BlueNord : Q2 2024 Report

BlueNord ASA

Second Quarter and Half Year Report 2024

Highlights of the Quarter

Compared to first quarter 2023

Revenue

$171m

1%

Cash flow from operations (excluding tax paid)

EBITDA

$72m

-18%

Total liquidity (cash and undrawn facilities)

$57m $406m

-35%

32%

"During the second quarter of 2024, BlueNord achieved several significant milestones that positions our business strongly for the future. Operationally, we produced 24.5 mboe/d and benefitted from the continued contribution of the first Halfdan infill well. This will be supplemented by an additional infill well on Halfdan that was sanctioned during the quarter and will be drilled in the second half of 2024. The Harald East Middle Jurassic well was spudded in June 2024 and we believe this could add up to 8 mmboe net to BlueNord in a success case, with the result due over the summer. This activity is facilitated by having an active drilling rig on the DUC, and we are pleased to announce that the Shelf Drilling Winner rig contract has been extended by 17 months beyond its current expiry in March 2025. We expect gas export from Tyra to partially resume imminently and plateau production to be reached in Q4 of this year according to the operator's plan. From a corporate perspective, we successfully completed the capital structure reset that we announced earlier in the year with an upsized USD 1.4 billion RBL facility and the issue of a new USD 300 million unsecured bond. This positions us well for the second half of the year where, with Tyra at plateau and all covenants now consistent with the distribution policy we have announced, we expect to start the material return of capital to shareholders."

Euan Shirlaw, Chief Executive Officer

Second Quarter and Half Year Report 2024

1

Contents

01	Summary of the Quarter	4
Financial Review	5
Operational Review	9
	Report for the First Half 2024	14
	Responsibility Statement	15
02	Condensed Consolidated Statement of Comprehensive Income	17
Condensed Consolidated Statement of Financial Position	18
Condensed Consolidated Statement of Changes in Equity	19
	Condensed Consolidated Statement of Cash Flows	20
03	Notes	21
Note 1: Accounting principles	22
Note 2: Revenue	23
	Note 3: Production expenses	23
	Note 4: Financial income and expenses	24
	Note 5: Tax	25
	Note 6: Intangible assets	27
	Note 7: Property, plant and equipment	28
	Note 8: Non-current receivables, trade receivables and other current assets	29
	Note 9: Inventories	29
	Note 10: Restricted cash, bank deposits, cash and cash equivalents	29
	Note 11: Borrowings	30
	Note 12: Trade payables and other current liabilities	31
	Note 13: Financial instruments	32
	Note 14: Asset retirement obligations	38
	Note 15: Shares and share capital	38
	Note 16: Subsequent events	38
04	Alternative performance measures	40
Information about BlueNord	41
Appendix	42

Second Quarter and Half Year Report 2024

2

Introduction

01

Second Quarter 2024 Summary

Operational:

• Strong operating performance, with hydrocarbon production of 24.5 mboepd in the second quarter which is within the range of BlueNord's quarterly guidance of 23.0-26.0 mboepd.
• The Tyra West facility is ready to start-up with all the wells now unplugged, and more than 50% of the Tyra East wells also unplugged. The hook-up and commissioning are complete on the Tyra satellites, Roar, Tyra South East and Valdemar.
• The operator's schedule for the repair of the transformer is in line with Q4 plateau production. Harald production to partially resume in July and will initially support the Tyra commissioning and hence only minor additional export volumes are expected. Other temporary production modes being investigated.
• Drilling operations commenced 17 June with successful spudding of Harald East Middle Jurassic Well.
• Approval of 17 months firm extension from March 2025 to the drilling service contract for the use of the Shelf Drilling Winner jack-up rig.

Financial and Corporate:

• Total revenues of USD 170.8 million in the second quarter and USD 339.3 million for the first half 2024.
• EBITDA of USD 72.2 million in the second quarter and USD 159.9 million in the first half of 2024.
• Cash flow from operations2) of USD 57.4 million in the second quarter and USD 145.8 million for the first half and net cash flow from operating activities of USD 50.1 million in the second quarter and USD 126.9 million for the first half 2024.
• Total liquidity of USD 406.0 million at the end of the period with cash on balance sheet of USD 136.0 million and undrawn RBL capacity of USD 270.0 million.
• Closing of amended USD 1.4 billion Reserve Based Lending Facility ("RBL" or "Facility") with a maturity in December 2029.
• Successful placement and settlement on 2 July of a new 5-year senior unsecured bond issue of USD 300 million and full redemption of BNOR14 bonds of USD 175 million.
• Appointment of Miriam Jager Lykke as Chief Operating Officer.
• Glen Ole Rødland elected as new Chair of BlueNord at the AMG on 14 May 2024.

