Annual Report
and Accounts
2023
Introduction
While creating value for stakeholders, BlueNord helps to
deliver the energy security that millions of people depend
on in today’s changing world.
Strategic Report
1 - 52
Highlights of the Year 1
Chair’s Statement 3
Completion of Tyra II 4
Our Business at a Glance 6
Chief Executive Officer Statement 9
Business Model 12
Our Strategy 13
Distribution Policy 14
Strategy in Action 15
Operational Review 21
Financial Review 23
Sustainability Report 25
Risk Management 44
Principal Risks and Uncertainties 45
Governance Report
53 - 71
Chair’s Introduction 54
Leadership 55
Corporate Governance Report 57
Board Activities 62
Audit Committee Report 63
Remuneration Committee Report 64
ESG Committee Report 65
Nomination Committee Report 66
Directors’ Report 67
Reporting of Payments to Governments 71
Financial Report
72-154
Consolidated Statements 73
Consolidated Statement
of Comprehensive Income 73
Consolidated Statement
of Financial Position 74
Consolidated Statement
of Changes in Equity 76
Consolidated Statement
of Cash Flows 77
Notes 78
Statutory Accounts 122
Income Statement 122
Balance Sheet 123
Cash Flow Statement 125
Notes 126
Independent Auditor’s Report 137
Statement of Compliance 140
Alternative Performance Measures 141
Supplementary oil and gas information (unaudited) 142
Appendices 143
Information about BlueNord 155
2nd largest
Oil and gas producer in Denmark
BlueNord is providing
Europe with the energy
itneeds today, tomorrow,
and in the net-zero future
1 BlueNord
Strategic Report
Annual Report and Accounts 2023
Highlights of the Year
2023 has positioned us well
to deliver on our plans for
2024 and beyond, bringing
broader value for all our
stakeholders
REVENUE
$795m
OPERATING CASH FLOW
$250m
EBITDA
$421m
TOTAL LIQUIDITY
(CASH AND UNDRAWN FACILITIES)
$317m
Read more on page 23 and 24
The new Tyra facilities were
safely restarted on the
21st March 2024 with
ramp-up to maximum
capacity under way.
Read more on page 4
Excellent results from well
optimisation activities has
decreased the production
decline in the DUC fields.
Read more on page 16
Reserves replacement of
135% year end 2023.
Read more on page 7
Elimination of routine flaring.
Read more on page 18
Excellent safety
performance, with second
lowest incident frequency
since 2009 despite very
high activity level.
Read more on page 5
2 Annual Report and Accounts 2023BlueNord
Strategic Report
Chair’s Statement 3
Completion of Tyra II 4
Our Business at a Glance 6
Chief Executive Officer Statement 9
Business Model 12
Our Strategy 13
Distribution Policy 14
Strategy in Action 15
Operational Review 21
Financial Review 23
Sustainability Report 25
Risk Management 44
Principle Risks and Uncertainties 45
Strategic
Report
3 Annual Report and Accounts 2023BlueNord
Strategic Report
BlueNord is well on its way to delivering its ambition of becoming a leading
independent European energy producer. This is on the back of a further
successful year in 2023 and the restart of Tyra in March 2024.
Chair’s Statement
BlueNord intends to commence
distributions in 2024, delivering on one of
our core commitments to shareholders.
Solid foundations for
shareholder value creation
BlueNord continues to prove its ability to deliver its
ambition of becoming a leading independent
European energy producer. This is on the back
of a further successful year in 2023 and with the
recently announced first gas from Tyra II. This
places BlueNord in a an increasingly strong
position, as a significant contributor to regional EU
energy security and a major supplier of gas, being
the fuel of choice for transition, as the world pivots
to a greener future.
This position has been achieved through a strong
and consistent focus on capital discipline, based
around maximising the DUC opportunity. With
production set to more than double, and with Tyra II
having been brought back on stream, our
approach to enhance value for our stakeholders
remains firm. The Company has set out a clear
path to continue to deliver from the DUC assets,
thereby maximising capital efficiency and allowing
it to become a significant dividend paying
company for its shareholders.
Energy security and access to economically
competitive sources of gas remains of key
importance in Europe. It comes on the back of
continued uncertainty across many parts of the
world, impacting trade and regional economic
performance, which is set to continue in 2024.
The need to have access to secure, safe and
cost-effective sources of energy is central to
economic success and the standard of living across
the region. It underpins business, transport and the
region’s economic competitiveness, in an era where
supply lines are being disrupted, interest rates
remain high and economic performance impacted.
BlueNord continued to perform in 2023,
representing another year of delivering against
results. This is reflected in its production and
financial performance, which was again at the top
end of estimations, with EBITDA for the year of
USD 421 million and production of 24.9 mboepd.
Riulf Rustad
Executive Chair
As a result of its now growing track record,
BlueNord is in an enviable position, with strong
foundations to continue to deliver in the year ahead
and beyond. Capital discipline and the ongoing
efficient use of capital remains the basis on which
the Company will be managed. Every decision will
be assessed against this basis, which has served
us well in getting us to where we are today.
Today, with Tyra II back on stream, BlueNord is set
to be able to start paying dividends in Q3 2024.
The Company’s assets, combined with the clear
plans set out for the future of the business, means it
is well placed to offer shareholders meaningful
returns, and BlueNord intends to distribute 50 –
70% of its net operational cashflow in the period
2024 – 2026.
That position also means the Company remains
well placed to meet its responsibilities to the
environment and the success of the region in
which it operates. With the ongoing increase in gas
production from Tyra, Denmark will be energy
self-sufficient and a net exporter of gas to the
wider EU region. This represents a milestone for
the country; helping people’s needs and
supporting the ongoing growth of the economy.
A further local, reliable source of gas for the region is
also in line with the EU’s ambition to reach net-zero.
In addition to being a source of transitional energy,
localised gas offers a much lower relative carbon
footprint to the alternatives, such as imported LNG,
which has increased in Europe, post sanctions
being imposed on Russian supplies.
The reweighting of the Company’s production
from liquids to gas, will also greatly reduce
BlueNord’s own emissions intensity, in line with its
ambitions. This is alongside continuing to evaluate
the opportunity for carbon storage through its
CCS subsidiary, CarbonCuts, which recently
submitted its license application for its onshore
CO
2
storage project in Denmark, Project Ruby.
Once again, on behalf of the Board and
shareholders, I would like to take the opportunity to
thank the operational and management teams for
their hard work and commitment to the success of
the business. It is through their dedication to the
Company and the skill they bring to the business
that we are in such a strong position today.
As the Board looks ahead to the rest of the year
and beyond, we do so again with greater
confidence. BlueNord is set to continue to
outperform and I look forward to supporting the
team in the year ahead as further progress is
made and milestones delivered.
Riulf Rustad
Executive Chair
4 Annual Report and Accounts 2023BlueNord
Strategic Report
Completion of Tyra II
A landmark
achievement as
Tyra II comes online
Ensuring sustainable energy security with
the redevelopment of Tyra.
On the 21st of March 2024, the first gas was
processed and exported to Nybro in Denmark from
the brand-new Tyra II facilities. This remarkable feat
of engineering is Denmark’s largest infrastructure
project to date and represents a gross investment of
around 27 billion Danish Kroner, or close to 4 billion
USD spent since the field development studies
commenced in 2013.
BlueNord is proud to have participated in the delivery
of Tyra II, and we congratulate everyone involved in
this landmark achievement, in particular the Operator
TotalEnergies and our partner Nordsøfonden.
Tyra II will be a vital part of Europe’s energy supply for
many years to come, providing much-needed energy
towards a net-zero future.
See Our Strategy on page 17 to find out more.
Strategic Pillar
Deliver Tyra II
271mmboe
2P based on YE23 ERCE
30%
Emission reduction
compared with the
former facility
1,200
Offshore staff contributed
during construction
35,000
Weight of 8 new topsides
225 km
distance from the Danish
Jutland Coast
95%
Recycling and reuse of the
old Tyra facilities
5 Annual Report and Accounts 2023BlueNord
Strategic Report
Due to the natural subsidence after
29 years of production, the seabed
below the Tyra platform had sunk
more than 5 metres, reducing the
distance between the sea and the
platform decks. The decision was
made to rebuild and modernise to
ensure safe continued operations
for years to come.
Completion of Tyra II continued
A significant investment
20172013 2018 2021-20232020 2024
The Tyra II timeline
Delivering
success for Tyra II
Dawn has been instrumental in the success of the Tyra
redevelopment project. Originally recruited as Operations Engineer,
then moving into the role of Tyra Project Manager, she has been
dedicated to the project since she joined BlueNord in 2022.
Her role involved contributing to Safety awareness among the
BlueNord team, based on her own expertise and frequent offshore
visits. Her work to nominate the Tyra health, safety and environment
(‘HSE’) team for the Danske Offshore Safety award resulted in the
Tyra team being shortlisted.
As a result of her work on Tyra, Dawn has become a Fellow in
Engineering with the Society of Operations Engineers. This is the
highest honour which can be bestowed upon an engineer and is
recognition for her contributions and accomplishments in the field
of start-up of new process plants.
Dawn Jamieson
Lead Operations Engineer, BlueNord
The DUC approved the
full redevelopment of
Tyra, the largest
investment ever taken in
the Danish North Sea.
October 2018 marked the
kick-off for onshore construction
around the world, including the
fabrication of jackets in Spain, an
accommodation unit in Italy, a
processing module in Indonesia,
and six well head and riser
modules in Singapore.
During the summer, the old
Tyra facilities were removed.
More than 50,000 tons of
materials were moved onshore
for dismantling and recycling.
In September, the foundations
for Tyra II were installed.
Over more than three
years, more than 35,000
tons of materials located 54
metres above the seabed
created Tyra II, Denmark’s
new high-tech hub for
natural gas production in
the Danish North Sea.
On 21 March 2024, the
first gas was processed
and exported to Nybro
in Denmark.
BlueNord has invested over one billion USD in the Tyra
redevelopment project, which will produce enough energy to
power the equivalent of 1.5 million homes, making Tyra, and
Denmark, a key gas producer for the EU.
The new Tyra facilities are expected to produce at 30% lower
emissions compared with the former facilities. With Tyra on
stream, our focus on maturation of new opportunities will
enable us to develop existing DUC discoveries and infill well
targets to ensure that the Tyra facilities are efficiently utilised
for many years to come. The DUC is set to deliver gas with a
significantly lower CO
2
footprint than what LNG import can
offer until Denmark and Europe can secure its energy supply
from renewable sources.
1
2
3
6 Annual Report and Accounts 2023BlueNord
Strategic Report
20%
36.8%
43.2%
Our Business at a Glance
BlueNord operates in the Danish North Sea with a 36.8
percent non-operated working interest in the DUC.
The DUC comprises of 15 fields, four export pipelines and significant
infrastructure. Oil and gas is being produced from four operational hubs. It
accounts for nearly 90 percent of the oil and gas that is produced in the area.
The four export pipelines secure exports from the hubs to the Danish mainland
and the international market.
You can find out more about the history of the DUC by visiting
bluenord.com/ourassets
2nd largest
Oil and gas producer in
Denmark
Successful restart of
production on Tyra
TotalEnergies (Operator) 43.2%
BlueNord (Partner) 36.8%
Nordsøfonden (Partner) 20%
DUC ownership
1
Oil pipeline to Fredericia
2
Gas pipeline to Nybro
3
Gas pipeline to Den Helder
Gas cross-border points
Denmark
Germany
Netherlands
Belgium
GORM
DAN
HALFDAN
TYRA
Sweden
The DUC, which started production
in 1972, is located in the Central
Graben sector of the North Sea.
7 Annual Report and Accounts 2023BlueNord
Strategic Report
0
10
20
30
40
50
60
>55
>40
24.9
26.7
26.9
2021 2022 2023 2024 2025
Our Business at a Glance continued
185.6mmboe
2P reserves
24.9mboepd
2023 production
>55mboepd
2025 production
135%
2023 reserves replacement
3.9%
2021-23 annual decline
>120%
2023-25 growth
DUC represents c.90 percent of Danish oil and gas
production with a low decline-rate on base production
and significant near-term growth.
Net production mboepd
2P development from YE22 to YE23, net
Actuals Estimates
2P reserves and 2C resources, net
213mmboe
2C
2P
Gas
Oil
Year End
2022
Produced
2023
Reserves
Additions
2023
Year End
2023
-9.1
182.3
12.5
185.6
Decrease Increase Total
8 Annual Report and Accounts 2023BlueNord
Strategic Report
DAN
KRAKA
REGNAR
ALMA
HALFDAN MAIN
HALFDAN NORTH EAST
HALFDAN NORTH
HARALD EAST
HARALD WEST
LULITA
FREJA
SVEND
VALDEMAR
ROAR
TYRA
BOJE
ADDA
GORM
ROLF
DAGMAR
SKJOLD
Our Business at a Glance continued
94%
Oil share of
2P reserves
26.5
Net 2P reserves
mmboe
7.9
Net production
2023
83%
Operational
efficiency
Producing field
No production
Discovery
69%
Oil share of
2P reserves
44.6
Net 2P reserves
mmboe
12.7
Net production
mboepd
91%
Operational
efficiency
Producing field
Discovery
42%
Oil share of
2P reserves
99.5
Net 2P reserves
mmboe
27-29
Expected Q4 2024
net production rate
mboepd
30%
Less emissions
compared to the
previous facilities
Producing field
Discovery
No production
Dan Hub
Discovered in 1971 and brought on production in
1972, Dan was the first DUC field in production.
Close to 26 percent of total Danish oil
production has been extracted from this field.
Halfdan Hub
Halfdan is currently the largest producing field in
Denmark and the most important DUC asset in
terms of both value and resources
Gorm Hub
The Gorm Hub was also discovered in 1971
and brought on production in 1981. Gorm
is the export hub for most of the oil produced
in Denmark.
Tyra Hub
Tyra is the largest gas field in the DUC. The
redevelopment will extend the field’s life to
continue producing until the concession
expiry in 2042.
Our assets
97%
Oil share of
2P reserves
14.9
Net 2P reserves
mmboe
4.3
Net production
mboepd
80%
Operational
efficiency
Producing field
No production
9 Annual Report and Accounts 2023BlueNord
Strategic Report
Chief Executive Officer Statement
Continuing to Deliver
Our achievements are the result of careful
planning, consistent execution, disciplined capital
allocation and by being adaptable. It has been
made possible by the strength of the team and
DUC partnership, the quality of the DUC assets
and the support of the Danish Government,
which has created an environment for
long-term investment.
The last year also saw the foundations being
successfully laid that will support long-term returns
to the Company’s shareholders. This included the
restart of production from the Tyra redevelopment,
commencing a programme of infill drilling and
beginning the process of adapting the capital
structure of the business to be appropriate for
our current position.
Looking back to where the Company has come
from since acquiring its interest in the DUC in 2019,
today’s position is a remarkable achievement. We
are, however, only at the start of the next chapter
in this story as we progress towards our ambition
of both becoming a significant, independent EU
energy producer and fully delivering the value
of BlueNord to our stakeholders.
Production and operations
Production for the year came in at the top end of
guidance at 24.9 mboed. This performance
predominantly reflects higher well potential and
less disruption than anticipated due to the reroute
work on Halfdan.
Better well potential is the result of well
maintenance activity undertaken in 2022 and
during 2023 across all three of our operational
hubs. This included a scale squeeze and
restimulation intervention on Gorm in 2022 and
a total of 3 well interventions and 13 restimulations
in 2023.
The rerouting of Halfdan oil stabilisation to Dan
took place in the second quarter of the year. The
work was completed ahead of schedule, resulting
in higher than anticipated production during that
period. The re-routing work eliminates routine
flaring within the DUC, which is a milestone for the
Company, and is in line with our commitments to a
sustainable energy future.
Tyra II
The successful completion of the Tyra II
redevelopment is the standout achievement of the
year. This represents a significant moment for the
Company, moving us to be a significant player in
the European energy supply landscape. Putting
this achievement in context, Tyra II is the largest
project carried out on the Danish continental shelf,
providing Denmark and Europe with 2.8 billion
cubic meter of gas per year. It is a strategically
important gas field, supporting European energy
security and economic development, while
reducing emissions intensity. The successful
completion of the Tyra II project also unlocks
200mmboe of reserves and extends potential field
life by c.25 years.
This achievement reflects the thorough planning
process, the effort, commitment, and quality of the
team on the ground and the broader management
of the project. I would like to thank all those involved.
At the start of 2023, Tyra was in final form, so the
work for the year centred on testing and
commissioning and the tie-in of facilities. This
included testing the gas turbine generators,
reconnecting the export pipeline to Denmark,
completion of subsea work, reconnecting all
satellite fields and completion of leak testing.
Delivery of these and other workstreams during
2023 was supported by further improvements to
productivity and a strong culture of safety.
With Tyra first gas achieved in Q1 2024, stable
production is now expected to be reached quicker,
with maximum technical capacity now due within
four months of first gas export resulting in Tyra II
making a greater contribution to 2024 production
than previously anticipated.This decision remains
in line with achieving production of more than
55mboepd by 2025 and average production of
more than 40 mboepd during 2024.
Euan Shirlaw
Chief Executive Officer
In 2023, BlueNord delivered operationally and financially.
The Company’s growing track record of achieving the
ambitious targets it has set will continue into 2024 with
the start of distributions to shareholders.
10 Annual Report and Accounts 2023BlueNord
Strategic Report
The additional production from Tyra II will
significantly reweight overall production from
liquids to gas, while also reducing emissions
perbarrel by 30 percent. In addition to the
environmental benefit, it will also greatly reduce the
Company’s lifting cost per barrel, to below USD13,
improving returns and cash flow generation in the
current year and beyond.
Maximising the production opportunity
The strategy to maximise returns from the DUC is
based on a programme of infill drilling and well
maintenance. This programme is expected to
keep production at over 40 mboepd to 2030, with
out- of-plan projects utilising existing infrastructure
currently being matured to further support the
development of additional volumes.
Plans for infill drilling involve a seven-well
programme. The Final Investment Decision (‘FID’)
was taken on two infill wells drilled from Halfdan in
December 2022. These wells are expected to
increase gas production from the Halfdan field,
with a net gain of c.2.9 million mboe to BlueNord, of
which 50 percent is gas. Total net cost at FID was
expected to be USD39m, implying a total unit
development cost of c.USD13/boe. The first well in
the sequence, HBA-27B commenced production
26 March and the initial production rate was in line
with the expectation of net 3 kboe/day.
FID on Harald East Middle Jurassic was taken in Q1
2024, and this well is expected to be spudded during
the summer of 2024. If successful, this well could be
on production through the new Tyra facilities by the
end of the year. It is targeting up to 8mmboe, net to
BlueNord, of which 80 percent is gas.
To maintain the high production level the DUC
partnership has committed to continue the well
intervention programme, with current plans for 19
‘WROM’ activities (Well and Reservoir Optimisation
Management), Skjold gas acceleration, HCA gas lift
installation and yearly stimulation campaigns. This
work will be undertaken by the Noble Reacher,
which is currently contracted to mid-2025. Looking
further ahead to 2030 it has been estimated that
additional WROM and restimulation opportunities
targeting ca. 8mmboe (net BlueNord) at a unit
technical cost of ca. 14 $/boe can be identified.
This programme also involves three
developments: Valdemar Bo South, Adda and
Halfdan North. FID on these developments is
expected to be taken between 2025 and 2027,
with production scheduled to start between 2027
and 2029.
In Q1 2023, the Company formed a strategic
partnership with Semco Marine, to help maximise
the DUC opportunity and access new opportunities.
Semco Marine is a Danish engineering and
contracting company with more than 40 years of
experience in the offshore industry.
Reserves
BlueNord, along with its partners in the DUC, has
been able to maintain a strong reserves position,
which will serve the Company well as it looks to
deliver consistent ongoing production and returns
to investors.
BlueNord’s annual reserves audit was undertaken
by ERCE and resulted in net 2P reserves of
186mmboe at the end of 2023. This compares to
183mmboe at the end of 2022, and represents a
reserves replacement ratio of over 130 percent in
2023. This extremely strong performance is a
testament to the quality of our portfolio, reflecting
not only the strong production performance in
2023 but also the progress that has been made in
advancing BlueNord’s portfolio of medium-term
development projects. Beyond our 2P reserves
base, BlueNord’s portfolio also holds more than
200mmboe of 2C contingent resources, of which
27mmboe is attributable to projects that are
expected to be onstream by 2030.
Sustainability
Sustainability is a theme that runs throughout the
Company. It is reflected in our focus on health and
safety; our goal of being a significant and local
independent supplier of gas to Europe; and our
strategy of investing in minimising the Company’s
footprint, through its operations and two material
CCS projects.
The BlueNord team works very closely with the
DUC Operator and other partners to ensure a safe
operating environment. This work is based on
investment and developing a positive work and
Chief Executive Officer Statement continued
11 Annual Report and Accounts 2023BlueNord
Strategic Report
management culture. The BlueNord team has
the operational skills and experience to play an
active role and I am pleased to report a positive
culture across all DUC operations, including the
Tyra II redevelopment.
During the year, the consortium eliminated
routine flaring from the DUC, through investing
in rerouting work on Halfdan. This represents
a milestone for the Company, reflecting its
commitment to minimising emissions from
operations. Furthermore, the Company is
continually assessing other additional emissions
reduction initiatives for its producing assets and
future activities.
The restart of gas production from Tyra also
delivers material benefit. This includes a 30
percent reduction in emissions per barrel from the
DUC and a local, secure supply of energy to the
region, which is key to reducing emissions and
supporting economic development.
BlueNord continues to invest, financially and
through technical and commercial support, in its
two CCS projects, Bifrost and CarbonCuts. These
represent opportunities to remove and safely store
material quantities of carbon from the atmosphere:
improving quality of life locally and supporting
Europe’s ambition of reaching net zero.
Team
The strength of the BlueNord team comes from
the range of skills and experience it offers. It allows
the Company to contribute operationally, to the
DUC, to the development of the two CCS projects
and to consider other opportunities, while also
maximising capital efficiency. This affords the
Board and senior management the comfort and
flexibility needed to continue to deliver for
shareholders and other stakeholders.
The culture of the team is incredibly positive,
reflecting individual commitments to the success
of the business. It is through that, and the skills
people bring to the Company, that we have been
so successful in delivering against multiple
milestones. I would like to take the opportunity to
thank each person for their support, without which
we would not be where we are today.
Financials
Revenue for the year was USD795m
(2022:USD967m). This reflects a strong
production performance, at the top end of
guidance, and an increased weighting to gas,
offset by lower overall commodity pricing,
mitigated by an active hedging policy.
EBITDA for the year to 31 December 2023 was
USD421m (2022: USD611m). This decrease
reflects the Company’s revenue performance,
combined with expenditure during the year to
support production.
The Company’s balance sheet remains strong,
with net debt at the year-end of USD1,088m,
reflecting a further year of strong cash flow
generation. At the year end the Company had total
liquidity of USD317m.
As production from Tyra II feeds through to cash
flows, the Company can expect its balance sheet
strength to improve further, placing BlueNord in a
good position to become a material, long term
dividend-paying company for its shareholders.
The hedging policy in 2023 supported access to
greater spot pricing, post-amending the hedging
policy requirements under the reserve-based
lending facility (‘RBL’) in 2022. Looking ahead to
2024, the hedging strategy will continue to allow
further exposure to commodity price changes,
while recognising the benefit of adding certainty
around future cash flow when the outlook for
commodity prices allows.
Outlook
We entered 2024 with a strong portfolio, supported
by the near-term addition of volumes from Tyra.
This means BlueNord is now able to put in place a
distribution policy that we believe fully delivers the
value of BlueNord’s portfolio to all our
stakeholders; we will prioritise near-term
distributions during 2024 to 2026, while at the
same time maintaining a conservative balance
sheet and undertaking measured reinvestment
where attractive opportunities to do so exist.
Despite the impact of Tyra on production in the
current year and beyond, we do not envisage any
change to the Company’s approach. Each
decision will continue to be assessed against the
most efficient use of capital and the Company’s
ability to drive higher distributions for investors and
other stakeholders for the long term. Nonetheless,
with production set to double, BlueNord finds itself
in a fortunate position, affording it a strong base
and flexibility, supporting its future.
As the year develops, I look forward to updating
investors on further milestones as they are met and
our plans for distribution. Despite the impact of an
increasingly volatile world, I also look forward to the
future of the Company with continued confidence.
Euan Shirlaw
Chief Executive Officer
Chief Executive Officer Statement continued
12 Annual Report and Accounts 2023BlueNord
Strategic Report
Business Model
Our purpose is to provide Europe with
the energy for today, tomorrow, and in
the net-zero future to come
BlueNord has a differentiated business model,
which prioritises distributions to shareholders,
while at the same time maintaining a conservative
balance and allocating capital as needed to
secure the long-term contribution of our
operational portfolio.
Delivering our business model starts with
maximising the value of our underlying business.
We do this by taking an active approach, focused
on influencing and exercising control. This is
further supported by measured reinvestment
where attractive.
As an engaged DUC partner, we play a meaningful
role in direction and activity, ensuring a well-
managed portfolio that fully delivers on its potential.
Maximise value of
our operational
portfolio
Maximise capital
available to
BlueNord
Allocate capital
per disciplined
framework
Framework for Disciplined Capital Allocation, Prioritising Near-Term Distributions
while maintaining a conservative balance sheet and securing the long-term contribution
of BlueNord’s portfolio.
Organic Growth:
Short-Cycle
• High-return, quick payback investments.
• Maximise contribution from base assets.
• Measure investments where attractive.
• Must be accretive to equity returns profile.
• Maintain conservative balance sheet.
• Maximise access to secured debt capacity.
• Maximise near-term distributions.
• Maintain long-term returns profile.
WROM
50–70% of net
operating cash flow
to be returned during
2024–26
RBL refinancing
Adda
Infill Well Programme
Address BNOR14
Valdemar Bo South
Halfdan North
Organic Growth:
Long-Cycle
Capital Structure
Distributions
13 Annual Report and Accounts 2023BlueNord
Strategic Report
13 BlueNord
Our core objective is to ensure we
maximise the long-term value we
deliver for our broad stakeholder
group. We believe we do this best by
balancing the demands of energy
security against the needs of the
energy transition, and our strategy
is set to enable this.
We will make further measured investments where
economically attractive to do so, which will in turn
help ensure energy prices are affordable to
consumers, both residential and industrial.
We will seek to lower overall emissions by producing
more gas which will offset higher carbon intensive
sources of energy like coal, investing in emissions
reduction initiatives for existing producing
assets, and investing in activities that support
a net-zero society.
01
Deliver operationally
Strong production performance, driven by an
active approach to asset management that will
see BlueNord continue to seek opportunities to
enhance near-term volumes.
• Strong production in upper end of
annual guidance.
• Mitigation of natural decline and
delivery at or above guidance for
12 consecutive quarters.
• Active management by the
operator with delivery of the
WROM programme.
• Attractive Short-Cycle Investments
being pursued with the first infill well
spudded in June.
• Ensure ramp-up to maximum
technical capacity delivered
within four months per current
Operator guidance.
• Deliver unplugging and reactivation
of Tyra wells according to
schedule to support journey to
peak production.
• Seek to debottleneck facilities to the
maximum extent possible, potentially
unlocking scope beyond 300
mmscfpd nameplate capacity.
• First gas achieved in March 2024.
• Shorter ramp-up to maximum
technical capacity supported by
additional work done prior to first gas.
• Activities support net BlueNord
production expectations of over 55
mboepd in 2025 and substantial free
cash flow generation.
• Deliver distribution profile with
50–70% of net operating cash flow
distributed to shareholders from
2024 to 2026.
• Complete refinancing of BlueNord
balance sheet with conservative
capital position maintained
throughout.
• Progress opportunities to invest
where accretive to long-term
distribution profile.
• Continue to assess opportunities
for short and long-term emissions
reductions.
• Distribution policy announced, which
will prioritise near-term returns to
shareholders, while maintaining a
conservative balance sheet.
• Progress made with project portfolio,
with maturation reflected in > 130%
2P reserves replacement for 2023.
• WROM to continue with activities
approved to 2025+.
• Focus on identifying further
opportunities for enhancement in
fields that have not been subject to
WROM to date.
• Further maturation of infill
opportunities, including for the newly
onstream Tyra hub.
Delivery in 2023 Focus for 2024
Our Strategy
02
Deliver Tyra II
03
Deliver our potential
Tyra secures energy supply by producing 2.8
billion cubic meters of gas per year to Denmark
and Europe, while at the same time reducing
emissions intensity by 30%.
Maximise value of BlueNord, with near-term
shareholder returns prioritised, while also
maintaining a conservative balance sheet
and reinvesting where attractive to do so.
14 Annual Report and Accounts 2023BlueNord
Strategic Report
Ability to return capital supported by substantial free cash flow generation with Tyra onstream,
which will enable the prioritisation of near-term returns to shareholders, while also allowing
measured reinvestment and for a conservative balance sheet to be maintained through cycle.
Cashflow Generation Supports all Stakeholders Shareholder Returns Policy Focused on 2024-26
2024 2025 2026 2027+
70% 70% 70%
Desire to
maintain a
meaningful
returns
profile
Distribution Policy
Distribution policy set to deliver material
near-term capital returns to shareholders
• 2024 to 26: Distribution policy of 50-70% of Net Operating Cash flow.
• 2027+: Desire to maintain a meaningful returns profile percentage of Net Operating Cash flow:
Distribution policy for 2024-26: % of Net Operating Cashflow
Shareholder distributions based on Net Operating Cashflow
50% 50% 50%
Prioritisation of shareholder
returns in the near-term
Measured re-investment to maintain
strong operational portfolio
Preservation of strong balance
sheet through-cycle
15 Annual Report and Accounts 2023BlueNord
Strategic Report
Strategy in Action
Acceleration of gas production from the
Skjold field by reduction of water injection
Exciting Gas Acceleration Project Pilot initiated end 2023
Strategic Pillar 01
Deliver operationally
The change from water injection to depletion drive
in parts of the Skjold field was started at the end of
2023. This is a common way of maximising
recovery from late-life fields and has the additional
benefit of enabling gas export from Gorm; this will
further maximise the economic benefit from Grom
hub production with sale of excess gas production
rather than injection back into the reservoir. This
project will potentially increase production by
1.3mmboe, net BlueNord by end 2027, and
increase the gas to oil ratio from the Skjold field.
There is some reservoir uncertainty associated
with this project. This is mitigated by conducting a
pilot project over one to two years, with the option
of reversing the process if the pilot is not
successful. Produced water from Skjold is
reinjected via restored water injectors in the Gorm
field and other parts of the Skjold field. This project
is also expected to lead to a reduction in fuel gas
consumed in pumps for water injection, if
produced water is reduced as expected.
The Gas Acceleration Pilot is expected to
increase the gas production from the Skjold
field by changing from water injection to
depletion drive. The project may benefit from
reducing the fuel consumption leading to
reduced emissions.
North area full waterflood
East area full depletion
West area partial waterflood
16 Annual Report and Accounts 2023BlueNord
Strategic Report
24.9
26.7
26.9
28.4
33.4
2019
Total export (kboepd )
0.0
0.6
1.2
1.8
2.4
3.0
2020 2021 2022 2023 Guidance 2024
23–2515%
5%
1%
7%
0–8%
Strategy in Action continued
A low overall decline has been observed in the export
volumes from the producing DUC fields since 2021. This is
mainly due to a high level of well activities and increased
focus on delivering a high operational efficiency. In summer
2022, the DUC optimisation journey commenced by
successful restimulation of eight wells in the Halfdan North
East field. This was followed by the WROM project on Dan
with a duration of 18 months, and is now continuing on
Halfdan. In parallel, restimulations are carried out with
regular intervals on both the Dan, Halfdan and Gorm fields.
Further to the increased production, following already
executed and planned work, the first infill well since the
HBB10 well was delivered in 2017; HBA-27B has come on
production end March 2024. The gas acceleration project
pilot on Skjold is also expected to accelerate gas production
and reduce water injection and associated fuel
consumption by shutting in one water injector pump on
Gorm. There is a continued high focus on keeping the
unplanned shortfalls low, and combining planned work in
the best possible way to maintain the operational efficiency
target above 90 percent.
Plot of actual export volumes from 2019 to 2023 from producing DUC fields (excluding Tyra) and the expected guidance
for 2024.
DUC excluding Tyra hub – Actual production and decline net BlueNord
Optimisation mitigates decline for the
producing DUC fields
Strategic Pillar 01 continued
Deliver operationally
Tyra II at a glance
Strategic Pillar 02
Deliver Tyra II
17 Annual Report and Accounts 2023BlueNord
Strategic Report
TWC
TWE
TEH
TEG
TEC
TEB
TEE
TWE
Ensuring sustainable energy
security with the Tyra II field
Strategy in Action continued
With the safe restart of Tyra production in
March 2024, focus is now on bringing the
Tyra West and East fields as well as satellites
Valdemar, Roar, Harald and Lulita on production
as soon as possible to maximize the utilisation
of one of the most advanced and efficient
offshore gas installations in the world.
30%
emissions reduction
compared to old facilities
Energy Security
Annual sale from Tyra when on plateau
is estimated to 2.8 billion cubic meters
of gas. This gas will satisfy the need for
natural gas in Denmark as well as
replacing LNG and coal generated
energy in Europe.
The new Tyra gas processing facilities
are one of the most technologically
advanced offshore gas installations in
the world. The new Tyra leverages
state-of-the-art digital solutions and
technological innovations to produce
more efficiently and with 30% lower
greenhouse gas emissions than the
former facilities.
The onshore control room will be
continuously manned and can be used
to fully remotely control the Tyra hub
offshore operations. This set-up will
improve collaboration between the
onshore and offshore teams, reduce
the need for unscheduled offshore
visits, reducing the overall risk of the
Tyra production operations.
The new Tyra facilities offshore are
equipped with around 100,000 data
points retrieved from sensors on
critical equipment, which will
continuously be monitored and
analysed by the onshore control room
team. A technology called advanced
predictive monitoring will be used to
ensure that potential repairs or
adjustments required are executed
before the processing equipment
stops working which will significantly
reduce unplanned shutdowns.
This new way of working will increase
the Tyra hub operational efficiency and
reduce cost and energy required for
the Tyra hub production operations.
18 Annual Report and Accounts 2023BlueNord
Strategic Report
0.8
1.5
1.7
1.9
2.4
Flaring (mboepd)
0.0
0.6
1.2
1.8
2.4
3.0
Strategy in Action continued
High focus on
reducing flaring on
producing facilities.
Gorm is the first hub
on the emissions
journey.
Routine flaring eliminated from July 2023,
and further flare reduction initiatives to be
implemented in 2024
Completed and ongoing flaring reduction projects on Gorm
Routine flaring has been eliminated in DUC as of
6 July 2023. The routine flaring was caused by
flaring of excess gas from the final stabilisation of
Halfdan oil on Gorm as there was no available
export route. This routine flaring was eliminated
through the Halfdan reroute project, where the oil
from Halfdan is now being routed to Dan for final
stabilisation. The estimated reduction in emissions
is 20 ktonCO
2
e/y.
During 2023, a feasibility study on flare gas
recovery from Gorm processing has been
completed, the project is expected to be
implemented by the end of 2024. The estimated
reduction in emissions is estimated to 9
ktonCO
2
e/y. In combination, the recently enabled
gas export from Gorm and the flare recovery has
the potential of reducing flaring on the Gorm facility
up to 50% in 2025.
Strategic Pillar 03
Deliver our potential
2021 2022 2023 2024 2025
Flaring – Gorm
Actuals Estimate 2024 Estimate 2025
GORM
19 Annual Report and Accounts 2023BlueNord
Strategic Report
Strategy in Action continued
BlueNord Long-Term Plan
The Long-Term Plan outlines development
activities up to 2030, based on the current
technical and economic landscape of the
Danish Underground Consortium (DUC).
Projects will be revised and optimised in
light of findings from technical studies,
production, and changing
macroeconomic conditions.
The plan includes the drilling of seven infill wells between
2023 and 2026. Of these, up to four oil wells will be drilled
from Halfdan, one gas near-field exploration well from Harald,
with two more still under consideration. The 4D seismic
acquired in 2023 is key to identifying pockets of undepleted
reservoir in the Halfdan field; interpretation of this data is
ongoing and will guide the infill programme.
Following delivery of these infill wells, three further
developments will be executed: five wells on Valdemar Bo
South, seven wells on Adda, and then nine Halfdan North
wells. BlueNord is conducting independent technical work to
investigate opportunities for acceleration, to enable timely
delivery of affordable energy.
In addition, we are working to mature additional infill wells in
the Tyra area. Work is ongoing to increase production and
reach design capacity during the summer of 2024, which will
unlock significant volumes from Tyra and satellites with our
modern and efficient processing facilities.
0
10
20
30
40
50
60
2023 2025 2026 2027 2028 2029 2030202420222021
Dan, Halfdan, Gorm
Tyra
In-Plan projects
Above plan
Expected Long-Term Plan production profile
Minimum 7 infill wells
to be drilled between 2023 and 2026
7 wells
on Adda
5 wells
on Valdemar Bo South
9 wells
on Halfdan North
Drilling of new wells Workovers or plugging and abandonment Development projects
2023 2024 2025
Q1 Q2 Q3 Q4
2030
Estimated rig activity schedule
WO
Halfdan TNE Infills
WO
Q1 Q2 Q3 Q4
HEmJ
W
O
Halfdan EKO Infills
Q1 Q2 Q3 Q4
Valdemar UC, Dan B North, Roar and
Tyra South East under maturation
Valdemar Bo South, Adda
and Halfdan North
2027
Strategic Pillar 03
Deliver our potential
20 Annual Report and Accounts 2023BlueNord
Strategic Report
Strategy in Action continued
Key BlueNord Long-Term Plan projects for 2024-30
Halfdan infill
The Halfdan infill wells are planned as a continuation of the Halfdan field development. A FID was made in 2022 for two infill
wells, planned to be drilled in the Halfdan Upper Cretaceous Tor formation. The first well commenced production in April
2024. If supported by positive indications from the 4D seismic study, the Halfdan Ekofisk well will be drilled after the Harald
East Middle Jurassic well.
Harald East
Middle Jurassic
This is a gas well drilled from the Harald platform into a Jurassic reservoir which has significantly better production potential
than the chalk reservoirs present in the Dan, Halfdan and Gorm hubs. The well is classified as a near field step-out well and
has a large range of subsurface outcomes. FID was taken in January 2024, with first production expected in late-2024.
HCA gas lift
The HCA gas lift project is planned for 2025. The gas lift is required to support well production and thereby increase
production potential. Project scope comprises modifications to Halfdan B topside facilities, as well as a gas lift manifold to
be installed at Halfdan C. Construction of the main module is complete.
Halfdan North
The Halfdan North Upper Cretaceous discovery is a northern extension of the producing Halfdan field. Halfdan North was
confirmed by the well HDN-2X and later in 2016 by the Tyra SE, TSB-3A well. The discovery will be tied back to the Halfdan
B (‘HBD’) processing platform with a seven kilometre pipeline from a newly-built wellhead platform with nine horizontal
wells, five producers and four water injectors. Field Development Plan submitted to Danish Energy Agency (‘DEA’) in 2020.
Valdemar Bo
South
This discovery is a southern extension of the producing Valdemar field. Valdemar Bo South has been confirmed by the
Bo-3X and Jude-1X exploration well and further by the VBA-6E horizontal well drilled in 2012. The discovery will be tied
back to Tyra E via the Valdemar BA platform with a 2.5km pipeline from a newly-built wellhead platform with five horizontal
wells. Field Development Plan submitted to DEA in 2020.
