7

CFFO in MUSD

1,009.6

750.2

3,058.0

Per share in USD

3.55

2.64

10.75

EBITDAX in MUSD

1,888.5

1,018.4

4,822.8

Per share in USD

6.64

3.58

16.96

Free cash flow in MUSD

822.3

526.2

1,645.5

Per share in USD

2.89

1.85

5.79

Net result in MUSD

468.5

68.9

493.8

Per share in USD

1.65

0.24

1.74

Adjusted net result in MUSD

395.4

149.8

795.7

Per share in USD

1.39

0.53

2.80

Net debt in MUSD

2,062.2

3,464.0

2,747.9

1 All numbers in this table relate to continuing and discontinued operations combined. For a further breakdown between continuing and discontinued operations, reference is made to pages 29-30

Comment from Nick Walker, President and CEO of Lundin Energy AB:
“I’m pleased to report that the combination of Lundin Energy’s E&P business with Aker BP, to create the leading European Independent E&P company, has now received approval from the shareholders of both companies. The combination is a tremendous deal, drawing on the best of both companies; creating a Norway pure play E&P company of scale, with production growth, a complementary portfolio of industry leading low cost and low carbon emissions assets, delivering sustainable and growing dividends into the next decade.

“For the Lundin Energy shareholders, the transaction delivers a significant up-front cash consideration, the opportunity to be a shareholder in the leading European E&P company and a retained interest in an exciting new renewables business that is positioned for growth, which will be led by a tremendous team with the Lundin entrepreneurial spirit. We anticipate that the transaction will be completed on 30 June 2022.

“In the meantime, our business continues to deliver on all fronts, with strong production and financial performance in the first quarter of 2022. Our world class assets continue to outperform, with production during the quarter towards the top of the guidance range and with industry leading low costs and low carbon emissions.

“Johan Sverdrup continues to exceed expectations. The Phase 2 processing platform was successfully installed on schedule and the project is on target to achieve first oil in the fourth quarter of 2022, which will boost production to 755 Mbopd gross.

“At the Greater Edvard Grieg Area, we see excellent reservoir performance from the recently completed projects and we’re progressing a series of new projects towards sanction in this prolific area, which will further extend the production plateau.

“Our Decarbonisation Plan is making great progress, with the recent completion of our first wind farm in Finland and with everything now on track for the electrification of Edvard Grieg by the end of 2022.

“Financially we had a very strong quarter, with record revenue of BUSD 1.98, delivering significant free cash flow of MUSD 822, allowing us to further reduce net debt to BUSD 2.1, despite a significant build of working capital. This really shows the quality of our business, allowing us to provide an increased quarterly dividend, that will continue until completion of the Aker BP transaction.

“Our mission, in everything we do, is long-term value creation for shareholders and we’ve had a great start to the year. We continue to deliver very strong results and the transformation of our business with the combination with Aker BP and the establishment of an exciting new renewables energy business means we can look forward to many more years of value creation.”

Audiocast presentation
Listen to Nick Walker, President and CEO and Teitur Poulsen, CFO, commenting on the report at a live audiocast held today, at 14:00 CEST. Follow the presentation on www.lundin-energy.com or dial in using the following telephone numbers:

UK/International: +44 3333000804
Sweden: +46 856642651
Norway: +47 23500243
USA: +1 6319131422
Access Pin: 62505911
Webcast link: https://edge.media-server.com/mmc/p/y8c5e7kc

For further information, please contact:

Edward Westropp
VP Investor Relations and Communications
Tel: +41 22 595 10 14
edward.westropp@lundin-energy.com

Robert Eriksson
Director Media and Corporate Affairs
Tel: +46 701 11 26 15
robert.eriksson@lundin-energy.com

Lundin Energy is an experienced Nordic oil and gas company that explores for, develops and produces resources economically, efficiently and responsibly. We focus on value creation for our shareholders and wider stakeholders through three strategic pillars: Resilience, Sustainability and Growth. Our high quality, low cost assets mean we are resilient to oil price volatility, and our organic growth strategy, combined with our sustainable approach and commitment to decarbonisation, firmly establishes our leadership role in a lower carbon energy future. (Nasdaq Stockholm: LUNE). For more information, please visit us at www.lundin-energy.com or download our App www.myirapp.com/lundin

Forward-looking statements
Certain statements made and information contained herein constitute “forward-looking information” (within the meaning of applicable securities legislation). Such statements and information (together, “forward-looking statements”) relate to future events, including Lundin Energy’s future performance, business prospects or opportunities. Forward-looking statements include, but are not limited to, statements with respect to estimates of reserves and/or resources, future production levels, future capital expenditures and their allocation to exploration and development activities, future drilling and other exploration and development activities. Ultimate recovery of reserves or resources are based on forecasts of future results, estimates of amounts not yet determinable and assumptions of management.

All statements other than statements of historical fact may be forward-looking statements. Statements concerning proven and probable reserves and resource estimates may also be deemed to constitute forward-looking statements and reflect conclusions that are based on certain assumptions that the reserves and resources can be economically exploited. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as “seek”, “anticipate”, “plan”, “continue”, “estimate”, “expect”, “may”, “will”, “project”, “predict”, “potential”, “targeting”, “intend”, “could”, “might”, “should”, “believe” and similar expressions) are not statements of historical fact and may be “forward-looking statements”. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. No assurance can be given that these expectations and assumptions will prove to be correct and such forward-looking statements should not be relied upon. These statements speak only as on the date of the information and Lundin Energy does not intend, and does not assume any obligation, to update these forward-looking statements, except as required by applicable laws. These forward-looking statements involve risks and uncertainties relating to, among other things, operational risks (including exploration and development risks), productions costs, availability of drilling equipment, reliance on key personnel, reserve estimates, health, safety and environmental issues, legal risks and regulatory changes, competition, geopolitical risk, and financial risks. These risks and uncertainties are described in more detail under the heading “Risk management” and elsewhere in Lundin Energy’s Annual Report. Readers are cautioned that the foregoing list of risk factors should not be construed as exhaustive. Actual results may differ materially from those expressed or implied by such forward-looking statements. Forward-looking statements are expressly qualified by this cautionary statement.

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