Financial and operational summary	Unit	Q2 2024	Q1 2024	Q2 20233)
Total revenue	USDm	170.8	168.5	190.7
EBITDA1)	USDm	72.2	87.7	98.7
Result before tax	USDm	10.6	8.1	50.3
Net result for the period	USDm	(1.3)	(4.6)	26.3
Cash flow from operations1)2)	USDm	57.4	88.4	99.3
Net Cash flow from operating activities1)	USDm	50.1	76.8	58.9
Investments in oil and gas assets	USDm	56.9	64.1	80.9
Abandonment spent1)	USDm	4.4	10.9	5.1
Reserve-based lending facility, drawn	USDm	880.0	850.0	800.0
Net interest-bearing debt1)	USDm	1,156.5	1,095.7	910.0
Oil production	mboepd	18.0	17.9	18.0
Gas production	mboepd	6.5	5.6	5.7
Total production4)	mboepd	24.5	23.5	23.7
Over/under-lift	mboepd	0.8	(1.1)	3.4
Realised Oil price	USD/boe	84.5	86.0	79.3
+/- Effect of hedges	USD/boe	(11.4)	(13.0)	(16.5)
Effective Oil price	USD/boe	73.1	73.0	62.7
Realised Gas price	EUR/MWh	26.3	35.0	36.8
+/- Effect of hedges	EUR/MWh	4.8	25.0	34.1
Effective Gas price	EUR/MWh	31.1	60.0	70.9

YTD 2024 YTD 20233)

1. 411.2

1. 220.2

18.8 143.6

(5.9) 74.9

1. 257.4
2. 217.0

1. 141.5

15.3 6.6

880.0 800.0

1,156.5 910.0

17.9 18.9

6.1 6.2

24.0 25.1

(0.1) 1.6

85.2 81.7

(12.1) (18.2)

73.1 63.5

18.6 40.7

25.7 44.2

44.4 84.9

1. See the description of "Alternative performance measures" at the end of this report for definitions.
2. Cash flow from operations is defined as Net Cash flow from operating activities excluding tax payments.
3. Restated. The comparative information is restated on account of correction of errors. See note 10 in the Annual Report 2023.
4. Q2 2024 Includes estimated production and operating efficiency for the last days in June, will be updated with actuals in Q3 2024.

Second Quarter and Half Year Report 2024

4

Financial Review

Selected data from consolidated statement of comprehensive income

USD million	Q2 2024	Q1 2024	Q2 20231)	YTD 2024	YTD 20231)
Total revenue	170.8	168.5	190.7		339.3	411.2
EBITDA	72.2	87.7	98.7		159.9	220.2
EBIT	40.7	58.5	73.7		99.2	169.2
Result before tax	10.6	8.1	50.3		18.8	143.6
Net result for the period	(1.3)	(4.6)	26.3		(5.9)	74.9
Earnings per share	(0.0)	(0.2)	1.0		(0.2)	2.9

1. Restated. The comparative information is restated on account of correction of errors. See note 10 Restatement of borrowing cost in the Annual Report 2023.

Revenues of USD 170.8 million in the second quarter of 2024, mainly related to oil and gas sales from the Danish Underground Consortium (DUC) fields, compared to USD 168.5 million in the previous quarter. The increase compared to last quarter was mainly related to increased oil volumes of 21.8 percent and gas volumes of 16.3 percent. Offset partly by lower realised gas prices net of hedging, with decrease of 48.1 percent.

Production expenses: In the current quarter USD 74.5 million was directly attributable to the lifting and transport of the Company's oil and gas production, equating to USD 33.4 per boe, compared to USD 70.9 million in the previous quarter, equating to USD 33.2 per boe. The increase was related to increased study costs and higher transportation costs. Due to uncertainties related to the gas production forecast for second quarter for Tyra, the transportation cost was impacted by a one-off penalty on gas nominations. Adjusted for concept studies, insurance and changes in stock and oil inventory, total production expenses amounted to USD 89.8 million compared to USD 72.3 million in the previous quarter.