Adda
The Adda discovery was made in 1977 by the Adda-1 well. The discovery well found gas condensate in the lower
Cretaceous Tuxen Formation and oil in the overlying Upper Cretaceous Hod Formation. The discovery will be tied back to
Tyra East with an 11km pipeline from a newly-built wellhead platform with seven horizontal producer wells. Field
Development Plan submitted to DEA in 2021.
Svend
Production from the Svend field ceased in 2016 due to well integrity issues. Due to dependencies on the production life of
the Harald hub, Svend is currently categorised as a potential addition to the Long-Term Plan, subject to HEMJ success.
Strategic Pillar 03 continued
Deliver our potential
21 Annual Report and Accounts 2023BlueNord
Strategic Report
Operational Review
The Company delivered five percent above budget despite production from the first Halfdan well being
delivered in 2024 (rather than 2023). Production during the year benefitted from an increased level of well-
optimisation activity and higher uptime than planned due to the reduced duration of planned shutdowns.
However, the safe delivery of the Tyra restart
and Tyra ramp-up is the most significant
ongoing development.
Following construction in Singapore, Indonesia, Italy
and Denmark, the world’s largest ever lift from a
floating crane – of 17,000 tonnes – took place in
October 2022. The subsequent offshore hook-up
and commissioning period involved more than 1500
offshore and 250 onshore workers.
During 2023 and the first quarter of 2024, a huge
scope of offshore work has been completed
enabling the Tyra facilities to process and export
gas to Denmark.
During the middle of the year, the commissioning
strategy was optimised and entailed extensive use
of Nitrogen rather than natural gas. This change of
strategy offered the benefits of less construction
work after the commencement of gas production
and also a significantly reduced fuel consumption
during start-up. This new strategy for start-up caused
a slightly delay of gas in and restart of Tyra but could
offer a significantly quicker ramp-up to full processing
capacity. The new commissioning strategy was
enabled by generation of Nitrogen on Tyra and this
Nitrogen generation has also increased efficiency
for reinstatement of wells.
Effective oil price
$67.8
USD/bbl
Net cash flow from operating activity
$250m
The Tyra East and Tyra West wells reinstatement has
progressed well with the phase 1 scope of installing
refurbished Xmas trees have been installed on all
Tyra East and West wells. The phase 2 scope of
removing temporary plugs have been completed for
all wells on the Tyra West B installation and work is
commencing well on Tyra West C with 18 out of 23
Tyra West wells re-instated as of end March. A
Wireline unit is being mobilised on Tyra East B.
The onshore control room has been operational
since June 2023 and has been actively used for
collaboration between the onshore and offshore
teams during commissioning. In parallel with the
hook-up and commissioning activities on Tyra East
and West, the Tyra Satellite fields that have also been
shut in since 2019 are being prepared for start-up.
Tyra production will be ramped up according to the
following sequence
• Gas in from Dan (achieved 16 March 2024).
• Gas export to Nybro (achieved 21 March 2024).
• Gas in from Harald (achieved 25 March 2024).
• Opening on valves in Nybro and export of gas to
the Danish market.
• Gas in from Tyra South East.
• Start-up of gas lift system.
• Two gas export trains in operation.
• Gas in from Valdemar.
• Gas in from Roar.
• Tyra West commencement of production.
• Tyra East commencement of production.
BlueNord performance in 2023
was strong
With production from the Harald field, a significant
step has been taken towards reaching the full
processing capacity at Tyra. To find out more about
the landmark Tyra story, see page 4 of this report.
The outlook for 2024 is extremely strong with an
expected doubling of the BlueNord production
throughout the year.
From the base assets, the production from the
Halfdan Tor North East infill well commenced late
March 2024 while Final Investment Decisions on the
Halfdan Ekofisk wells is expected during the years
while WROM on Halfdan will continue throughout
the year.
The investment in the Harald East Middle Jurassic
well was approved in January 2024 and in a success
case, this well could provide a production upside in
the last quarter of 2024.
Work is ongoing to mature the major projects towards
Investment Decisions in 2025 which will contribute to
maintaining the BlueNord production around 50 000
mboepd. BlueNord has built a stable business that is
underpinned by our position and expertise on the
DUC Assets and reservoirs.
Marianne Eide
Chief Operating Officer
22 Annual Report and Accounts 2023BlueNord
Strategic Report
Operational Review continued
PRODUCTION PERFORMANCE 2023 PRODUCTION OUTLOOK 2024
Dan
Hub
Production performance was high in 2023 mainly attributed to:
• 18 well interventions carried out with the rig Noble Reacher.
• Six restimulations carried out in March and eight restimulations
in May.
• Stable well-count throughout the year.
To keep production high in 2024 the plan is to:
• Carry out two proactive workovers by rig Shelf Drilling Winner.
• Maintain the high operational efficiency to benefit from the
increased production potential resulting from the 2022/23
optimisation campaign.
• Carry out restimulation campaign during the summer months.
Gorm
Hub
Production performance was high in 2023 mainly attributed to:
• Restimulation of 13 wells carried out in the Gorm field.
• Available gas production capacity has been increased through
gas reinjection into the Rolf field and also by storing excess gas
in the Gorm Halfdan pipeline. In late 2023, gas export from
Gorm was established which will also increase gas production
capacity and reduce flaring.
To keep production high in 2024 the plan is to:
• Fully implement the Skjold Gas Acceleration Project Pilot, where the
recovery mechanism is changed from water injection to depletion in
parts of the Skjold field, which is expected to increase the production
gas to oil ratio, as well as accelarate reserves. Start water injection in
the two newly reinstated water injectors in the Gorm field.
• Perform restimulation campaign during the summer months.
• Utilise the gas export that was established late 2023.
Halfdan
Hub
Production performance was high in 2023 mainly attributed to:
• Arrest of the production decline of the Halfdan field by keeping
the well-count high and stable.
• Exceptionally high operating efficiency of 90.7 percent.
• Continued high gas production as a result of the restimulation
of eight HCA wells in 2022.
To keep production high in 2024 the plan is to:
• Carry out 17 well interventions with the rig Noble Reacher. The
interventions include water shut-off treatments, as well as zone
shifting of the wells for optimisation of the water flood efficiency.
• Carry out restimulations on nine wells.
• The Halfdan Tor NE infill well HBA-27B commenced production in
April 2024.
• Maintain the high operational efficiency at this hub.
Tyra
Hub
To ensure safe and efficient start-up:
• ensure tailored re-start and ramp-up for each individual well to
protect the productivity of each well.
• analyse pressure buildup during production shut-in to understand
more about the potential of each reservoir.
• commence studies for identification of well optimisation
opportunities.
2023 – Annual performance
The production performance in 2023 was
excellent and resulted in the upper production
guidance given at the beginning being
exceeded. It should also be noted that the 2023
production performance was achieved without
the start-up of new wells. The Halfdan North Tor
North East infill well commenced production in
late March 2024. This excellent performance
was caused by a high level of well intervention
and restimulation activities, as well as a high
operational efficiency. In particular, the
production benefited from the optimisation
campaign on the Dan field which started in
mid-2022 and continued throughout 2023. In
this campaign, a total of 50 well interventions
were carried out on Dan with the rig Noble
Reacher, and resulted in the 2023 production
from the Dan Hub being two percent higher
than the 2022 production. In 2024, Noble
Reacher will move to Halfdan, where 17 well
interventions are planned to be carried out.
The delivered operational efficiency was
86percent, which was in line with BlueNord’s
expectation for 2023. The forecasted high
operational efficiency was delivered despite
two production loss incidents at the beginning
of the year. In general the Company has seen
excellent operational performance by the
operator and quick response to these loss
events. With respect to brown-field modification
execution, the Dan-Halfdan re-route work
was completed ahead of schedule with
lower than expected impact on Dan and
Halfdan production.
As a response to the strong production
performance of the Gorm Hub, life extension
activities were initiated by the partnership in
2023 to ensure longer-term integrity of the
installation to ensure maximum recovery
of reserves.
23 Annual Report and Accounts 2023BlueNord
Strategic Report
Financial Review
Total revenue
$795m
Total liquidity
$317m
EBITDA
$421m
Effective oil price
$67.8
USD/bbl
Net cash flow from operating activity
$250m
Effective gas price
75.7
EUR/MWh
Cost per boe
$32.5
“We have had a strong year driven
by excellent underlying operating
performance which exceeded
expectations and led to a strong
and stable financial result in 2023.
When comparing with 2022, the
commodity price environment in
2023 was less volatile and on
average lower overall pricing
was realised.
With revenues of USD 795 million and EBITDA of
USD 421 million for the full year, this has resulted in
significant cash generation from operating activities
of USD 250 million, ending the year with total liquidity
of USD 317 million, comprising of cash on balance
sheet of USD 167 million and undrawn RBL capacity
of USD 150 million.
Our capital structure remains robust supported by
our liquidity position and net debt, with no principal
maturities prior to Tyra first gas. The RBL facility
hassuccessfully remained at the same level of
USD1.1billion, with maximum cash drawing capacity
of USD 1.0 billion.
We also continue to maintain a hedging policy that
provides visibility over future cash flow, adding
volumes where it makes sense to do so, thereby
supporting our balance sheet and capital structure
through this continued uncertain price environment.
Jacqueline Lindmark Boye
Chief Financial Officer
The Company had revenues of USD 795.0
million in 2023 (2022: USD 966.9 million) mainly
related to oil and gas sales from the DUC fields.
The decrease is related to lower realised
commodity prices, with a decrease of
23.2percent on gas and 10.2 percent on oil,
respectively, net of hedging effects, in addition
to 2.9 percent lower oil volumes, offset by
1.2percent higher gas volumes.
Production expenses of USD 295.9 million
in 2023 (2022: 308.5 million) were directly
attributable to the lifting and transport of the
Company’s oil and gas production, which
equates to USD 32.5 per boe (2022: USD 31.6
per boe). Adjusted for insurance and changes in
stock and inventory, total production expenses
amounted to USD 340.1 million in 2023 (2022:
USD 323.4 million). Current year is influenced by
the production enhancing WROM and the
Integrity Recovery Project (‘IRP’) project which
started in 2022.
Personnel expenses were USD 18.0 million in
2023 (2022: USD 12.5 million). The increase is
mainly due to the increased number of FTE’s
and implementation in 2022 of the share-based
long-term incentive (‘LTI’) programme; the LTI
is valued and accounted for according to
International Financial Reporting Standards
(‘IFRS
®
’) 2. For more information related to the
LTI, see page 64 in the Remuneration
Committee Report.
Other operating expenses amounted to
USD 14.1 million in 2023 (2022: USD 19.1 million).
The decrease is due to lower consultant and
legal fees.
Operating result (EBITDA) for 2023 was a
profit of USD 421.4 million (2022: USD 611.2
million). This decrease is mainly attributable
to lower revenue.
24 Annual Report and Accounts 2023BlueNord
Strategic Report
Financial Review continued
Net financial items amounted to an expense of
USD 75.2 million in 2023 (2022 restated: USD
168.7 million). This is primarily driven by the
decrease in the negative fair value adjustment on
NOR13’s embedded derivative in 2023 compared
to 2022, the value of which is influenced by
changes in BlueNord’s share price, and the
unwinding and fair-value adjustment of the interest
swap. In addition, 2022 was influenced by a
positive effect from the extinguishment of the
NOR13 bond loan, that was partly offset by higher
interest income related to restricted cash. The net
financial items for 2022 have been restated due to
capitalisation of borrowing cost on qualifying
assets under construction, for more details see
note 10 on page 92.
Income Tax for the Group amounted to a current
tax cost of USD 145.5 million and deferred tax
movements amounted to USD 11.8 million
(income), which corresponds to a statutory tax rate
of 64 percent on result before tax on hydrocarbon
income, adjusted with the effects of investment
uplift, foreign exchange adjustment of tax losses
and interest limitation. Current tax is impacted by
the temporary EU-solidarity tax charge; however,
this is offset by an equivalent reduction in
hydrocarbon tax deferred tax charge, hence not
increasing the effective tax rate from the statutory
64 percent. Effective tax is 0 percent on result
before tax in Norway and UK and 22 percent
tax on result before tax on ordinary income
in Denmark.
Reference is made to note 14 in the consolidated
financial statements for further details to the taxes
this period.
The Group’s net result for the year of USD 109.8
million (2022 restated: loss of USD 8.8 million).
Total non-current assets amounted to USD 3.0
billion at the end of 2023, of which USD 2.4 billion
related to property, plant and equipment, intangible
assets of USD 151.6 million, deferred tax assets of
USD 218.5 million, derivatives related to the RBL
interest swap and gas hedges of USD 14.0 million
and USD 213.9 million in restricted cash, relating to
security for DUC cash-call obligations pledged to
TotalEnergies, and security against Nini/Cecilie
abandonment costs.
Total current assets amounted to USD 381.9 million
at the end of 2023. USD 59.9 million in trade
receivables and accrued revenue, mainly related
to oil and gas revenue, USD 24.8 million in
prepayments primarily offshore and non-payment
insurance premiums, USD 166.7 million of cash
and USD 54.7 million of inventory.
Equity amounted to USD 813.6 million at the
end of 2023 (2022 restated: 664.2 million).
The increase in equity is mainly related to the
net result of the year and the positive fair value
adjustment of hedges.
Interest-bearing debt amounted to USD 1.2 billion
at the end of 2023 (2022: USD 1.1 billion). The
increase mainly relates to the draw-down of USD
50 million on the RBL facility. Most of the BNOR13
convertible bond loan was converted to BNOR15
in the beginning of 2023; the remaining value was
converted to shares by end of 2023. BNOR15
convertible bond loan had a book value of USD
202.0 million at the end of 2023. The bond loans
are valued at amortised cost and the embedded
derivatives are accounted for as a derivative liability
at fair value through profit and loss. BlueNord’s
USD 1.1 billion RBL facility, drawn at USD 850.0
million on 31 December 2023 and with maximum
cash drawing capacity of USD 1.0 billion, had a
book-value of USD 820.8 million at the end of
2023, of which USD 125.0 million is classified as
current liability as it is due for payment in the
second half of 2024. The senior unsecured bond
loan BNOR14 had a book value of USD 169.1 million
at the end of 2023. The RBL facility and the
unsecured bond loan are valued at amortised cost.
Asset retirement obligations amounted to USD
1,049 million at the end of 2023 (2022: USD 955.8
million). The increase is driven primarily by
accretion of the provision during 2023, updated
exchange rates and some minor changes in cut-off
years. USD 981.4 million is related to the DUC
assets, USD 64.3 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 a cash escrow
account of USD 64.3 million.
Net cash flow from operating activities amounted
to USD 249.9 million at the end of 2023 (2022:
USD561.3 million). The decrease is mainly driven
by higher tax payments in 2023 of USD 229.8
million that relate in large part to the 2022 taxable
income, as well as lower revenue mainly from lower
commodity prices net of hedging. Cash flow from
operations excluding changes in taxes paid
amounted to USD 479.7 million in 2023 compared
to USD 572.9 million in 2022.
Cash flow used in investing activities amounted to
an outflow of USD 347.6 million at the end of 2023
(2022: USD 259.0 million). The cash flow used in
investing activities related to DUC investments of
USD 311.0 million, of which USD 254.7 million
wasspent on Tyra redevelopment (including
preparation work related to Tyra satellites and
excluding capitalised interest). USD31.2 million
was spent on drilling the infill well on Halfdan; in
addition, USD 25.0 million was spent on projects
such as Gorm lifetime extension, gasacceleration
project, 4D seismic survey and other minor
projects. USD 25.0 million in deferred
consideration, USD 8.7 million in paid
decommissioning, issue of a long-term loan of
USD 2.8 million and USD 0.1 million in exploration
and evaluation assets.
Cash flow from financing activities amounted to an
outflow of USD 3.9 million at the end of the year
(2022: USD 156.5 million). The cash outflow in the
current year is mainly related to USD 53.6 million in
paid interest net of interest swap and financing
costs, offset by USD 50.0 million drawdown on the
RBL facility, compared to last year’s voluntary
repayment of USD 100.0 million on the RBL facility.
Net change in cash and cash equivalents
amounted to a cash outflow of USD 101.6 million in
2023 (2022: positive cashflow of USD 145.8
million). Cash and cash equivalents were in total
USD 166.7 million at the end of 2023.
25 Annual Report and Accounts 2023BlueNord
Strategic Report
Sustainability Report
Delivering secure, affordable
and locally produced energy
to Denmark and EU
We recognise climate change science as set out
by the United Nations Intergovernmental Panel on
Climate Change (‘IPCC’) and support the global
climate change goals outlined in the United
Nations Framework Convention on Climate
Change (‘UNFCCC’) and the Paris Agreement.
We also recognise that hydrocarbons are
expected to remain an important part of the energy
mix for the foreseeable future, and that we have a
responsibility to play an active role in the energy
transition. Our strategy is to produce affordable
and reliable energy for Denmark and the wider EU,
whilst managing climate-related risks and
opportunities, by assessing operational emissions
reduction activities in conjunction with the
Operator and partners.
Whilst our overall emissions will increase in 2024
as Tyra is brought back on-stream, emissions will
be lower than in 2018 during Tyra’s last full year of
production prior to shut down. Tyra’s new modern
and efficient facilities will result in a 30 percent
emissions reduction compared to the old facilities.
Tyra signals the start of a new era, minimising
emissions in the most efficient way possible while
contributing positively to the growing demand for
energy. Tyra enables us to produce locally sourced
hydrocarbons, displacing imported hydrocarbons
which have higher emissions intensities.
Investment in CarbonCuts is another commitment
from BlueNord to take an active role in the energy
transition and support Denmark and EU ambitions for
Carbon Storage deployment and contribute to the
Paris Agreement’s goal of arresting global warming.
Our goals
We recognise climate change and support
Denmark and EU net zero goals by working
to reduce our carbon footprint.
BlueNord continues to
identify our solutions to
contribute to the UN SDGs as
we aim to address various
environmental, social and
economic challenges facing
our world today. Examples of
our actions, programmes and
the SDGs to which they relate
are demonstrated throughout
this report and are summarised
in Appendix 2.
26 Annual Report and Accounts 2023BlueNord
Strategic Report
Sustainability Report continued
Commitments, stakeholder engagement and materiality
40%
Reduction in scope 1 and scope 2 emissions by 40% from
DUC assets by 2030 compared to 2015 levels
We are committed to the following:
• As a responsible partner in the DUC, BlueNord
is committed along with the operator
TotalEnergies to:
– Ensuring people’s safety and upholding
Human Rights in our operations and those
of our suppliers.
– Reducing scope 1 and scope 2 emissions by
40 percent from DUC assets by 2030
compared to 2015 levels. Taking an active
role in Denmark’s target to reduce its
emissions by 70 percent by 2030 compared
to 1990 levels, as part of Denmark’s
commitment to the Paris Agreement.
– Helping EU reduce emissions by at least 55
percent by 2030 compared to 1990 levels,
as part of the European Green Deal.
– Reducing methane emissions by using
state-of-the-art technology to detect leaks
and subsequently repair them.
– Being a player in the circular economy.
– Preserving biodiversity.
– Sharing the economic value we create.
• We will do this by:
– Reducing DUC GHG emissions intensity by
bringing Tyra II on stream.
– Investing in methane detection and
reduction, and flare reduction initiatives.
– Evaluating and executing further Carbon
Footprint Reduction (‘CFR’) opportunities.
Electrification of the DUC operations is
currently being studied.
– Supporting DUC to locally recycle obsolete
infrastructure, such as Tyra, and plan for
further recycling during future
decommissioning activities.
– Investing in the CCS value chain with
CarbonCuts.
– Conducting transparent Environmental
Impact Assessments.
– Complying with EU reporting standards and
regulatory requirements during operations,
by adopting Corporate Sustainability
Reporting Directive (‘CSRD’) by 2025.
– Maintaining our social licence to operate by
engaging with stakeholders, including local
communities, regulatory authorities, and
industry partners.
– Returning value through taxation to the
Danish government to enable further state
investment in the Energy Transition.
• The impacts of which will drive:
– Secure access to affordable and locally
produced energy.
– Economic growth and job opportunities
for Denmark.
– Delivery of environmental, social and
governance (‘ESG’) considerations
into financial decision making with the
aim of promoting long-term sustainable
development.
– Continuous improvement of DUC
environmental footprint.
During 2023, BlueNord aligned with the
Norwegian Transparency Act and the Equality
and Anti-Discrimination Act. We developed a
separate report from each committee (ESG,
Remuneration, Audit, and Nomination), conducted
a materiality assessment, and established
reporting against the Task Force on Climate-
related Financial Disclosures (‘TCFD’). BlueNord
also established a risk register and has requested
monthly emissions data from the Operator.
In 2022, the EU Council gave final approval to the
CSRD, to which BlueNord is required to report in
accordance with the new standards, ESRS, from
next year (2025). The Company has therefore
taken steps to prepare for this.
TCFD and CSRD reporting standards integration
is a reflection of the changing landscape and the
expectations of investors, governments and
external stakeholders. We rely on their guidance
to continually evaluate and improve our
governance and working practices.
BlueNord engages both directly and indirectly
with internal and external stakeholders in a
continuous dialogue throughout the year to
obtain their feedback on ‘our energy-efficient
emission reduction activities to reduce the
footprint from our value chain’. Key stakeholders
are employees, investors, lenders, business
partners, government agencies, local
communities, and suppliers. In the context of
the RBL facility redetermination process,
ESG performance is regularly monitored by
BlueNord lenders.
BlueNord initiated a double materiality
assessment in 2023 as it makes progress
to comply with CSRD by 2025.
27 Annual Report and Accounts 2023BlueNord
Strategic Report
Sustainability Report continued
Environment
As a non-operator BlueNord works to protect the
environment where possible, both in its own
operations and through the Company’s
partnership with the DUC. We support the goals
of the Paris Agreement by reducing the carbon
footprint of our operations, for example by
improving energy efficiency, reducing venting,
and eliminating the routine flaring of gas.
We are committed to provide transparency on
greenhouse gas emissions across all scopes, our
emission reduction activities, and climate-related
risks and opportunities. In 2023 we initiated a
double materiality assessment of impacts, risks
and opportunities in line with EFRAG guidelines,
and we are continuously working alongside the
Operator to provide transparent emissions data.
Whilst currently the key framework which guides
our reporting is the TCFD (Task Force on Climate-
related Financial Disclosures, now IFRS S2), we
shall be moving towards CSRD disclosure
compliance by reporting year 2025.
In 2023 we worked alongside the Operator to
provide a transparent set of metrics covering
atmospheric emissions, chemical usage, and
discharges to sea and spills. CO
2
emissions have
increased slightly (+3%) from 2022 to 2023 mainly
due to higher activity on Dan and commissioning
activities at Tyra, and partially offset by CO
2
emissions decrease linked to CFR activities on
Halfdan and Gorm. Methane (CH4) emissions
have reduced because of the drone campaign and
the subsequent reconciliation of reported versus
measured emissions. The GHG emissions
intensity increase is linked to natural production
decline from 2022 to 2023 (-6%) and the increase
in CO
2
emissions.
BlueNord recognises that air quality can affect
public health and the environment. Traditional air
pollutants in the oil and gas E&P industry can
include ammonia, carbon monoxide, sulphur
oxides, nitrous oxides, non-methane volatile
organic compounds and particulate matter.
As part of our environmental management, we
work alongside the Operator to continuously
monitor our non-GHG air emissions and put
measures in place to reduce the impact of
our activities.
Emissions, chemical usage, and discharge to
the sea are regulated with permits issued by the
regulatory body.
Emissions
Emissions to the environment includes
atmospheric emissions and discharge to sea as
a result of the company’s activities. Greenhouse
and non-greenhouse gases (GHG and non-GHG)
are emitted to the atmosphere as a result of fuel
combustion, flaring and fugitive emissions.
BlueNord scope 1 emissions arise from its
partnership in the DUC, mostly linked to fuel
combustion for powering the offshore installations.
Flaring of natural gas occurs on all DUC hubs to
allow for safe operations during production
upsets and non-routine activities.
Routine flaring has been eliminated in 2023
following the re-route of Halfdan production.
Fugitive emissions can occur via venting for safety
reasons, partial combustion or leaks and are
surveyed regularly. Scope 2 emissions are linked
to energy consumption at BlueNord offices.
Routine flaring has
been eliminated in
2023 following the
re-route of Halfdan
production.
28
BlueNord
Strategic Report
Annual Report and Accounts 2023
Performance status 2023: Atmospheric emissions
3
Ospar reporting perimeter (includes drilling and logistics)
1
TOPIC 2022 PERFORMANCE 2023 PERFORMANCE
3
CHANGE
CO
2
emissions
Total CO
2
emissions
290 kt
Total CO
2
emissions
303 kt
CH
4
emissions
Total CH
4
emissions
703 tonnes
Total CH
4
emissions
434 tonnes
nmVOC
555 tonnes 215 tonnes
NOx and SOx
emissions
NOx
1,515 tonnes
NOx
1,156 tonnes
SOx
17 tonnes
SOx
31 tonnes
TOPIC 2022 PERFORMANCE 2023 PERFORMANCE CHANGE
Contribution
to total GHG
emissions
Fuel consumption –
Fuel Gas
76%
Fuel consumption –
Fuel Gas
75%
Fuel consumption – Diesel
10%
Fuel consumption – Diesel
14%
Flare
10%
Flare
9%
Fugitive emissions
4%
Fugitive emissions
2%
GHG intensity
(CO
2
eq/boe)
29.6 32.2
ETS reporting perimeter
2
TOPIC 2022 PERFORMANCE 2023 PERFORMANCE CHANGE
EU ETS CO
2
emissions
Total CO
2
emissions
263 kt
Total CO
2
emissions
271 kt
EU ETS CO
2
intensity
(CO
2
/boe)
24.8 27.3
KEY Higher Unchanged Lower
1. Numbers have been verified and submitted by the DUC operator to DEA for OSPAR reporting. Awaiting Approval from OSPAR
2. Numbers have been submitted by the DUC operator to External Auditors for verification
3. Numbers are net to BlueNord unless stated otherwise
Sustainability Report continued
29 Annual Report and Accounts 2023BlueNord
Strategic Report
Sustainability Report continued
Performance status 2023: Discharge to sea
3
KEY Higher Unchanged Lower
1. Numbers have been verified and submitted by the DUC operator to DEA for OSPAR reporting. Awaiting Approval from OSPAR
2. Number of spills is 100% DUC.
3. Numbers are net to BlueNord unless stated otherwise
Ospar reporting perimeter
1
TOPIC 2022 PERFORMANCE 2023 PERFORMANCE CHANGE
Discharge
to sea
Discharged produced water
6.5 mm m
3
Discharged produced water
6.8 mm m
3
Volume of oil discharged
44.6 tonnes
Volume of oil discharged
48.0 tonnes
Oil concentration in water
6.9 mg/L
Oil concentration in water
7.0 mg/L
Spills Number of oil and diesel spills
2
6
Number of oil and diesel spills
2
15
Oil and diesel spills
0.25 tonnes
Oil and diesel spills
0.02 tonnes
Number of chemical spills
2
32
Number of chemical spills
2
20
Chemical spills
3.33 tonnes
Chemical spills
0.05 tonnes
TOPIC 2022 PERFORMANCE 2023 PERFORMANCE CHANGE
Chemical
usage
Green chemicals
1,496 tonnes
Green chemicals
1,904 tonnes
Yellow chemicals
2,812 tonnes
Yellow chemicals
3,082 tonnes
Red chemicals
26 tonnes
Red chemicals
27 tonnes
Black chemicals
0 tonnes
Black chemicals
0 tonnes
Total chemicals
4,333 tonnes
Total chemicals
5,014 tonnes
Chemical
discharge
Green chemicals
296 tonnes
Green chemicals
1,119 tonnes
Yellow chemicals
1,575 tonnes
Yellow chemicals
1,848 tonnes
Red chemicals
5 tonnes
Red chemicals
6 tonnes
Black chemicals
0 tonnes
Black chemicals
0 tonnes
Total chemicals
1,876 tonnes
Total chemicals
1,876 tonnes
30 Annual Report and Accounts 2023BlueNord
Strategic ReportStrategic Report
Sustainability Report continued
Emissions reduction initiatives
In 2023 BlueNord initiated an inventory of its
Scope 1, 2, and 3 emissions, and is working
alongside the Operator to set out an emissions
reduction roadmap with GHG emissions reduction
targets founded upon cost-effective CFR initiatives
on an asset-by-asset basis.
We acknowledge that we have indirect emissions
related to upstream and downstream activities.
Under Scope 3, Category 11 of the GHG Protocol
(‘Use of sold product’) constitutes the bulk of
BlueNord scope 3 emissions. We are working to
define the boundaries of our scope 3 emissions
and to collect the data.
Carbon Capture and Storage
To support climate targets and reduce carbon
emissions globally, ‘CCS’ technologies will have to
be deployed at scale. CCS is a means by which
hard-to-abate industries can mitigate climate
change, by reducing/avoiding carbon emissions
and even reducing atmospheric CO
2
concentration, when linked to energy production
from biomass or CO
2
capture from the air.
It involves the separation, treatment and
transportation of CO
2
from industrial sources to
a long-term storage location. As noted in the
International Energy Agency (‘IEA’)’s report Net
Zero by 2050: A Roadmap for the Global Energy
Sector, CCS can facilitate the transition to net zero
by tackling emissions from existing assets and
providing a way to address emissions from
challenging sectors. BlueNord is involved in two
CCS projects: Bifrost and Ruby.
Carbon Cuts
BlueNord has made a strategic investment in
CarbonCuts A/S, intending to establish an onshore
CO
2
storage location in Denmark and address
Denmark’s ambitions for onshore storage of CO
2
.
2025
3D Seismic
Work
2024
Award of
storage-licence
2026
Drilling
and listing
2028
Development
drilling
2027
Fabrication and
construction
2029
CO
2
storage
Timeframe until the beginning of CCS operations for the Ruby project.
The Company will contribute to the Paris
Agreement’s goal of arresting global warming,
with its core business to build, own and operate
permanent geological sites for CO
2
storage.
The target for the first storage of CO
2
is 2029.
CarbonCuts’ first project in the Rødby area has
received local support and has attracted national
and international political interest.
CarbonCuts A/S was registered as a legal entity in
August 2022, specifically to explore the
opportunity of CO
2
storage in the Rødby area.
CarbonCuts A/S is a wholly owned subsidiary of
the BlueNord Group, which has funded its activities
since October 2022.
CarbonCuts and the municipality of Lolland have
collaborated since early 2022 to mature the CO
2
storage site. The Ruby Project covers CO
2
receiving facilities, intermediate storage, pumping
and injection facilities as well as a number of wells
for injection and observation. Several CO
2
import
options are being investigated to allow flexibility
and optionality in terms of pace, customer
requirements and volume. A phased development
approach is being considered with CO
2
injection
anticipated to commence by 2029.
CarbonCuts has gained solid political support
via weekly contact with the local business
association, Business Lolland-Falster. Obtaining
public acceptance is of the highest priority, and
CarbonCuts continues to actively engage with
stakeholders, including local communities,
regulatory authorities, and industry partners,
CarbonCuts provides a fit-for-
purpose opportunity for BlueNord
to drive strategic and effective
sustainability activities, which
can be scaled appropriately.
We recognise the important role
that we have to play in Denmark,
and the Ruby project is crucial for
both the climate and Denmark’s
CO₂ storage ambitions, and we
look forward to advancing with
CarbonCuts in a strong position
as a full member of the
BlueNord group.
Euan Shirlaw
Chief Executive Officer, BlueNord
seeking input and feedback to inform our strategic
decisions, and to ensure our social licence
to operate.
CarbonCuts is preparing for the next phases of
‘Ruby’, including seismic surveys expected to be
conducted next winter should CarbonCuts be
awarded the license. The focus remains firm on the
goal: to launch a sustainable storage solution with
accompanying infrastructure that can contribute
to fulfilling Denmark’s CO₂ goals and serve as
an inspiration for CO₂ storage globally.
Headquartered in Kgs. Lyngby and as a subsidiary
of BlueNord, CarbonCuts has access to extensive
knowledge of the energy sector and the Danish
subsurface. BlueNord’s insights and capital
strengthen CarbonCuts’ position as a CO₂
storage operator.
31 Annual Report and Accounts 2023BlueNord
Strategic Report
Bifrost
Project Bifrost is developing a concept for
storing CO
2
in a depleted reservoir in the
Harald field. This partnership is between the
DUC, Ørsted and the Technical University of
Denmark (‘DTU’). This project assesses the
potential for transporting CO
2
– captured
onshore – via specialised shipping or
existing pipelines, and finally injected into
the empty gas reservoirs at the Harald field.
With a storage capacity of several million
tonnes per year, the Harald-field was the
perfect location for the partnership to study
a future concept.
Efficiency optimisation
Reducing fuel gas consumption plays an important
role in reducing DUC GHG emissions. In 2023,
several projects have been carried out to improve
energy efficiencies. New air filters have been
installed on Dan DFG gas turbine and DFF
compressor resulting in 1.3 kt CO
2eq
reduction. Dan
aftercooler pressure drop was reduced, which led
to emissions reduction of 2.7 kt CO
2eq
. HBD
compression train cooling optimisation reduced
emissions by 1.6 kt CO
2eq
at Halfdan. Optimisation
of lift gas with the setup of the Carbon Intensity
Manager resulted in an estimated 4.2 kt CO
2eq
reduction in 2023. More projects are being
matured to further reduce fuel consumption at
DUC’s operations, such as air filters replacement
at Dan and Halfdan power generators.
Electrification
Powering the DUC installation with renewable
energy would substantially reduce scope 1
emissions. The DUC partnership is investigating
whether electrification of the Oil and Gas
operations can be technically feasible and
economically viable. Options assessed include
various renewable energy sources, different types
of electricity transport technology, various designs
of electrical substations, and scoping of brownfield
work to convert directly driven machinery to
electrically powered ones.
Flaring reduction and elimination
Following the re-routing of Halfdan oil production
from Gorm to Dan over the course of 2023, routine
flaring has been eliminated from DUC operations.
The estimated reduction in emissions is 20
ktonCO
2
e/yr. Remaining flaring is taking place
either for safety reasons or during adhoc
maintenance, testing or repair. Flaring reduction
opportunities are being reviewed continuously. As
an example, during 2023, a feasibility study on flare
gas recovery from Gorm processing with the
potential of reducing flaring on the Gorm facility by
~25% has been completed. The project is
expected to be implemented by end 2024 with an
estimated reduction in emissions of 9 ktonCO
2
e/y.
Methane reduction
Methane is a potent GHG, with a 100-year global
warming potential 28-34 times that of CO
2
.
Methane can be emitted because of incomplete
gas combustion (fuel gas and flare), process
release or leaks. In order to measure and monitor
methane emissions, LDAR (Leak Detection and
Repair) campaigns are carried out with platform
Optical gas imaging (OGI) cameras or through
drones campaigns.
The 2023 drone campaign led to a decrease
in venting and fugitive emissions from the
reconciliation of reported versus measured
methane emissions, as flares were found to have
better combustion efficiency than originally
assumed. The DUC partnership is committed to
reducing methane emissions in line with EU targets.
Sustainability Report continued
32 Annual Report and Accounts 2023BlueNord
Strategic Report
Sustainability Report continued
BlueNord is utilising the power of AI to
extract information from historical and
real-time operations and production
data. This enables us to optimise
decision making processes and
improve operational efficiencies by
reducing data search times. It will
improve real-time decision support
during drilling operations and help us
evaluate field development strategies
based on field performance.
Looking to the future, AI will enable us
to improve:
• Detection of emissions and
monitoring of emissions
performance and metrics.
• Identification of environmental risks
associated with our operations,
underlining our commitment to
responsible and sustainable
business practices.
Technology and innovation
BlueNord aims to be a meaningful participant
in the energy transition. The Company has a
focus on facilitating improved technical,
commercial, and economic framing of
environmental initiatives.
Together with DUC partners, BlueNord invests in
research and development through the Technical
University of Denmark (‘DTU’), University of
Copenhagen, Aarhus University, Aalborg
University, and the Geological Survey of Denmark
and Greenland. In 2014 DUC founded a research
centre, the Danish Offshore Technology Centre
(‘DOTC’), which conducts research into
responsible and efficient oil and gas production
from the Danish North Sea with a reduced
environmental and climate footprint.
In 2023 the DUC contributed funding amounting
to DKK118 million to DOTC. The DOTC focuses on
the following areas;
• Abandonment of offshore oil and gas fields,
including the monitoring of abandoned
installations in reference to an environmental
baseline for long-term protection.
• CO
2
storage in old oil and gas fields.
• Produced water management; developing
new technologies to optimise water treatment
processes, with a view to achieving our vision
of zero harmful discharge.
• Operations and maintenance technologies,
including modular architecture for planning
maintenance in a cost-effective way.
In addition to the research and development
studies conducted at DTU, BlueNord is also
participating in the INNO-CCUS partnership
which is developing and maturing technology
relating to the capture, storage and utilisation
of CO
2
.
Artificial Intelligence
Circular Economy
33 Annual Report and Accounts 2023BlueNord
Strategic Report
Sustainability Report continued
We support DUC’s ambition to locally recycle
obsolete infrastructure. During the dismantling of
the old platforms and structures from the Tyra field,
98.5% of the material was either directly reused or
recycled at local Danish recycling yards. For
example, a few of the generators were used again
elsewhere, and other parts were processed and
traded on the international market. We will use the
wealth of knowledge gained during Tyra
redevelopment over the coming decades to
reduce the impact upon the environment from
decommissioning and abandonment of offshore
installations and pipelines relating to DUC
operations. In partnership with the DOTC,
BlueNord is researching cost-effective
abandonment options that will deliver robust
environmental protection.
Water and biodiversity
Biodiversity is a priority for our stakeholders, and
we are committed to engaging in research and
dialogue to enhance further understanding of
potential impacts and how we can contribute,
including by leveraging natural climate solutions.
In partnership with the DTU and DOTC, BlueNord
is investigating the role and importance of subsea
structures, such as platforms, for cod stocks in the
Danish North Sea. The current project – to
evaluate the environmental baseline of cod
populations around offshore structures – started
with offshore data collection in summer 2023, and
is due to complete with a further survey in 2024.
Also in partnership with the DTU and DOTC,
BlueNord is devising ways to improve the
treatment and disposal of the water produced
alongside hydrocarbons. The current Produced
Water Management Programme uses technology
which purifies water to an exceptional standard,
such that the water being let out to sea is of greater
purity than that which legislation and discharge
permits require. Nevertheless, our vision is to go
further, and to completely eliminate harmful
discharges associated with produced water.
We are improving and stabilising water
treatment processes with new instrumentation
and advanced process control technology.
Biological treatment methods and advanced
oxidation will be tested and, if found to be
feasible, further developed. Projects to
demonstrate the technology in offshore
applications will be undertaken.
Biodiversity is a priority
for our stakeholders,
and we are committed
to engaging in research
and dialogue.
34 Annual Report and Accounts 2023BlueNord
Strategic Report
For this reason the Financial Stability Board, the
international body established by the G20 in 2009
to monitor and make recommendations about the
global financial system, has created TCFD, to
improve and widen reporting of climate-related
financial information.
In line with TCFD recommendations, a report in
accordance with TCFD is, as of 2022, an integral
part of BlueNord’s annual financial reporting.
Thereport is reviewed annually by our Audit
Committee, ESG Committee, and the Board.
TCFD encourages a standardised reporting
structure for financially material climate-related
risks and opportunities to give investors, lenders,
and insurers enhanced comparability when
assessing and pricing pertinent companies.
The TCFD framework is made up of 11
recommended disclosures divided into four pillars
that represent core elements of how organisations
operate. The four pillars are: governance, strategy,
risk management, and metrics and targets.
