Noreco’s 2Q Net Loss Increases (Norway)

Norwegian Energy Company ASA (Noreco) today presents its second quarter 2013 report, with a negative EBITDA of NOK 45 million and a net loss of NOK 504 million for the period.

Significant events in the second and third quarter 2013 include:

– Start-up of Huntington production in April more than doubles Noreco’s production capacity. Technical problems have delayed the ramp-up phase, which now is on-going

– Danish production shut down until further notice due to new problems with the Siri platform. Expected to start-up in September

– Oselvar shutdown – waiting on replacement of defect compressor at the Ula-platform. Expected to start-up in September

– The Gohta-well was spudded in July. Drilling continues.

– Waiver related to gearing ratio obtained until fourth quarter

Revenue in the second quarter 2013 was 246 million, up from NOK 230 million in the second quarter 2012. Production in the second quarter was 4,561 barrels of oil equivalents per day, up from 4,042 barrels of oil equivalents per day in the previous quarter. The achieved average oil, gas and NGL price was USD 102.5 per barrels of oil equivalents in the second quarter 2013.

Exploration and evaluation expenses amounted to NOK 119 million in the second quarter 2013. This includes drilling costs related to the exploration wells on Scotney, Lupin and Ogna which were completed and declared dry during the reporting period.

EBITDA (earnings before interest, tax, depreciation and amortization) in second quarter 2013 was negative NOK 45 million, compared to negative NOK 185 million in the second quarter 2012.

The net result for the second quarter was negative NOK 504 million, compared negative NOK 87 million for the second quarter of 2012. The weaker net profit this year is due to write-downs of NOK 497 million, which was significantly impacted by a lower forward-curve for the oil price as of 30 June 2013.

[mappress]

Press Release, August 29, 2013