Operating result before depreciation, amortisation and impairment (EBITDA) in the second quarter of 2024 was a profit of USD 72.2 million, compared to USD 87.7 million in previous quarter. This decrease mainly relates to lower effective gas prices offset partly by increased oil and gas volumes. Higher volumes led to increased total operating expenses in absolute terms, notably changes in oil inventory (overlift). In addition, there is some increased study costs, transportation costs and stock.

Net Financial items amounted to an expense of USD 30.1 million for the second quarter of 2024, compared to an expense of USD 50.3 million in the previous quarter. Mainly influenced by the positive effect on the fair value adjustment related to embedded derivatives on BNOR15 compared to negative effect in previous quarter. Offset partly by value adjustment of amortised cost related to the amendment of RBL facility and reduced net foreign exchange gain in the current quarter compared to the previous quarter.

Income tax amounted to USD 11.9 million for the second quarter of 2024 compared to USD 12.7 million for the previous quarter. The increase in income tax is primarily due to change in operating results. YTD 2024 current income tax amounted to an income of USD 62.9 million and deferred tax movements amounted to a cost of USD 88.8 million, which corresponds to a statutory tax rate of 64 percent on result before tax on hydrocarbon income, adjusted for investment uplift and interest restriction as well as currency adjustment of tax losses carried forward in DKK. Effective 0 percent tax on result before tax in Norway and UK and effective 22 percent tax on result before tax on ordinary income in Denmark.

Net result for the second quarter of 2024 was a loss of USD 1.3 million, compared to USD 4.6 million loss in the previous quarter.

Second Quarter and Half Year Report 2024

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Financial review continued

Selected data from the consolidated statement of financial position

USD million	30.06.2024	31.03.2024	30.06.20231)
Total non-current assets	3,030.5	3,080.6	2,782.3
Total current assets	297.2	324.3	556.9
Total assets	3,327.7	3,404.9	3,339.3
Total equity	774.3	780.7	786.2
Interest bearing debt	1,218.4	1,205.2	1,124.6
Asset retirement obligations	1,058.8	1,050.3	975.5
Total current liabilities	108.1	105.8	113.5

1. Restated. The comparative information is restated on account of correction of errors. See note 10 Restatement of borrowing cost in the Annual Report 2023.

Total non-currentassets amounted to USD 3.0 billion at the end of the second quarter of 2024 compared to USD 3.1 billion in the previous quarter. Decreased due to decrease in deferred tax asset, offset by increase in property, plant and equipment. Total non-current assets consist of property, plant and equipment of USD 2.5 billion, intangible assets of USD

148.4 million, deferred tax asset of USD 169.7 million, derivatives related to the gas hedges of USD 1.8 million and USD 215.2 million in restricted cash, relating to cash pledged to TotalEnergies as security for DUC cash call obligations and security against Nini/Cecilie abandonment costs.

Total current assets amounted to USD 297.2 million at the end of the second quarter of 2024 compared to USD 324.3 million at the end of the previous quarter. Decrease in derivative instruments assets due to settlement of gas hedges and due to unwinding of the interest swap contract. In addition, oil inventory and cash have decreased, offset by increased stock inventory and trade receivables. Total current assets consist of USD 16.3 million in derivatives related to oil and gas hedges, USD 61.6 million in trade receivables, mainly related to oil and gas revenue, USD 14.2 million in prepayments mainly related to insurance, USD 136.0 million of cash and USD 63.9 million of stock and oil inventory.

Total equity amounted to USD 774.3 million at the end of the second quarter of 2024, compared to USD 780.7 million at the end of the previous quarter. Decrease in equity was mainly related to negative fair value adjustment of hedges loss for the period, partly offset by issue of new shares and sale of treasury shares in relation to exercise of share options.

Interest-bearingdebt amounted to USD 1.2 billion at the end of the second quarter of 2024, which is at the same level as the end of the previous quarter. The convertible bond loan BNOR15 had a book value of USD 216.8 million at the end of the current quarter. BlueNord's new USD 1.4 billion RBL facility, drawn at USD 880.0 million on 30 June 2024 and with maximum cash drawing capacity of USD 1.15 billion, had a book value of USD 831.3 million at the end of the second quarter, this includes a drawn down of USD 30.0 million and USD 5.6 million due to value adjustment of amortised cost related to amended RBL facility, offset by USD 30.4 million in transaction costs. For more information about the new RBL facility, see note 11. The senior unsecured bond loan BNOR14 had a book value of USD 170.2 million at the end of the period. BNOR14 is classified as current liability due to the call option on 14 June to redeem all outstanding bonds.