Moreover, the framework separates into three
main categories: risks related to the physical
impacts of climate change, risks related to the
transition to a lower-carbon economy, and
climate-related opportunities. TCFD has also
incorporated financial impact as an integral part
of its disclosure recommendations.
For more about TCFD see the Appendix to this
report from page 143.
Sustainability Report continued
Task Force on Climate-related Financial Disclosures (‘TCFD’)
There is a growing demand for decision-useful, climate-related
information, and creditors and investors are increasingly demanding
access to risk information that is consistent, comparable, and clear.
GOVERNANCE RECOMMENDED
DISCLOSURES
Disclose the
organisation’s
governance around
climate-related risks
and opportunities.
a) Describe the board’s
oversight of climate
related risks and
opportunities.
b) Describe the
management’s role in
assessing and
managing climate-
related risks and
opportunities.
STRATEGY RECOMMENDED
DISCLOSURES
Disclose the actual
and potential impacts
of climate-related
risks and
opportunities on the
organisation’s
business, strategy,
and financial planning
where such
information
is material.
a) Describe the climate-
related risks and
opportunities the
organisation has
identified over the short,
medium, and long-term.
b) Describe the impact
of climate-related risks
and opportunities on the
organisation’s
businesses, strategy,
and financial planning.
c) Describe the
resilience of the
organisation’s strategy,
taking into consideration
different climate-related
scenarios, including a
2°C or lower scenario.
RISK MANAGEMENT RECOMMENDED
DISCLOSURES
Disclose how the
organisation
identifies, assesses,
and manages
climate-related risks.
a) Describe the
organisation’s processes
for identifying and
assessing climate-related
risks.
b) Describe the
organisation’s
processes for managing
climate-related risks.
c) Describe how
processes for
identifying, assessing,
and managing climate
related risks are
integrated into the
organisation’s overall
risk management.
METRICS & TARGETS RECOMMENDED
DISCLOSURES
Disclose the metrics
and targets used to
assess and manage
relevant climate-
related risks and
opportunities where
such information
is material.
a) Disclose the metrics
used by the organisation
to assess climate-related
risks and opportunities in
line with its strategy and
risk management
process.
b) Disclose Scope 1,
Scope 2, and, if
appropriate, Scope 3
greenhouse gas (GHG)
emissions, and the
related risks.
c) Describe the targets
used by the organisation
to manage climate-
related risks and
opportunities and
performance against
targets.
At BlueNord we have
identified the most
significant climate-
related risks and
opportunities we face.
35 Annual Report and Accounts 2023BlueNord
Strategic Report
Social
Sustainability Report continued
We strive for zero accidents, zero incidents,
and zero impact to the environment.
Outside the DUC, our vendors are mostly in the
Nordic and North Europe areas. They provide
consultancy, legal and financial services, which are
judged to involve minor risk. However, when
considering new investments or when tendering
for goods and services, due diligence and
monitoring of prospective partners (as well as
existing ones) is undertaken wherever applicable.
We also consider how we can ensure that our
operations do not come into conflict with any
fundamental human rights principles. As part of
tender processes and when concluding contracts,
we seek to confirm that all parties adhere to human
rights, sound working conditions, employment
terms, and our Code of Conduct.
For more information see the Governance
section of this report from page 54.
Supply chain
The BlueNord health, safety and environment
(HSE) policy has been revised and updated as of
October 2023. Our vision of ‘zero accidents, zero
incidents, and zero impact to the environment’
underpins our commitment to:
• Ensuring safe and efficient operations.
• Compliance with regulatory standards.
• Striving to reduce climate and other
environmental impacts to as low as
reasonably practicable.
BlueNord is ultimately accountable for the
contribution of all our people to health, safety and
environmental outcomes, and continuous
improvement in these areas.
By complying with applicable standards and
regulations and continually improving our
management system we make positive progress
towards the key goal of zero fatalities and zero
recordable work-related accidents.
As a partner in DUC, we take responsibility for HSE
by actively supporting the good HSE work of the
Operator, and proactively participating in meetings
and initiatives. Further to constructive dialogue
regarding the offshore working environment
issues on Total Energies platforms in DUC which
began in 2022, we have built robust relations and
trust, with our Lead Operations Engineer
participating regularly in Tyra offshore meetings.
Planning of preventative safety and environmental
work involves the participation of local health and
safety representatives to maximise employee
welfare and minimise our already low rates of
sickness absence. In addition, all employees are
offered annual on-site first aid and defibrillator
courses, and ergonomic assessments as
applicable.
Total sick leave in the BlueNord group was
reported to be 0.41 percent in 2023. No work-
related illness was reported.
0.41%
Total sick leave
1
0
Work-related accidents or injuries
in 2023
1
1. Excluding non-operational DUC interests
36 Annual Report and Accounts 2023BlueNord
Strategic Report
90
90
85
80
85
79
At BlueNord everyone has equal opportunities for
development regardless of gender, age, ethnicity, sexual
orientation, family status, disabilities, religion or language
I feel a sense of belonging at BlueNord
I find that I can bring my whole
self to work at BlueNord
Sustainability Report continued
BlueNord is an equal opportunity employer,
committed to fostering DE&I in the workplace. We
welcome and embrace a variety of skillsets and
perspectives, and we value differences between
people of different cultural backgrounds, ethnicity,
age, gender, gender identification, gender
expression, sexual orientation, functional ability,
religion, and philosophies of life. These principles
apply to all employment practices at BlueNord,
including recruitment, hiring, compensation and
benefits, promotion, training and development,
and leave of absence.
The Norwegian Equality and Anti-Discrimination
Act stipulates that organisations must identify and
address challenges regarding equality and
diversity in the workplace before any incidents or
discrimination take place. The Act’s general activity
duty applies to BlueNord; in addition, we are
implementing the working method that the Act
prescribes for specific activity duty: Investigate,
Analyse, Implement and Evaluate results.
An initial assessment of challenges was carried out
at the end of 2022. Gender-equalising terms for
duration and payment of parental leave were
implemented as part of BlueNord’s leave policy.
As of 2023, a set of questions to establish whether
BlueNord is considered a safe, inclusive, and
healthy workplace with equal opportunities and
zero tolerance for harassment were included in our
annual Employee Engagement and Working
Environment survey.
Following the survey, inclusion was considered
one of the topics to be further highlighted in the
programme for our culture journey 2023. The
survey performed in January 2024 proves that
initiatives taken have had a positive impact.
As part of our culture journey 2023, sessions and
activities involving all staff were undertaken to
understand, recognise, and embrace diversity and
its impact on our multinational teams and
organisation. This has helped to foster a sense of
belonging and integration within the BlueNord
team. Correspondingly, we have enhanced the
awareness of bias and blind-spots, cultural
differences, and cross-cultural communication.
As part of the performance management process
involving annual performance dialogue, mid-term
review and personal development planning,
performance evaluations are assessed and
calibrated jointly by leaders to avoid the risk and
impact of biases and discrimination.
BlueNord champions the hybrid working model,
work-life balance, and support for our team across
different stages of their lives. In addition, we
support our employees with leave schemes to take
care of children and close relatives, payment
during sickness, and we have implemented
gender-equalising terms for duration and payment
of parental leave.
Channels and procedures are in place for reporting
concerns about harassment of any kind, whether
experienced by or witnessed by a staff member.
Appropriate handling of any potential
discrimination issue is detailed in the Company’s
harassment policy, supplementing the grievance
process, and the existing Whistleblowing
procedure and its related integrity channel.
No whistleblowing incidents have been reported
since the implementation of our integrity channel in
2020. BlueNord will continue to improve its
systematic approach to promoting equality and
preventing discrimination in the workplace in 2024.
Diversity, equity and inclusion
BlueNord believes embracing diversity, equity and inclusion
(‘DE&I’) positively impacts recruitment and retention and
drives performance across the Company.
BlueNord DE&I index
79.1
January 2022
80.5
January 2023
Extract from DE&I Index
Extract of responses from BlueNord ‘s annual Employee Engagement and Working Environment survey
included in BlueNord DE&I index. Responses on a 7-point Likert scale converted into a 0–100 index scale
2024
2023
37 Annual Report and Accounts 2023BlueNord
Strategic Report
62%
21%
16%
57%
43%
7.5%
25%
32.5%
15.5%
15%
5%
30%
20%
10%
20%10%
10%
Sustainability Report continued
We believe that each and every one of our people makes a
difference. We work as one team across our three locations,
with forty employees and three in-house consultants at year
end 2023.
Our people and values
BlueNord supports the principle of freedom of
association and collective bargaining. We fully
respect the right of employees to form and join
trade unions, as well as the right to remain
non-unionised. There are no trade unions currently
represented at BlueNord. Thus, the Company is
not bound by any collective bargaining
agreements, except for what may follow from local
legislation, case law and legal practice.
25 percent of the team works in a managerial role.
However, BlueNord operates an essentially flat
management structure, with just one leadership
level in support of the Executive Team.
As an organisation, BlueNord is growing
organically, focusing on and prioritising the
presence of the best-qualified person in every
role, regardless of their gender. This applies to
both the recruitment of new employees and the
assessment of performance and capabilities for
internal advancement.
Oslo
Copenhagen
London
18–26
27–35
36–45
46–55
56–64
65+
Executive team
Leadership team
All managers
Staff
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Full Time Equivalent 37.32Gender split
Age distribution
Leadership – gender distribution
Male
Female
Male Female
New employees
18–26
27–35
36–45
46–55
56–64
65+
38
BlueNord
Strategic Report
Annual Report and Accounts 2023
Building culture is a collective effort at BlueNord.
We strive for an inclusive culture with full employee
engagement, where everyone feels empowered,
respected, and has a strong sense of belonging.
With commitment from the Executive Team and
active involvement from our team of Culture
Ambassadors, the whole organisation has
participated in our culture journey 2023, through
Company-wide camps, team discussions, and
one-to-one activities throughout the year.
Our team represents ten different nationalities and
a wide range of ages, background, experiences,
and ways of thinking. These are some of the
reasons why many of our employees look forward
to going to work every morning.
Sustainability Report continued
The best thing about working in
BlueNord is that we are a small
organisation with great colleagues.
The BlueNord values
we revisited and revitalised our values,
which are integral to our culture and vision
of becoming a leading independent
producer of gas in Europe.
Our values reflect our Company and our
people. They serve as our compass,
guiding us today, and towards the
Company we want to be. They provide a
framework for how we think, act and
interact. Our values influence how we
operate, lead, and make decisions.
Bold
We are determined, using our creativity and technical
expertise to challenge the status quo, willing and
unafraid to explore alternative paths.
Purposeful
We are ambitious, moving forward with purpose and a
focus on value and results. Our people are connected,
contributing to the bigger picture.
Dependable
We deliver on what we promise, sharing ideas and
possibilities. We are in this together, supporting each
other throughout.
BlueNord Employee Engagement index
64.8
January 2022
79.1
January 2023
80.5
January 2024
Extract from Employee Engagement survey
Extracts of responses from BlueNord annual Employee Engagement and Working
Environment survey. Responses on a 7-point Likert scale converted into a 0–100
index scale
2024
2023
87
86
86
83
85
83
85
85
I look forward to going to work
My work tasks motivate me
I feel appreciated at work
Overall, I am satisfied with my work
39 Annual Report and Accounts 2023BlueNord
Strategic Report
39 Annual Report and Accounts 2023
Sustainability Report continued
To enhance individual as well as team growth and high
performance, our culture journey 2023 focused on the
fundamentals for developing a positive and robust
safety culture, and a learning organisation.
Our culture initiatives are rooted in our core values and have concentrated on
the elements that foster psychological safety, trust and a sense of belonging,
as well as open communication and feedback.
With commitment from the
Executive Team and active
involvement from our team
of Culture Ambassadors,
the whole organisation has
participated in our culture
journey 2023.
As a Culture Ambassador Network (‘CAN’) we are
committed to support the integration of BlueNord’s
culture, in our day-to-day business.
We will be proactive in promoting our values and will
operate with integrity and confidentiality.
We aim to role model the core values of the
Company and uphold psychological safety and
inclusivity in our workplace.
We will highlight the elements that BlueNord wants
to characterise our culture by:
• Speaking about our previous, ongoing and
upcoming culture initiatives.
• Encouraging colleagues to learn more about our
culture initiatives, initiate and facilitate discussions.
• Role modelling.
• Pointing out to the management positive
examples of good cultural behavior
demonstrated by BlueNord team members.
Meet our Culture Ambassadors
• In addition to upskilling in our CAN meetings,we
share experiences and lessons learned in
facilitation, reflect and discuss relevant topics.
• In our encounters with the organisation, we identify
culture and change challenges in our respective
geographic areas, and support and help
resolve these.
We work to continuously support and improve
our culture.
40 Annual Report and Accounts 2023BlueNord
Strategic Report
Learning is part of our Company’s culture.
Continuous improvement and sharing
knowledge and ideas are considered to be vital
for the business to thrive. Employees at all levels
are encouraged to consider how they upgrade
their knowledge and skills, and development
activities are included in every personal
development plan. As of 2024, all training
activity is to be recorded, to enable KPIs to
be set for competence management and
people development.
Experience and on-the-job training are a
primary source of learning. This is backed by
competence development and coaching, both
individually and in teams, together with
mentoring, job-shadowing, and formal training
courses and sessions. Participation in seminars
and conferences is also supported, as a means
to keep abreast of industry trends and
developments, update professional expertise,
and to build and manage networks.
This activity has been further supplemented by
new initiatives this year, including lunch-and-
learn sessions which have been initiated by
employees, inviting other professions to
meetings to gain new insight into cross-
disciplinary topics that impact our business.
Upskilling activities regarding giving and
receiving feedback, and joint discussions
around how to define our feedback culture, were
also an essential part of our culture journey 2023
training programme, and this activity will be
extended in the future.
To make sure all employees adhere to governing
documents and the standards for business
conduct at BlueNord, our Code of Conduct is
among the mandatory documents for all
employees to read and understand. This training
forms part of our on-boarding process.
Handling insider information was a mandatory
session with our legal advisers for all employees
in 2023. This safeguards BlueNord, not only as a
listed company, but also because most of our
permanently-employed people are participating
in our Long-Term Incentive (‘LTI’) programme
and can become shareholders themselves.
An e-learning course related to our Code of
Conduct and other governing documents, which
will include subsequent annual refreshers and
updates, is being developed for implementation
in 2024.
We are committed to respecting local values
and norms, performing our business activities
with integrity and in an ethical manner, in full
compliance with the laws and regulations of all
countries in which we operate.
BlueNord is not a large employer, but through
the business we carry out as partner in DUC,
our operations generate a positive impact on
communities. The economic multiplier effect
of our engagement with contractors, and
the purchasing of services and equipment,
creates a platform for wider growth,
employment and prosperity.
During 2023, we increased our number of
interns from one to three. Two of these interns
are working part-time in Operations until they
complete their degrees in 2025. An international
student worked for five months full-time in
Finance, and was followed by a master’s
student now engaged until their degree is
complete, also in 2025. Further internships are
to be assessed this year, including the
development of a structure for short-term
summer internships. In 2024, we also plan
to offer an IT apprenticeship at our
Copenhagen office.
BlueNord helps socially vulnerable people to
participate in society through our ties with
Pant-for-Pant (Pledge-by-Pledge), a non-profit
bottle collection service that employs socially
disadvantaged and homeless people.
BlueNord’s recyclable bottles are donated to
Pant-for-Pant service workers to help them
build an everyday life with a real job, while
working together for the environment.
BlueNord is proud to have raised funds in 2023
for, amongst others, The Norwegian Childhood
Cancer Society and its corresponding
foundations in Denmark and the UK. Our
charitable giving policy is being developed for
implementation in 2024. The policy aims to be
a reflection of BlueNord's values of Bold,
Purposeful, Dependable, and a commitment
to our social responsibility.
Education and training
Community engagement
Sustainability Report continued
3
Internships in 2023
41 Annual Report and Accounts 2023BlueNord
Strategic Report
Governance
Sustainability Report continued
BlueNord believes that effective corporate governance is critical
for ensuring accountability, achieving strategic goals and
generating value for stakeholders.
The Company sets high standards of performance and
professionalism based on honesty, integrity and fairness in its
business practices. BlueNord works together with partners and
contractors on the basis of the same principles of integrity and
fairness, with zero tolerance for bribery and corruption.
Read our Corporate Governance policy
Our ESG Committee was established in 2020 to support the
BlueNord commitment to ESG and to evolve our contribution to
the energy transition.
The Chief Corporate Affairs Officer reports directly to the Chief
Executive Officer, and is supported by executive management,
who are responsible for risk and opportunity identification, and for
ensuring effective processes and mitigation efforts, including ESG
matters, within managers’ respective areas of responsibility.
Read our latest ESG Committee report
BlueNord is committed to conducting our business in a
responsible, ethical and lawful manner. We aim always to be a
trusted partner for customers, shareholders, colleagues, business
partners and neighbours.
The BlueNord Code of Conduct forms the basis for the high
standards of integrity in our business. The Code of Conduct
applies to all Directors, officers, and employees, including
subsidiaries in which BlueNord holds (directly or indirectly) an
ownership interest. The Code of Conduct also applies to those
acting for or on behalf of BlueNord. BlueNord expects our
business partners, such as suppliers, subcontractors, joint venture
partners, and other contracting parties, to adhere to standards
consistent with this Code of Conduct.
Read our Code of Conduct
BlueNord has zero tolerance regarding bribery and corruption.
The Company expects the local management of each Group
subsidiary to promote a strong anti-corruption culture. Each
Company shall make active efforts to prevent undesirable
conduct and ensure that their employees are capable of dealing
with challenging situations.
Read our Anti-Corruption and Bribery policy
BlueNord is committed to respecting fundamental human and
labour rights, both in operations and in relations with business
partners, and to complying with applicable laws and regulations.
We conduct our business in a manner that respects the rights
and dignity of all people. We support and acknowledge the
fundamental principles of human and labour rights as defined
in the International Bill of Human Rights, the United Nations
Guiding Principles on Business and Human Rights, the Universal
Declaration of Human Rights, and the International Labour
Organisation Declaration on Fundamental Principles and Rights
at Work.
Our human rights work is also guided by the OECD Guidelines
for Multinational Enterprises. Our human rights commitments are
set out in our Code of Conduct.
Read our Human and Working Rights & Diversity and
Inclusion Policy
Governance, systems and processes ESG Committee
Code of Conduct Anti-bribery and corruption
Human rights
42 Annual Report and Accounts 2023BlueNord
Strategic Report
Sustainability Report continued
BlueNord maintains an in-house IT department
with overall responsibility for IT operations,
security, governance, and strategy. Day-to-day IT
operations are outsourced to a provider with
extensive experience in the oil and gas industry,
supplying infrastructure and general/industry-
specific applications. BlueNord’s IT environment
also incorporates third-party SaaS applications.
Although situated in relatively safe and politically
stable countries, BlueNord acknowledges that we
are not immune to the rising risk of cyber attacks.
To bolster our cyber security capabilities,
BlueNord has partnered with a recognised firm of
security experts, providing cyber security
management, including risk assessments,
endpoint security, round-the-clock monitoring of
security events, and incident response.
Procedures for handling cyber security incidents
have been established and form part of the
BlueNord Incident Management plan.
All staff are required to familiarise themselves with
our Incident Management plan. This plan is in
place to ensure personnel safety, environmental
protection, safe recovery, and business continuity
in the event of incidents, while also facilitating
necessary communication with our stakeholders.
Our focus on security covers both external threats
and internal risks. Internal measures include
restricting access to our offices, conducting
background checks, and requiring
ID control for all new hires. IT security campaigns
are run on a continuous basis. All staff and
consultants working with our IT systems must
confirm in writing that they have read and will
adhere to BlueNord’s End-user IT instruction.
This document includes both IT security
requirements and acceptable-use policies.
As new technology is acquired, the instruction
and our IT security policy will be updated
accordingly. In late 2023, BlueNord embarked on
a private AI pilot project, which has in turn driven
recent policy updates on the adoption of AI
technology and the Company’s stance on the
use of public AI.
BlueNord’s business management system is
guided by regulatory requirements,
international, national and industry-specific
standards. In close collaboration with a highly
experienced team from Det Norske Veritas
(‘DNV’) providing best practice in the oil and gas
industry, further development of BlueNord’s
existing business management system was
initiated in 2023 and is to be finalised in 2024.
Our management system ensures safe and
efficient business operations, a joint way of
working which is easily and efficiently
accessible for anyone joining or partnering with
BlueNord, and compliant with internal and
external requirements for operations in the
North Sea. All relevant business processes,
procedures, governing documents and
regulatory requirements for respective
BlueNord disciplines are documented in the
management system.
Cyber security
Business management system
Our management system
ensures safe and efficient
business operations.
43 Annual Report and Accounts 2023BlueNord
Strategic ReportStrategic Report
Sustainability Report continued
Our Whistleblowing procedure and integrity
channel, which is accessible on our corporate
website and intranet, is managed by
PricewaterhouseCoopers (‘PwC’). The
procedure applies to all officers, Directors and
employees of the Company, whether temporary
or permanent, full-time or part-time, and
regardless of their location. Anyone doing
business for or on behalf of BlueNord must also
comply with the Whistleblowing procedure.
The procedure is mandatory reading for all new
employees during on-boarding. We encourage
employees, hire-ins and external parties to raise
concerns and report suspected violations
of applicable laws and regulations to our integrity
channel. All reports made in good faith will
be dealt with expeditiously, with persons
reporting assured of no adverse
consequences for themselves.
No whistleblowing incidents have been reported
since the integrity channel was first implemented
in 2020.
Employees and consultants are also encouraged
to speak up about all other issues of concern in
the workplace, and are supported to seek advice
if they are in doubt. Our Harassment policy sets
out protected channels for notification in the
event that an individual has experienced
behaviour that falls short of the exemplary
standards we expect from all employees.
This policy also refers to the Grievance process in
our management system, which can be initiated if
a concern or a complaint is seen as appropriate
for raising on a more formal basis. Correspondingly,
any appeal process, where applicable, will be
carried out according to local legislation.
Remuneration for executives and employees is
based on the following principles:
• A clear and transparent compensation policy.
• Compliance with regulatory requirements and
principles of good business conduct.
• Fair treatment of all employees.
• Sustainable pay linking remuneration to
performance, actual results and stakeholder
value creation.
BlueNord’s compensation policy includes
Short-Term Incentives (‘STI’) and Long-Term
Incentives (‘LTI’).
STI is a variable pay component, in the form of an
annual bonus programme that rewards high
performance based on the achievement of
operational and financial targets. Targets are set
annually and are tied to the execution of business
strategy, including environmental metrics which for
2023 was related to emission intensity reductions.
LTI includes our Performance Shares programme.
This uses a set of weighted KPIs which measure
share price performance on both an absolute and
relative basis (70 percent), emissions reduction
performance (20 percent), and tenure (10 percent).
For more information about Executive
Remuneration, see our
Executive Remuneration Report 2023
Whistleblowing, harassment and grievance
Remuneration
The KPIs of the variable pay
programmes include
emission reduction targets.
44 Annual Report and Accounts 2023BlueNord
Strategic Report
Risk Management
Risk management framework
Effective risk management is
essential to successfully delivering
our strategy. The risk management
process needs to identify and
determine the nature and extent of
risk the Company is exposed to
and the extent to which mitigation
is required and thus, the level of
risk that is acceptable.
Board of Directors
The Board is responsible for the
Company’s risk framework.
Meet the Board on page 55
The internal control framework supports the
management and mitigation of risk. The process is
designed to manage, mitigate and communicate,
rather than eliminate, the risk of failure to achieve
strategic priorities.
Risk management and internal control are given
high priority by the Board of Directors. The Board is
responsible for identifying principal risks and
determining the nature and extent of those risks
the Company is willing to take. The impact of
climate-related risks are also taken into account
and specific detail can be seen on page 52.
The Board is also responsible for monitoring the
Company’s risk management framework and for
reviewing its effectiveness. The Audit Committee
assists the Board of Directors on an ongoing basis
in monitoring the Company’s system for risk
management and internal control.
Risk management process
The Company faces various risks which may
impact the Company and not all these risks are
necessarily in the Company’s control. For this
reason, the Company has established a risk
management process to identify and assess how
to respond to risks. That response can include
acceptance, an action plan with mitigating factors
to reduce the risk, transfer to third parties, or
terminating the risk by ceasing certain activities.
The Executive Team sets the tone and is
responsible for monitoring and managing the most
significant risks, and identified risk owners are
responsible for ensuring risks within their area are
being appropriately managed.
Risk assessment includes risk
identification through review
meetings held with key
personnel in the organisation
on a quarterly basis. This
includes an evaluation of
likelihood and impact
considering both quantitative
and qualitative factors. The
collated risks are maintained
inthe Company risk register
and matrix.
Risk monitoring occurs on a
quarterly basis through an
Executive Team evaluation,
monitoring and review of
the risk register and matrix,
which is to be presented to the
Audit Committee along with the
quarterly financial statements.
Risk mitigation requires an
assessment of mitigation plans
and controls based on risk
appetite. Risk mitigation plans
are developed between risk
owners and with feedback
from the Executive Team
considering the risk appetite
and context set at Board-level.
Status of the risk assessment
ispresented annually and
reviewed with the Board and
updated as required based
onthe current risk appetite
andcontext, both internal
andexternal.
Strategic objectives and risk appetite sets the context at Board-level
Internal control
The Company’s management is responsible for
establishing and maintaining sufficient internal
control over financial reporting. The Company’s
specific policies, standards and accounting
principles have been developed for the annual and
quarterly financial reporting of the Group. The
Chief Executive Officer and Chief Financial Officer
supervise and oversee the external reporting and
the internal reporting processes. This includes
assessing financial reporting risks and internal
controls over financial reporting within the Group.
The consolidated external financial statements are
prepared in accordance with International IFRS
and International Accounting Standards as
adopted by the EU. The cyclical process works in
practice as follows:
45 Annual Report and Accounts 2023BlueNord
Strategic Report
Principal Risks and Uncertainties
The risks and uncertainties described in this section are the material
known risks and uncertainties faced by BlueNord at the time of publication.
Oil and gas production and reserves
Risk Impact Mitigation Movement
Geographical concentration
and field interdependency
Production of oil and gas is concentrated in a limited number of offshore fields in a limited
geographical area of the Danish continental shelf. Consequently, the concentration of fields
and infrastructure may result in incidents or events in one location affecting a significant part
of BlueNord business.
Material influencing factors
• Four producing hubs that are interconnected and utilise the same infrastructure.
• The fields within one hub are interconnected and one field can depend on another to
extract hydrocarbons.
• All gas produced on the different hubs is processed and transported to shore via the Tyra
Hub or the Northern Offshore Gas Transport (‘NOGAT’) pipeline.
• The Gorm Hub receives liquids from all the other hubs and sends it to shore via pipeline
from Gorm E.
The Operator has ongoing inspection and
maintenance plans in place to proactively
maintain assets and minimise the risk of
incidents.
Where events occur, activities are adjusted
to respond to specific issues as they arise,
and isolated where possible to minimise
the impact.
Actual reserves may differ from
reported reserves estimates
The reported reserves and resources represent significant estimates based on several
factors and assumptions made as of the reported date, all of which may vary considerably
from actual results. Further, oil and gas production could also vary significantly from reported
reserves and resources. Should the actual results of the Company deviate from the
estimated reserves and resources, this may have a significant impact on the value of the
Group’s assets and cash flow from operations.
Material influencing factors
• Assumptions on which the reserves estimates are determined include geological and
engineering estimates (which have inherent uncertainties), historical production, the
assumed effects of regulation by governmental agencies and estimates of future
commodity prices and operating costs.
• The Company is a non-operated partner in the DUC and as such has less control of
future decline-mitigating investments in the producing assets that have an impact on oil
and gas production.
Reported reserves are based on independent
technical expert’s reports, which are carried
out at least annually.
BlueNord has a subsurface team with
appropriate technical expertise that monitors
and reviews production and reserves in
addition to the external reserves reporting.
This provides oversight of performance and
expectations throughout the year to enable
response and follow up on a timely basis
should concerns arise.
KEY Increasing Unchanged Decreasing
46 Annual Report and Accounts 2023BlueNord
Strategic Report
Principal Risks and Uncertainties continued
Risk Impact Mitigation Movement
Ongoing investment in
developments
The Company makes and expects to continue to make substantial investments in its
business for the development and production of oil and natural gas reserves. Such
projects require substantial investments to bring into production, which come with
several inherent risks.
Material influencing factors
• Development projects have inherent execution risks, including cost overruns and delays,
in addition to the impact of commodity prices on the economics of a project.
• The Company may also be unable to obtain needed capital or financing on satisfactory
terms, which could lead to a decline in its oil and gas reserves.
The Company intends to finance future
investments with cash flow from operations
and borrowings under its RBL facility and
other equity and debt facilities. The Company
regularly monitors liquidity, borrowing base,
and other financial ratios.
Projects are screened for technical and
non-technical risks with economics reviewed
at multiple price scenarios.
Tyra redevelopment project
The Tyra redevelopment project is, to date, the largest project carried out on the Danish
continental shelf. The project is now nearing completion, but the risk of delay remains,
particularly with regards to the ramp-up of production and further uncertainty of
performance once wells are unplugged. Such risks may have an adverse effect on
BlueNord’s financial position.
Material influencing factors
• The scope of the project includes removal of old facilities, modifying existing ones, and
installing new features; there are inherent risks with such significant projects, including
risks of cost overruns and delays.
• The project has been delayed twice to date; the first in November 2020 due to the
Covid-19 pandemic, and again in August 2022 driven by global supply chain challenges.
BlueNord maintains a regular dialogue with
the Operator’s key personnel on the project in
addition to a review of weekly and monthly
progress reporting.
BlueNord’s internal technical experts are
closely involved with this review and have
an established feedback process with
the Operator.
Decommissioning estimates
There are significant uncertainties and significant estimation risks relating to the cost and
timing for decommissioning of offshore installations and infrastructure. A significant
deviation from such estimates may have a material adverse effect on the Company’s results
of operations, tax position, cash flow and financial condition. This includes the timing of
when security may need to be put in place.
Material influencing factors
• Within the DUC, the partners are primarily liable to each other on a pro-rata basis and,
secondarily, jointly and severally liable for all decommissioning obligations.
• There is an obligation for participants to provide security for their respective share of any
decommissioning liabilities ahead of actual decommissioning based on calculations as
set out in the joint operating agreement.
Decommissioning estimates are reviewed at
least on an annual basis and updated every
five years in detail based on technological,
regulatory and any other relevant information
at the time.
The need for decommissioning security is
assessed annually.
Oil and gas production and reserves continued
KEY Increasing Unchanged Decreasing
47 Annual Report and Accounts 2023BlueNord
Strategic Report
Principal Risks and Uncertainties continued
Market risks
Risk Impact Mitigation Movement
Commodity prices
The Company’s main business is to produce and sell oil and gas, therefore future revenues,
cash flow, profitability, financing, and rate of growth depend substantially on prevailing prices
of oil and gas. Because oil and gas are globally traded, the Company is unable to control or
predict the prices it receives for the oil and gas it produces.
Commodity price fluctuations could reduce the Company’s ability to refinance its
outstanding credit facilities and could result in a reduced borrowing base under credit
facilities available to the Company, including the RBL facility. Fluctuations in commodity
prices could also lead to impairments of the Company’s assets.
Material influencing factors
• During 2023, volatility and uncertainty remained in the commodity market, however the
spikes of 2022 did not recur, and global supply risks have been managed. The impact of
conflict in various regions continues to have some impact but markets have tended to
adapt to this situation.
• The hydrocarbons produced from specific fields may also have a premium/discount in
relation to benchmark prices, such as Brent, which may vary over time.
• The majority of the natural gas produced by the Company is sold at Trading Hub Europe
(‘THE’) prices. THE closely follows the Dutch Title Transfer Facility (‘TTF’) price. The
Company is more exposed to additional price volatility deriving from proposed
responses by the European Commission, as seen with the proposed Market Correcting
Mechanism, however this has not recurred in 2023.
The Company actively seeks to reduce
this risk through the establishment of
hedging arrangements.
BlueNord has to date executed this policy in
the market through forward contracts.
BlueNord enters hedging contracts on both oil
and gas that mitigate the short-term impact of
price volatility.
Further detail on BlueNord’s hedging policy
can be found in note 2 to the financial
statements and note 19 on financial
instruments.
Foreign currency exposure
The Group is exposed to market fluctuations in foreign exchange rates. Significant
fluctuations in exchange rates between euros and Danish kroner to US dollars, may
materially adversely affect the reported results.
Material influencing factors
• Revenues are in US dollars for oil and in euros for gas, while operational costs, taxes and
investments are primarily in US dollars, euros and Danish kroner.
• The Company’s financing is primarily in US dollars.
The Company considers currency risk to be
low, as the main financial items held in a
currency other than the functional currency
of the respective components is offset by
positions in other components of the Group
and/or hedged.
KEY Increasing Unchanged Decreasing
48 Annual Report and Accounts 2023BlueNord
Strategic Report
Principal Risks and Uncertainties continued
Cyber security
Risk Impact Mitigation Movement
Key infrastructure, networks
or core systems are compromised
or are otherwise rendered
unavailable
A compromised network or infrastructure would seriously impair the Company’s ability to
maintain regular operations, including being able to continue reporting, regulatory and
financial obligations if required information were not available.
Material influencing factors
• As in 2022, ongoing global tensions continue to raise IT security risks around cyber crime
and similar threats.
• Protection and monitoring of critical infrastructure continues to be a high priority in the
Danish energy sector.
The Company has in place IT controls and
processes, including preventative security
routines, disaster recovery and business
continuity plans.
The Company elevated its IT security-related
routines and IT systems to protect against
cyber criminality and similar threats.
Financial liabilities
Risk Impact Mitigation Movement
Available funding to meet the
Company’s financial liabilities
The Company has several debt instruments which expose it to interest rate risk and
obligations to meet certain covenants. The Company’s material hedging programme
provides significant visibility over its ability to meet these requirements, however if the
Company is unable to, then actions to rectify this position may be required. There can be no
assurance that such actions will be available or enough to allow BlueNord to ultimately fulfil
its obligations. The availability of funding and the nature and diversity of lenders being used
can pose third party liquidity risk.
Material influencing factors
• Exposure to floating interest rates through the Company’s USD 1.1 billion RBL.
• Exposure to fixed interest rates through a USD 208.0 million convertible bond and a
USD 175.0 million senior unsecured note.
• Under these financing instruments, the Company is subject to several covenants,
including maximum leverage relative to earnings and demonstration of a minimum level
of liquidity.
The Company has fixed USD 1.0 billion of RBL
interest rate exposure until 30 June 2024.
The Company restructured the NOR13
convertible bond into the new NOR15
convertible bond with revised terms, including
a later conversion date.
The Group monitors its liquidity and covenant
coverage continuously to ensure it will be able
to meet its financial obligations as they fall due.
As of the date of this report, the Company is in
an ongoing refinancing process as part of the
continuous review and optimisation of the
capital structure.
KEY Increasing Unchanged Decreasing
49 Annual Report and Accounts 2023BlueNord
Strategic Report
Principal Risks and Uncertainties continued
Risk Impact Mitigation Movement
Future capital requirements
BlueNord’s future capital requirements will be determined based on several factors,
including production levels, commodity prices, future expenditures that are required to be
funded, and the development of the Company’s capital structure.
To the extent the Company’s operating cash flow is insufficient to fund the business plan at
the time additional external capital may be required. BlueNord currently has a strong
financial base, supported by existing liquidity and hedging positions, however any
unexpected changes that result in lower revenues or increased costs may necessitate the
raising of additional external capital. There can be no guarantee that, if required, BlueNord
would be able to access the debt or equity markets on favourable terms, or if necessary be
able to adequately restructure or refinance its debt.
BlueNord maintains a strong relationship
with its banking syndicate through continual
engagement to underpin its borrowing
position and has an active investor
relations strategy to support access
to the capital markets.
Insurance risk
The Company maintains liability insurance in an amount that it considers adequate and
consistent with industry standards. However, the nature of the risks inherent in oil and gas
industry generally, and on the Danish continental shelf specifically, are such that liabilities
could materially exceed policy limits or not be insured at all. In which event, the Company
could incur significant costs that could have an adverse effect on its financial condition,
results of operation and cash flow.
Material influencing factors
• Due to the ongoing geopolitical situation, there may be an increased risk for the Group’s
assets becoming a target of war acts and/or sabotage, as seen with the Nord Stream
pipeline sabotage in September 2022. No such event was noted during 2023.
• Any such acts of war or sabotage directed towards the Group’s assets may have a
material adverse effect on the Group’s assets and financial position, and whether an
incident is classified as an act of war or sabotage under the Group’s insurances may
have consequences for the Group’s right to claim insurance proceeds under the
relevant insurances.
The Company annually reviews the adequacy
of insurance coverage.
Financial liabilities continued
KEY Increasing Unchanged Decreasing
50 Annual Report and Accounts 2023BlueNord
Strategic Report
Third-party risk
Risk Impact Mitigation Movement
Third-party risk
The Company does not have a majority interest in any of its licences and consequently
cannot solely control such assets. Nor does the Company have operatorship over any of its
assets. The Company therefore has limited control over management of such assets.
Mismanagement by the Operator or disagreements with the Operator as to the most
appropriate course of action may result in significant delays, losses or increased costs to it.
Jointly owned licences (as is the case for the Company’s licences) also result in possible
joint liability, on certain terms and conditions. Other participants in licences may default on
their obligations to fund capital or other funding obligations in relation to the assets. In such
circumstances, the Company may be required under the terms of the relevant operating
agreement or otherwise to contribute all or part of such funding shortfall. The Company may
not have the resources to meet these obligations.
The Company has consultation rights or right
to withhold consent in relation to significant
operational and development matters,
depending on: the importance of the matter,
the level of its interest in the licence, or which
licence the contractual arrangements for the
licence apply to.
The structure of engagement with the
Operator is contractually set out in the joint
operating agreement.
Politics, regulation and compliance
Risk Impact Mitigation Movement
Changes in obligations arising
from operating in markets that
are subject to a high degree of
regulatory, legislative and political
intervention and uncertainty
Exploration and development activities in Denmark are dependent on receipt of
government approvals and permits to develop assets. There is no assurance that future
political conditions in Denmark will not result in the government adopting new or different
policies and regulations relating to exploration, development, operation and ownership of oil
and gas, environmental protection, and labour relations. Any of the above factors may have a
material adverse effect on the Company’s business, results of operations, cash flow and
financial condition.
Material influencing factors
• Future political conditions in Denmark could result in government adopting new or
different policies, meaning that the Company may be unable to obtain, maintain or renew
required drilling rights, licences and permits resulting in work being halted.
• Due to the Russian invasion of Ukraine, new regulations have been imposed by the EU,
United States, United Kingdom and other governments, which affects the export and
import of oil and gas to and from the Russian market.
• Trade restrictions on the Russian market could increase the importance of the oil and gas
fields in Europe, including in Denmark. Such increase in importance could result in
governments adopting new regulations that could affect the assets and the operations of
the Group.
The Company maintains a regular dialogue
with the Danish Energy Agency as well as
relevant government ministries.
This ensures an up-to-date understanding is
in place in order to act and respond on a timely
basis to any impact on the business.
Principal Risks and Uncertainties continued
KEY Increasing Unchanged Decreasing
51 Annual Report and Accounts 2023BlueNord
Strategic Report
Principal Risks and Uncertainties continued
Risk Impact Mitigation Movement
Danish taxation and regulations
All of BlueNord’s petroleum assets are located in Denmark and the petroleum industry is
subject to higher taxation than other businesses. There is no assurance that future political
conditions in Denmark will not result in the relevant government adopting different policies
for petroleum taxation than those currently in place.
Material influencing factors
The law proposal on the Solidarity Contribution was enacted in 2023 and its impact on the
Company is known and accounted for. No new exposures have been identified during 2023
As taxation has a major impact on the Company’s results, such amendments may
significantly impact the Group’s cash flow and financial condition.
A further tax yet to be adopted is regarding additional CO
2
duties. The proposal as currently
presented would be implemented from 2025 but as it is still in proposal stage, the timing and
extent of impact remains uncertain.
Dialogue is maintained with industry bodies
and the relevant government ministries to
understand proposed legislations before they
are enacted and provide full impact analysis.
There is a Compensation Agreement
between the Danish state and the DUC such
that the Companies participating in the DUC
are entitled to compensation for tax increases.
Due to the Agreement, any alterations in
present legislation to the disadvantage of
the DUC licencees can be challenged
for compensation.
The compensation would be determined with
a view to the impact of the changes on the
DUC, however these cannot exceed the net
advantage deemed to have been obtained
by the state.
Financial reporting risk
While BlueNord has in place internal controls covering the Company’s financial reporting
function, any material error or omission could significantly impact the accuracy of
reported financial performance and expose the Company to a risk of regulatory or
other stakeholder action.
Internal controls over financial reporting are
designed and in operation.
Reputational risks
BlueNord may be negatively affected by adverse market perception as it depends on a high
level of integrity to maintain the trust and confidence of investors, DUC participants, public
authorities and counterparties.
Any mismanagement, fraud or failure to satisfy fiduciary or regulatory responsibilities, or
negative publicity resulting from other activities, could materially affect the Company’s
reputation, as well as its business, access to capital markets and commercial flexibility.
Clear code of conduct, ethical guidelines and
Whistleblower procedure are in place.
See more on Governance on page 54.
Politics, regulation and compliance continued
KEY Increasing Unchanged Decreasing
52 Annual Report and Accounts 2023BlueNord
Strategic Report
Principal Risks and Uncertainties continued
Climate risk
Risk Impact Mitigation Movement
Changes to and impacts of
environmental regulations
All phases of the oil and gas business present environmental risks and hazards and are
subject to environmental regulation pursuant to a variety of international conventions and
state and municipal laws and regulations.
Compliance with such legislation can require significant expenditures and a breach may
result in the imposition of fines and penalties, some of which may be material, in addition to
loss of reputation.
Material influencing factors
• Environmental legislation provides for, among other things, restrictions and prohibitions
on spills, and releases or emissions of various substances produced in association with
oil and gas operations.
• Legislation also requires that wells and facility sites are operated, maintained, abandoned
and reclaimed to the satisfaction of applicable regulatory authorities.
• The Company is subject to legislation in relation to the emission of carbon dioxide,
methane, nitrous oxide and other GHGs.
• Environmental legislation is evolving in a manner expected to result in stricter standards
and enforcement, larger fines and liability, and potentially increased investments and
operating costs.
• With all assets on the Danish continental shelf, the Company is highly exposed to
changes in Danish law.
The Company maintains a regular dialogue
with the Danish Energy Agency as well as
relevant government ministries.
This ensures an up-to-date understanding is
in place to act and respond on a timely basis to
any impact on the business.
The Operator has a framework and controls in
place to manage within regulatory
requirements. BlueNord maintains an
overview of the requirements and dialogue
with the Operator through the appropriate
joint committees.
See also climate risks outlined under TCFD on page 34.
KEY Increasing Unchanged Decreasing
53 Annual Report and Accounts 2023BlueNord
Governance Report
Chair’s Introduction 54
Leadership 55
Corporate Governance Report 57
Board Activities 62
Audit Committee Report 63
Remuneration Committee Report 64
ESG Committee Report 65
Nomination Committee Report 66
Directors’ Report 67
Reporting of Payments to Governments 71
Governance
Report
54 Annual Report and Accounts 2023BlueNord
Governance Report
This section of the report demonstrates that BlueNord maintains robust
systems and practices that support the Board, Company and the Executive
Team in making good decisions for the future of the business, in the interest
of all stakeholders.
Chair’s Introduction
The Board believes that good corporate
governance is an essential building block
for the development of a successful and
sustainable business.
Good corporate governance is key for
a successful, sustainable business
The stakeholders of the Company include
employees, contractors, suppliers, partners,
regulators, end users, and others who interact with
or are affected by the environment in the vicinity of
the Company’s assets and operational areas.
The Board believes that good corporate
governance is an essential building block for the
development of a successful and sustainable
business. This belief is rooted in the understanding
that sound governance structures, clear roles and
responsibilities, and robust accountability
mechanisms are instrumental in driving business
success and resilience over the long term.
To support the Board and as a framework for the
Company to adhere to, BlueNord seeks to comply
with the Norwegian Code of Practice, which is
available on the Norwegian Corporate
Governance Committee website (www.nues.no).
The Company’s corporate values and code of
conduct also provide a framework on which the
Company acts and decisions are made. The code
of conduct describes the Company’s ethical
commitments and requirements related to
business practice and personal behaviour.
BlueNord has a diverse board, with the relevant
experience and skills to support the Company and
best practice. The composition of the Board is
such that it can operate independently of any
special interests.
The Executive Team also has extensive and
relevant experience, applicable to supporting best
practice, including technical, operational, financial,
financial market and other wider corporate skills.
The CEO and other members of the Executive
Team report to the Board on Company activities
on a monthly basis.
The Board shall hold at least five ordinary
proceedings each year. During 2023, attendance
at Board meetings was 96.4 percent. Board
meetings are based around a formal agenda. The
Board will annually seek to define and evaluate the
Company’s objectives, main strategies and risk
profiles to ensure it continues to create value.
To ensure a more detailed assessment and of key
areas of the business, the Board is supported by
various committees, which include audit,
nominations, remuneration and ESG. With an
exception from the Nomination Committee, the
committees are made up of members of the
Board. Designated representatives from the
administration participate in the respective
committee meetings as required, depending
on their relevant position and skills.
Board committees meet regular during the year,
and the average attendance during 2023 was 91.7
percent. Committee meetings are held in person or
online and are based around a formal agenda, with
the saliant points reported to the wider Board.
The Board aims to ensure there is the opportunity
for continuous and transparent dialogue with
shareholders. This includes key decisions being
put to shareholders on an annual basis through
an Annual General Meeting (‘AGM’). The meeting
is held virtually to encourage attendance
and participation, with the option to vote and
asking questions.
Riulf Rustad
Executive Chair
Corporate and Social Responsibility
Find out more in our Sustainability Report.
Find out more on page 25
55
BlueNord
Governance Report
Annual Report and Accounts 2023
Riulf Rustad Marianne Lie Tone Kristin Omsted
Executive Chair Board member Board member
Riulf Rustad is a Norwegian businessman with a long track
record from investments in sectors such as oil and gas, oil
services and offshore. Mr. Rustad operates through his
platform Ousdal AS and holds/has held various Board
positions, both in listed and unlisted companies. Mr. Rustad was
elected as Chair of the Board of Directors of BlueNord in 2016,
and was re-elected at the AGM of 19 May 2022 for a period of
two years.
Marianne Lie is the owner of Fajoma Consulting AS and is the
founder and Managing Director of Forum for Miljøteknologi
(FFM). She holds/has held several Board positions both in listed
and unlisted companies. Lie has served as a member of the
Board of Directors in BlueNord since 26 May 2016, and was
re-elected at the AGM of 19 May 2022 for a period of two years.
Tone Omsted holds a BA Hons. in Finance from the University
of Strathclyde. She has broad experience from corporate
finance and capital markets, and currently serves as Head of
Investor Relations at Entra ASA. Previous experience includes
14 years as an investment banking executive at SEB Enskilda.
She has also served on the Board of Directors of Panoro
Energy ASA. Ms Omsted has served as Member of the Board
of Directors of BlueNord since 26 May 2016, and was
re-elected at the AGM of 19 May 2022 for a period of two years.
Colette Cohen Robert J. McGuire Peter Coleman
Board member Board member Board member
Colette Cohen is a chemistry graduate from Queens University
Belfast and also holds a master’s degree in Project Management
and Economics. Her career began with BP in 1991 and she has
worked for companies including ConocoPhillips and Britannia in
the North Sea, Norway, the US and Kazakhstan. Colette was
SVP for Centrica Energy’s E&P UK/NL was the CEO of The Net
Zero Technology Centre for seven years until 2023. Ms. Cohen
has served as member of the Board of Directors of BlueNord
since 7 August 2019, and was re-elected at the AGM of 25 April
2023 for a period of two years.
Robert McGuire is the founder of Longwing Partners LLC, a
strategic advisory firm. He has a 30-year global track record as
an adviser, investor and business leader, has served on
numerous Boards and has extensive experience in the energy
sector, having led the European energy businesses at both
Goldman Sachs and J.P.Morgan. Bob is also an independent
director at TSX-listed GDI Integrated Facilities Services. He has
a BA from Boston College and an MBA from Harvard Business
School. Mr. McGuire was elected as member of the Board of
Directors of BlueNord at an Extraordinary General Meeting
held on 2 March 2020, and was re-elected at the AGM of
19 May 2022 for a period of two years.
Peter Coleman joined Taconic, a shareholder in BlueNord, in
April 2018 where he is a Director focusing on European credit,
based in their London office. Prior to joining Taconic, Peter was
a Managing Director on the European distressed debt team at
SVP Global. Previously, he was an Investment Director in
distressed debt at Sisu Capital and prior to this, he was a
Director in the corporate finance group and tax group at
PricewaterhouseCoopers. Peter earned a dual LL. B. and B.
Com. from Victoria University in New Zealand in 1996.
Mr. Coleman has served as member of the Board of Directors of
BlueNord since 19 May 2021, and was re-elected at the AGM of
25 April 2023 for a period of two years.
Jan Lernout
Board member
Jan Lernout is a partner and portfolio manager at Kite Lake
Capital Management (UK) LLP, a shareholder in BlueNord,
which he founded in July 2010. Prior to that he was a partner
and portfolio manager at Cheyne Capital Management (UK)
LLP and an Executive Director and member of the Investment
Committee in the European Special Situations Group (ESSG)
at Goldman Sachs International. He holds a Master in
Commercial Engineering from KU Leuven and an MBA from
the University of Chicago Booth School of Business. He is a
CFA Charterholder. Mr. Lernout has served as member of the
Board of Directors of BlueNord since 19 May 2021, and was
re-elected at the AGM of 25 April 2023 for a period of two years.
Board of Directors
Leadership
Riulf
Rustad
Marianne
Lie
Colette
Cohen
Ton e
Kristin
Omsted
Robert J.
McGuire
E A
AA
R
RC
COMMITTEE MEMBERSHIP KEY
C
Chair
R
Remuneration Committee member
E
ESG Committee member
A
Audit Committee member
E
56 Annual Report and Accounts 2023BlueNord
Governance Report
56 BlueNord Annual Report and Accounts 2023
Euan Shirlaw Jacqueline Lindmark Boye
Chief Executive Officer Chief Financial Officer
Euan has served as the Chief Executive Officer of BlueNord
since May 2022. He initially joined the company as the Chief
Financial Officer in 2019 and additionally held the role of
Acting Managing Director from November 2021. He has a
background of providing strategic advice to a wide range of oil
and gas companies on acquisition, divestment and merger
activity, as well as raising debt and equity capital. Prior to
joining BlueNord, Euan was a senior member of the oil and
gas advisory team at BMO Capital Markets, having also
focused on the Energy space while working with Credit
Suisse, RBC Capital Markets and Rothschild in London. He
has an MSc in Business and Accountancy from the University
of Edinburgh.
Jacqueline joined BlueNord in 2019 and was appointed Chief
Financial Officer in October 2023, after being a member of
the Executive Team since November 2022. She has over 20
years’ experience in finance and audit within the energy
industry in Australia, the UK and Denmark. Prior to joining
BlueNord, Jacqueline has held various roles, including
leadership with Shell, AGL Energy, EY and PwC. She holds a
Bachelor in Commerce and Bachelor in Arts from Monash
University in Australia and is a member of the Chartered
Accountants Australia and New Zealand.
Executive Team
Leadership continued
Marianne Eide Cathrine F. Torgersen
Chief Operating Officer Chief Corporate Affairs Officer
Marianne joined BlueNord in 2022 and holds the position of
Chief Operating Officer. She has 30 years of experience
in the upstream oil and gas industry. Prior to joining BlueNord,
she held senior management, commercial and technical roles
with Shell, BG Group, Gaz de France, Conoco and Equinor,
both based in Norway and the United Kingdom. Marianne has
an MSc in Petroleum Engineering from the Norwegian
Institute of Technology in Trondheim.
Cathrine joined BlueNord in 2020 and holds the position of
Chief Corporate Affairs Officer. She previously had the role as
Senior Account Director in Hill+Knowlton, where she advised
a wide range of oil and gas and shipping companies. During
her seven years in Hill+Knowlton, she was a member of the
Management Team and was also leading the Financial
Communications practice. Prior to joining Hill+Knowlton,
Cathrine worked with institutional high-yield sales at Pareto
Securities Inc. in New York and Clarksons Platou Securities.
She has a BSc in Business Administration and Finance from
Bocconi University.
Euan
Shirlaw
Jacqueline
Lindmark
Boye
Cathrine F.
Torgersen
Marianne
Eide
57 Annual Report and Accounts 2023BlueNord
Governance Report
Shareholders
Nomination Committee
Audit Committee
Remuneration Committee
ESG Committee
General Meeting
Board of Directors
CEO
Executive Team
BlueNord ASA (‘the Company’) has made a strong commitment to ensure trust in the Group and to
enhance value creation for shareholders and society over time. The Company acts in a responsible and
prudent manner through efficient decision making and communication between the management, the
Board of Directors (‘the Board’, ‘Board of Directors’) and the shareholders of the Company, represented
by the AGM.
The Company’s framework for corporate governance is intended to decrease business risk, maximise
value and utilise the Company’s resources in an efficient and sustainable manner, to the benefit of
shareholders, employees and society at large. The Company will seek to comply with the Norwegian
Code of Practice for corporate governance (‘Corporate Governance Code’), which is available on the
Norwegian Corporate Governance Committee website: www.nues.no.
The principal purpose of the Corporate Governance Code is to ensure: (i) that listed companies
implement corporate governance that clarifies the respective roles of shareholders, the Board of
Directors and executive management more comprehensively than that which is required by legislation;
and (ii) effective management and control over activities with the aim of securing the greatest
possible value creation over time in the best interest of companies, shareholders, employees
and other parties concerned.
The Company will, due to the listing of its shares on Oslo Børs, be subject to reporting requirements for
corporate governance under the Accounting Act section 3-3b, as well as Oslo Børs’ Rule Book II section
4.4. The Board of Directors will include a report on the Company’s corporate governance in each Annual
Report, including an explanation of any deviations from the Corporate Governance Code. The corporate
governance framework of the Company is subject to annual review by the Board of Directors.
According to the Company’s own evaluation, the Company deviates from the Corporate Governance
Code on the following points:
• Item 4: The Board of Directors of the Company has been, and is expected to be, provided with
authorisations to acquire own shares and issue new shares. Not all such authorisations have separate
and specific purposes for each authorisation, as the purposes of the authorisations shall be explained
in the notices to the general meetings adopting the authorisations.
• Item 11: Options have been granted to members of the Board of Directors through the share option
programme of the Company, first implemented at an extraordinary general meeting in October 2018
and later extended and expanded.
• Item 14: Due to the unpredictable nature of takeover situations, the Company has decided not to
implement detailed guidelines on takeover situations. In the event a takeover were to occur, the Board
of Directors will consider the relevant recommendations in the Corporate Governance Code and
whether the concrete situation entails that the recommendations in the Corporate Governance Code
can be complied with or not.
Corporate Governance Report
Governance operating model – Organisational design and Committee Structure
For further information on committees’ work, see
their reports on pages 62-66.
58 Annual Report and Accounts 2023BlueNord
Governance Report
1. Implementation and reporting on corporate governance
The Board of BlueNord is responsible for compliance with corporate governance standards. BlueNord is
a Norwegian public limited liability Company (‘ASA’), listed on the Oslo Stock Exchange and established
under Norwegian law.
In accordance with the Norwegian Accounting Act, section 3-3b, BlueNord includes a description of
principles for corporate governance as part of the Board of Directors’ Report in the Annual Report. The
Company will seek to comply with the Corporate Governance Code.
The Company’s strategy is to continue its value creation to replace and maximise recovery of proven
reserves and resources and to continue to explore new opportunities in and above the ground.
2. Business
The Company is a publicly owned oil, gas and offshore industry Company with a strategic focus on value
creation through increased recovery, enabled by a competent organisation with a long-term view on
reservoir management and the capability to invest in and leverage new technology.
On an annual basis, the Board defines and evaluates the Company’s objectives, main strategies and risk
profiles for the Company’s business activities to ensure that the Company creates value for shareholders.
The Company integrates considerations related to its stakeholders, as well as social, environmental and
sustainability considerations into its value creation and shall achieve its objectives in accordance with the
Company’s Code of Conduct.
The Company’s business is defined in the following manner in the Company’s Articles of Association,
section 3: ‘The object of the Company is direct and indirect ownership of and participation in
companies and enterprises within exploration, production, and sale related to oil and gas, and
other activities related hereto.’
3. Equity and dividends
3.1 Equity
As of 31 December 2023, the Company’s consolidated equity was USD 813.6 million, which is equivalent
to approximately 26 percent of total assets. The Company’s equity level and financial strength shall be
considered in light of its objectives, strategy and risk profile.
3.2 Dividend policy
The Company has not paid any dividends to date, whether in cash or in kind.
The Company does not expect to make dividend payments prior to completion of the Tyra
redevelopment project. The Company established in February 2024 its distribution policy for the
period 2024 to 2026.
3.3 Share capital increases and issuance of shares
At the AGM held on 25 April 2023, The Board of Directors was authorised to increase the Company’s
share capital by up to NOK 1,414,463 (this represents 2,620,203 shares at a nominal value of NOK
0.5398295) valid until the AGM in 2024, but in no event later than 30 June 2024.
Outstanding shares as of 11 April 2024 were 26,205,849, which is an increase of 497,425 shares
compared to year-end 2022. During the year, 494,853 shares were issued following conversion of
BNOR13 and 2,572 shares issued following conversion of parts of BNOR15.
3.4 Purchase of own shares
The Board of Directors of the Company has been authorised to acquire and dispose own shares with a
total nominal amount up to NOK 1,414,462 (this represents 2,620,203 shares), valid until the AGM in 2024,
however in any event no later than 30 June 2024. The authorisation can be used in relation to incentive
schemes for employees/Directors of the Group, as consideration in connection with acquisition of
businesses and/or for general corporate purposes.
As of 21 March 2024, the Company holds 100,521 of its own shares, approximately 0.38 percent.
4. Equal treatment of shareholders and transactions with related parties
4.1 Class of shares
The Company has one class of shares. All shares carry equal rights in the Company, and the articles of
association do not provide for any restrictions, or rights of first refusal, on transfer of shares. Share
transfers are not subject to approval by the Board of Directors.
4.2 Pre-emption rights to subscribe
According to the Norwegian Public Limited Liability Companies Act section 10-4, the Company’s
shareholders have pre-emption rights in share offerings against cash contribution. Such pre-emption
rights may, however, be set aside, either by the general meeting or by the Board of Directors if the general
meeting has granted a Board authorisation which allows for this. Any resolution to set aside pre-emption
rights will be justified by the common interests of the Company and the shareholders, and such
justification will be publicly disclosed through a stock exchange notice from the Company.
4.3 Trading in own shares
The Board of Directors will aim to ensure that all transactions pursuant to any share buy back programme
will be carried out either through the trading system at Oslo Børs or at prevailing prices at Oslo Børs and in
accordance with the Market Abuse Regulation (‘MAR‘). In the event of such a programme, the Board of
Directors will take the Company’s and shareholders’ interests into consideration and aim to maintain
transparency and equal treatment of all shareholders. If there is limited liquidity in the Company’s shares,
the Company shall consider other ways to ensure equal treatment of all shareholders.
Corporate Governance Report continued
59 Annual Report and Accounts 2023BlueNord
Governance Report
4.4 Transactions with close associates
The Board of Directors aims to ensure that any non-immaterial future transactions between the
Company and shareholders, a shareholder’s parent Company, members of the Board of Directors,
executive personnel or close associates of any such parties are entered into on arm’s length terms. For
any such transactions that do not require approval by the general meeting pursuant to the Norwegian
Public Limited Liability Companies Act, the Board of Directors will, on a case-by-case basis, assess
whether a fairness opinion from an independent third party should be obtained.
4.5 Guidelines for Directors and executive management
The Board of Directors has adopted rules of procedures for the Board of Directors which, inter alia,
include guidelines for notification by members of the Board of Directors and executive management if
they have any material direct or indirect interest in any transaction entered into by the Company.
5. Freely negotiable shares
The shares of the Company are freely transferable. There are no restrictions on transferability of shares
pursuant to the Articles of Association.
6. General meetings
6.1 Notification
The notice for a general meeting, with reference to or attached support information on the resolutions to
be considered at the general meeting, shall as a principal rule be sent to shareholders no later than 21
days prior to the date of the general meeting.
The Board of Directors will seek to ensure that the resolutions and supporting information are sufficiently
detailed and comprehensive to allow shareholders to form a view on all matters to be considered at the
meeting. The notice and support information, as well as a proxy voting form, will normally be made
available no later than 21 days prior to the date of the general meeting on the Company’s website:
www.bluenord.com/general-meetings.
6.2 Participation and execution
To the extent deemed appropriate or necessary by the Board of Directors, the Board of Directors will
seek to arrange for the general meeting to vote separately on each candidate nominated for election to
the Company’s corporate bodies.
The Board of Directors and the Nomination Committee shall, as a general rule, be present at general
meetings. The auditor will attend the ordinary general meeting and any extraordinary general meetings to
the extent required by the agenda items or other relevant circumstances. The Board of Directors will seek
to ensure that an independent chair is appointed by the general meeting if considered necessary based
on the agenda items or other relevant circumstances.
The Company will aim to prepare and facilitate the use of proxy forms which allows separate voting
instructions to be given for each item on the agenda and to nominate a person who will be available to
vote on behalf of shareholders as their proxy. The Board of Directors may decide that shareholders may
submit their votes in writing, including by use of electronic communication, in a period prior to the general
meeting. The Board of Directors should seek to facilitate such advance voting.
7. Nomination Committee
The Nomination Committee is provided for and governed by the Articles of Association, in addition to
instructions for the Nomination Committee. For more information relating to the Nomination Committee,
read the Nomination Committee report on page 66.
8. Board of Directors: composition and independence
Pursuant to the Articles of Association, section 5, the Company’s Board of Directors shall consist of three
to seven members, which are shareholders’ elected members in accordance with a decision by the AGM.
The composition of the Board of Directors should ensure that the Board can attend to the common
interests of all shareholders and meet the Company’s need for expertise, capacity and diversity. Attention
should be paid to ensuring that the Board can function effectively as a collegiate body.
The composition of the Board of Directors should ensure that it can operate independently of any special
interests. The majority of the shareholder-elected members of the Board should be independent of the
Company’s executive personnel and material business contacts. At least two of the members of the
Board elected by shareholders should be independent of the Company’s main shareholder(s), the
executive personnel and material business contacts.
The Board of Directors should not include executive personnel. If the Board does include executive
personnel, the Company should provide an explanation for this and implement consequential
adjustments to the organisation of the work of the Board, including the use of Board committees to help
ensure more independent preparation of matters for discussion by the Board.
The Chair of the Board of Directors should be elected by the AGM.
The term of office for members of the Board of Directors should not be longer than two years at a time.
The Board members can be elected for a shorter term by the AGM. The Annual Report should provide
information to illustrate the expertise of the members of the Board of Directors and information on their
record of attendance at Board meetings. In addition, the Annual Report should identify which members
are considered to be independent.
Corporate Governance Report continued
60 Annual Report and Accounts 2023BlueNord
Governance Report
Corporate Governance Report continued
9. The work of the Board of Directors
9.1 Rules of procedures for the Board of Directors
The Board of Directors is responsible for the overall management of the Company and shall supervise
the Company’s business and the Company’s activities in general.
The Norwegian Public Limited Liability Companies Act regulates the duties and procedures of the Board
of Directors. In addition, the Board of Directors has adopted supplementary rules of procedures, which
provide further regulation on, inter alia, the duties of the Board of Directors and the Chief Executive
Officer, the division of work between the Board of Directors and the Chief Executive Officer, the annual
plan for the Board of Directors, notices of Board proceedings, administrative procedures, minutes, Board
committees, transactions between the Company and the shareholders, and matters of confidentiality.
The Board shall produce an annual plan for its work, with a particular emphasis on objectives, strategy
and implementation. The Chief Executive Officer shall at least once a month, by attendance or in writing,
inform the Board of Directors about the Company’s activities, position and profit trend.
The Board of Directors’ consideration of material matters in which the Chair of the Board is, or has been,
personally involved, shall be chaired by some other member of the Board. The Board of Directors
shall evaluate its performance and expertise annually and make the evaluation available to the
Nomination Committee.
9.2 Audit Committee
The Company’s Audit Committee is governed by the Norwegian Public Limited Liability Companies Act
and a separate instruction adopted by the Board of Directors. To read the latest Audit Committee Report,
please see page 63 of this report.
9.3 Remuneration Committee
The Company’s Remuneration Committee is governed by an instruction adopted by the Board of
Directors. To read the latest Remuneration Committee Report, please see page 64 of this report.
9.4 ESG Committee
The Environment, Social & Governance (ESG) Committee is governed by an instruction adopted by the
Board of Directors. To read the latest ESG Committee report, please see page 65 of this report.
10. Risk management and internal control
Risk management and internal control are given high priority by the Board of Directors, which ensures
that adequate systems for risk management and internal control are in place. For more information about
how risks are managed, please see the risk report on page 44.
11. Remuneration of the Board of Directors
The remuneration of the Board of Directors shall be decided by the AGM, and reflects the Board of
Directors’ responsibilities, expertise, time commitment and the complexity of the Company’s activities.
For more detail, on the Board’s remuneration, please refer to the Executive Remuneration Report 2023
on www.bluenord.com.
12. Remuneration of the executive management
The Board of Directors has in accordance with the Norwegian Public Limited Liability Companies Act
section 6-16 prepared a policy for executive management remuneration. The policy includes the main
principles applied in determining the salary and other remuneration of executives as further set out in the
regulation on policies and reports on remuneration for executive management (Nw. Forskrift om
retningslinjer og rapport og godtgjørelse for ledende personer). The Company shall annually prepare a
report on remuneration to executive management in accordance with the Norwegian Public Limited
Liability Companies Act section 6-16b. For more detail, please refer to the Guidelines on Executive
Remuneration adopted by the AGM on 19 May 2022 on www.bluenord.com.
13. Information and communications
13.1 General
The Board of Directors has adopted a separate manual on disclosure of information, which sets forth the
Company’s disclosure obligations and procedures. The Board of Directors will seek to ensure that
market participants receive correct, clear, relevant and up-to-date information in a timely manner, taking
into account the requirement for equal treatment of all participants in the securities market.
The Company will, each year, publish a financial calendar, providing an overview of the dates for major
events such as its ordinary general meeting and publication of interim reports.
13.2 Information to shareholders
The Company shall have procedures for establishing discussions with shareholders to enable the Board
to develop a balanced understanding of the circumstances and focus of such shareholders. Such
discussions shall be done in compliance with the provisions of applicable laws and regulations.
All information distributed to the Company’s shareholders will be published on the Company’s website at
the same time as it is sent to shareholders, at the latest.
61 Annual Report and Accounts 2023BlueNord
Governance Report
Corporate Governance Report continued
14. Takeovers
In the event the Company becomes the subject of a takeover bid, the Board of Directors shall seek to
ensure that the Company’s shareholders are treated equally and that the Company’s activities are not
unnecessarily interrupted. The Board of Directors shall also ensure that the shareholders have sufficient
information and time to assess the offer.
There are no defence mechanisms against takeover bids in the Company’s Articles of Association, nor
have other measures been implemented to specifically hinder acquisitions of shares in the Company.
The Board of Directors has not established written guiding principles for how it will act in the event of a
takeover bid, as such situations are normally characterised by concrete and one-off situations, which
make a guideline challenging to prepare.
In the event a takeover were to occur, the Board of Directors will consider the relevant recommendations
in the Corporate Governance Code and whether the concrete situation entails that the recommendations
in the Corporate Governance Code can be complied with or not.
15. Auditor
The Board of Directors will require the Company’s auditor to annually present to the Audit Committee a
review of the Company’s internal control procedures, including identified weaknesses and proposals for
improvement, as well as the main features of the plan for the audit of the Company.
Furthermore, the Board of Directors will require the auditor to participate in meetings of the Board of
Directors that deal with the annual accounts; at least one Board meeting with the auditor shall be held
each year in which no member of the executive management is present.
The Board of Directors’ Audit Committee shall review and monitor the independence of the Company’s
auditor, including in particular the extent to which services other than auditing provided by the auditor or
the audit firm represents a threat to the independence of the auditor.
The remuneration to the auditor for statutory audit will be approved by the ordinary general meeting. The
Board of Directors should report to the general meeting on details of fees for audit work and any fees for
other specific assignments.
62 Annual Report and Accounts 2023BlueNord
Governance Report
The Board has responsibility for the overall management of the Company,
including strategic priorities, identifying and assessing principal risks, as
well as the level of risk deemed appropriate for the Company to take. The
Board is responsible for establishing and thereafter monitoring the risk
and internal control framework. The Board delegates a level of day-to-day
management to the CEO and Executive Team; however, the Board retains
the ultimate decision-making authority.
Board Activities
The Board held eight meetings during 2023. A further three meetings
were held in 2024, one related to the Tyra update and two prior to the
publication of Q4 and this Annual Report and Accounts. In addition,
three written resolutions were approved related to approval of the
2024 budget/Tyra CCE4, CarbonCuts license application
submission and Harald East Middle Jurassic Investment proposal.
Name Attendance
Riulf Rustad (Chair)
Marianne Lie
Tone Omsted
Colette Cohen
Robert McGuire
Jan Lernout
Peter Coleman
The areas of focus covered through Board meetings during 2023
has included:
• Established strategic priorities, including ESG strategy
andrebranding.
• Operational and performance updates, including regular
monitoring of the Tyra redevelopment project, Health, Safety,
Security and Environment (‘HSSE’), capital structure and
liquidityoutlook.
• Reviews and considers forecast medium-term liquidity position
ofthe Company.
• Approval of restructuring of the NOR13 convertible bond loan and
approval of the voluntary exchange offer into the new BNOR15
convertible bond loan.
• Annually review of the ten top risks in the Company’s enterprise
risk matrix.
• Review of executive management structure and performance,
including the appointment of Jacqueline Lindmark Boye as CFO.
• Approval of the tax protection principles related to Global position.
• Review of executive management remuneration, the Company’s
Short Term and Long-Term Incentive programmes and their KPIs
and awards as endorsed by the Remuneration Committee.
• Approval of the Halfdan Ekofisk infill investment decision.
• Review of the various Board committees’ performance and
confirmation of membership and continued committee structure.
63 Annual Report and Accounts 2023BlueNord
Governance Report
Audit Committee Report
Work of the Audit Committee
• Support the Board’s responsibilities relating
to the integrity of financial reporting and the
financial reporting process.
• Evaluate the risk management of financial
reporting and monitor the systems for
internal controls.
• Review the external auditors’ independence
and objectivity and review the effectiveness
and quality of the annual audit plan.
• Develop and implement policy for any
engagement of external auditors to supply
non-audit services.
Activities during the year
The committee held six scheduled meetings during 2023. A further two
meetings were held in 2024, prior to the publication of Q4 and this Annual
Report and Accounts. In addition to the members of the committee listed on
this page, meetings of the Committee were also attended by the CFO and the
Head of Group Reporting. The Company’s auditor works closely with the
Audit Committee and attended all meetings during the year.
The committee spent considerable time during the year reviewing all interim
and annual reports before they are reviewed by the Board of Directors and
then published. Any identified risks and their effects on financial reporting are
discussed on a quarterly basis; in addition, the management give a quarterly
update on compliance.
Every quarter, the Audit Committee reviews the memorandum for tax and
impairment triggers. New accounting effects and issues are monitored on a
quarterly basis by the committee. Prior to the year-end closing, the committee
reviews key assumptions and accounting principles, and discusses early
warning and key issues.
During the year, the Audit Committee has worked together with executive
management and the auditor to further develop the already strong
cooperation and improve the processes and internal control environment
related to material financial reporting lines.
In 2023 the Audit Committee also held a joint session with the ESG Committee
to discuss and agree how to work together regarding sustainability reporting
to ensure both Committees contribute effectively as this develops within the
Company. The Audit Committee has a key role in ensuring non-financial data is
properly integrated into the risk and control framework whilst the ESG Committee
focuses on strategy development and performance. The two committees
will regardless have overlapping responsibilities and will remain coordinated
as sustainability reporting and performance assessment develops.
2023 meeting summary
In the course of eight meetings during FY2023/24, the Audit Committee
has continued to work on a range of audit matters.
These include overall performance and tax issues, compliance, reviews of
policy documentation, updates to delegated authority, and liquidity
forecasts. Reviews have also taken place regarding internal controls and
business continuity planning (‘BCP’).
The committee received updates from KPMG regarding the final report on
the inspection from the Financial Supervisory Authority of Norway (FSA).
In addition, the committee was informed of the new era of sustainability
reporting triggered by CSRD, and half-year accounting issues.
Discussions were held on impairment triggers and accounting effects,
as well as tax effects.
A review of the updated finance process descriptions and risk and control
matrix was undertaken, as well as a review of the new internal materiality
assessment. The committee reviews the Enterprise risk matrix on a
quarterly basis. In addition, the committee discussed the financial reporting
risks and the proposed distribution policy.
The Audit Committee consists of the following
Board members:
• Marianne Lie (Chair)
• Tone Omsted
• Peter Coleman
All members are independent of the Company’s executive
management and all three committee members sit on the
Board of Directors of BlueNord ASA.
Committee meeting attendance
Name Attendance
Marianne Lie
Tone Omsted
Peter Coleman
BlueNord has established an
Audit Committee with formally
delegated duties and
responsibilities within written
terms of reference.
Marianne Lie
Audit Committee Chair
64 Annual Report and Accounts 2023BlueNord
Governance Report
Remuneration Committee Report
2023 meeting summary
The committee convened for five scheduled meetings in 2023, with the CEO
and EVP People and Capability invited to attend where relevant.
The executive remuneration guidelines were reviewed, with no changes made
from those approved by the AGM in May 2022. The audited Executive
Remuneration Report, which was prepared in line with the Public Limited
Liability Companies Act § 6-16b and best practices in remuneration
disclosure, was endorsed.
In Q2 2023 and upon the Board’s request, a benchmarking exercise for
executive remuneration was conducted by Mercer. After a comprehensive
review of the report, the committee recommended no changes to BlueNord’s
total compensation policy or the executive remuneration structure.
The committee reviewed and recommended the proposed annual salary
increase for eligible executives and employees in 2023. It also endorsed and
recommended employment terms for the new CFO, appointed in October
2023, and the promotion of the previous EVP of Investor Relations and
ESG to Chief Corporate Affairs Officer, which involved no change in
employment terms.
The committee reviewed and endorsed the 2023 KPIs for the Company’s
Short Term Incentive programme. It also examined and endorsed the
programme’s 2022 KPIs’ achievement and the proposed annual performance
bonus payment for executives and employees.
The committee reviewed and endorsed the achievement of KPIs for the
first performance period of the 2022 LTI programme, which involves annual
vesting. It then recommended the first award of performance shares to
eligible executives and employees. The committee also reviewed and
endorsed the grant and KPIs for the 2023 LTI programme’s three-year
performance and vesting period. However, due to the executive
remuneration benchmark exercise conducted in Q2, the Board did not
approve the grant for the performance period 1 January 2023 to
31 December 2025, until July 2023.
In Q4 2023, the Committee evaluated its own structure and performance.
Measures were set with the Company’s management to ensure the KPIs
for variable pay are endorsed and available for the Board’s approval at the
first month of each programme’s performance period.
Executive Remuneration Report 2023
For more details on the executive remuneration, please read the full report
here: www.bluenord.com/reports-and-presentations.
The Remuneration Committee
is a preparatory and advisory
committee which supports the
Board with regard to executive
management compensation.
Marianne Lie
Remuneration Committee Chair
The Remuneration Committee consists of the following
Board members:
• Marianne Lie (Chair)
• Jan Lernout
These members are independent of the Company’s executive
management, and both committee members sit on the Board
of Directors of BlueNord ASA (since May 2016 and May 2021,
respectively).
Committee meeting attendance
Name Attendance
Marianne Lie
Jan Lernout
Role of the Remuneration Committee
• Prepare the annual executive
remuneration report and, at least annually,
review and recommend any amendments
to the guidelines for executive
remuneration, to be proposed by the
Board for adoption by the AGM;
• monitor, evaluate and approve
the application of the guidelines for
the remuneration provided to
executive management;
• request information and assistance from
executive management which is deemed
relevant for the Remuneration Committee
to carry out its tasks; and
• seek advice and recommendations from
sources outside of the Company if relevant
and subject to appropriate confidentiality.
65 Annual Report and Accounts 2023BlueNord
Governance Report
ESG Committee Report
The ESG Committee shall:
• support the development of the Company’s overall environmental, social
and governance strategy;
• oversee the Company’s ESG activities and assess if any developments or
investments are compatible with, and supportive of, the strategic objectives
of the Company;
• ensure that the Board is informed on material relevant topics or events
related to the Company’s work on ESG;
• review the Company’s ability to address and mitigate risks related to
ESG; and
• ensure that the Company strives for transparency and high standards in its
ESG reporting.
Activities during the year
The committee held four scheduled meetings during 2023. A further meeting
was held in 2024, prior to the publication of this Annual Report. In addition to the
members of the committee listed on this page, meetings of the committee were
also attended by the CEO, the Chief Corporate Affairs Officer and by invitation,
the CFO or other members of the leadership team for specific topics.
The committee has worked closely with key members from the Executive
Team during 2023 to develop the ESG strategy of the Company, to identify
material topics and to assess risks and opportunities that are relevant to the
Company. The committee has also been involved in improvements of the
standards and transparency of the ESG reporting of BlueNord.
In addition, during 2023 the Committee was involved in developments and
recommendations made to the Board in relation to CarbonCuts and the
eventual license application for onshore CO
2
storage in Denmark
completed in January 2024.
The ESG Committee also held a joint session with the Audit Committee to
discuss and agree how to work together regarding sustainability reporting
to ensure both Committees contribute effectively as this develops within
the Company. The ESG Committee focuses on strategy development and
performance and it is acknowledged that the two committees will have
overlapping responsibilities and will remain coordinated as sustainability
reporting and performance develops.
Following the committee’s work during 2023 and to date in 2024, the
Company is today reporting against the TCFD framework and it has taken
measures to adapt to the Norwegian Transparency Act and the Anti-
Discrimination Act. In addition, the Company has further progressed in its
preparations to align itself to report against the new ESRS, which is
expected from 2025 including establishing responsibilities within teams to
work on and understand future reporting requirements, double materiality
assessment, gap analysis and prepare the reporting structure going
forward. This work will continue during 2024 to establish baselines from
which targets can be set and measured and processes and controls for the
gathering of data to support performance reporting.
The ESG Committee consists of the following
Board members:
• Colette Cohen (Chair)
• Robert McGuire
All members are independent of the Company’s executive
management and all committee members sit on the Board
of Directors of BlueNord ASA.