Asset retirement obligations amounted to USD 1,058.8 million at the end of the second quarter of 2024, compared to USD 1,050.3 million at the end of the previous quarter. The increase is primarily due to accretion expense for the period, offset by abandonment paid in the period. USD 993.1 million relates to the DUC assets, USD 62.3 million to Nini/Cecilie, USD 1.5 million to Lulita and USD 1.9 million to the Tyra F-3 pipeline. The Nini/Cecilie asset retirement obligation is secured through an escrow account of USD 62.3 million.

Total current liabilities amounted to USD 372.1 million at the end of second quarter of 2024 compared to USD 415.1 million last quarter. Decrease mainly related to reclassification of USD 125 million to non-current liability due to refinancing of the RBL facility. In addition, decrease in tax payable, due to updated tax payable assessment for 2023, derivative liability due to settlement of hedges during the quarter and trade payables. Total current liabilities consist of USD 170.2 million related to unsecured bonds loan BNOR14, USD 54.0 million in taxes payable, USD 35.9 million of current derivatives related to oil price hedges (non-current derivatives amounted to USD 76.8 million, of which USD 59.2 million related to embedded derivatives and USD 17.5 million related to oil price hedges), USD 53.4 million in liabilities to DUC operator, USD 13.6 million related to VAT payable, USD 34.2 million in accrued cost including accrued interest expenses, over-lift of oil USD 6.6 million and USD 0.5 million related to trade payables.

Second Quarter and Half Year Report 2024

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Financial review continued

Selected data from the consolidated statement of cash flows

USD million	Q2 2024	Q1 2024	Q2 20231)	YTD 2024	YTD 20231)
Cash flow from operations1)	57.4	88.4	99.3		145.8	257.4
Net cash flow from operating activities	50.1	76.8	58.9		126.9	217.0
Cash flow used in investing activities	(61.3)	(73.5)	(86.0)		(134.8)	(174.5)
Cash flow from financing activities	(10.5)	(12.3)	(16.7)		(22.8)	(26.2)
Net change in cash and cash equivalents	(21.7)	(9.0)	(43.8)		(30.7)	16.4
Cash and cash equivalents	136.0	157.7	284.7		136.0	284.7

1)Cash flow from operations is defined as Net Cash flow from operating activities excluding tax payments.

Net Cash flow from operating activities amounted to USD 50.1 million for the second quarter of 2024, compared to USD

76.8 million for the previous quarter. Decrease related to increased production costs, lower gas prices net of hedging, partly offset by increased oil and gas volumes, slightly higher operating costs and higher cash calls leading to a higher working capital movement this quarter. Cash flow from operations (excluding tax payments) amounted to a cash flow of USD 57.4 million for the second quarter, compared to USD 88.4 million for the previous quarter. Current quarter had a higher negative effect from working capital of USD 17.0 million compared to USD 2.0 million in previous quarter, this includes changes on trade receivable, trade payables, prepayments and inventories. Net Cash flow from operating activities excluding changes in working capital amounted to a cash inflow of USD 67.1 million for the second quarter of 2024, compared to cash outflow of USD 78.8 million for the previous quarter.

Cash flow used in investing activities amounted to an outflow of USD 61.3 million for the quarter, compared to USD 73.5 million for the previous quarter. The cash flow used in investing activities was mainly related to investments in the DUC asset of which USD 49.6 million related to the Tyra Redevelopment project, USD 3.6 million related to drilling of the Harald East Middle Jurassic well, USD 2.2 million related to Gorm life extension work and USD 1.5 million related to other minor projects. In addition, USD 4.4 million in abandonment costs mainly related to decommissioning of Dan Echo wells.

Cash flow from financing activities amounted to an outflow of USD 10.5 million for the second quarter of 2024, compared USD 12.3 million for the previous quarter. The cash outflow in the current quarter was related to interest payments on the RBL facility and BNOR14, in addition to transaction cost related to the RBL refinancing of USD 30.4 million. Offset by drawdown of USD 30 million on the new RBL facility, issue of new shares and sale of treasury shares in relation to exercise of share options.

Net change in cash and cash equivalents amounted to negative USD 21.7 million at the end of the quarter compared to USD 9.0 million for the previous quarter. Cash and cash equivalents were in total USD 136.0 million at the end of second quarter 2024.

Second Quarter and Half Year Report 2024

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Financial review continued

Financial Risk Mitigation

The Company actively seeks to reduce exposure to the risk of fluctuating commodity prices, in addition to interest rate and foreign exchange risk as required, through the establishment of hedging arrangements. To achieve this, BlueNord has executed a hedging policy in the market and entered into forward contracts. More details on BlueNord's hedging policy can be found in note 13.4 as well as further detail on BlueNord's financial risk management is outlined in note 2 to the financial statements in the 2023 Annual Report which is available at www.bluenord.com/reports-and-presentations/.

During Q2 2024 the company entered foreign exchange hedges to secure fixed USD to DKK exchange rates at a nominal amount of USD 32.6 million equivalent to DKK 225 million, for selected future payments in relation to taxes, VAT and cash calls related to the Company's forecast cash-flows.

The table below summarises the quantity of volume hedged and average price at the end of the second quarter.

	Volume hedged oil	Average hedged price	Volume hedged gas	Average hedged price
	(boe)	($/bbl)	(MWh)	(EUR/MWh)
2024 (Q3-Q4)	2,034,000	73.3	1,170,000	42.0
2025	3,600,000	74.5	3,435,000	36.4
2026	1,500,000	73.5	1,410,000	33.0

Second Quarter and Half Year Report 2024

8

Operational Review

Production

Key figures	Unit	Q2 20241)	Q1 2024	Q2 20233)
Dan hub	mboepd	7.4	7.8	7.0
Gorm hub	mboepd	4.5	4.0	4.3
Halfdan hub	mboepd	12.9	11.9	12.3
Tyra hub	mboepd	(0.3)	(0.2)	-
Total production	mboepd	24.5	23.5	23.6
Over/under-lift	mboepd	0.8	(1.1)	3.4
Net sales	mboepd	25.3	22.4	27.1
Oil sales	mboepd	18.8	16.8	21.4
Gas sales	mboepd	6.5	5.6	5.7
Operating efficiency2)	%	90.3 %	90.2 %	79.1 %

YTD 20241) YTD 20233)

1. 7.6

1. 4.3

1. 13.2

(0.2)-

24.0 25.1

(0.1)1.6

1. 26.7

1. 20.5

6.16.2

90.2 % 84.0 %

1. Includes estimated production and operating efficiency for the last days in June, will be updated with actuals in Q3 2024.
2. Operating efficiency is calculated as: delivered production / (delivered production + planned shortfalls + unplanned shortfalls)
3. Production and operating efficiency updated with actuals. Numbers published in Q2 2023 included estimates end of June due to early cut off.

Average production in Q2 2024 was 24.5 mboepd which is within the Q2 guidance of 23.0-26.0 mboepd. In this quarter, production tests have confirmed that the new Halfdan infill well, HBA-27B, which came online late March is producing in line with expectations. Further, it has been established that the gas export route through Tyra to the Nybro plant in Denmark is now operational. This was demonstrated on 11-17 June where the Nogat pipeline was closed in due to planned pigging. During this period all gas was exported through the Tyra facilities to Denmark.

Dan hub

In April and May Dan production was very stable, with an average operating efficiency of 95%. While the production potential was maintained in June, shortfalls were experienced mainly due to an issue on the Fredericia plant over the weekend 14-16 June, and successful planned maintenance of the Dan FG IP/HP compressor. Further, planned wellhead maintenance on several Dan wells was performed in June.

Gorm hub

On the Gorm hub, the SGPAP project (Skjold partial gas depletion pilot) is ongoing, with water injection reduced by ca. 40 mbwpd as planned. The depletion response from the reduced injection is expected to be seen within the coming months. However, the slight delay of the SGPAP project means we to date have seen less production from the Skjold field than expected.

Planned maintenance on the gas module was successfully carried out from 25 April - 2 May with an associated close in of production from the hub during this period. Since 21 May the Gorm IP-B compressor has been stopped due to a rupture disc burst, thereby leading to production losses of ca. 600 boepd (net BlueNord). The issue is expected to be solved early July.

Halfdan hub

The Halfdan production in April and May was very good, with an average operating efficiency of 95%. As for the remaining hubs, shortfalls were experienced in June due to the production ramp-down caused by the issue at the Fredericia plant over the weekend 14-16 June.

The Halfdan infill well HBA-27B, which started production late Q1 2024, was production tested several times in April and May. The well tests confirmed that the performance of the well is in line with expectations.

Second Quarter and Half Year Report 2024

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