Committee meeting attendance
Name Attendance
Colette Cohen
Robert McGuire
The Company’s ESG Committee
is a preparatory and advisory
committee to the Board,
established in 2020 to support
the commitment to ESG and
to evolve the Company’s role
as a contributor in the
energy transition.
Colette Cohen
ESG Committee Chair
66 Annual Report and Accounts 2023BlueNord
Governance Report
Nomination Committee Report
Work of the Nomination Committee:
The Chair of the Nomination Committee is responsible for the committee’s
work and call of meetings, however each member can request a committee
meeting. The Nomination Committee shall regularly review the structure and
composition of the Board, including the knowledge, skills, experience and
diversity of the Board. It shall keep under regular review that the needs of the
Company are reflected in the Board composition and give full consideration to
succession planning for the Board members. The Nomination Committee
shall also ensure that there is a formal and transparent procedure for the
appointment of new Directors to the Board.
The Nomination Committee has contact with the Company’s shareholders,
Board of Directors and the Company’s executive personnel. All shareholders
of BlueNord have the possibility to propose candidates. If a candidate is
proposed, the Nomination Committee shall consider the experience,
competence and capacity of each candidate.
The Nomination Committee’s proposal for the 2024 Annual General
Meeting will be published and made available on www.bluenord.com/
general-meetings/ at the Annual General Meeting at latest.
Activities during the period
The committee has taken note of the paragraph 5 of the Articles of
Association in which it is stated that the Board of Directors shall have from
three to seven shareholders elected members and that such Board
members are elected to a two-year period unless the general meeting
decides upon a shorter term.
According to the Articles of
association § 6 the Nomination
Committee shall consist of
three members.
The term of office shall be two years unless the
AGM determines that the term shall be shorter.
The Nomination Committee shall prepare
a motion for the Annual General Meeting
relating to:
• Election of members of the Board of Directors
and the chairperson of the Board of Directors.
• Election of the members of the Nomination
Committee and the chairperson of
the Committee.
• The remuneration of the Directors and the
members of the Nomination Committee.
• Any amendments of the Nomination
Committee’s Mandate and Charter.
Richard Sjøqvist
Nomination Committee Chair
The Nomination Committee in BlueNord consists of:
• Richard Sjøqvist (Chair)
• Kristian Utkilen
• Annette Malm Justad
All members were elected in 2022 for two years and are consequently
up for election in 2024.
Committee meeting attendance
Name Attendance
Richard Sjøqvist
Kristian Utkilen
Annette Malm Justad
67 Annual Report and Accounts 2023BlueNord
Governance Report
BlueNord ASA (BlueNord, ‘the Company’) is a Norwegian company listed
onthe Oslo Stock Exchange. The Company was established in 2005 and
hasa strategic focus on value creation through increased recovery of
hydrocarbons, enabled by a competent organisation with a long-term view
on reservoir management and the capability to invest in and leverage
new technology.
Following the acquisition of Shell’s Danish upstream assets in 2019, BlueNord
ASA holds a 36.8 percent non-operated interest in the DUC and is the second
largest oil and gas producer in Denmark. DUC is a joint venture between
TotalEnergies (43.2 percent), BlueNord (36.8 percent) and Nordsøfonden
(20.0 percent), and comprises four hubs (Halfdan, Tyra, Gorm and Dan) and
11producing fields. It is operated by TotalEnergies, which has extensive
offshore experience in the region and worldwide.
Since the acquisition in 2019, BlueNord has built a meaningful presence in
Denmark and established good relationships with its partners TotalEnergies
and Nordsøfonden, as well as other stakeholders including the DEA.
Production assets and field developments
The Company delivered strong production from the Halfdan, Dan and Gorm
hubs in 2023 with a yearly average of 24.9 mboepd and an overall operational
efficiency at approximately 86.1 percent. Production during the year benefitted
from an increased level of well optimisation activity and higher uptime than
planned due to reduced duration of planned shutdowns.
The Tyra redevelopment project was completed in March 2024, with
production start-up 21 March 2024. The Tyra redevelopment project is the
largest project ever carried out on the Danish continental shelf. As the offshore
installation campaign for Tyra II was completed in 2022, the main work in 2023
has been related to testing and commissioning and the tie-in of facilities. This
work included testing the gas turbine generators, reconnecting the export
pipeline to Denmark, completion of subsea work, reconnecting all satellite
fields and completion of leak testing.
The annual revision of reserves, performed by an independent organisation
(ERCE) in accordance with SPE PRMS 2018 standards, resulted in total 2P
reserves at year end 2023 of 185.6mmboe.
Directors’ Report
Capital structure
Convertible bond (BNOR13)
The main part of the convertible bond loan (BNOR13) was transferred into
the convertible bond loan (BNOR15) in 2022, the opening value in 2023 was
USD 0.2 million with an eight-year tenor and a mandatory conversion to
equity after five years was issued in 2019. BNOR13 has paid in kind (‘PIK’)
interest with additional bonds at a coupon rate of 8.0 percent.
In December 2023, the remaining convertible bond loan was converted into
equity in December 2023.
Convertible bond (BNOR15)
USD 228.4 million convertible bond with a five-year tenor and a conversion
to equity or cash settlement after three years. BNOR15 consists of USD
151.4million converted from BNOR13 plus additional compensation bonds
of USD 56.2 million. BNOR15 has PIK interest with additional bonds at a
coupon rate of 8.0 percent.
BlueNord may alternatively, at its own discretion, pay cash interest of
6.0percent. Should the instrument be in place beyond the three-year
conversion period, the interest rate of BNOR15 will be reduced to 0.0
percent for the remaining period subject to approval from RBL lenders.
Reserve-based lending facility
The BlueNord RBL facility is a seven-year, first lien, senior secured RBL with
a total facility amount of USD 1.1 billion, including a Letter of Credit sub-limit
of USD 100.0 million.
At the end of 2023, USD 850.0 million was drawn under the RBL, with an
additional USD 100.0 million Letter of Credit outstanding. Principal
repayments on the facility will commence from the second half of 2024, and
interest is charged on debt drawings based on the secured overnight
financing rate (‘SOFR’) and a margin of 4.0–4.5 percent. In October 2023,
BlueNord made a drawdown of USD 50.0 million. In addition, the Company
hedged the SOFR rate on USD 1.0 billion of principal from 1 November 2021
to 30 June 2024 at a rate of 0.4041 percent.
Senior unsecured note (BNOR14)
USD 175.0 million senior unsecured note with a coupon rate of 9.0 percent
and a maturity in June 2026. In order to reduce exposure to future market
volatility, BlueNord ASA successfully reached an agreement with
its bondholders in 2021, adding additional headroom to certain
financial covenants.
The Tyra II field start-
up will lead to a step-
change in BlueNord’s
future performance.
68 Annual Report and Accounts 2023BlueNord
Governance Report
Group financial results for 2023
The consolidated financial statements of BlueNord have been prepared in accordance with IFRS and
interpretations from the IFRS interpretation committee (‘IFRIC’), as endorsed by the EU.
See the section on the Financial Review, on pages 23 and 24.
Risk mitigation
The Company actively seeks to reduce the risk it is exposed to regarding fluctuating commodity prices
through the establishment of hedging arrangements.
Currently all the Company’s commodity price hedging arrangements are executed solely in the market
through forward contracts. At the time of this report, the Company had purchased the following:
Oil Q1-24 Q2-24 Q3-24 Q4-24 Q1-25 Q2-25
Volumes (bbl) 900,000 900,000 957,000 957,000 795,000 795,000
Price
(USD/bbl) 61.3 61.3 72.5 72.5 74. 5 74. 5
Equiv. daily
production
(mbblpd) 9.9 9.9 10.4 10.4 8.8 8.7
Oil Q3-25 Q4-25 Q1-26 Q2-26 Q3-26 Q4-26
Volumes (bbl) 900,000 900,000 525,000 525,000 225,000 225,000
Price
(USD/bbl) 73.7 73.7 74.5 74. 5 71.1 71.1
Equiv. daily
production
(mbblpd) 9.8 9.8 5.8 5.8 2.4 2.4
Gas Q1-24 Q2-24 Q3-24 Q4-24 Q1-25 Q2-25
Volumes (MWh) 420,000 495,000 495,000 450,000 450,000 345,000
Price
(EUR/MWh) 99.4 41.4 41.4 45.6 45.6 33.9
Equiv. daily
production
(mboepd) 2.7 3.2 3.2 2.9 2.9 2.2
Gas Q3-25 Q4-25 Q1-26 Q2-26 Q3-26 Q4-26
Volumes 345,000 255,000 255,000 60,000 60,000 –
Price 33.9 32.2 32.2 27. 5 27.7 –
Equiv. daily
production 2.2 1.6 1.7 0.4 0.4 –
In addition, the Company has a swap transaction with a group of banks to fix the Company’s floating
interest rate exposure under the RBL facility. See the section on risk factors and risk management on
pages 84 to 87, and note 19 in the consolidated financial statements.
Principal risks and uncertainties
The Company is required to give a description of the principal risks and uncertainties which it faces.
These principal risks and uncertainties are included as part of the risk report and can be found
on page 44.
Going concern assumption
Pursuant to the Norwegian Accounting Act section 3-3a, the BlueNord Board confirms that the
requirements of the going concern assumption are met and that the annual accounts have been
prepared on that basis.
Our financial integrity, and our working capital and cash position, are considered satisfactory in relation
to the planned activity level for the next 12 months.
Health, environment and safety
BlueNord puts emphasis on its employees performing Company activities in line with the principals of
business integrity and with respect for people and the environment. During 2023, BlueNord was, through
its ownership in the DUC in which TotalEnergies is the operator, involved in production of oil and gas,
which could cause emissions to the sea and air.
BlueNord will conduct its business operation in full compliance with all applicable national legislation in
the countries where it is operating. The Company is committed to carry out its activities in a responsible
manner to protect people and the environment. Our fundamentals of health, safety, environment
and quality (‘HSEQ’) and safe business practice are an integral part of BlueNord operations and
business performance.
For more information, see the Sustainability section on pages 25 to 43.
Personnel resources and working environment
As at end 2023, the Group had 40 employees equal 37.32 FTE, including 3 interns, and 43.0 percent of
the employees were women. The total growth rate in 2023 was 13.9 percent and the rolling 12 months
retention rate 91.9 percent and attrition rate 5.2 percent per December 2023. In October 2023,
Jacqueline Lindmark Boye was appointed as CFO and Cathrine Torgersen promoted to Chief Corporate
Affairs Officer.
As at end 2023, the Company’s Board of Directors consists of three women and four men, all elected by
shareholders. There are no employee representatives on the Board. As at end 2023, more than 40.0
percent of the Board members are women.
Directors’ Report continued
69 Annual Report and Accounts 2023BlueNord
Governance Report
BlueNord is an equal opportunity employer, committed to fostering diversity and inclusion in the
workplace. We welcome and embrace a variety of skillsets, perspectives, and we value differences
between people of different cultural backgrounds, ethnicity, age, gender, gender identification, gender
expression, sexual orientation, functional ability, religion, and philosophies of life. These principles apply
to all employment practices at BlueNord, including recruitment, hiring, compensation and benefits,
promotion, training and development, and leave of absence.
Management compensation is described in the Executive Remuneration Report. Sick leave in the Group
was 0.41 percent in 2023.
For more information, see the sustainability section on pages 25 to 43.
Research and development
BlueNord invests in research and development to support and further grow its exploration and
production (‘E&P’) and energy transition activities.
For more information, see the Sustainability section on page 25.
Corporate governance
The Board wishes to maintain an appropriate standard of corporate governance and to fulfil the
recommendations in the Norwegian Code of Practice for Corporate Governance. Corporate
governance in BlueNord is based on equal treatment of all shareholders, a principle which is reflected in
the decisions taken at the general assembly.
For more information about the Board’s composition and activities during the year, see the section on
corporate governance on page 57 in this report.
AGM
The AGM held on 25 April 2023 re-elected Colette Cohen, Jan Lernout and Peter Coleman. All matters
on the agenda were approved.
For more information about corporate governance and corporate social responsibility, see the
relevant sections of this report. Also, see www.bluenord.com/corporate-governance and
www.bluenord.com/csr.
Directors’ and officers’ liability insurance
The Company has acquired and maintains a Directors’ and officers’ insurance policy to cover the
personal liability for financial losses that Directors and officers of the Company, and the Directors
and officers of the Company’s subsidiaries, may incur in their capacities as such (Nw. styre og
ledelsesansvar). The policy is placed with a reputable international carrier on market terms.
Ownership
There are no restrictions on the transfer of shares in BlueNord ASA. The Company currently has
approximately 2,600 shareholders and 23.59 percent of the shares are held by residents of Norway.
BlueNord ASA
In 2023, the parent Company was a holding Company and the operating expenses mainly consisted of
shareholder costs, consultancy fees, legal fees and payroll expenses. Net financial loss mainly due to
interest expenses from bond loans, partly offset by interest received from Group companies.
For more information about financial risk and market conditions, and a statement regarding going concern,
please see the relevant sections above. These comments are also valid for the parent Company.
Parent Company financial results for 2023
Personnel expenses were USD 5.8 million in 2023 (2022: USD 4.4 million), with the increase mainly due
to an increase in average full-time equivalents and full-year cost related to the LTIP, which is valued and
accounted for according to IFRS 2. Other operating expenses amounted to USD 3.5 million in 2023
(2022: USD 4.1 million); the decrease is related to lower consultant and legal fees. The net operating result
for 2023 was a loss of USD 5.7 million (2022: USD 6.0 million).
Net financial items amounted to an expense of USD 4.7 million in 2023 (2022: USD 76.5 million). The
decreased financial expense mainly related to the effect in 2022 of the extinguishment of the BNOR13
bond loan, in addition to decreased write-down of loans to subsidiaries, increased interest income from
intercompany loans and lower foreign exchange losses compared to 2022.
The Company’s net result for the year amounted to a loss of USD 10.4 million (2022: USD 82.5 million).
Allocations
The result for the year for BlueNord ASA in 2023 was a loss of USD 10.4 million. The Board proposes the
following allocations:
• allocated from other equity: USD 10.4 million; and
• total appropriation: USD 10.4 million.
Directors’ Report continued
70 Annual Report and Accounts 2023BlueNord
Governance Report
Outlook
BlueNord ASA has a stable business, underpinned by the Company’s position in the DUC and further
supported by risk mitigations. The volatility in prices has been significant and management is
continuously assessing the market to mitigate commodity price volatility. The Company has during 2023
entered into fixed-price swap contracts for additional oil and gas volumes from 2024 to 2026.
The Company monitors global as well as local political and economic conditions that may affect future
results. The Company has not identified any negative impact on the Company’s assets or income. See
further detail on this issue and mitigations as outlined in the section Principal Risks and Uncertainties
on page 45.
First gas from the Tyra II field was achieved 21 March 2024, with ramp-up to maximum technical capacity
expected within four months. This will lead to a step-change in performance for BlueNord, with a
doubling of production combined with a lowering of lifting cost per boe and emissions intensity. Direct
field operating expenditure is expected to decrease to USD 13 per barrel on average in 2025.
BlueNord ASA has a cash position with total liquidity of USD 316.7 million at the end of 2023 with cash on
balance sheet of USD 166.7 million and undrawn RBL capacity of USD 150.0 million. The Company has a
solid basis for executing the strategy and the ambition to deliver material shareholder returns and
significant value creation.
Activity to progress value additive organic DUC investment projects also continues, and we will seek to
sanction projects as they are sufficiently matured. BlueNord ASA believes economic investments in
these projects will help to replace produced reserves and provide strong financial returns benefitting the
Company’s shareholders.
The Company expects increased production from Q2 2024; the increase is driven by the Tyra production
start-up.
Guidance 2024 Unit Base Tyra Total
Q1 mboepd 22.0–23.0 – 22.0–23.0
Q2 mboepd 23.0–26.0 3.0–7.0 26.0–33.0
Q3 mboepd 23.0–25.0 20.0–29.0 43.0–54.0
Q4 mboepd 23.0–25.0 27.0–29.0 50.0–54.0
The following sections of BlueNord ASA Annual Report constitute part of the Director’s Report.
Annual Report Chapter Reference Content Page Reference
Strategic Report Financial Review 23–24
Strategic Report Sustainability Report 25–43
Strategic Report Principal Risks and Uncertainties 45–52
Governance Report Corporate Governance Report 57–61
Appendix 4 Norwegian Transparency Act Statement 153–154
Oslo
11 April 2024
Riulf Rustad Tone Kristin Omsted Marianne Lie Colette Cohen
Executive Chair Board member Board member Board member
Robert J. McGuire Jan Lernout Peter Coleman Euan Shirlaw
Board member Board member Board member Chief Executive Officer
Directors’ Report continued
71 Annual Report and Accounts 2023BlueNord
Governance Report
Reporting of Payments to Governments
This report is prepared in accordance with the Norwegian Accounting Act section § 3-3 d) and Securities
Trading Act § 5-5 a). It states that companies engaged in activities within the extractive industries shall
annually prepare and publish a report containing information about their payments to governments at
country and project level. The Ministry of Finance has issued a regulation (F20.12.2013 nr 1682 – ‘the
regulation’) stipulating that the reporting obligation only applies to reporting entities above a certain size
and to payments above certain threshold amounts. In addition, the regulation stipulates that the report
shall include other information than payments to governments, and it provides more detailed rules
applicable to definitions, publication and Group reporting.
The management of BlueNord ASA has applied judgement in the interpretation of the wording in the
regulation with regards to the specific type of payment to be included in this report, and on what level it
should be reported. When payments are required to be reported on a project-by-project basis, it is
reported on a field-by-field basis. Only gross amounts on operated licences are to be reported, as all
payments within the licence performed by non-operators will normally be cash calls transferred to the
operator and are as such not payments to the government. All activities in BlueNord ASA within the
extractive industries are located on the Danish continental shelf and all are performed as non-operator.
All the reported payments below are to the Danish government.
Income tax
The income tax is calculated and paid on a corporate level and is therefore reported for the whole
Company rather than licence-by-licence. The income tax payment in 2023 is a USD 40.0 million second
instalment repayment for 2022 pertaining to the special tax incentives implemented in 2017. This
repayment is triggered from 2022 and onwards if commodity prices exceed certain thresholds. It
constitutes a repayment of tax benefits previously received from the incentive scheme, in the case of
market conditions significantly improving compared to the assumptions in 2017, where the incentive
scheme was implemented.
Further, in 2023 BlueNord paid USD 141.0 million of 25 %-chapter 2 hydrocarbon tax pertaining to 2022
earnings and USD 16.0 million pertaining to prior years. The Group also paid Danish corporate tax
for income 2022 of USD 9.0 million. In addition, BlueNord paid the first instalment of the temporary
EU-solidarity contribution, which is calculated at 33.0 percent of 2023 earnings. The instalment
amounted to USD 24.0 million.
Other information required to be reported
In accordance with the regulation (F20.12.2013 nr 1682), BlueNord ASA is also required to report
on investments, operating income, production volumes and purchases of goods and services.
All reported information is relating to BlueNord ASA activities within the extractive industries on the
Danish continental shelf:
• Total net investments amounted to USD 347.6 million, as specified in the cash flow analysis in the
financial statements.
• Sales income (petroleum revenues) in 2023 amounted to USD 791.5 million, as specified in note 4 to
the financial statements.
• Total production in 2023 was 9.1 million barrels of oil equivalents, see note 5 to the consolidated
financial statements.
• For information about purchases of goods and services, reference is made to the Income Statement
and the related notes.
72 Annual Report and Accounts 2023
BlueNord
72
BlueNord
Financial Report
Annual Report and Accounts 2023
Consolidated Statements 73
Consolidated Statement of Comprehensive Income 73
Consolidated Statement of Financial Position 74
Consolidated Statement of Changes in Equity 76
Consolidated Statement of Cash Flows 77
Notes 78
Statutory Accounts 122
Income Statement 122
Balance Sheet 123
Cash Flow Statement 125
Notes 126
Independent Auditor’s Report 137
Statement of Compliance 140
Alternative Performance Measures 141
Supplementary oil and gas information (unaudited) 142
Appendices 143
Information about BlueNord 155
Financial
Report
Annual Report and Accounts 202373
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
| 2022 | |||
| USD million Note 2023 | restated | ||
Total revenues | 4 | ||
| Production expenses | 5 | ( | ( |
| Exploration and evaluation expenses | 6 | ( | ( |
| Personnel expenses | 7 | ( | ( |
| Other operating expenses | 8 | ( | ( |
Total operating expenses | ( | ( | |
Operating result before depreciation, amortisation and impairment (‘EBITDA’) | |||
| Depreciation/amortisation/impairment | 11 | ( | ( |
Net operating result (‘EBIT’) | |||
| Financial income | 13 | ||
| Financial expenses | 13, 10 | ( | ( |
Net financial items | ( | ( | |
Result before tax (‘EBT’) | |||
| Income tax benefit/(expense) | 14, 10 | ( | ( |
| Net result for the year | ( | ||
| Other comprehensive income: | |||
| Items that are or may be subsequently reclassified to profit or loss: | |||
| Realised cash flow hedge | 19 | ( | |
| Related tax – realised cash flow hedge | 14, 19 | ( | |
| Changes in fair value cash flow hedges | 19 | ( | |
| Related tax – changes in fair value cash flow hedges | 14, 19 | ( | |
Currency translation adjustment | ( | ||
Total other comprehensive income for the year | |||
| Total comprehensive income for the year | |||
| Basic earnings/loss USD per share | 15 | ( | |
| Diluted earnings/loss USD per share | 15 | ( |
(1)
(2)
(2)
(1) The comparative information is restated on account of correction of errors. See note 10 Restatement of borrowing cost.
(2) 100 percent attributable to equity holders of the parent company
Consolidated Statement of Comprehensive Income
As of 31 December
Annual Report and Accounts 202374
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Consolidated Statement of Financial Position
As of 31 December
| 31.12.2022 | 01.01.2022 | |||
USD million | Note | 31.12.2023 | restated | restated |
| Non-current assets | ||||
| Intangible assets | 9 | |||
| Deferred tax assets | 14, 10 | |||
| Property, plant and equipment | 11, 10 | |||
Right of Use asset | ||||
| Restricted bank deposits | 18, 19 | |||
| Receivables non-current | 16 | |||
| Derivative instruments | 19 | |||
Total non-current assets | ||||
| Current assets | ||||
| Derivative instruments | 19 | |||
| Trade receivables and other current assets | 16 | |||
| Inventories | 17 | |||
| Cash and cash equivalents | 18 | |||
Total current assets | ||||
Total assets |
(1)
(1)
Annual Report and Accounts 202375
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Consolidated Statement of Financial Position continued
As of 31 December
| 31.12.2022 | 01.01.2022 | |||
USD million Note | 31.12.2023 | restated | restated | |
| Equity | ||||
| Share capital | 20 | |||
| Other equity | 10 | |||
Total equity | ||||
| Non-current liabilities | ||||
| Asset retirement obligations | 22 | |||
| Convertible bond loans | 19, 23 | |||
| Bond loan | 19, 23 | |||
| Reserve-based lending facility | 19, 23 | |||
| Derivative instruments | 19 | |||
Other non-current liabilities | ||||
Total non-current liabilities | ||||
| Current liabilities | ||||
| Reserve-based lending facility | 19, 23 | |||
| Asset retirement obligations | 22 | |||
| Tax payable | 14 | |||
| Derivative instruments | 19 | |||
| Trade payables and other current liabilities | 24 | |||
Total current liabilities | ||||
Total liabilities | ||||
Total equity and liabilities |
(1)
(1)
(1) The comparative information is restated on account of correction of errors. See note 10 Restatement of borrowing cost.
Oslo
11 April 2024
Riulf Rustad Tone Kristin Omsted Marianne Lie Colette Cohen
Executive Chair Board member Board member Board member
Robert J. McGuire Jan Lernout Peter Coleman Euan Shirlaw
Board member Board member Board member Chief Executive Officer
Annual Report and Accounts 202376
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
| Share | Treasury | Currency | Cash flow | Other | Tota l | ||
| All figures in USD million Share capital | premium fund | share reserve | translation fund | hedge reserve | equity | equity | |
| 2022 | |||||||
Equity on 01.01.2022 as previously reported | ( | ( | ( | ||||
Impact of restatement 01.01.2022 (note 10) | |||||||
Restated equity 01.01.2022 | ( | ||||||
Net result for the period | ( | ( | |||||
Impact of restatement 2022 (note 10) | |||||||
| Other comprehensive income | |||||||
Realised cash flow hedge | |||||||
Related tax – realised cash flow hedge | ( | ( | |||||
Changes in fair value cash flow hedges | ( | ( | |||||
| Related tax – changes in fair value | |||||||
cash flow hedges | |||||||
Currency translation adjustments | ( | ( | |||||
Total other comprehensive income | ( | ||||||
Issue of shares | |||||||
Capital reduction, approved and registered | ( | ||||||
Settlement derivatives/conversion bonds | |||||||
Share-based incentive program | |||||||
Total transactions with owners for the period | ( | ||||||
Equity as of 31.12.2022 restated | ( | ( | |||||
| 2023 | |||||||
Equity as of 01.01.2023 restated | ( | ( | |||||
Net result for the period | |||||||
| Other comprehensive income | |||||||
Realised cash flow hedge | ( | ( | |||||
Related tax – realised cash flow hedge | |||||||
Changes in fair value cash flow hedges | |||||||
| Related tax – changes in fair value | |||||||
cash flow hedges | ( | ( | |||||
Currency translation adjustments | |||||||
Total other comprehensive income | |||||||
Issue of shares | |||||||
| Settlement derivatives/conversion bonds | |||||||
Share-based incentive program | |||||||
Total transactions with owners for the period | |||||||
Equity as of 31.12.2023 | ( |
(1)
(1) For further information see Borrowings note 22.
Consolidated Statement of Changes in Equity
As of 31 December
Annual Report and Accounts 202377
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
| 2022 | |||
| USD million Note 2023 | restated | ||
| Cash flows from operating activities | |||
| Net result for the year | 10 | ( | |
| Adjustments for: | |||
| Income tax benefit/(expense) | 14, 10 | ||
| Net financial items | 13, 10 | ||
| Depreciation/impairment | 11 | ||
Share-based payments expenses | |||
| Interest received | 13 | ||
Other financial items paid | ( | ( | |
| Net gain on sale of assets | 13 | ( | |
| Changes in: | |||
| Trade receivable | 16 | ( | |
| Trade payables | 24 | ( | |
| Inventories and spare parts | 17 | ( | |
| Prepayments | 16 | ( | ( |
| Over/under-lift | 16 | ( | |
| Other current balance sheet items | ( | ||
Cash flow from operating activities | |||
Tax (paid)/received | ( | ( | |
Net cash flow from operating activities | |||
| Cash flows from investing activities | |||
| Long-term loan provided | 16 | ( | ( |
Consideration sale of asset | |||
Deferred consideration | ( | ||
| Investment in oil and gas assets (excluding capitalised interest) | 11 | ( | ( |
| Investment in exploration and evaluation assets | 9 | ( | ( |
| Payments for decommissioning of oil and gas fields | 22 | ( | ( |
Net cash flow from investing activities | ( | ( | |
| Cash flows from financing activities | |||
| Drawdown long-term liability | 23 | ||
| Repayment long-term liability | 23 | ( | |
Lease payments | ( | ( | |
Sale of shares | |||
Interest and fees external loan | ( | ( | |
Net cash flow from financing activities | ( | ( | |
Net change in cash and cash equivalents | ( | ||
Cash and cash equivalents at the beginning of the year | |||
Cash and cash equivalents at end of the year |
(1)
(2)
(3)
(1) The comparative information is restated on account of correction of errors. See note 10 Restatement of borrowing cost.
(2) Excluding interest received from restricted bank accounts.
(3) Mainly currency adjustments balance sheet items.
Consolidated Statement of Cash Flows
For the year ended 31 December
Annual Report and Accounts 202378
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Notes
Annual Report and Accounts 202379
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Notes continued
1 Summary of material accounting policies continued
| Country of | ||||
| incorporation | Ordinary shares | Ordinary shares | ||
| and place | directly held | held by the | ||
| Name | of business | Nature of business | by parent (%) | Group (%) |
BlueNord Denmark A/S | Denmark | Intermediate holding company | 100% | |
BlueNord Energy Denmark A/S | Denmark | Exploration and production activity | 100% | |
BlueNord Gas Denmark A/S | Denmark | Exploration and production activity | 100% | |
BlueNord Energy 8/06 Denmark B.V | Netherlands | Exploration and production activity | 100% | |
BlueNord Pipeline Denmark Aps | Denmark | Infrastructure oil and gas | 100% | |
BlueNord UK Ltd | Great Britain | Exploration activity | 100% | 100% |
BlueNord Energy UK Ltd | Great Britain | Exploration activity | 100% | |
Altinex AS | Norway | Intermediate holding company | 100% | 100% |
BlueNord AS | Norway | Dormant Company | 100% | 100% |
Annual Report and Accounts 202380
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Notes continued
1 Summary of material accounting policies continued
Annual Report and Accounts 202381
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Notes continued
1 Summary of material accounting policies continued
Annual Report and Accounts 202382
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Notes continued
1 Summary of material accounting policies continued
Annual Report and Accounts 202383
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Notes continued
1 Summary of material accounting policies continued
Annual Report and Accounts 202384
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Notes continued
1 Summary of material accounting policies continued
USD million | NOK | DKK | EUR |
Financial assets | 0 | 52 | 3 |
Financial liabilities | 0 | 8 | (1) |
Effect net result/equity | 0 | 44 | 4 |
Annual Report and Accounts 202385
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Notes continued
2 Financial risk management continued
USD million | Equity | OCI | Net result |
Net book value 31.12.23 | 9 | 9 | 0 |
Commodity price +10% | (22) | (22) | 0 |
Commodity price -10% | 22 | 22 | 0 |
Annual Report and Accounts 202386
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Notes continued
2 Financial risk management continued
2.3 Fair value estimation
The Group has certain financial instruments carried at fair value. The different fair value hierarchy levels have been defined as follows:
Level 1: Quoted prices (unadjusted) in active markets for identical assets and liabilities.
The fair value of financial instruments traded in active markets is based on quoted market prices at the statement of financial position date. A market is regarded as active
if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service, or regulatory agency, and those prices represent
actual and regularly occurring market transactions on an arm’s length basis. The quoted market price used for financial assets held by the Group is the current bid price.
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the assets or liability, either directly or indirectly.
The fair value of financial instruments that are not traded in an active market (for example, over-the-counter derivatives) is determined by using valuation techniques.
These valuation techniques maximise the use of observable market data where it is available and rely as little as possible on entity specific estimates. If all significant
inputs required to fair value an instrument are observable, the instrument is included in Level 2. If one or more of the significant inputs is not based on observable
market data, the instrument is included in Level 3. Specified valuation techniques used to value financial instruments include:
• Quoted market prices or dealer quotes for similar instruments.
• The fair value of interest rate swaps is calculated as the present value of the estimated future cash flows based on observable yield curves.
• The fair value of forward foreign exchange contracts is determined using forward exchange rates at the statement of financial position date, with the resulting
value discounted back to present value.
Level 3: Inputs for other assets or liabilities that are not based on observable market data.
In Level 3, there is one financial instrument, the embedded derivatives in the convertible bond.
The fair value of the embedded derivatives is calculated based on the Black-Scholes-Merton valuation model. A change in the share price of +/- 10 percent would
have the following impact on the embedded derivates, net result and equity:
| Sensitivity Analysis | |||
| Share price | (%) | 10% | -10% |
Embedded derivatives | USD million | (14) | 13 |
Effect Net result/Equity | USD million | (14) | 13 |
The embedded derivatives are in jurisdictions where there are tax loss carried forward where no deferred tax assets are recognised. Therefore, it is concluded
that there is no tax effect of the changes in fair value. See note 19 for fair value hierarchy and further information.
Annual Report and Accounts 202387
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Notes continued
Annual Report and Accounts 202388
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Notes continued
3 Critical accounting estimates and judgements continued
USD million 2023 | 2022 | |
Sale of oil | 485.6 | 552.1 |
Sale of gas and NGL | 306.0 | 408.4 |
Other income | 3.5 | 6.4 |
Total Revenue | 795.0 | 966.9 |
Oil – lifted volumes (mmbbl) | 7.16 | 7.32 |
Effective oil price USD/bbl | 67.8 | 75.5 |
Gas – lifted volumes (mmboe) | 2.20 | 2.25 |
Effective gas price EUR/MWh | 75.7 | 101.9 |
Effective gas price USD/boe | 139.1 | 181.1 |
Annual Report and Accounts 202389
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Notes continued
4 Revenue continued
Revenue per customer 2023 | 2022 | |
Shell Trading International | 75.8% | 77.7% |
Ørsted Salg & Service AS | 17.4% | 32.6% |
Natixis (1) | 6.4% | -8.0% |
Shell Energy Europe Limited | 3.2% | 16.2% |
| BNP Paribas | 2.4% | -4.2% |
| Macquarie Bank Europe | 2.1% | 0.0% |
Crossbidge Energy A/S | 0.2% | 0.0% |
| Lloyds Bank Corporate Markets PLC | -2.2% | -10.0% |
| SEB Skandinaviska Enskilda Banken AB | -2.3% | -2.4% |
| CommonwealthBank | -3.0% | -1.9% |
Total Revenue | 100.0% | 100.0% |
(1)
(1)
(1)
(1)
(1)
(1) Settlement of commodity hedges in place with financial institutions.
USD million 2023 | 2022 | |
Direct field opex | (243.8) | (233.1) |
Tariff and transportation expenses | (34.9) | (43.3) |
Production general and administrative | (17.3) | (32.1) |
Field operating cost | (295.9) | (308.5) |
Total produced volumes (mmboe) | 9.1 | 9.8 |
In USD/boe | (32.5) | (31.6) |
| Adjustments for: | ||
Concept studies | (6.2) | (1.5) |
Change in inventory position | (6.7) | 4.0 |
Over/under-lift of oil and NGL | (6.3) | 7.7 |
Insurance and other | (21.9) | (19.4) |
Stock scrap | (3.0) | (5.6) |
Production expenses | (340.1) | (323.4) |
Annual Report and Accounts 202390
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Notes continued
USD million 2023 | 2022 | |
Other exploration and evaluation expenses | (1.4) | (0.7) |
Total exploration and evaluation expenses | (1.4) | (0.7) |
USD million Note 2023 | 2022 | ||
Salaries | (10.3) | (9.2) | |
Social security tax | (1.4) | (1.0) | |
| Pension costs | 21 | (0.7) | (0.5) |
Costs relating to share-based payments | (5.2) | (1.4) | |
Other personnel expenses | (0.4) | (0.4) | |
Total personnel expenses | (18.0) | (12.5) | |
Average number of employees | 37.3 | 30.5 |
USD 1 000 2023 | 2022 | |
Short-term employee benefits | 2,239 | 1,898 |
Post-employment benefits | 98 | 70 |
Share-based payments | 787 | 5,303 |
Total remuneration to key management | 3,124 | 7,271 |
Annual Report and Accounts 202391
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Notes continued
USD million 2023 | 2022 | |||
Consultant fees | (9.4) | (15.3) | ||
Other operating expenses | (4.7) | (3.8) | ||
Total other operating expenses | (14.1) | (19.1) | ||
| Capitalised | ||||
| exploration | Conceptual | |||
| expenditures | studies | Licence | Total | |
Book value 31.12.22 | 1.8 | 1.9 | 156.6 | 160.4 |
Acquisition costs 31.12.22 | 1.8 | 1.9 | 186.0 | 189.8 |
Additions | 0.1 | – | – | 0.1 |
Reclassified to operating expenses | – | (1.9) | – | (1.9) |
Acquisition costs 31.12.23 | 1.9 | – | 186.0 | 187.9 |
Accumulated depreciation, amortisation and write-downs 31.12.22 | – | – | (29.4) | (29.4) |
Depreciation/amortisation | – | – | (6.9) | (6.9) |
Accumulated depreciation, amortisation and write-downs 31.12.23 | – | – | (36.3) | (36.3) |
Book value 31.12.23 | 1.9 | – | 149.7 | 151.6 |
| Capitalised | ||||
| exploration | Conceptual | |||
| expenditures | studies | Licence | Total | |
Book value 31.12.21 | 1.4 | – | 164.7 | 166.0 |
Acquisition costs 31.12.21 | 1.4 | – | 186.0 | 187.4 |
Additions | 0.5 | 1.9 | – | 2.4 |
Acquisition costs 31.12.22 | 1.8 | 1.9 | 186.0 | 189.8 |
Accumulated depreciation and write-downs 31.12.21 | – | – | (21.3) | (21.3) |
Depreciation/amortisation | – | – | (8.0) | (8.0) |
Accumulated depreciation and write-downs 31.12.22 | – | – | (29.4) | (29.4) |
Book value 31.12.22 | 1.8 | 1.9 | 156.6 | 160.4 |
Annual Report and Accounts 202392
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Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Notes continued
10 Restatement of borrowing cost
In preparing the financial statements for 2023, the Group discovered that it had not capitalised borrowing costs on qualifying assets under construction.
This relates to the Tyra redevelopment project. The project had started already when the Group acquired Shell’s Danish upstream Assets medio 2019. The Group
has not borrowed funds specifically for the purpose of the development project. The Group did not identify that it should have capitalised borrowing costs based
on its general borrowings.
The Group identifies qualifying assets as those that takes over 12 months to get ready for its intended use. For the periods presented this is only the Tyra
redevelopment project. The Group calculates a weighted average interest rate per year based on outstanding borrowings (the bond loans and the RBL). It uses
the effective interest rates in these calculations. The interest rates used for capitalisation have been:
2019 | 2020 | 2021 | 2022 | 2023 |
7.4% | 8.6% | 8.1% | 8.5% | 8.4% |
The average carrying amount of assets under construction each year have been multiplied by these interest rates to arrive at the borrowing costs that could be
capitalised. The amount of borrowing costs eligible for capitalisation has been calculated as the actual interest expense before capitalisation less interest income
and gains on extinguishment of bond loans. Tyra II started production 21 March 2024 hence the qualifying assets were ready for its intended use early 2024,
consequently it is not expected any capitalisation of borrowing costs going forward.
Based on this, the Group has calculated the amounts of borrowing costs to be capitalised each year in USD million:
2019 | 2020 | 2021 | 2022 | 2023 |
12.4 | 40.2 | 58.5 | 60.3 | 78.0 |
The capitalised amounts have increased the carrying amounts of the Group’s assets.
The errors have been corrected by restating each of the affected financial statement line items for prior periods. The following tables summaries the impacts on
the Group’s consolidated financial statement.
Annual Report and Accounts 202393
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Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Notes continued
10 Restatement of borrowing cost continued
Consolidated Statement of Comprehensive Income:
USD million Note 2022 | Adj. | 2022 restated | ||
Operating result before depreciation, amortisation and impairment (‘EBITDA’) | 611.2 | – | 611.2 | |
| Depreciation/amortisation/impairment | 11 | (133.5) | (133.5) | |
Net operating result (‘EBIT’) | 477.7 | – | 477.7 | |
| Financial income | 13 | 61.3 | – | 61.3 |
| Financial expenses | 13 | (290.3) | 60.3 | (230.0) |
Net financial items | (229.0) | 60.3 | (168.7) | |
Result before tax (‘EBT’) | 248.7 | 60.3 | 309.0 | |
| Income tax benefit/(expense) | 14 | (279.2) | (38.6) | (317.8) |
| Net result for the year | (30.5) | 21.7 | (8.8) | |
| Basic earnings/loss USD per share | 15 | (1.2) | (0.4) | |
| Diluted earnings/loss USD per share | 15 | (1.2) | (0.4) |
(1)
(1) 100 percent attributable to equity holders of the parent company
Consolidated Statement of Financial position:
Year ended 31.12.2022
USD million Note
| As previously | ||||
reported | Adjustments | As restated | ||
| Non-current assets | ||||
| Intangible assets | 9 | 160.4 | – | 160.4 |
| Deferred tax assets | 14 | 348.8 | (109.7) | 239.1 |
| Property, plant and equipment | 11 | 1,911.9 | 171.4 | 2,083.3 |
Right of Use asset | 0.9 | – | 0.9 | |
| Restricted bank deposits | 18, 19 | 203.7 | – | 203.7 |
| Receivables non-current | 16 | 0.8 | – | 0.8 |
| Derivative instruments | 19 | 33.7 | – | 33.7 |
Total non-current assets | 2,660.1 | 61.7 | 2,721.8 | |
Total current assets | 583.9 | – | 583.9 | |
Total assets | 3,244.0 | 61.7 | 3,305.7 | |
| Equity | ||||
| Share capital | 20 | 1.7 | – | 1.7 |
Other equity | 600.8 | 61.7 | 662.5 | |
Total equity | 602.5 | 61.7 | 664.2 | |
Total liabilities | 2,641.5 | – | 2,641.5 | |
Total equity and liabilities | 3,244.0 | 61.7 | 3,305.7 |
Annual Report and Accounts 202394
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Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Notes continued
10 Restatement of borrowing cost continued
01.01.2022
USD million Note
| As previously | ||||
reported | Adjustments | As restated | ||
| Non-current assets | ||||
Intangible assets | 9 | 166.0 | – | 166.0 |
Deferred tax assets | 14 | 526.3 | (71.1) | 455.2 |
Property, plant and equipment | 11 | 1,898.7 | 111.1 | 2,009.8 |
Right of Use asset | 0.7 | – | 0.7 | |
Restricted bank deposits | 18, 19 | 205.5 | – | 205.5 |
Receivables non-current | 16 | – | – | – |
Derivative instruments | 19 | 9.7 | – | 9.7 |
Total non-current assets | 2,806.9 | 40.0 | 2,846.9 | |
Total current assets | 283.0 | – | 283.0 | |
Total assets | 3,089.9 | 40.0 | 3,129.9 | |
| Equity | ||||
Share capital | 20 | 29.5 | – | 29.5 |
Other equity | 462.7 | 40.0 | 502.7 | |
Total equity | 492.2 | 40.0 | 532.2 | |
Total liabilities | 2, 597.7 | – | 2, 597.7 | |
Total equity and liabilities | 3,089.9 | 40.0 | 3,129.9 |
There is no impact on the net cash flows from operating, investing or financing activities for the year ended 31 December 2022.
| Financial Report | |||
| Consolidated Statement | 73 | ||
| of Comprehensive Income | |||
Consolidated Statement of Financial Position | 74 | ||
Consolidated Statement of Change in Equity | 76 | ||
Consolidated Statement of Cash Flows | 77 | ||
Note 1: Summary of significant accounting policies | 78 | ||
Note 2: Financial risk management | 84 | ||
| Note 3: Critical accounting estimates | 87 | ||
| and judgements | |||
Note 4: Revenue | 89 | ||
Note 5: Production expenses | 89 | ||
Note 6: Exploration and evaluation expenses | 90 | ||
Note 7: Personal expenses | 90 | ||
Note 8: Other operating expenses | 91 | ||
Note 9: Intangible assets | 91 | ||
95 | BlueNord | Annual Report and Accounts 2023 |
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment | 95 |
Note 12: Impairments | 96 |
Note 13: Financial income and expenses | 97 |
Note 14: Tax | 97 |
Note 15: Earnings per share | 102 |
| Note 16: Non-current receivables, trade | 102 |
| receivables and other current receivables | |
Note 17: Inventories | 103 |
Note 18: Restricted bank deposits, cash and cash equivalents | 103 |
Note 19: Financial instruments | 104 |
Note 20: Share capital | 110 |
Note 21: Post-employment benefits | 112 |
Note 22: Asset retirement obligations | 112 |
Note 23: Borrowings | 114 |
Note 24: Trade payables and other payables | 118 |
Note 25: Guarantees | 119 |
Note 26: Investments in jointly owned assets | 120 |
Note 27: Contingencies and commitments | 120 |
| Note 28: Related party transactions 121 |
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Notes continued
| Asset under | Production | |||
| construction | facilities | Other assets | Tota l | |
| Book value 31.12.22 restated | 1,222.3 | 859.6 | 1.4 | 2,083.3 |
Acquisition costs 31.12.22 restated | 1,222.3 | 1,252.5 | 3.1 | 2,477.9 |
Sale of assets | – | – | (0.0) | (0.0) |
| Additions | 322.7 | 65.9 | 0.4 | 388.9 |
Reclassification from AUC to production facilities | (122.2) | 122.2 | – | – |
Reclassification from capex to opex | – | 1.5 | – | 1.5 |
Revaluation abandonment assets | – | 49.4 | – | 49.4 |
Disposals | – | – | (0.3) | (0.3) |
Currency translation adjustment | – | 0.1 | 0.0 | 0.1 |
Acquisition costs 31.12.23 | 1,422.8 | 1,491.5 | 3.1 | 2,917.4 |
Depreciation and write-downs 31.12.22 | – | (392.9) | (1.7) | (394.6) |
Sale of asset, reversal depreciation | – | – | 0.0 | 0.0 |
Depreciation | – | (94.9) | (0.2) | (95.1) |
Disposals | – | – | 0.2 | 0.2 |
Currency translation adjustment | – | (0.0) | (0.0) | (0.0) |
Depreciation and write-downs 31.12.23 | – | (487.9) | (1.7) | (489.5) |
Book value 31.12.23 | 1,422.8 | 1,003.7 | 1.4 | 2,427.9 |
| Asset under | Production | |||
| construction | facilities | Other assets | Tota l | |
Book value 31.12.21 as previously reported | 818.5 | 1,078.5 | 1.7 | 1,898.7 |
Impact of restatement 01.01.2022 | 111.1 | – | – | 111.1 |
Book value 01.01.2022 restated | 929.6 | – | – | 2,009.8 |
Acquisition costs 01.01.2022 restated | 929.6 | 1,346.6 | 3.1 | 2,279.4 |
Sale of assets | – | (0.2) | (0.2) | (0.4) |
Additions | 292.7 | 9.1 | 0.2 | 301.9 |
Revaluation abandonment asset | – | (102.8) | – | (102.8) |
Currency translation adjustment | – | (0.1) | (0.1) | (0.2) |
Acquisition costs 31.12.22 restated | 1,222.3 | 1,252.5 | 3.1 | 2,477.9 |
Accumulated depreciation and write-downs 01.01.2022 | – | (268.2) | (1.4) | (269.6) |
Sale of asset, reversal depreciation | – | 0.1 | – | 0.1 |
Depreciation | – | (124.8) | (0.3) | (125.1) |
Currency translation adjustment | – | 0.0 | 0.0 | 0.0 |
Accumulated depreciation and write-downs 31.12.22 | – | (392.9) | (1.7) | (394.6) |
Book value 31.12.22 restated | 1,222.3 | 859.6 | 1.4 | 2,083.3 |
Annual Report and Accounts 202396
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Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Notes continued
Annual Report and Accounts 202397
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Notes continued
USD million 2023 | 2022 | |
Total interest income | 17.8 | 4.0 |
| Value adjustment interest swap unrealised | – | 12.7 |
Volume protection true-up | 0.6 | – |
Extinguishment of bond loans | 1.0 | 33.7 |
Foreign exchange gains | 3.7 | 11.0 |
Total other financial income | 5.3 | 57.3 |
| 2022 | ||
| USD million 2023 | restated | |
Interest expense from bond loans | (44.9) | (46.5) |
| Interest expense from bank debt | (51.9) | (51.4) |
| Less capitalised borrowing cost | 78.0 | 60.3 |
Total interest expenses | (18.9) | (37.6) |
| Value adjustment interest swap unrealised | (0.7) | – |
| Value adjustment of embedded derivatives | (14.1) | (132.3) |
Utilisation of derivatives | (0.1) | – |
Interest expense from bond loans | (44.9) | (46.5) |
Accretion expense related to asset retirement obligations | (49.3) | (48.0) |
Foreign exchange losses | (12.3) | (8.5) |
Other financial expenses | (3.0) | (3.4) |
Total other financial expenses | (79.5) | (192.3) |
Net financial items | (75.2) | (168.7) |
Annual Report and Accounts 202398
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Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Notes continued
14 Tax continued
| 2022 | ||
| Income tax in profit/loss (Danish corporate income tax and hydrocarbon tax) 2023 | restated * | |
Income tax current year | (63.3) | (139.9) |
| Solidarity contribution, current | (72.2) | – |
Repayment of tax benefit related to chapter 3b | – | (62.7) |
Income tax for prior years | (10.1) | (2.0) |
Current income tax | (145.5) | (204.6) |
Deferred tax movements | (65.8) | (65.9) |
Deferred tax movements, impact of restatement 2022 | (38.6) | |
| Solidarity contribution, deferred | 70.5 | – |
Prior year adjustment, deferred tax | 7.1 | (8.6) |
Deferred tax expense | 11.8 | (113.1) |
Tax (expense)/income | (133.7) | (317.8) |
Tax (expense)/income related to OCI 2023 | 2022 | |
Cash flow hedges | (47.7) | (102.9) |
Tax (expense)/income related to OCI | (47.7) | (102.9) |
Hydrocarbon tax 64% | Corporate tax 22% | ||||
2023 | 2023 | In total | |||
Result before tax | 237.2 | 6.3 | 243.6 | ||
Expected tax on profit before tax | 151.8 | 64% | 1.4 | 22% | 153.2 |
| Tax effect of: | |||||
Prior year adjustment | 4.2 | 2% | (1.3) | -20% | 2.9 |
| FX adjustment of net operating losses carried forward in DKK | (24.6) | -10% | – | 0% | (24.6) |
| Investment uplift on CAPEX projects | (42.6) | -18% | – | 0% | (42.6) |
| Permanent differences | 37.9 | 16% | 3.0 | 48% | 40.9 |
No recognition of tax assets in Norway and UK | – | 0% | 3.8 | 61% | 3.8 |
Tax expense (income) in profit/loss | 126.8 | 53% | 7.0 | 110% | 133.7 |
Annual Report and Accounts 202399
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Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Notes continued
14 Tax continued
Hydrocarbon tax 64% | Corporate tax 22% | ||||
Reconciliation of nominal to actual tax rate, continues | 2022 restated* | 2022 | In total | ||
Result before tax | 424.4 | (115.4) | 309.0 | ||
Expected tax on profit before tax | 271.6 | 64% | (25.4) | 22% | 246.2 |
| Tax effect of: | |||||
Prior year adjustment | 9.6 | 2% | 0.2 | 0% | 9.8 |
| FX adjustment of net operating losses carried forward in DKK | 37. 3 | 9% | – | 0% | 37. 3 |
| Repayment of tax benefit related to chapter 3b | 30.1 | 7% | – | 0% | 30.1 |
| Investment uplift on CAPEX projects | (36.8) | -9% | – | 0% | (36.8) |
Permanent differences | – | 0% | 29.1 | -25% | 29.1 |
No recognition of tax assets in Norway and UK | – | 0% | 2.0 | 2% | 2.0 |
Tax expense (income) in profit/loss | 311.8 | 73% | 6.0 | 5% | 317.8 |
Hydrocarbon tax 64% | Corporate tax 22% | ||||
2023 | 2023 | In total | |||
OCI before tax | 82.8 | – | (22.7) | – | 60.1 |
Expected tax on OCI before tax | (53.0) | 64% | 5.0 | 22% | (48.0) |
| Tax effect of: | |||||
Non-taxable currency translation adjustment | – | – | 0.3 | – | 0.3 |
Tax in OCI | (53.0) | 64% | 5.3 | 22% | (47.7) |
Hydrocarbon tax 64% | Corporate tax 22% | ||||
2022 | 2022 | In total | |||
OCI before tax | 148.5 | – | 33.7 | – | 182.3 |
Expected tax on OCI before tax | (95.1) | 64% | (7.4) | 22% | (102.5) |
| Tax effect of: | |||||
Non-taxable currency translation adjustment | – | – | 0.4 | – | 0.4 |
Tax in OCI | (95.1) | 64% | (7.9) | 22% | (102.9) |
Annual Report and Accounts 2023100
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
14 Tax continued
Current income tax payable 2023 | 2022 | |
| Tax payable relates to the Group's entities in Denmark. The amounts payable as of 31.12.23 were: | ||
Corporate tax for 22% (Denmark) | (4.6) | (13.9) |
Hydrocarbon tax (Denmark) | (73.7) | (126.3) |
Hydrocarbon tax for prior years (Denmark) | (12.9) | (12.7) |
Hydrocarbon tax pertaining to pre-acquisition period 2019 not indemnified by the Seller | – | (10.2) |
Solidarity contribution | (48.8) | – |
Repayment of tax benefit related to chapter 3b | – | (45.9) |
Tax payables | (140.0) | (209.0) |
| Effect | Effect | |||
| 01.01.23 | recognised | recognised | ||
| restated* | in profit/loss | in OCI | 31.12.2023 | |
Property, plant and equipment | 745.9 | 67.0 | – | 812.8 |
Intangible assets, licences | 25.1 | 4.3 | – | 29.4 |
Inventories and receivables | 29.3 | 4.6 | – | 33.8 |
Asset retirement obligation (‘ARO’) provision | (564.5) | (59.5) | – | (623.9) |
Other assets and liabilities | (2.8) | (0.1) | – | (2.9) |
Tax loss carryforward, corporate tax (22%) | – | – | – | – |
Tax loss carryforward, chapter 2 tax (25%) | (0.1) | 0.1 | – | – |
Tax loss carryforward, chapter 3a tax (52%) | (471.9) | (28.1) | 32.3 | (467.7) |
Deferred tax asset, net | (239.1) | (11.7) | 32.3 | (218.5) |
Notes continued
Annual Report and Accounts 2023101
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Notes continued
14 Tax continued
| Effect | Effect | |||
| 01.01.22 | recognised | recognised | 31.12.2022 | |
| restated* | in profit/loss | in OCI | restated | |
Property, plant and equipment | 624.0 | 12.1 | – | 636.1 |
Property, plant and equipment, impact of restatement 2022 | 71.1 | 38.6 | – | 109.7 |
Intangible assets, licences | 17. 2 | 7.9 | – | 25.1 |
Inventories and receivables | 26.7 | 2.6 | – | 29.3 |
Asset retirement obligation (‘ARO’) provision | (611.1) | 46.7 | – | (564.5) |
Other assets and liabilities | – | (2.8) | – | (2.8) |
Tax loss carryforward, corporate tax (22%) | (2.0) | 0.1 | 1.9 | – |
Tax loss carryforward, chapter 2 tax (25%) | (22.8) | (14.4) | 37.1 | (0.1) |
Tax loss carryforward, chapter 3a tax (52%) | (558.3) | 28.5 | 57.9 | (471.9) |
Deferred tax asset, net | (455.2) | 119.2 | 96.9 | (239.1) |
Tax losses carried forward, Denmark. In million DKK | 2023 | 2022 |
Corporate tax (22%) | – | – |
Chapter 2 Hydrocarbon tax (25%) | – | – |
Chapter 3a Hydrocarbon tax (52%) | 5,523.2 | 5,773.0 |
Tax losses carried forward, Norway. In million NOK | 2023 | 2022 |
Corporate tax Norway (22%) | 1,204.2 | 1,071.0 |
Tax losses carried forward, UK. In million GPB/USD | 2023 | 2022 |
Trade losses, UK (hydrocarbon s 330 (2)), USD | 78.0 | 75.0 |
Trade losses, UK (hydrocarbon), USD | 100.1 | 96.0 |
Pre-trading capital expenditure, UK (hydrocarbon), GBP | 41.6 | 41.0 |
Annual Report and Accounts 2023102
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Notes continued
15 Earnings per share
Earnings per share are calculated by dividing the profit attributable to ordinary shareholders of the parent company by the weighted average number of ordinary
shares in issue during the year.
| 2022 | ||
| USD million 2023 | restated | |
Profit (loss) attributable to ordinary shareholders from operations | 109.8 | (8.8) |
Adjustment amortisation convertible bond loans | 26.9 | 28.8 |
Adjustment fair value embedded derivatives | 14.1 | 132.3 |
Profit (loss) basis for fully diluted shareholders from operations | 178.9 | 174.0 |
Number of shares outstanding at the beginning of the year | 25,571,262 | 24,110,852 |
Conversion part of convertible bond | 497,425 | 1,159,411 |
Sale of treasury shares | 36,641 | 300,999 |
Number of shares outstanding at the end of the year | 26,105,328 | 25,571,262 |
Weighted average number of shares (basic) | 26,043,859 | 25,004,296 |
| Adjustment convertible bond loan | 4,809,743 | 5,822,649 |
Adjustment option schemes | 378,869 | 391,868 |
Weighted average number of shares (diluted) | 31,232,471 | 31,218,813 |
Earnings per share in USD | 4.2 | (0.4) |
Earnings per share in USD diluted | 4.2 | (0.4) |
(1)
(2)
(1) The comparative information is restated on account of correction of error. See note 10 Reclassification of borrowing cost.
(2) The BNOR15 convertible bond loan is converted to number of shares by dividing the principal amount at year end (USD 228.4 million, 2022: USD 207.6 million) with the conversion price (47.5 USD/share, 2022: 38.8
USD/share) as this is less favourable. The conversion price is 99 percent of the volume-weighted average price (‘VWAP’) for the last 20 days (483.1 NOK/share, 2022: 382.9 NOK/share) converted to USD by using the
closing rate at year end (10.17 NOK/USD, 2022: 9.86 NOK/USD).
In 2022, the BNOR13 convertible bond loan was converted to number of shares by dividing the principal amount at year end (USD 13.8 million) with the strike price (28.97 USD share) as this was less favourable.
USD million 2023 | 2022 | |
| Non-current assets | ||
Convertible loan CarbonCuts | 1.1 | 0.2 |
Loan CarbonCuts | 2.6 | 0.6 |
Total non-current receivables | 3.7 | 0.8 |
| Current assets | ||
Trade receivables | 59.9 | 94.4 |
Under-lift of oil/NGL | 2.6 | 8.9 |
Prepayments | 24.8 | 24.2 |
Other receivables | 1.4 | 1.1 |
Total trade receivables and other current receivables | 88.7 | 128.6 |
Annual Report and Accounts 2023103
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
16 Non-current receivables, trade receivables and other current assets continued
| Past due | |||||||
USD million Total | Not past due | > 30 days | 30–60 days | 61–90 days | 91–120 days | > 120 days | |
Trade receivables | 59.9 | 59.9 | – | – | – | – | – |
Total | 59.9 | 59.9 | – | – | – | – | – |
| Past due | |||||||
USD million Tota l | Not past due | > 30 days | 30–60 days | 61–90 days | 91–120 days | > 120 days | |
Trade receivables | 94.4 | 94.4 | – | – | – | – | – |
Total | 94.4 | 94.4 | – | – | – | – | – |
USD million 2023 | 2022 | |
Product inventory, oil | 15.0 | 21.6 |
| Other stock (spares and consumables) | 39.7 | 34.3 |
Total inventories | 54.7 | 55.9 |
USD million 2023 | 2022 | |
| Non-current assets | ||
Restricted bank deposits pledged as security for abandonment obligation related to Nini/Cecilie | 64.3 | 61.1 |
| Restricted bank deposits pledged as security for cash call obligations towards TotalEnergies | 149.6 | 142.5 |
Total non-current restricted bank deposits | 213.9 | 203.7 |
| Current assets | ||
Unrestricted cash and cash equivalents | 166.7 | 268.4 |
| Restricted bank deposits | 0.1 | 0.1 |
Total current cash and cash equivalents | 166.9 | 268.4 |
Total bank deposits | 380.7 | 472.1 |
Notes continued
Annual Report and Accounts 2023104
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
USD million Level 1 | Level 2 | Level 3 | Total | |
| Assets | ||||
| Financial assets at fair value through profit or loss | ||||
– Derivative instruments interest swap, ineffective part | – | 1.2 | – | 1.2 |
| Financial assets at fair value hedging instruments | ||||
– Derivative instruments interest swap | – | 20.4 | – | 20.4 |
– Derivative instruments price hedge | – | 64.1 | – | 64.1 |
Total assets | – | 85.7 | – | 85.7 |
| Liabilities | ||||
| Financial liabilities at fair value through profit or loss | ||||
| – Embedded derivatives convertible bond BNOR15 | – | – | 53.0 | 53.0 |
| Financial liabilities at fair value hedging instruments | ||||
– Derivative instruments price hedge | – | 39.2 | – | 39.2 |
Total liabilities | – | 39.2 | 53.0 | 92.2 |
Notes continued
Annual Report and Accounts 2023105
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
19 Financial instruments continued
USD million Level 1 | Level 2 | Level 3 | Total | |
| Assets | ||||
| Financial assets at fair value through profit or loss | ||||
– Derivative instruments interest swap, ineffective part | – | 11.1 | – | 11.1 |
| Financial assets at fair value hedging instruments | ||||
– Derivative instruments interest swap | – | 44.6 | – | 44.6 |
– Derivative instruments price hedge | – | 108.9 | – | 108.9 |
Total assets | – | 164.6 | – | 164.6 |
| Liabilities | ||||
| Financial liabilities at fair value through profit or loss | ||||
– Embedded derivatives convertible bond BNOR13 | – | – | 10.0 | 10.0 |
– Embedded derivatives convertible bond BNOR15 | – | – | 38.9 | 38.9 |
| Financial liabilities at fair value hedging instruments | ||||
– Derivative instruments price hedge | – | 166.8 | – | 166.8 |
Total liabilities | – | 166.8 | 48.9 | 215.7 |
| Financial | Assets at fair | Hedging | ||
| assets at | value through | instruments | ||
| amortised cost | profit or loss | at fair value | Total | |
| Assets | ||||
Convertible loan CarbonCuts | 1.1 | – | – | 1.1 |
Loan CarbonCuts | 2.6 | – | – | 2.6 |
Derivative instruments interest swap | – | – | 21.6 | 21.6 |
Derivative instruments price hedge | – | – | 64.1 | 64.1 |
Trade receivables and other current assets | 88.7 | – | – | 88.7 |
Restricted bank deposits | 214.0 | – | – | 214.0 |
Cash and cash equivalents | 166.7 | – | – | 166.7 |
Total | 473.1 | – | 85.7 | 558.8 |
Notes continued
Annual Report and Accounts 2023106
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
19 Financial instruments continued
| Financial | Liabilities at fair | Hedging | ||
| liabilities at | value through | instruments | ||
| amortised cost | profit or loss | at fair value | Total | |
| Liabilities | ||||
Derivative instruments price hedge | – | – | 39.2 | 39.2 |
| Embedded derivatives convertible bond BNOR15 | – | 53.0 | – | 53.0 |
Convertible bond loan | 201.7 | – | – | 201.7 |
Senior unsecured bond loan | 169.1 | – | – | 169.1 |
Reserve-based lending facility | 820.8 | – | – | 820.8 |
Trade payables and other current liabilities | 125.3 | – | – | 125.3 |
Total | 1,316.9 | 53.0 | 39.2 | 1,409.1 |
| Financial | Assets at fair | Hedging | ||
| assets at | value through | instruments | ||
| amortised cost | profit or loss | at fair value | Tot al | |
| Assets | ||||
Convertible loan CarbonCuts | 0.2 | – | – | 0.2 |
Loan CarbonCuts | 0.6 | – | – | 0.6 |
Derivative instruments interest swap | – | – | 55.7 | 55.7 |
Derivative instruments price hedge | – | – | 108.9 | 108.9 |
Trade receivables and other current assets | 128.6 | – | – | 128.6 |
Restricted bank deposits | 203.7 | – | – | 203.7 |
Cash and cash equivalents | 268.4 | – | – | 268.4 |
Total | 601.5 | – | 164.6 | 766.1 |
| Financial | Liabilities at fair | Hedging | ||
| liabilities at | value through | instruments | ||
| amortised cost | profit or loss | at fair value | Tot al | |
| Liabilities | ||||
Derivative instruments price hedge | – | – | 166.8 | 166.8 |
Embedded derivatives convertible bond BNOR15 | – | 38.9 | – | 38.9 |
Embedded derivatives convertible bond BNOR13 | – | 10.0 | – | 10.0 |
Convertible bond loans | 188.7 | – | – | 188.7 |
Senior unsecured bond loan | 166.9 | – | – | 166.9 |
Reserve-based lending facility | 764.0 | – | – | 764.0 |
Deferred consideration | 25.0 | – | – | 25.0 |
Trade payables and other current liabilities | 115.6 | – | – | 115.6 |
Total | 1,260.2 | 48.9 | 166.8 | 1,476.0 |
Notes continued
Annual Report and Accounts 2023107
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Notes continued
19 Financial instruments continued
| Total amount | Carrying | Fair | |
| outstanding | amount | value | |
| Financial assets | |||
Convertible loan CarbonCuts | 1.1 | 1.1 | |
Loan CarbonCuts | 2.6 | 2.6 | |
Derivative instruments interest swap | 21.6 | 21.6 | |
Derivative instruments price hedge | 64.1 | 64.1 | |
Trade receivables and other current assets | 88.7 | 88.7 | |
Restricted bank deposits | 214.0 | 214.0 | |
Cash and cash equivalents | 166.7 | 166.7 | |
Total | 558.8 | 558.8 | |
| Financial liabilities | |||
Derivative instruments price hedge | 39.2 | 39.2 | |
| Embedded derivative convertible bond BNOR15 | 53.0 | 53.0 | |
Convertible bond loan | 228.4 | 201.7 | 175.4 |
Senior unsecured bond loan | 175.0 | 169.1 | 175.0 |
Reserve-based lending facility | 850.0 | 820.8 | 850.0 |
Trade payables and other current liabilities | 125.3 | 125.3 | |
Total | 1,253.4 | 1,409.1 | 1,417.9 |
Annual Report and Accounts 2023108
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
19 Financial instruments continued
| BNOR15 2023 | ||
Valuation date | (date) | 31 Dec 23 |
Agreement execution date | (date) | 30 Dec 22 |
Par value of bonds | (USD) 228,427,464 | |
Reference share price at time of agreement | (NOK) | 413 |
Share price at 31.12.2023 | (NOK) | 498 |
Fair value at grant date | (USD) | 38,928,552 |
Fair value at 31.12.2023 | (USD) | 53,038,213 |
PIK interest rate | (%) | 8.00% |
Expected remaining life | (years) | 2.0 |
Number of options | (#) | 4,441,461 |
Conversion price | (NOK) | 537 |
Fixed FX rate of agreement | (USD:NOK) | 10.440 |
Risk-free rate (based on government bonds) | (%) | 3.36% |
Expected volatility | (%) | 45.39% |
Model used | Black – Scholes – Merton | |
Notes continued
Annual Report and Accounts 2023109
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
19 Financial instruments continued
| Maturity | ||||||
| Less than | 1 to 3 | 3 to 6 | 6 to 9 | 9 to 12 | More than | |
| As at 31.12.2023 | 1 month | months | months | months | months | 12 months |
| Commodity forward sales contracts oil: | ||||||
Notional quantity (in mbbl) | – | 900.0 | 900.0 | 882.0 | 882.0 | 3,540.0 |
Notional amount (in USD million) | – | 55.2 | 55.2 | 63.3 | 63.3 | 259.8 |
Average hedged sales price (in USD/bbl) | – | 61.3 | 61.3 | 71.7 | 71.7 | 73.4 |
| Commodity forward sales contracts gas: | ||||||
Notional quantity (in mMWh) | – | 420.0 | 285.0 | 285.0 | 270.0 | 450.0 |
Notional amount (in EUR million) | – | 41.8 | 14.6 | 14.6 | 14.8 | 22.9 |
Average hedged sales price (in EUR/MWh) | – | 99.4 | 51.3 | 51.3 | 54.7 | 50.9 |
| USD Million Hedge Reserve | |
Balance as of 01.01.2022 | (67. 5) |
Realised cash flow hedge on revenue | 242.2 |
Realised cash flow hedge on financial items | (17.5) |
Related tax – realised cash flow hedge | (151.2) |
Changes in fair value cash flow hedge | (40.4) |
Related tax – changes in fair value cash flow hedge | 48.2 |
Balance as of 31.12.2022 | 13.9 |
Realised cash flow hedge on revenue | (19.7) |
Realised cash flow hedge on financial items | (29.3) |
Related tax – realised cash flow hedge | 19.1 |
Changes in fair value cash flow hedge | 107.8 |
Related tax – changes in fair value cash flow hedge | (66.8) |
Balance as of 31.12.2023 | 24.9 |
Notes continued
Annual Report and Accounts 2023110
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
No. of shares | Share capital* | |
Number of shares and share capital as of 01 January 2022 | 24,549,013 | 29.5 |
Issue of shares | 1,159,411 | 1.4 |
Capital reduction, approved and registered | – | (29.3) |
Number of shares and share capital as of 31 December 2022 | 25,708,424 | 1.7 |
Issue of shares | 497,425 | 0.0 |
Number of shares and share capital as of 31 December 2023 | 26,205,849 | 1.7 |
| Treasury share | ||
| No. of shares | reserve* | |
Number of treasury shares and treasury share reserve as of 01 January 2022 | (438,161) | (0.5) |
Sale of treasury shares | 300,999 | 0.3 |
Number of treasury shares and treasury share reserve as of 31 December 2022 | (137,162) | (0.1) |
Sale of treasury shares | 36,641 | 0.0 |
Number of treasury shares and treasury share reserve as of 31 December 2023 | (100,521) | (0.1) |
Notes continued
Annual Report and Accounts 2023111
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
20 Share capital continued
Shareholder* Shareholding | Ownership share | Voting share | |
Euroclear Bank S.A./N.V. | 6,815,172 | 26.0% | 26.0% |
Goldman Sachs International | 5,096,153 | 19.4% | 19.4% |
Barclays Bank PLC | 2,105,007 | 8.0% | 8.0% |
SOBER AS | 1,850,000 | 7.1% | 7.1% |
J.P. Morgan Securities LLC | 1,459,883 | 5.6% | 5.6% |
The Bank of New York Mellon SA/NV | 949,183 | 3.6% | 3.6% |
BNP Paribas | 621,520 | 2.4% | 2.4% |
CLEARSTREAM BANKING S.A. | 509,620 | 1.9% | 1.9% |
Citibank, N.A. | 499,653 | 1.9% | 1.9% |
State Street Bank and Trust Comp | 494,195 | 1.9% | 1.9% |
Sbakkejord AS | 425,500 | 1.6% | 1.6% |
FINSNES INVEST AS | 313,000 | 1.2% | 1.2% |
SOSYFR INVEST AS | 308,070 | 1.2% | 1.2% |
HANASAND | 263,150 | 1.0% | 1.0% |
ALTO HOLDING AS | 238,300 | 0.9% | 0.9% |
VELDE HOLDING AS | 230,000 | 0.9% | 0.9% |
Morgan Stanley & Co. Int. Plc. | 210,055 | 0.8% | 0.8% |
JPMorgan Chase Bank, N.A., London | 200,872 | 0.8% | 0.8% |
OUSDAL AS | 200,000 | 0.8% | 0.8% |
SONGA CAPITAL AS | 185,735 | 0.7% | 0.7% |
Total | 22,975,068 | 87.7% | 87.7% |
Other owners (ownership <0.67%) | 3,230,781 | 12.3% | 12.3% |
Total number of shares at 02 April 2024 | 26,205,849 | 100.0% | 100.0% |
Notes continued
Annual Report and Accounts 2023112
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
Notes continued
USD million 31.12.2023 | 31.12.2022 | |
Balance on 01.01. | 955.8 | 1,029.2 |
Provisions and change of estimates made during the year | 52.6 | (107.0) |
Accretion expense | 49.2 | 48.1 |
Incurred cost removal | (8.7) | (14.4) |
Currency translation adjustment | 0.1 | (0.1) |
Total provision made for asset retirement obligations | 1,049.0 | 955.8 |
| Breakdown of short-term and long-term asset retirement obligations | ||
Short-term | 15.4 | 9.8 |
Long-term | 1,033.7 | 946.1 |
Total provision for asset retirement obligations | 1,049.0 | 955.8 |
Annual Report and Accounts 2023113
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
22 Asset retirement obligations continued
| ARO | Change in | |
| ($'mm) | provision | |
Abandonment Cost Estimate | 984.7 | |
Abandonment Cost Estimate increase +40.0% | 1,376.0 | 40.0% |
Abandonment Cost Estimate increase +10.0% | 1,081.1 | 10.0% |
Abandonment Cost Estimate decrease -10.0% | 884.6 | -10.0% |
Abandonment Cost Estimate decrease -30.0% | 688.0 | -30.0% |
Discount rate +1.0% | 859.1 | -13.0% |
Discount rate -1.0% | 1,128.8 | 15.0% |
Inflation rate +1.0% | 1,127.1 | 15.0% |
Inflation rate -1.0% | 859.1 | -13.0% |
Notes continued
Annual Report and Accounts 2023114
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
31.12.2023 | 31.12.2022 | |||
| Principal | Book | Principal | Book | |
| USD million | amount | value | amount | value |
| BNOR13 Convertible Bond | – | – | 13.8 | 13.1 |
BNOR15 Convertible Bond (2) | 228.4 | 201.7 | 207.6 | 175.7 |
| BNOR14 Senior Unsecured Bond | 175.0 | 169.1 | 175.0 | 166.9 |
Total non-current bonds | 403.4 | 370.8 | 396.5 | 355.6 |
| Reserve-based lending facility | 725.0 | 695.8 | 800.0 | 764.0 |
Total non-current debt | 725.0 | 695.8 | 800.0 | 764.0 |
| Reserve-based lending facility | 125.0 | 125.0 | – | – |
| Deferred Consideration | – | – | 25.0 | 25.0 |
Total current debt | 125.0 | 125.0 | 25.0 | 25.0 |
Total borrowings | 1,253.4 | 1,191.6 | 1,221.5 | 1,144.6 |
Notes continued
Annual Report and Accounts 2023115
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
23 Borrowings continued
Cash flows | Non–cash changes | ||||||
| Receipts/ | Interest and | Conversion | Move from | ||||
Movements in interest-bearing liabilities | 31.12.22 | payments | financing cost | to shares | LT to ST | Amortisation | 31.12.23 |
BNOR13 Convertible Bond | 13.1 | – | – | (13.2) | – | 0.1 | (0.0) |
BNOR15 Convertible Bond | 175.7 | – | – | (0.1) | – | 26.2 | 201.7 |
BNOR14 Senior Unsecured Bond | 166.9 | – | (15.8) | – | – | 17. 9 | 169.1 |
| Reserve-based lending facility | 764.0 | 50.0 | (37.9) | – | (125.0) | 44.6 | 695.8 |
| Total movement non-current | |||||||
interest-bearing liabilities | 1,119.6 | 50.0 | (53.6) | (13.3) | (125.0) | 88.9 | 1,066.6 |
Reserve-based lending facility | – | – | – | – | 125.0 | – | 125.0 |
| Deferred Consideration | 25.0 | (25.0) | – | – | – | – | – |
| Total movement current | |||||||
interest-bearing liabilities | 25.0 | (25.0) | – | – | 125.0 | – | 125.0 |
Total movement in interest-bearing liabilities | 1,144.6 | 25.0 | (53.6) | (13.3) | – | 88.9 | 1,191.6 |
(1)
(2)
(1) The cash outflow from interest and financing cost of USD 37.9 million and the change in amortisation of USD 44.6 million on the reserve-based lending facility is net of realised gain on interest swap of USD 46.4 million.
(2) Classified as investing activity in the Cash Flow as it is related to the acquisition in 2019.
Cash flows | Non-cash changes | ||||||
| Receipts/ | Interest and | Conversion | Conversion | ||||
Movements in interest-bearing liabilities | 31.12.21 | payments | financing cost | to shares | BNOR15 | Amortisation | 31.12.22 |
BNOR13 Convertible Bond | 157.1 | – | – | (29.6) | (143.3) | 28.8 | 13.1 |
BNOR15 Convertible Bond | – | – | (4.4) | – | 180.1 | – | 175.7 |
BNOR14 Senior Unsecured Bond | 164.9 | – | (15.8) | – | – | 17.7 | 166.9 |
Reserve-based lending facility | 857.3 | (100.0) | (41.4) | – | – | 48.1 | 764.0 |
| Total movement non-current | |||||||
interest-bearing liabilities | 1,179.3 | (100.0) | (61.6) | (29.6) | 36.8 | 94.6 | 1,119.6 |
Deferred Consideration | 25.0 | – | – | – | – | – | 25.0 |
| Total movement current | |||||||
interest-bearing liabilities | 25.0 | – | – | – | – | – | 25.0 |
Total movement in interest-bearing liabilities | 1,204.3 | (100.0) | (61.6) | (29.6) | 36.8 | 94.6 | 1,144.6 |
Notes continued
Annual Report and Accounts 2023116
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
23 Borrowings continued
23.2 Details on borrowing
Details on borrowings outstanding on 31 December 2023
Reserve based lending facility
In April 2021, BlueNord amended its existing senior secured reserve-based credit facility to commit to a seven-year senior reserve-based credit facility of USD 1.1
billion. The facility is a reserve-based credit facility secured against certain cash flows generated by the Group. The amount available under the facility is
recalculated every six months based upon the calculated cash flow generated by certain producing fields and fields under development at an oil price and
economic assumptions agreed with the banking syndicate providing the facility. The facility is secured by a pledge over the shares of certain Group companies, a
pledge over the Company’s working interest in its share of the DUC licence and security over insurances, hedging contracts, project accounts, intercompany
loans and material contracts. The pledged assets on 31 December 2023 amounted to USD 1,355 million and represented the carrying value of the pledge of the
Group companies whose shares are pledged as described in the section 5 below (Assets pledged as security for interest-bearing debt).
Pledge value: carrying value of shares held in Altinex AS, BlueNord Denmark A/S, BlueNord Energy Denmark A/S, BlueNord Gas Denmark A/S by BlueNord ASA.
BNOR13
In July 2019, BlueNord issued a subordinated convertible bond loan of USD 158 million with a tenor of eight years where the lender was granted a right to convert
the loan into new shares in the Company at a conversion price of NOK 240 (USD 29.3) per share by way of set-off against the claim on the Company. The loan has
a mandatory conversion to equity after five years and carries an interest of 8 percent p.a. on a PIK basis, with an alternative option to pay cash interest at 6 percent
p.a., payable semi-annually. Should the instrument be in place beyond the five-year conversion period, the interest rate on BNOR13 will be reduced to 0.0 percent
for the remaining term of the loan.
In November 2022, BlueNord had proposed for some amendments to the BNOR13 bond which includes a two-year delay in the mandatory conversion date
(8 November 2023 to 31 December 2025) following the expected Tyra first gas date and an inclusion of a call option to allow the Company to redeem the BNOR13
bond with cash in December 2025. To reflect the premium of the then share price relative to the BNOR13 previous conversion price, the principal amount has been
updated from approximately USD 165 million to approximately USD 227 million by way of issuance of compensation bonds. Conversion price has been reset to
USD 51.4307 per share and interest rate remains unchanged.
In December 2022, the majority of the convertible was transferred into a new convertible instrument, BNOR15, with the remaining BNOR13 bond still being subject
to the amendments proposed by the Company in November 2022. The value of the BNOR13 convertible bond at year end is USD 63.
BNOR14
In December 2019, BlueNord successfully completed the issue of a USD 175 million unsecured bond. The proceeds are utilised for general corporate purposes
and the bond carries an interest of 9 percent p.a., payable semi-annually, with a six and a half-year tenor.
BNOR15
In December 2022, BlueNord launched an exchange offer for the BNOR13 bondholders in exchange for a new subordinated convertible bond of USD 208 million,
with revised terms and a later and more flexible conversion date in 2025. The Company issued a total of 207,641,201 new BNOR15 bonds, each with a nominal
value of USD 1. The BNOR15 bond terms mirror the amendments of the BNOR13 bond except that, inter alia, a tap issue mechanism has been included. Interest
payments are on similar terms with BNOR13, which is an interest of 8 percent p.a. on a PIK basis, with an alternative option to pay cash interest at 6 percent p.a.,
payable semi-annually.
Notes continued
Annual Report and Accounts 2023117
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
23 Borrowings continued
| Reserve–Based | ||||
| Year BNOR15 | BNOR14 | Lending Facility | Total | |
2024 | – | – | 125.0 | 125.0 |
2025 | – | – | 275.0 | 275.0 |
2026 | – | 175.0 | 275.0 | 450.0 |
2027 | – | – | 137. 5 | 137. 5 |
2028 | – | – | 37. 5 | 37. 5 |
Total | – | 175.0 | 850.0 | 1,025.0 |
Notes continued
Annual Report and Accounts 2023118
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
| Reserve–Based | ||||
Year | BNOR15 | BNOR14 | Lending Facility | Total |
Interest rate | – | 9.0% | SOFR** | |
2024 | – | 15.8 | 85.5 | 101.3 |
2025 | – | 15.8 | 63.4 | 79.2 |
2026 | – | 7.9 | 36.0 | 43.9 |
2027 | – | – | 9.6 | 9.6 |
2028 | – | – | 0.3 | 0.3 |
Total | – | 39.4 | 194.9 | 234.3 |
* BNOR13/BNOR15 carries a variable interest charge of: (i) 6 percent per annum in cash, payable semi-annually, or; (ii) 8 percent per annum PIK cumulative interest, rolled up semi-annually, to add to BNOR13/BNOR15 capital
on conversion at expiry of the bond. Currently, the Company has elected the PIK interest of 8 percent and is therefore forecasting no cash interest payments on BNOR13/BNOR15 in the above table.
** In Q3 2021, the Company entered a USD 1.0 billion swap transaction with a group of banks to fix the Company’s floating interest rate (LIBOR/SOFR from 01 November 2021) exposure under its Reserve Lending
Facility from November 2021 until 30 June 2024. BlueNord will, as a result, pay interest on its RBL cash drawings equal to 0.4041 percent plus the applicable margin.
23.5 Assets pledged as security for interest-bearing debt
Net book value in the separate financial statements of assets pledged as securities
The Group has the following pledged assets for the Reserve Based Lending facility:
USD million 2023 | 2022 | |
BlueNord ASA shares in Altinex AS | 396.8 | 393.5 |
Altinex AS shares in BlueNord Energy 8/06 Denmark B.V and other companies | 614.7 | 614.7 |
Loans from Parent to subsidiaries | 343.2 | 308.3 |
Total net book value | 1,354.7 | 1,316.5 |
USD million 2023 | 2022 | |
Trade payable | 17.5 | 17.0 |
Liabilities to operators relating to joint venture licences | 70.9 | 66.8 |
Accrued interest | 1.3 | 3.3 |
Salary accruals | 2.4 | 2.5 |
Public duties payable | 12.8 | 8.3 |
Deferred consideration | – | 25.0 |
Other current liabilities | 20.3 | 17.7 |
Total trade payables and other current liabilities | 125.3 | 140.6 |
Notes continued
23 Borrowings continued
Annual Report and Accounts 2023119
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
24 Trade payables and other payables continued
USD million 2023 | 2022 | |
USD | 40.2 | 54.7 |
DKK | 70.3 | 71.2 |
EUR | 12.3 | 11.3 |
GBP | 0.8 | 0.8 |
NOK | 1.7 | 2.6 |
Total | 125.3 | 140.6 |
Notes continued
Annual Report and Accounts 2023120
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
26 Investments in jointly owned assets
Investments in jointly own assets are included in the accounts by recognising the Group’s share of the assets, liabilities, revenues and expenses related to the
joint operation.
The Group holds the following licence equities on 31 December 2023:
Licence Field | Country | Ownership share | |
DUC | DUC | Denmark | 36.8% |
1/90 | Lulita Part | Denmark | 20.0% |
7/86 | Lulita Part | Denmark | 20.0% |
8/06B | Denmark | 36.8% |
Notes continued
Annual Report and Accounts 2023121
BlueNord
Financial Report
Consolidated Statement
of Comprehensive Income
73
Consolidated Statement of Financial Position 74
Consolidated Statement of Change in Equity 76
Consolidated Statement of Cash Flows 77
Note 1: Summary of significant accounting policies 78
Note 2: Financial risk management 84
Note 3: Critical accounting estimates
and judgements
87
Note 4: Revenue 89
Note 5: Production expenses 89
Note 6: Exploration and evaluation expenses 90
Note 7: Personal expenses 90
Note 8: Other operating expenses 91
Note 9: Intangible assets 91
Note 10: Restatement of borrowing cost 92
Note 11: Property, plant and equipment 95
Note 12: Impairments 96
Note 13: Financial income and expenses 97
Note 14: Tax 97
Note 15: Earnings per share 102
Note 16: Non-current receivables, trade
receivables and other current receivables
102
Note 17: Inventories 103
Note 18: Restricted bank deposits,
cash and cash equivalents
103
Note 19: Financial instruments 104
Note 20: Share capital 110
Note 21: Post-employment benefits 112
Note 22: Asset retirement obligations 112
Note 23: Borrowings 114
Note 24: Trade payables and other payables 118
Note 25: Guarantees 119
Note 26: Investments in jointly owned assets 120
Note 27: Contingencies and commitments 120
Note 28: Related party transactions 121
Note 29: Subsequent events 121
Contents for
Consolidated Statements
27 Contingencies and commitments continued
Notes continued
Annual Report and Accounts 2023122
BlueNord
Financial Report
Income Statement
122
Balance Sheet
123
Cash Flow Statement
125
Note 1: Accounting principles
126
Note 2: Revenue
128
Note 3: Investments in subsidiaries
128
Note 4: Restricted bank deposits
128
Note 5: Borrowings
129
Note 6: Guarantees
131
Note 7: Shareholders’ equity
131
Note 8: Share capital and shareholder information
132
Note 9: Payroll expenses and remuneration
134
Note 10: Write-down and
reversal of financial assets
134
Note 11: Tax
134
Note 12: Other operating expenses and audit fees
135
Note 13: Related party transactions
136
Supplementary oil and gas information
(unaudited)
142
Information about BlueNord 155
Contents for
Statutory Accounts
Income Statement for BlueNord ASA
(Parent Company) for the year ended 31 December
USD million Note 2023 2022
Total revenues 2, 13 3.7 2.6
Personnel expenses
10, 13 (5.8) (4.4)
Other operating expenses
12, 13 (3.5) (4.1)
Total operating expenses (9.3) (8.5)
Operating result before depreciation, amortisation and impairment (‘EBITDA’) (5.6) (5.9)
Depreciation, amortisation and impairment (0.1) (0.0)
Net operating result (‘EBIT’) (5.7) (6.0)
Reversal of financial assets
10 0.5 –
Interests received from Group companies 34.7 25.1
Interest income 1.2 0.2
Foreign exchange gains 2.0 0.1
Total financial income 38.4 25.4
Extinguishment of bond loans
5 (1.7) (57.5)
Amortised cost from bond loans (36.5) (32.8)
Interest expenses current liabilities (0.0) (0.0)
Issue of compensation bonds (0.0) –
Foreign exchange losses (1.7) (11.5)
Impairment of financial assets
10 (0.5) (2.7)
Other financial expenses (2.7) 2.5
Total financial expenses (43.1) (101.9)
Net financial items (4.7) (76.5)
Result before tax (‘EBT’) (10.4) (82.5)
Tax
11 – –
Net result for the year (10.4) (82.5)
Appropriation:
Allocated to/(from) other equity (10.4) (82.5)
Total appropriation (10.4) (82.5)
Annual Report and Accounts 2023123
BlueNord
Financial Report
Income Statement
122
Balance Sheet
123
Cash Flow Statement
125
Note 1: Accounting principles
126
Note 2: Revenue
128
Note 3: Investments in subsidiaries
128
Note 4: Restricted bank deposits
128
Note 5: Borrowings
129
Note 6: Guarantees
131
Note 7: Shareholders’ equity
131
Note 8: Share capital and shareholder information
132
Note 9: Payroll expenses and remuneration
134
Note 10: Write-down and
reversal of financial assets
134
Note 11: Tax
134
Note 12: Other operating expenses and audit fees
135
Note 13: Related party transactions
136
Supplementary oil and gas information
(unaudited)
142
Information about BlueNord 155
Contents for
Statutory Accounts
Balance Sheet for BlueNord ASA
(Parent Company) for the year ended 31 December
USD million Note 31.12.23 31.12.22
ASSETS
Non-current assets
Financial non-current assets
Investment in subsidiaries
3 396.8 393.5
Loan to Group companies
10 342.1 311.0
Restricted bank deposits
4 64.3 61.1
Machinery and equipment 0.0 0.1
Other non-current assets 0.0 0.0
Total non-current assets 803.2 765.7
Current assets
Trade receivables 0.0 0.0
Other current receivables 0.3 0.7
Total current receivables 0.3 0.7
Financial current assets
Restricted bank deposits 0.1 0.1
Cash and cash equivalents 0.3 6.0
Total financial current assets 0.5 6.1
Total current assets 0.8 6.9
Total assets 804.0 772.5
Annual Report and Accounts 2023124
BlueNord
Financial Report
Income Statement
122
Balance Sheet
123
Cash Flow Statement
125
Note 1: Accounting principles
126
Note 2: Revenue
128
Note 3: Investments in subsidiaries
128
Note 4: Restricted bank deposits
128
Note 5: Borrowings
129
Note 6: Guarantees
131
Note 7: Shareholders’ equity
131
Note 8: Share capital and shareholder information
132
Note 9: Payroll expenses and remuneration
134
Note 10: Write-down and
reversal of financial assets
134
Note 11: Tax
134
Note 12: Other operating expenses and audit fees
135
Note 13: Related party transactions
136
Supplementary oil and gas information
(unaudited)
142
Information about BlueNord 155
Contents for
Statutory Accounts
USD million Note 31.12.23 31.12.22
EQUITY AND LIABILITIES
Equity
Paid-in equity
Share capital 1.7 1.7
Share premium fund 782.9 768.4
Treasury share reserve (0.1) (0.1)
Total paid-in capital 784.5 769.9
Retained earnings
Other equity (395.6) (390.7)
Total retained earnings (395.6) (390.7)
Total equity
7 388.9 379.2
Non-current liabilities
Convertible bond loans
5 228.4 223.2
Bond loan
5 169.1 166.9
Other non-current liabilities 0.0 –
Total non-current liabilities 397.5 390.1
Current liabilities
Trade payables 16.1 1.6
Other current liabilities 1.4 1.7
Total current liabilities 17.6 3.3
Total liabilities 415.1 393.3
Total equity and liabilities 804.0 772.5
Oslo
11 April 2024
Riulf Rustad Tone Kristin Omsted Marianne Lie Colette Cohen
Executive Chair Board member Board member Board member
Robert J. McGuire Jan Lernout Peter Coleman Euan Shirlaw
Board member Board member Board member Chief Executive Officer
Balance Sheet for BlueNord ASA continued
(Parent Company) for the year ended 31 December
Annual Report and Accounts 2023125
BlueNord
Financial Report
Income Statement
122
Balance Sheet
123
Cash Flow Statement
125
Note 1: Accounting principles
126
Note 2: Revenue
128
Note 3: Investments in subsidiaries
128
Note 4: Restricted bank deposits
128
Note 5: Borrowings
129
Note 6: Guarantees
131
Note 7: Shareholders’ equity
131
Note 8: Share capital and shareholder information
132
Note 9: Payroll expenses and remuneration
134
Note 10: Write-down and
reversal of financial assets
134
Note 11: Tax
134
Note 12: Other operating expenses and audit fees
135
Note 13: Related party transactions
136
Supplementary oil and gas information
(unaudited)
142
Information about BlueNord 155
Contents for
Statutory Accounts
USD million Note 2023 2022
Net result for the period (10.4) (82.5)
Adjustments for:
Depreciation/impairment
10 0.1 0.0
Share-based payments expenses 1.9 0.5
Net financial cost/(income) 4.7 76.5
Interest received 0.1 0.2
Other financial items paid (0.0) (0.2)
Changes in:
Trade receivable 0.1 (0.1)
Trade payables 14.6 1.8
Prepayments 0.0 (0.2)
Other current balance sheet items (0.6) (0.9)
Net cash flow from operations 10.6 (4.7)
Cash flows from investing activities
Loans to Group companies (0.7) 7.6
Investment in furniture, equipment and machinery (0.0) (0.0)
Net cash flow from investing activities (0.7) 7.6
Cash flows from financing activities
Sale of shares
7 0.2 5.4
Interest and financing costs (15.8) (20.2)
Net cash flow from (used) in financing activities (15.5) (14.8)
Net change in cash and cash equivalents (5.7) (11.9)
Cash and cash equivalents at the beginning of the period 6.0 17.9
Cash and cash equivalents at end of the year 0.3 6.0
Cash Flow for BlueNord ASA
(Parent Company) for the year ended 31 December
Annual Report and Accounts 2023126
BlueNord
Financial Report
Income Statement
122
Balance Sheet
123
Cash Flow Statement
125
Note 1: Accounting principles
126
Note 2: Revenue
128
Note 3: Investments in subsidiaries
128
Note 4: Restricted bank deposits
128
Note 5: Borrowings
129
Note 6: Guarantees
131
Note 7: Shareholders’ equity
131
Note 8: Share capital and shareholder information
132
Note 9: Payroll expenses and remuneration
134
Note 10: Write-down and
reversal of financial assets
134
Note 11: Tax
134
Note 12: Other operating expenses and audit fees
135
Note 13: Related party transactions
136
Supplementary oil and gas information
(unaudited)
142
Information about BlueNord 155
Contents for
Statutory Accounts
Notes
1 Accounting principles
BlueNord ASA is a public limited liability company registered in Norway, with headquarters in Oslo (Nedre Vollgate 1, 0158 Oslo).
The annual accounts for Blue Nord ASA (‘BlueNord’ or the ‘Company’) have been prepared in compliance with the Norwegian Accounting Act (‘Accounting Act’)
and accounting principles generally accepted in Norway (‘NGAAP’) as of 31 December 2023.
The Company is listed on the Oslo Stock Exchange under the ticker ‘BNOR’. The financial statements for 2023 were approved by the Board of Directors on 11 April
2024 and will be presented for approval at the Annual General Meeting on 14 May 2024.
Going concern
The Board of Directors confirm that the financial statements have been prepared under the presumption of going concern, and that this is the basis for the
preparation of these financial statements. The financial solidity and the Company’s working capital and cash position are considered satisfactory in regards of the
planned activity level for the next 12 months.
Basis of preparation
The financial statements are prepared on the historical cost basis. The subtotals and totals in some of the tables may not equal the sum of the amounts shown due
to rounding.
Use of estimates
The preparation of financial statements in compliance with the Accounting Act requires the use of estimates. The application of the Company’s accounting
principles also require management to apply judgement. Areas, which to a great extent contain such judgements, a high degree of complexity, or areas in which
assumptions and estimates are significant for the financial statements, are described in the notes.
Revenues
Income from sale of services is recognised at fair value of the consideration, net after deduction of VAT. Services are recognised in proportion to the
workperformed.
Classification of balance sheet items
Assets intended for long-term ownership or use have been classified as fixed assets. Receivables are classified as current assets if they are to be repaid within
oneyear after the transaction date. Similar criteria apply to liabilities. First year’s instalment on non-current liabilities and non-current receivables are classified
ascurrent liabilities and assets. For interest-bearing debt where the Company is required to be in compliance with financial covenants, the loans are classified as
current liabilities if BlueNord is in breach with the covenants to that extent that the loan would be payable on the demand of the creditor. If a waiver is agreed with
the creditor prior to approval of these financial statements, the classification is carried forward in accordance with the payment schedule of the initial
borrowingagreement.
Investments in subsidiaries
For investments in subsidiaries, the cost method is applied. The cost price is increased when funds are added through capital increases or when Group
contributions are made to subsidiaries. Dividends received are initially taken as income. Dividends exceeding the portion of retained profit after the acquisition
are reflected as a reduction to book value.
Dividend/group contribution from subsidiaries are reflected in the same year as the subsidiary makes a provision for the amount.
Annual Report and Accounts 2023127
BlueNord
Financial Report
Income Statement
122
Balance Sheet
123
Cash Flow Statement
125
Note 1: Accounting principles
126
Note 2: Revenue
128
Note 3: Investments in subsidiaries
128
Note 4: Restricted bank deposits
128
Note 5: Borrowings
129
Note 6: Guarantees
131
Note 7: Shareholders’ equity
131
Note 8: Share capital and shareholder information
132
Note 9: Payroll expenses and remuneration
134
Note 10: Write-down and
reversal of financial assets
134
Note 11: Tax
134
Note 12: Other operating expenses and audit fees
135
Note 13: Related party transactions
136
Supplementary oil and gas information
(unaudited)
142
Information about BlueNord 155
Contents for
Statutory Accounts
1 Accounting principles continued
Asset impairments
Impairment tests are carried out if there is indication that the carrying amount of an asset exceeds the estimated recoverable amount. The test is performed on the
lowest level of non-current assets at which independent cash flows can be identified. If the carrying amount is higher than both the fair value less cost to sell and
recoverable amount (net present value of future use/ownership), the asset is written down to the highest of fair value less cost of disposal and the recoverableamount.
Previous impairment charges are reversed in later periods if the conditions causing the write-down are no longer present.
Foreign currencies
The functional currency and the presentation currency of the company is US dollars (‘USD’).
Assets and liabilities in foreign currencies are valued at the exchange rate on the balance sheet date. Exchange gains and losses relating to sales and purchases in
foreign currencies are recognised as other financial income and other financial expenses.
Interest-bearing bond loans, convertible bond loans and other debt to financial institutions
Interest-bearing bond loans, convertible bond loans and borrowings are initially recognised at fair value, net of transaction costs incurred and the conversion
option is not separated. Subsequently, loans and borrowings are measured at amortised cost using the EIR method. Gains and losses arising on the repurchase,
settlement or cancellation of liabilities are recognised either in interest income and other financial items or in interest and other finance expenses within net
financial items. Financial liabilities are presented as current if the liabilities are due to be settled within 12 months after the balance sheet date, or if they are held for
the purpose of being traded.
Other liabilities
Liabilities, with the exception of certain liability provisions, are recognised in the balance sheet at nominalamount.
Taxes
The tax in the income statement includes payable taxes for the period, refundable tax and changes in deferred tax. Deferred tax is calculated at relevant tax rates
on the basis of the temporary differences which exist between accounting and tax values, and any carryforward losses for tax purposes at the year-end. Tax
enhancing or tax reducing temporary differences, which are reversed or may be reversed in the same period, have been offset. Deferred tax and tax benefits
which may be shown in the balance sheet are presented net. Net deferred tax assets are not recognised due to uncertainty about future taxable profits.
Tax reduction on Group contributions given and tax on Group contribution received, recorded as a reduction of cost price or taken directly to equity, are recorded
directly against tax in the balance sheet (offset against payable taxes if the Group contribution has affected payable taxes, and offset against deferred taxes if the
Group contribution has affected deferred taxes).
Deferred tax is reflected at nominal value.
Cash flow statement
The cash flow statement has been prepared according to the indirect method. Cash and cash equivalents include cash, bank deposits, and other current investments
which immediately and with minimal exchange risk can be converted into known cash amounts, with due date less than three months from purchase date.
Share-based payments
The Company operates a number of equity-settled, share-based compensation plans, under which the entity receives services from employees as consideration
for equity instruments (options and shares) of the Company. The fair value of the employee services received in exchange for the grant of the options is recognised
as an expense.
Notes continued
Annual Report and Accounts 2023128
BlueNord
Financial Report
Income Statement
122
Balance Sheet
123
Cash Flow Statement
125
Note 1: Accounting principles
126
Note 2: Revenue
128
Note 3: Investments in subsidiaries
128
Note 4: Restricted bank deposits
128
Note 5: Borrowings
129
Note 6: Guarantees
131
Note 7: Shareholders’ equity
131
Note 8: Share capital and shareholder information
132
Note 9: Payroll expenses and remuneration
134
Note 10: Write-down and
reversal of financial assets
134
Note 11: Tax
134
Note 12: Other operating expenses and audit fees
135
Note 13: Related party transactions
136
Supplementary oil and gas information
(unaudited)
142
Information about BlueNord 155
Contents for
Statutory Accounts
1 Accounting principles continued
The total amount to be expensed is determined by reference to the fair value of the options and shares granted:
Fair value:
• includes any market performance conditions; and
• excludes the impact of any service and non-market performance vesting conditions (for example, profitability, sales growth targets and remaining an
employee of the entity over a specified timeperiod).
Non-market performance and service conditions are included in assumptions about the number of options and shares that are expected to vest. The total
expense is recognised over the vesting period (which is the period over which all of the specified vesting conditions are to be satisfied). At the end of each
reporting period, the Group revises its estimates of the number of options and shares that are expected to vest based on the non-market vesting conditions.
It recognises the impact of the revision to original estimates, if any, in the income statement, with a corresponding adjustment to equity. When the options are
exercised, the Company issues new shares. The proceeds received net of any directly attributable transaction costs are credited to share capital (nominal value)
and share premium. The social security contributions payable in connection with the grant of the share options and shares are considered an integral part of the
grant itself, and the charge will be treated as a cash-settled transaction.
2 Revenue
USD million 2023 2022
Management fee subsidiaries 3.7 2.6
Total revenue 3.7 2.6
3 Investments in subsidiaries
Investments in subsidiaries are booked according to the cost method.
USD million
Subsidiaries Location
Ownership/
voting right
Equity
31 December
Net
loss
Book
value
Altinex AS Oslo 100% 287.3 (3.4) 396.8
BlueNord UK Ltd Great Britain 100% (2.0) (0.4) –
BlueNord AS Oslo 100% 0.0 (0.0) –
Book value 31.12.23 396.8
The impairment test as of 31 December 2023 justifies the overall value of Altinex and its subsidiaries.
4 Restricted bank deposits
USD million 2023 2022
Restricted bank deposits pledged as security for abandonment obligation related to Nini/Cecilie
(1)
64.3 61.1
Other restricted bank deposits
(2)
0.1 0.1
Total restricted bank deposits 64.4 61.2
(1) In connection to the asset retirement obligation of USD 64.3 million (DKK 434 million) in the Group Company BlueNord Energy Denmark.
(2) Tax Withholding Account.
Notes continued
Annual Report and Accounts 2023129
BlueNord
Financial Report
Income Statement
122
Balance Sheet
123
Cash Flow Statement
125
Note 1: Accounting principles
126
Note 2: Revenue
128
Note 3: Investments in subsidiaries
128
Note 4: Restricted bank deposits
128
Note 5: Borrowings
129
Note 6: Guarantees
131
Note 7: Shareholders’ equity
131
Note 8: Share capital and shareholder information
132
Note 9: Payroll expenses and remuneration
134
Note 10: Write-down and
reversal of financial assets
134
Note 11: Tax
134
Note 12: Other operating expenses and audit fees
135
Note 13: Related party transactions
136
Supplementary oil and gas information
(unaudited)
142
Information about BlueNord 155
Contents for
Statutory Accounts
5 Borrowings
5.1 Summary of borrowings
USD million 2023 2022
BNOR13 Convertible Bond – 14.2
BNOR15 Convertible Bond 228.4 209.0
BNOR14 Senior Unsecured Bond 169.1 166.9
Total non-current bonds 397.5 390.1
Total borrowings 397.5 390.1
Details on borrowings outstanding on 31 December 2023
BNOR13
In July 2019, BlueNord issued a subordinated convertible bond loan of USD 158 million with a tenor of eight years where the lender was granted a right to convert
the loan into new shares in the Company at a conversion price of NOK 240 (USD 29.3) per share by way of set-off against the claim on the Company. The loan has
a mandatory conversion to equity after five years and carries an interest of 8 percent p.a. on a PIK basis, with an alternative option to pay cash interest at 6 percent
p.a., payable semi-annually. Should the instrument be in place beyond the five-year conversion period, the interest rate on BNOR13 will be reduced to 0.0 percent
for the remaining term of the loan.
In November 2022, BlueNord had proposed for some amendments to the BNOR13 bond which includes a two-year delay in the mandatory conversion date
(08 November 2023 to 31 December 2025) following the expected Tyra first gas date and an inclusion of a call option to allow the Company to redeem the
BNOR13 bond with cash in December 2025. To reflect the premium of the then share price relative to the BNOR13 previous conversion price, the principal amount
has been updated from approximately USD 165 million to approximately USD 227 million by way of issuance of compensation bonds. Conversion price has been
reset to USD 51.4307 per share and interest rate remains unchanged.
In December 2022, the majority of the remaining convertible loan was transferred into the new convertible instrument, BNOR15 and, of the remaining USD 13.8 million
outstanding on 31 December 2022, USD 14.2 million was converted into equity by 26 January 2023, including conversion of USD 0.5 million in accumulated interests.
The remaining BNOR13 bond was then subject to the amendments as proposed by the Company in November 2022 and USD 48.2 thousand compensation bonds
were issued on 26 January. The amendment to BNOR13 terms aligns the terms of the remaining bond with that of the BNOR15 bond. In December 2023, USD
195,723 was converted into equity and so the outstanding value of BNOR13 is USD 63 in Q4 2023. Given the insignificant amount outstanding on BNOR13, this has
been assumed as nil in the reporting.
BNOR14
The Company issued a senior unsecured bond of USD 175 million in 2019, due in June 2026. The bond carries an interest of 9 percent p.a., payable semi-annually. In
July 2021, BlueNord’s written resolution regarding the addition of further headroom under the Leverage Ratio covenant through to the end of 2023 was resolved
and approved by the Company’s BNOR14 bondholders. Based on this written resolution, the maximum Leverage Ratio has been amended to 7.0x (from 5.0x)
ending Q2 2023, 6.0x (from 3.0x) during Q3 2023 and 5.0x (from 3.0x) during Q4 2023. From Q1 2024 onwards, the maximum Leverage Ratio will revert to 3.0x per
the original bond terms. In addition to the change in maximum permitted leverage, BlueNord’s minimum bank deposits threshold has increased to USD 75 million
until the end of 2023 (from USD 50 million until end Q2 2023 and USD 25 million during Q3 and Q4 2023).
Notes continued
Annual Report and Accounts 2023130
BlueNord
Financial Report
Income Statement
122
Balance Sheet
123
Cash Flow Statement
125
Note 1: Accounting principles
126
Note 2: Revenue
128
Note 3: Investments in subsidiaries
128
Note 4: Restricted bank deposits
128
Note 5: Borrowings
129
Note 6: Guarantees
131
Note 7: Shareholders’ equity
131
Note 8: Share capital and shareholder information
132
Note 9: Payroll expenses and remuneration
134
Note 10: Write-down and
reversal of financial assets
134
Note 11: Tax
134
Note 12: Other operating expenses and audit fees
135
Note 13: Related party transactions
136
Supplementary oil and gas information
(unaudited)
142
Information about BlueNord 155
Contents for
Statutory Accounts
5 Borrowings continued
BNOR15
The Company issued a convertible bond loan of USD 207.6 million in December 2022, with a five-year tenor and a conversion to equity or cash settlement after
three years (31 December 2025). BNOR15 is made up of a transfer from BNOR13 of USD 151.4 million plus additional compensation bonds of USD 56.2 million.
Similarly, to BNOR13, the lender was granted a right to convert the loan into new shares in the Company by way of set-off against the claim on the Company. The
loan carries an interest of 8 percent p.a. on a PIK basis, with an alternative option to pay cash interest at 6 percent p.a., payable semi-annually. In Q1 2023, USD 0.1
million was converted into equity.
5.2 Covenants
Reserve-based lending facility
The reserve-based credit facility constitutes senior debt of the Company and is secured on a first priority basis against certain of the Company’s subsidiaries and
their assets. The reserve-based credit facility agreement contains a financial covenant that the ratio of Net Debt to EBITDAX (earnings before interest, tax,
depreciation, amortisation and exploration) shall be: less than 6.0:1.0 at the end of financial years 2021 and 2022; less than 3.5:1.0 at the end of financial year 2023;
and less than 3.0:1.0 at the end of financial year 2024 onwards until the expiry of the facility. Each test is carried out on the audited full-year financial statements of
BlueNord ASA. BlueNord must also demonstrate minimum bank deposits on a look forward basis of USD 50 million during the relevant period, which is the latest
of completion of the Tyra redevelopment project and following 12-month period. The agreement also includes special covenants which, among other, restrict the
Company from taking on additional secured debt, provide parameters for minimum and maximum hedging requirements and restrict declaration of dividends or
other distributions. BlueNord is in compliance with these covenants at the end of 2023.
BNOR14
In July 2021, BlueNord’s written resolution regarding the addition of further headroom under the Leverage Ratio covenant through to the end of 2023 was resolved
and approved by the Company’s BNOR14 bondholders. Based on this written resolution, the maximum Leverage Ratio has been amended to 7.0x (from 5.0x)
during the Tyra Redevelopment Period ending Q2 2023, 6.0x (from 3.0x) during Q3 2023 and 5.0x (from 3.0x) during Q4 2023. From Q1 2024 onwards, the
maximum Leverage Ratio will revert to 3.0x per the original bond terms. In addition to the change in maximum permitted leverage, BlueNord’s minimum bank
deposits threshold has increased to USD 75 million until the end of 2023 (from USD 50 million until end Q2 2023 and USD 25 million during Q3 and Q4 2023).
BlueNord is in compliance with the covenants at the end of 2023.
5.3 Payment structure
Principal BNOR14 Total
2026 175.0 175.0
Total 175.0 175.0
Interest payments at 31.12.2023 BNOR15* BNOR14 Total
Interest rate – 9.00%
2024 – 15.8 15.8
2025 – 15.8 15.8
2026 – 7.9 7.9
Total – 39.4 39.4
* BNOR15 carries a variable interest charge of: (i) 6 percent per annum in cash, payable semi-annually, or; (ii) 8 percent per annum PIK cumulative interest, rolled up semi-annually, to add to BNOR15 capital on conversion
at expiry of the bond. Currently, the Company has elected the PIK interest of 8 percent and is therefore forecasting no cash interest payments on BNOR15 in the above table.
Notes continued
Annual Report and Accounts 2023131
BlueNord
Financial Report
Income Statement
122
Balance Sheet
123
Cash Flow Statement
125
Note 1: Accounting principles
126
Note 2: Revenue
128
Note 3: Investments in subsidiaries
128
Note 4: Restricted bank deposits
128
Note 5: Borrowings
129
Note 6: Guarantees
131
Note 7: Shareholders’ equity
131
Note 8: Share capital and shareholder information
132
Note 9: Payroll expenses and remuneration
134
Note 10: Write-down and
reversal of financial assets
134
Note 11: Tax
134
Note 12: Other operating expenses and audit fees
135
Note 13: Related party transactions
136
Supplementary oil and gas information
(unaudited)
142
Information about BlueNord 155
Contents for
Statutory Accounts
5 Borrowings continued
5.4 Pledged assets
Pledged assets relate to the carrying value of the pledged shares under the reserve-based lending facility entered into by the wholly owned subsidiary Altinex AS, please
see note 23 in the Consolidated financial statements.
6 Guarantees
Overview of issued guarantees on 31 December 2023
The parent company of the Group, BlueNord ASA (‘BlueNord’), has issued a Parent Company guarantee to the Danish Ministry of Climate, Energy and Building on
behalf of its subsidiary BlueNord Energy Denmark A/S and BlueNord Gas Denmark A/S.
The Company has provided a parent company guarantee to the Danish Ministry of Climate, Energy and Utilities related to the Group’s activities on the Danish
continental shelf, including BlueNord’s participation in the Tyra West Pipeline and the Lulita licence. The Company has also provided a parent company guarantee
towards the lenders in relation to the Company’s USD 1.1 billion reserve-based lending facility and customary obligations/guarantees under joint operating
agreements. BlueNord has also provided a parent company guarantee to Shell Energy Europe Limited in relation to its subsidiary BlueNord Energy Denmark
A/S’s obligations under a gas offtake and transportation agreement capped at EUR 30 million.
Furthermore, the Company has provided a parent company guarantee to Total E&P Denmark A/S for its obligations under the JOA together with a guarantee
from Shell. BlueNord has provided standby Letters of Credit of USD 100 million, issued under the USD 100 million sub-limit of the RBL facility for the benefit of Shell
in connection with this guarantee.
In relation to BlueNord’s historic operations in the UK North Sea, the Company has issued a parent company guarantee on behalf of its subsidiaries BlueNord
UKLtd and BlueNord Energy UK Limited.
On 31 December 2012, BlueNord issued a parent company guarantee on behalf of its subsidiary Noreco Norway AS. BlueNord guarantees that, if any amounts
become payable by Noreco Norway AS to the Norwegian Secretary of State under the terms of the licences and the Company does not repay those amounts on
first demand, BlueNord shall pay to the Norwegian Secretary of State on demand an amount equal to all such amounts. Noreco Norway AS was liquidated in 2018,
however as per 31 December 2023, the guarantee has not been withdrawn.
7 Shareholders’ equity
Changes in equity
All figures in USD million
Share
capital
Share
premium
Treasury
reserve
Other
equity Total
Equity 31 December 2022 1.7 768.4 (0.1) (390.7) 379.2
Issue of shares 0.0 14.5 – – 14.6
Conversion bonds – – – 0.5 0.5
Share-based incentive program – – 0.0 5.0 5.1
Net result for the period – – – (10.4) (10.4)
Equity 31 December 2023 1.7 782.9 (0.1) (395.6) 388.9
Notes continued
Annual Report and Accounts 2023132
BlueNord
Financial Report
Income Statement
122
Balance Sheet
123
Cash Flow Statement
125
Note 1: Accounting principles
126
Note 2: Revenue
128
Note 3: Investments in subsidiaries
128
Note 4: Restricted bank deposits
128
Note 5: Borrowings
129
Note 6: Guarantees
131
Note 7: Shareholders’ equity
131
Note 8: Share capital and shareholder information
132
Note 9: Payroll expenses and remuneration
134
Note 10: Write-down and
reversal of financial assets
134
Note 11: Tax
134
Note 12: Other operating expenses and audit fees
135
Note 13: Related party transactions
136
Supplementary oil and gas information
(unaudited)
142
Information about BlueNord 155
Contents for
Statutory Accounts
8 Share capital and shareholder information
2023 2022
Ordinary shares 26,205,849 25,708,424
Treasury shares (100,521) (137,162)
Total shares 26,105,328 25,571,262
Par value in NOK 10 10
BlueNord owns 100,521 of its own shares. All shares have equal rights. All shares are fully paid.
Changes in number of shares and share capital:
No. of shares Share capital*
Number of shares and share capital as of 1 January 2022 24,549,013 29.5
Issue of shares 1,159,411 1.4
Capital reduction, approved and registered – (29.3)
Share capital as of 31.12.22 25,708,424 1.7
Issue of shares 497,425 0.0
Share capital as of 31.12.23 26,205,849 1.7
No. of shares
Treasury
share reserve*
Treasury shares as of 1 January 2022 (438,161) (0.5)
Sale of Treasury shares 300,999 0.3
Treasury shares as of 31.12.22 (137,162) (0.1)
Sale of Treasury shares 36,641 0.0
Treasury shares as of 31.12.23 (100,521) (0.1)
* In USD million.
Changes in 2023
The Company received conversion notice from bondholders holding BNOR13 and BNOR15 bonds for a total principal amount of USD 14.6 million in 2023, which
pursuant to the bond terms are convertible into 497,425 new shares in the Company. The BNOR13 conversion in January had a conversion price of USD 28.9734, the
following conversions had a conversion price of USD 51.4307 according to the new bond terms. Following such conversions, the share capital is increased with NOK
268.5/USD32.7 thousands.
The Company sold 36,641 of its own shares during the year, of which 23,641 shares was related to first award of the Long-Term Incentive program (LTI).
The shares price at transfer date was 475 NOK/share. In addition, 13,000 shares were sold to cover exercise of options held by former employees at strike
price 160 NOK/share.
Notes continued
Annual Report and Accounts 2023133
BlueNord
Financial Report
Income Statement
122
Balance Sheet
123
Cash Flow Statement
125
Note 1: Accounting principles
126
Note 2: Revenue
128
Note 3: Investments in subsidiaries
128
Note 4: Restricted bank deposits
128
Note 5: Borrowings
129
Note 6: Guarantees
131
Note 7: Shareholders’ equity
131
Note 8: Share capital and shareholder information
132
Note 9: Payroll expenses and remuneration
134
Note 10: Write-down and
reversal of financial assets
134
Note 11: Tax
134
Note 12: Other operating expenses and audit fees
135
Note 13: Related party transactions
136
Supplementary oil and gas information
(unaudited)
142
Information about BlueNord 155
Contents for
Statutory Accounts
8 Share capital and shareholder information continued
Overview of shareholders at 02 April 2024:
Shareholder* Shareholding Ownership share Voting share
Euroclear Bank S.A./N.V. 6,815,172 26.0% 26.0%
Goldman Sachs International 5,096,153 19.4% 19.4%
Barclays Bank PLC 2,105,007 8.0% 8.0%
SOBER AS 1,850,000 7.1% 7.1%
J.P. Morgan Securities LLC 1,459,883 5.6% 5.6%
The Bank of New York Mellon SA/NV 949,183 3.6% 3.6%
BNP Paribas 621,520 2.4% 2.4%
CLEARSTREAM BANKING S.A. 509,620 1.9% 1.9%
Citibank, N.A. 499,653 1.9% 1.9%
State Street Bank and Trust Comp 494,195 1.9% 1.9%
Sbakkejord AS 425,500 1.6% 1.6%
FINSNES INVEST AS 313,000 1.2% 1.2%
SOSYFR INVEST AS 308,070 1.2% 1.2%
HANASAND 263,150 1.0% 1.0%
ALTO HOLDING AS 238,300 0.9% 0.9%
VELDE HOLDING AS 230,000 0.9% 0.9%
Morgan Stanley & Co. Int. Plc. 210,055 0.8% 0.8%
JPMorgan Chase Bank, N.A., London 200,872 0.8% 0.8%
OUSDAL AS 200,000 0.8% 0.8%
SONGA CAPITAL AS 185,735 0.7% 0.7%
Total 22,975,068 87.7% 87.7%
Other owners (ownership <0.67%) 3,230,781 12.3% 12.3%
Total number of shares at 02 April 2024 26,205,849 100.0% 100.0%
* Nominee holder.
Notes continued
Annual Report and Accounts 2023134
BlueNord
Financial Report
Income Statement
122
Balance Sheet
123
Cash Flow Statement
125
Note 1: Accounting principles
126
Note 2: Revenue
128
Note 3: Investments in subsidiaries
128
Note 4: Restricted bank deposits
128
Note 5: Borrowings
129
Note 6: Guarantees
131
Note 7: Shareholders’ equity
131
Note 8: Share capital and shareholder information
132
Note 9: Payroll expenses and remuneration
134
Note 10: Write-down and
reversal of financial assets
134
Note 11: Tax
134
Note 12: Other operating expenses and audit fees
135
Note 13: Related party transactions
136
Supplementary oil and gas information
(unaudited)
142
Information about BlueNord 155
Contents for
Statutory Accounts
9 Payroll expenses and remuneration
USD million 2023 2022
Salaries (incl. Directors’ fees) (2.6) (3.1)
Social security tax (0.9) (0.5)
Pension costs
(1)
(0.1) (0.1)
Costs relating to share-based payments (1.9) (0.5)
Other personnel expenses (0.2) (0.2)
Total personnel expenses (5.8) (4.4)
Average number of employees 8.0 7.6
(1) Norwegian companies are obliged to have an occupational pension in accordance with the Norwegian Act related to mandatory occupational pension. BlueNord ASA meets the Norwegian requirements for
mandatory occupational pension (‘obligatorisk tjenestepensjon’).
For further information on remuneration to key management personnel and Board of Directors, please see note 7 in the Consolidated financial statements.
10 Write-down and reversal of financial assets
USD million 2023 2022
Net impairment loans to subsidiaries (0.5) (2.7)
Net reversal of prior years’ impairments on loans to subsidiaries 0.5 –
Net impairment of financial assets (0.0) (2.7)
Write-down of loans to subsidiaries in 2023 consists of impairment of loans in BlueNord UK Ltd. The reversal of previous years’ impairment is related to BlueNord
Energy UK Ltd. The intercompany loans to the UK investment are impaired to zero.
Write-down of loans to subsidiaries in 2022 consists of impairment of loans to BlueNord UK Ltd. and BlueNord Energy Ltd. The intercompany receivables to the
UK investment are impaired to zero.
11 Tax
Reconciliation of nominal to actual tax rate:
USD million 2023 2022
Result before tax (10.4) (82.5)
Corporation income tax of income (loss) before tax -22% (2.3) (18.2)
Calculated tax expense (2.3) (18.2)
Permanent differences 1.0 12.5
Changes in deferred tax assets – not recognised 1.3 3.7
Prior year adjustments – 2.0
Income tax expense – –
Notes continued
Annual Report and Accounts 2023135
BlueNord
Financial Report
Income Statement
122
Balance Sheet
123
Cash Flow Statement
125
Note 1: Accounting principles
126
Note 2: Revenue
128
Note 3: Investments in subsidiaries
128
Note 4: Restricted bank deposits
128
Note 5: Borrowings
129
Note 6: Guarantees
131
Note 7: Shareholders’ equity
131
Note 8: Share capital and shareholder information
132
Note 9: Payroll expenses and remuneration
134
Note 10: Write-down and
reversal of financial assets
134
Note 11: Tax
134
Note 12: Other operating expenses and audit fees
135
Note 13: Related party transactions
136
Supplementary oil and gas information
(unaudited)
142
Information about BlueNord 155
Contents for
Statutory Accounts
11 Tax continued
Deferred tax liability and deferred tax assets:
USD million 2023 2022
Net operating loss deductible 98.1 98.8
Interest limitation carried forward 34.7 35.8
Fixed assets 0.0 0.0
Current assets (24.2) (21.8)
Liabilities 34.5 18.1
Tax base deferred tax liability/deferred tax asset 143.1 130.9
Net deferred tax liability/(deferred tax asset) (22%) (31.5) (28.8)
Unrecognised deferred tax asset 31.5 28.8
12 Other operating expenses and audit fees
USD million 2023 2022
Lease expenses (0.1) (0.2)
IT expenses (0.7) (0.2)
Travel expenses (0.2) (0.2)
General and administrative costs (0.2) (0.1)
Consultant fees (1.8) (2.9)
Other operating expenses (0.5) (0.5)
Total other operating expenses (3.5) (4.1)
Expensed audit fee:
USD 1000, excl. VAT 2023 2022
Auditor's fees (232.7) (313.0)
Other services (86.1) (65.4)
Total audit fees (318.8) (378.4)
Notes continued
Annual Report and Accounts 2023136
BlueNord
Financial Report
Income Statement
122
Balance Sheet
123
Cash Flow Statement
125
Note 1: Accounting principles
126
Note 2: Revenue
128
Note 3: Investments in subsidiaries
128
Note 4: Restricted bank deposits
128
Note 5: Borrowings
129
Note 6: Guarantees
131
Note 7: Shareholders’ equity
131
Note 8: Share capital and shareholder information
132
Note 9: Payroll expenses and remuneration
134
Note 10: Write-down and
reversal of financial assets
134
Note 11: Tax
134
Note 12: Other operating expenses and audit fees
135
Note 13: Related party transactions
136
Supplementary oil and gas information
(unaudited)
142
Information about BlueNord 155
Contents for
Statutory Accounts
13 Related party transactions
Transactions with related party
USD million 2023 2022
a) Allocation of cost to Group companies, Management fee 3.7 2.6
b) Allocation of cost to Group companies, IT expenses 0.7 0.5
c) Purchases of services – –
d) Sale of assets – –
Interest income and interest expenses to Group companies are presented separately in the income statement.
Services are charged between Group companies at an hourly rate which corresponds to similar rates between independent parties. Allocation of IT and
management fee to Group companies amounts to USD 4.4 million for 2023.
Balances with Group companies
Carrying value of balances with Group companies are stated on the face of the balance sheet and are all related to 100 percent controlled subsidiaries.
BlueNord did not have any other transactions with any other related parties during 2023. Please see the Executive Remuneration Report 2023 for Director’s fee paid
to shareholders and remuneration to management.
Notes continued
137 Annual Report and Accounts 2023
BlueNord
Financial Report
To the General Meeting of BlueNord ASA
Opinion
We have audited the financial statements of BlueNord ASA, which comprise:
• the financial statements of the parent company BlueNord ASA (the Company), which comprise the
balance sheet as at 31 December 2023, the income statement and cash flow statement for the year
then ended, and notes to the financial statements, including a summary of significant accounting
policies, and
• the consolidated financial statements of BlueNord ASA and its subsidiaries (the Group), which
comprise the consolidated statement of financial position as at 31 December 2023, the consolidated
statement of comprehensive income, consolidated statement of changes in equity and consolidated
statement of cash flows for the year then ended, and notes to the financial statements, including
material accounting policy information.
In our opinion
• the financial statements comply with applicable statutory requirements,
• the financial statements give a true and fair view of the financial position of the Company as at
31 December 2023, and its financial performance and its cash flows for the year then ended in
accordance with the Norwegian Accounting Act and accounting standards and practices generally
accepted in Norway, and
• the consolidated financial statements give a true and fair view of the financial position of the Group as
at 31 December 2023, and its financial performance and its cash flows for the year then ended in
accordance with IFRS Accounting Standards as adopted by the EU.
Our opinion is consistent with our additional report to the Audit Committee.
Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs). Our
responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit
of the Financial Statements section of our report. We are independent of the Company and the Group as
required by relevant laws and regulations in Norway and the International Ethics Standards Board for
Accountants’ International Code of Ethics for Professional Accountants (including International
Independence Standards) (IESBA Code), and we have fulfilled our other ethical responsibilities in
accordance with these requirements. We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our opinion.
To the best of our knowledge and belief, no prohibited non-audit services referred to in the Audit
Regulation (537/2014) Article 5.1 have been provided.
We have been the auditor of the Company for 16 years from the election by the general meeting of the
shareholders on 25 April 2008 for the accounting year 2008.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our
audit of the financial statements of the current period. These matters were addressed in the context of
our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide
a separate opinion on these matters.
Impairment trigger assessment
Refer to note 3.2, critical accounting estimates and assumptions (section d), note 9 Intangible assets,
note 11 Property, plant and equipment and note 12 Impairments.
The key audit matter How the matter was addressed in our audit
As at 31 December 2023, the Group has
Property, plant and equipment of USD 2,427.9
million and intangible assets of USD 151.6 million.
The Group did not recognise any impairment
charge in 2023.
The recoverable amounts of producing assets
and assets under construction are sensitive to
changes in assumptions, in particular oil and gas
prices, potential cost overruns, discount rate and
oil and gas reserves. Any negative developments
in these assumptions and forecasts may be an
impairment trigger.
Significant auditor judgment is required
when evaluating managements impairment
trigger assessment.
For the cash-generating unit we critically assessed
and challenged the assumptions used in
managements impairment trigger assessment,
including:
• comparison of the Group equity against market
capitalisation including an assessment as to how
much of the headroom should be contributed to
the cash-generating unit
• Assessed whether the capitalisation of interest
for the current and previous years should be
considered an impairment trigger
We also evaluated the adequacy and
appropriateness of the disclosures in the
financial statements.
Independent Auditor’s Report
Report on the Audit of the Financial Statements
138 Annual Report and Accounts 2023
BlueNord
Financial Report
Assets retirement obligations
Refer to note 3.2 Critical accounting estimates (section c) and assumptions and note 22 Assets
retirement obligations.
The key audit matter How the matter was addressed in our audit
As at 31 December 2023, the Group has
non-current Assets retirement obligations of
USD 1,033.7 million and current Asset retirement
obligations of USD 15.4 million.
The determination of the asset retirement
obligations (“ARO”) involves judgement related to
the estimation of future costs, the discount rate
applied, the economic cut-off date for fields and
the related timing of the expected costs.
Significant auditor judgment is required when
evaluating the asset retirement obligations
and to determine whether there is sufficient
evidence available to support the estimates
and judgments made.
Our audit procedures in this area included:
• Assessing management’s process to determine
the present value of the estimated future
decommissioning and removal expenditures
required by local conditions and requirements.
• We critically assessed and challenged the link
between the economic cut-off date for fields for
consistency to the reserves estimate, for which
a third party assessment has been obtained.
• We assessed and challenged managements
expected future costs estimates by comparing
these to reports from the operator company
and evaluating the historical accuracy of the
cost estimates.
• Assessing the discount and inflation rate applied
with reference to industry practice along with
market and Company data.
• We assessed the mathematical and
methodological integrity of management’s
valuation model.
We also evaluated the adequacy and
appropriateness of the disclosures in the
financial statements.
Other Information
The Board of Directors and the Managing Director (management) are responsible for the information
in the Board of Directors’ report and the other information accompanying the financial statements.
The other information comprises information in the annual report, but does not include the financial
statements and our auditor’s report thereon. Our opinion on the financial statements does not cover
the information in the Board of Directors’ report nor the other information accompanying the
financial statements.
In connection with our audit of the financial statements, our responsibility is to read the Board of Directors’
report and the other information accompanying the financial statements. The purpose is to consider if
there is material inconsistency between the Board of Directors’ report and the other information
accompanying the financial statements and the financial statements or our knowledge obtained in the
audit, or whether the Board of Directors’ report and the other information accompanying the financial
statements otherwise appears to be materially misstated. We are required to report if there is a material
misstatement in the Board of Directors’ report or the other information accompanying the financial
statements. We have nothing to report in this regard.
Based on our knowledge obtained in the audit, it is our opinion that the Board of Directors’ report
• is consistent with the financial statements and
• contains the information required by applicable statutory requirements.
Our opinion on the Board of Director’s report applies correspondingly to the statements on Corporate
Governance and Corporate Social Responsibility.
Responsibilities of Management for the Financial Statements
Management is responsible for the preparation of financial statements of the Company that give a true
and fair view in accordance with the Norwegian Accounting Act and accounting standards and practices
generally accepted in Norway, and for the preparation of the consolidated financial statements of the
Group that give a true and fair view in accordance with IFRS Accounting Standards as adopted by the
EU. Management is responsible for such internal control as management determines is necessary to
enable the preparation of financial statements that are free from material misstatement, whether due to
fraud or error.
In preparing the financial statements, management is responsible for assessing the Company’s and the
Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern.
The financial statements of the Company use the going concern basis of accounting insofar as it is not
likely that the enterprise will cease operations. The consolidated financial statements of the Group use
the going concern basis of accounting unless management either intends to liquidate the Group or to
cease operations, or has no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole
are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with ISAs will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in aggregate,
they could reasonably be expected to influence the economic decisions of users taken on the basis of
these financial statements.
As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional
scepticism throughout the audit. We also:
• identify and assess the risks of material misstatement of the financial statements, whether due to
fraud or error. We design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a
material misstatement resulting from fraud is higher than for one resulting from error, as fraud may
involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Independent Auditor’s Report continued
Report on the Audit of the Financial Statements
139 Annual Report and Accounts 2023
BlueNord
Financial Report
• obtain an understanding of internal control relevant to the audit in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Company’s and the Group’s internal control.
• evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.
• conclude on the appropriateness of management’s use of the going concern basis of accounting and,
based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the Company’s and the Group’s ability to continue as a
going concern. If we conclude that a material uncertainty exists, we are required to draw attention in
our auditor’s report to the related disclosures in the financial statements or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to
the date of our auditor’s report. However, future events or conditions may cause the Company and the
Group to cease to continue as a going concern.
• evaluate the overall presentation, structure and content of the financial statements, including the
disclosures, and whether the financial statements represent the underlying transactions and events in
a manner that achieves a true and fair view.
• obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the Group to express an opinion on the consolidated financial statements.
We are responsible for the direction, supervision and performance of the group audit. We remain
solely responsible for our audit opinion.
We communicate with the Board of Directors regarding, among other matters, the planned scope and
timing of the audit and significant audit findings, including any significant deficiencies in internal control
that we identify during our audit.
We also provide the Audit Committee with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other
matters that may reasonably be thought to bear on our independence, and where applicable,
related safeguards.
From the matters communicated with the Board of Directors, we determine those matters that were of
most significance in the audit of the financial statements of the current period and are therefore the key
audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should
not be communicated in our report because the adverse consequences of doing so would reasonably
be expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
Report on Compliance with Requirement on European Single Electronic Format (ESEF)
Opinion
As part of the audit of the financial statements of BlueNord ASA, we have performed an assurance
engagement to obtain reasonable assurance about whether the financial statements included in the
annual report, with the file name bluenordasa-2023-12-31-en, have been prepared, in all material
respects, in compliance with the requirements of the Commission Delegated Regulation (EU) 2019/815
on the European Single Electronic Format (ESEF Regulation) and regulation pursuant to Section 5-5 of
the Norwegian Securities Trading Act, which includes requirements related to the preparation of the
annual report in XHTML format, and iXBRL tagging of the consolidated financial statements.
In our opinion, the financial statements, included in the annual report, have been prepared, in all material
respects, in compliance with the ESEF regulation.
Management’s Responsibilities
Management is responsible for the preparation of the annual report in compliance with the ESEF
regulation. This responsibility comprises an adequate process and such internal control as management
determines is necessary.
Auditor’s Responsibilities
Our responsibility, based on audit evidence obtained, is to express an opinion on whether, in all material
respects, the financial statements included in the annual report have been prepared in compliance with
ESEF. We conduct our work in compliance with the International Standard for Assurance Engagements
(ISAE) 3000 – “Assurance engagements other than audits or reviews of historical financial information”.
The standard requires us to plan and perform procedures to obtain reasonable assurance about
whether the financial statements included in the annual report have been prepared in compliance with
the ESEF Regulation.
As part of our work, we have performed procedures to obtain an understanding of the Company’s
processes for preparing the financial statements in compliance with the ESEF Regulation. We examine
whether the financial statements are presented in XHTML-format. We evaluate the completeness and
accuracy of the iXBRL tagging of the consolidated financial statements and assess management’s use
of judgement. Our procedures include reconciliation of the iXBRL tagged data with the audited financial
statements in human-readable format. We believe that the evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion.
Oslo,
11 April 2024
KPMG AS
Mona Irene Larsen
State Authorised Public Accountant
(This document is signed electronically)
Independent Auditor’s Report continued
Report on the Audit of the Financial Statements
140 Annual Report and Accounts 2023
BlueNord
Financial Report
Board and management confirmation
Today, the Board of Directors and the Chief Executive Officer reviewed and approved the Board of
Directors’ Report and the BlueNord ASA consolidated and separate annual financial statements as
of 31 December 2023.
To the best of our knowledge, we confirm that:
• the BlueNord ASA consolidated annual financial statements for 2023 have been prepared in
accordance with IFRS Accounting Standards as adopted by the EU, and additional Norwegian
disclosure requirements in the Norwegian Accounting Act;
• the financial statements for BlueNord ASA have been prepared in accordance with the Norwegian
Accounting Act and Norwegian Accounting Standards;
• that the Board of Directors’ Report for the Group and the parent company is in accordance with the
requirements in the Norwegian Accounting Act and Norwegian Accounting Standard no 16;
• that the information presented in the financial statements gives a true and fair view of the Company’s
and the Group’s assets, liabilities, financial position and results for the period viewed in their entirety;
and
• that the Board of Directors’ Report gives a true and fair view of the development, performance,
financial position, principle risks and uncertainties of the Company and the Group.
Oslo
11 April 2024
Riulf Rustad Tone Kristin Omsted Marianne Lie Colette Cohen
Executive Chair Board member Board member Board member
Robert J. McGuire Jan Lernout Peter Coleman Euan Shirlaw
Board member Board member Board member Chief Executive Officer
Statement of Compliance
141 Annual Report and Accounts 2023
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Financial Report
Alternative Performance Measures
BlueNord chooses to disclose Alternative Performance Measures as part of its financial reporting as a
supplement to the financial statements prepared in accordance with the IFRS. This information is provided
as useful supplemental information to investors, security analysts and other stakeholders to provide an
enhanced insight into the financial development of BlueNord’s business operations and to improve
comparability between periods.
EBITDA Earnings before interest, taxes, depreciation, depletion, amortisation and impairments. EBITDA
assists in comparing performance on a consistent basis without regard to depreciation and amortisation,
which can vary significantly depending on accounting methods or non-operating factors and provides a
more complete and comprehensive analysis of our operating performance relative to other companies.
Adj. EBITDA is EBITDA adjusted for the cost based on fair value of the share-options programme and
Non-payment insurance as these costs are related to the DUC acquisition and not directly related to the
operational result for the year.
USD million 2023 2022
EBITDA 421.4 611.2
Non-payment insurance 6.4 4.7
Share-option programme
(1)
0.0 0.1
Adj. EBITDA 427.8 616.0
(1) Corrected prior year to only include the share option programme awarded after the DUC acquisition, hence the LTI Programme is not
adjusted for.
Cash flow from operations is defined as Net cash flow from operating activities excluding
taxpayments.
USD million 2023 2022
Cash flow from operating activities 479.7 572.9
Tax received/(paid) (229.8) (11.6)
Net cash flow from operating activities 249.9 561.3
Interest-bearing debt defined as the book value of the current and non-current interest-bearing debt.
USD million 31.12.2023 31.12.2022
Convertible bond loans (201.7) (188.7)
Senior Unsecured bond loan (169.1) (166.9)
Reserve-based lending facility (820.8) (764.0)
Other interest-bearing debt – (25.0)
Interest-bearing debt (1,191.6) (1,144.6)
Net interest-bearing debt is defined by BlueNord as cash and cash equivalents reduced by current
and non-current interest-bearing debt. The RBL facility and bond loans are included in the calculation
with the total amount outstanding and not the amortised cost including transaction cost.
USD million 31.12.2023 31.12.2022
Cash and cash equivalents 166.7 268.4
Convertible bond loan (228.4) (221.5)
Senior Unsecured bond loan (175.0) (175.0)
Reserve-based lending facility (850.0) (800.0)
Other interest-bearing debt – (25.0)
Net interest-bearing debt (1,086.7) (953.1)
142 Annual Report and Accounts 2023
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In March 2024, the Group reported oil and gas 2P reserves and near-term 2C resources, the report is reported separately from the Annual Report 2023. The Reserves Evaluator ERC Equipoise Ltd (‘ERCE’)
has carried out an independent evaluation of the hydrocarbon Reserves and certain Contingent Resources held by BlueNord Energy Denmark A/S in the DUC Sole Concession area, offshore Denmark.
ERCE has carried out this work in accordance with the June 2018 SPE/WPC/AAPG/ SPEE/SEG/SPWLA/EAGE Petroleum Resources Management System (‘PRMS’) as the standard for classification
and reporting.
In line with the Annual Statement of Reserves and Resources, the reported reserves include remaining volumes expected to be recovered based on reasonable assumptions about future technical, economic,
fiscal, and financial conditions based on year end 2023 data. The calculations of recoverable volumes are associated with significant uncertainties. The 2P estimate represents a best estimate of reserves.
The reported contingent resources (near-term 2C) are potentially recoverable volumes from known accumulations for which development plans are being matured or further evaluation is under way with a
view to development in the near term. This does not include the full portfolio of BlueNord’s 2C resources.
The 2P reserves and near-term 2C resources for the DUC portfolio are shown below using the figures from the Annual Statement of Reserves and Resources issued in March 2024 as basis.
Total reserves as of 31.12.2023
Field Hub Status
Liquids
(mmbbl)
Gas
(mmboe)
Oil Eq.
(mmboe)
Interest
%
Oil Eq.
(mmboe)
Dan Dan On Production 60.4 4.5 64.9 36.8% 23.9
Kraka Dan On Production 6.9 0.1 7.1 36.8% 2.6
Gorm Gorm On Production 14.4 – 14.4 36.8% 5.3
Skjold Gorm On Production 22.4 1.2 23.7 36.8% 8.7
Rolf Gorm On Production 2.4 – 2.4 36.8% 0.9
Halfdan (incl. Halfdan North East) Halfdan On Production 77.6 24.9 102.6 36.8% 37.7
Tyra Tyra Under Development 31.6 83.2 114.8 36.8% 42.2
Valdemar Tyra Under Development 38.4 21.3 59.7 36.8% 22.0
Roar Tyra Under Development 7.0 16.1 23.1 36.8% 8.5
Harald Tyra Under Development 1.0 5.5 6.7 36.8% 2.5
Lulita Tyra Under Development 1.1 0.6 1.6 28.4% 0.4
Halfdan HCA Gas Lift Project Halfdan Approved for Development 0.6 7.4 8.0 36.8% 2.9
Halfdan Ekofisk Infills Halfdan Justified for Development 5.7 5.1 10.8 36.8% 4.0
Valdemar Bo South Tyra Justified for Development 17.2 7.7 24.9 36.8% 9.2
Adda (Phase 1) Tyra Justified for Development 17.2 23.0 40.2 36.8% 14.8
Total 2P reserves 304.0 200.6 504.6 185.6
Field
Halfdan Tor NE Infill #2 1.4 1.0 2.4 36.8% 0.9
Adda (Phase 2) 3.4 10.5 14.0 36.8% 5.1
Svend 311.4 1.7 13.1 36.8% 4.8
Halfdan North 38.4 5.9 44.3 36.8% 16.3
Total 2C resources 54.7 19.0 73.7 27.1
Total 2P reserves and near-term 2C Resources 358.7 219.7 578.3 212.7
Supplementary oil and gas information (unaudited)
143 Annual Report and Accounts 2023
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Financial Report
Appendix 1. Task Force on Climate-related Financial Disclosures (‘TCFD’)
BlueNord’s TCFD reporting is fully compliant with the requirements shown below.
There is a growing demand for decision-useful, climate-related information, and creditors and investors
are increasingly demanding access to risk information that is consistent, comparable, and clear.
The Financial Stability Board created the TCFD to improve and increase reporting of climate-related
financial information. Additionally, TCFD encourages the standardised reporting structure for financially
material climate-related risks and opportunities to give investors, lenders, and insurers enhanced
comparability when assessing and pricing pertinent companies.
The TCFD framework is made up of 11 recommended disclosures divided into four pillars that represent
core elements of how organisations operate. The four pillars are: governance, strategy, risk management,
and metrics and targets. Moreover, the framework separates into three main categories: risks related to
the physical impacts of climate change, risks related to the transition to a lower-carbon economy, and
climate-related opportunities. TCFD has also incorporated financial impact as an integral part of its
disclosure recommendations.
In line with the TCFD recommendations, a report in accordance with TCFD is as of 2022 an integrated
part of BlueNord’s annual financial reporting, and the report is reviewed annually by the Audit Committee,
ESG Committee and the Board.
Core elements of recommended Climate-related Financial Disclosures
Governance
The organisation’s governance around climate-related risks and opportunities.
Strategy
The actual and potential impacts of climate-related risks and opportunities on the organisation’s business, strategy,
and financial planning.
Risk management
The processes used by the organisation to identify, assess and manage climate-related risks.
Metrics and targets
The metrics and targets used to assess and manage relevant climate-related risks and opportunities.
Governance Recommended Disclosures
Disclose the organisation’s
governance around
climate-related risks
and opportunities.
a) Describe the Board’s
oversight of climate-related
risks and opportunities.
b) Describe management’s
role in assessing and managing
climate-related risks and
opportunities.
Strategy Recommended Disclosures
Disclose the actual and
potential impacts of
climate-related risks and
opportunities on the
organisation’s business,
strategy, and financial
planning where such
information is material.
a) Describe the climate-related
risks and opportunities the
organisation has identified
over the short, medium, and
long term.
b) Describe the impact of
climate-related risks and
opportunities on the
organisation’s businesses,
strategy, and financial planning.
c) Describe the resilience of
the organisation’s strategy,
taking into consideration
different climate-related
scenarios, including a 2
o
c
or lower scenario.
Risk management Recommended Disclosures
Disclose how the
organisation identifies,
assesses, and manages
climate-related risks.
a) Describe the organisation’s
processes for identifying and
assessing climate-related risks.
b) Describe the organisation’s
processes for managing
climate-related risks.
c) Describe how processes
for identifying, assessing, and
managing climate-related
risks are integrated into
the organisation’s overall
risk management.
Metrics and targets Recommended Disclosures
Disclose the metrics and
targets used to assess and
manage relevant climate-
related risks and
opportunities where such
information is material.
a) Disclose the metrics used
by the organisation to assess
climate-related risks and
opportunities in line with
its strategy and risk
management process.
b) Disclose scope 1, scope 2,
and, if appropriate, scope 3
GHG emissions, and the
related risks.
c) Describe the targets used by
the organisation to manage
climate-related risks and
opportunities and performance
against targets.
144 Annual Report and Accounts 2023
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1. Governance
a. Board-level oversight
The Board fully supports the recommendations of the TCFD. The Board Chair has overall responsibility
for the management of climate-related issues at BlueNord, and the Board is responsible for ensuring that
climate-related targets are defined and addressed as part of Company strategy.
The Board receives regular updates from management, and will ensure that our risk management and
internal control systems are adequate in relation to the regulations governing the business.
The Board reviews the Group’s main risk areas and internal control systems annually. This includes the
Group’s values, Code of Conduct and corporate responsibility policy. The Board reports annually on
climate impacts and any risks that the Company faces.
b. Management-level oversight
Executive management is responsible for identifying risks and opportunities, and for implementing
effective processes and mitigation efforts. This includes climate-related issues, risks and opportunities
within the managers’ respective areas of responsibility.
The Chief Corporate Affairs Officer has responsibility for ESG strategy, and reports directly to the CEO. In
2020, an ESG Committee was established to support BlueNord’s commitment to ESG and to evolve our
contribution to the energy transition.
Climate risks are also assessed as part of BlueNord’s risk management process. For more information
on BlueNord’s risk management processes, including the assessment of climate-related risks, see the
relevant sections of this report.
See Governance Framework on page 53.
2. Strategy
a. and b. Identified climate-related risks and opportunities
In line with the recommendations laid out in the TCFD framework, BlueNord has conducted a process to
assess how, and to what extent, the Company is exposed to climate risk. Management representatives
for Finance and Corporate Affairs participated in a workshop to identify significant physical risk, transition
risk, and opportunities created by climate change.
In the workshop, risks and opportunities were assessed in a strategic and financial context, against three
different time horizons and four different climate scenarios. This assessment was reviewed again in
January 2024.
The following time horizons were used:
• Short term – 2023–25.
• Medium term – 2025–30.
• Long term – 2030–50.
These four International Energy Agency (‘IEA’) climate scenarios were used:
• Net Zero Emissions by 2050 scenario (‘NZE’).
• Stated Policies scenario (‘STEPS’).
• Sustainable Development scenario (‘SDS’).
• Announced Pledges scenario (‘APS’).
For BlueNord it is important to identify the most significant climate-related risks and opportunities
we face, as this can help us to make informed decisions about how to mitigate, or take advantage of,
these factors.
To identify the most critical risk factors, the management representatives assessed factors that could
potentially impact the operations negatively and the probability of occurrence.
To identify the opportunities with the highest potential, the management representatives assessed how
the factors could potentially impact the Company positively, and the degree of difficulty posed by taking
advantage of any opportunity.
Risk factor defined as most critical:
1. High/increased CO
2
tax.
Opportunities defined with greatest potential:
1. Resource efficiency.
2. Evolution of financial markets.
3. Relatively flexible BlueNord investments.
4. Sector already strictly regulated and well-prepared for harsh weather conditions.
Appendix 1. Task Force on Climate-related Financial Disclosures (‘TCFD’) continued
145 Annual Report and Accounts 2023
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Acute physical risk
Through our acute physical risk identification process, we identified extreme weather due to increased frequency and intensity of strong wind, storms, and hurricanes as most significant to BlueNord. Such events
may impact BlueNord’s direct operations, or cause disruptions in the supply chain. Any events delaying production have a financial implication.
Identified
risk
Description
of risk
Potential
impacts
Potential financial
impacts
The climate scenario in which
the risk is most relevant
Time
horizon
Mitigation
strategy
Increased frequency and
intensity of strong wind,
storms, and hurricanes
Climate change and temperature
increases may lead to more
extreme weather. The wind speed
is expected to increase, and the air
will contain more moisture. This will
lead to increased occurrences of
strong winds, storms, and
hurricanes in the future.
• Inability to have people
safely Offshore.
• Inability to transport people
and equipment, as this is done
by helicopter and supply ships.
• Weakened production
capacities due to shortage
of supplies, employees
and possible damage to
the equipment.
Reduced revenue and increased
costs associated with asset repair
and additional labour. Potential
impact on production.
BlueNord sees the greatest
consequences in STEPS, but the
negative effects may be more
relevant for the supply chain at
an earlier stage.
Long term. BlueNord is constantly working to
strengthen our work on human rights
and decent working conditions, by
reviewing and revising our Corporate
Social Responsibility Guidelines.
This helps us establish governance
documents, routines and instructions
related to due diligence processes and
our supply chain to ensure that we
apply to the highest standards of
professional and ethical standards in
the conduct of our business affairs. In
addition, Total Energies has in 2023
provided a letter of comfort related to
their compliance program, with this the
main part of the companies supply
chain has been assessed.
Chronic physical risk
Chronic physical risks refer to longer-term shifts in climate patterns, such as sustained higher temperatures that may cause sea level rise or chronic heat waves.
Identified
risk
Description
of risk
Potential
impacts
Potential financial
impacts
The climate scenario in which
the risk is most relevant
Time
horizon
Mitigation
strategy
Rising sea levels Sea levels may rise due to
expanding ocean volumes from
temperature increases and from
melting glaciers and ice sheets.
• High waves which hit the
infrastructure on the platform
causing damage.
• Increased cost due to
adaption of platforms in order
to handle rising sea level.
Most relevant in STEPS. Long term. The platforms have already been
reconstructed or assessed to meet the
risk of sinking seabeds. This has
prepared them more for extreme
weather events and rising sea levels.
Transition risk – Policy and Legal
Transitioning to a lower-carbon economy may entail extensive policy and legal changes to address mitigation and adaptation requirements related to climate change. We have identified the following policy actions
and climate-related litigation claims as the most significant for BlueNord.
Identified
risk
Description
of risk
Potential
impacts
Potential financial
impacts
The climate scenario in which
the risk is most relevant
Time
horizon
Mitigation
strategy
Uncertainty related to the EU
Taxonomy and how this will
impact BlueNord
Increasing need to demonstrate
that economic activities are
environmentally sustainable.
• More difficult and more
expensive to raise support
from a capital market
perspective and debts
perspective.
• Limited access to capital.
• Increased cost of capital.
Most relevant in NZE/SDS. Medium and long term.
Focus on having a close dialogue
with investors.
Transparency is crucial when it
comes to climate risk. BlueNord
focuses on being as transparent
as possible towards investors
and other stakeholders.
Appendix 1. Task Force on Climate-related Financial Disclosures (‘TCFD’) continued
146 Annual Report and Accounts 2023
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Appendix 1. Task Force on Climate-related Financial Disclosures (‘TCFD’) continued
Transition risk – Policy and Legal continued
Transitioning to a lower-carbon economy may entail extensive policy and legal changes to address mitigation and adaptation requirements related to climate change. We have identified the following policy actions
and climate-related litigation claims as the most significant for BlueNord.
Increased carbon
pricing and taxes
Carbon tax is an instrument
for cost-effective cuts in
GHG emissions.
Other extraordinary taxes or
measures to affect the operations
of high-emission sectors could
also be put in place as solidarity
measures.
• Low emissions and being part
of the energy transition will
play a bigger part in the licence
to operate.
• Increase cost of the business
and shorten life of assets,
and increase likelihood of
stranded assets.
Most relevant in NZE/SDS. Short, medium and long term.
Reducing emissions as much
as possible on current and
future operations.
Transition risk – Technology
Technological improvements or innovations that support the transition to a lower-carbon, energy-efficient economic system can have a significant impact on organisations.
Identified
risk
Description
of risk
Potential
impacts
Potential financial
impacts
The climate scenario in which
the risk is most relevant
Time
horizon
Mitigation
strategy
Transition to lower
emission technology
Gas has a role and opportunity
in the transition. In the long run,
the need for oil and gas will
change/decrease.
Technology also represents an
opportunity in identifying,
addressing, and reducing risks.
Changes in demand due to:
• Declining cost on renewables.
• Electrification of industries
and transportation.
• Advanced technology, which
makes it possible to monitor
and detect possible spills
and reduce impact, and
consequently, identify and
reduce emissions.
• Decrease in revenue, due to
reduced oil and gas demand
• Technology for monitoring
will provide more precise
measures, ability to respond
immediately and potentially
reduce financial impact.
Most relevant in NZE. Medium and long term.
CCS projects, both onshore
and offshore to support hard
to abate emissions.
Transition risk – Market
While the ways in which markets could be affected by climate change are varied and complex, one of the major ways is through shifts in supply and demand for certain commodities, products, and services as
climate-related risks and opportunities are increasingly taken into account.
Identified
risk
Description
of risk
Potential
impacts
Potential financial
impacts
The climate scenario in which
the risk is most relevant
Time
horizon
Mitigation
strategy
Changes in gas demand The transition to a zero-emissions
society is expected to decrease
the demand for gas in the long run.
The speed of transition is
uncertain.
The current geopolitical situation
has increased the focus on energy
security where gas plays a part,
but also where the transition to
renewables has increased in pace.
• Declining demand based on
new technology. For instance,
electric vehicles, heat pumps,
an increasingly circular
economy and less use
of plastic.
• Decreased revenues. Most relevant in NZE. Medium and long term.
BlueNord focuses on gas as
the transition fuel to decrease
carbon intensity.
147 Annual Report and Accounts 2023
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Appendix 1. Task Force on Climate-related Financial Disclosures (‘TCFD’) continued
Transition risk – Reputation
Climate change has been identified as a potential source of reputational risk tied to changing customer or community perceptions of an organisation’s contribution to or detraction from the transition
to a lower-carbon economy.
Identified
risk
Description
of risk
Potential
impacts
Potential financial
impacts
The climate scenario in which
the risk is most relevant
Time
horizon
Mitigation
strategy
Reputation risk in the
era of ESG
Fossil fuel is not a renewable
energy source and leaves a large
carbon footprint. Still, gas will play
a role in the future energy mix.
Abandonment of infrastructure
needs to be done in a safe and
sustainable manner thus
contributing to circularity of
these materials.
• Oil and gas producers
generally have a poor
reputation in the field of ESG.
BlueNord needs to
demonstrate the required
accountability and
responsibility to maintain its
social licence to operate.
• Increased requirements for
sustainable abandonment.
• Reduced revenue from
decreased demand for
goods/services.
• Reduction in capital availability
and higher cost of capital.
• Increased cost related to
abandonment/recycling.
Most relevant in NZE, SDS.
Medium and long term.
Presenting a balanced view of both our
production activities and energy
transition initiatives and projects, for
example Carbon Cuts CCS project.
BlueNord is working diligently to recycle
materials. The Company is also
assessing sustainable
decommissioning strategies which
leave infrastructure on the seabed
based on value to sealife.
Resource efficiency
There is growing evidence that it is possible for organisations to reduce operating costs by improving efficiency across production and distribution processes, buildings, machinery/appliances,
and transport/mobility.
Identified
risk
Description
of risk
Potential
impacts
Potential financial
impacts
The climate scenario in which
the risk is most relevant
Time
horizon
Mitigation
strategy
Efforts to increase
resource efficiency
More efficient operations can
lower cost and reduce emissions
intensity. Good for both business
and the environment.
• Increased operational
productivity leads to increased
revenue and reduced
unit costs.
• Increased interest
from investors.
• Easier access to capital.
• Increased revenue.
All. Short, medium, and long term. Reducing emissions from our facilities in
collaboration with the Operator. We
work actively to reduce flaring and to
improve production optimisation to
reduce emissions and energy (fuel) use.
Energy sources
The trend toward decentralised clean energy sources, rapidly declining costs, improved storage capabilities, and subsequent global adoption of these technologies is significant. Organisations that shift their
energy usage toward low-emission energy sources could potentially save on annual energy costs.
Identified
risk
Description
of risk
Potential
impacts
Potential financial
impacts
The climate scenario in which
the risk is most relevant
Time
horizon
Mitigation
strategy
Use of alternative energy
in operations
The world is switching to
renewable energy and electrical
operating solutions that reduce
the emission of CO
2
.
BlueNords platforms are gas-fired
or fired by diesel generators.
There is a potential to develop
the approach to alternative
energy sources.
• Emissions reduction. • Easier access to capital. Most relevant in NZE. Medium and long term. Dialogue with the Operator on
alternative energy sources and potential
electrification of facilities remains an
opportunity if economic to do so.
148 Annual Report and Accounts 2023
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Products and services
Organisations that innovate and develop new low-emission products and services may improve their competitive position and capitalise on shifting consumer and producer preferences.
Identified
risk
Description
of risk
Potential
impacts
Potential financial
impacts
The climate scenario in which
the risk is most relevant
Time
horizon
Mitigation
strategy
New products To reach the climate targets and
reduce carbon emissions
internationally, CCS technologies
need to be deployed on a large
scale and will be increasingly
important.
• CCS represents a benefit for
the climate which does not
involve the sacrifice of crucial
energy sources.
• Increased interest from new
investors and easier access
to capital.
Most relevant in NZE. Medium and long term. Two CCS projects: Project Bifrost and
CarbonCuts.
Markets
Organisations that proactively seek opportunities in new markets or types of assets may be able to diversify their activities and better position themselves for the transition to a lower-carbon economy. In particular,
opportunities exist for organisations to access new markets through collaborating with governments, development banks, small-scale local entrepreneurs, and community groups in developed and developing
countries as they work to shift to a lower-carbon economy. BlueNord has addressed the following opportunity.
Identified
risk
Description
of risk
Potential
impacts
Potential financial
impacts
The climate scenario in which
the risk is most relevant
Time
horizon
Mitigation
strategy
Financial markets evolvement ESG and climate risk is
increasingly seen as an important
risk in the financial markets.
• Shift from the typical funding
sources to more targeted
structures.
• For those not addressing this
– higher risk and costs.
• Changed interest rate market.
Relevant in all scenarios. Short, medium and long term. Various measures to be more suited for
a changed financial market.
Resilience
The concept of climate resilience involves organisations developing adaptive capacity to respond to climate change to better manage the associated risks and seize opportunities, including the ability to respond to
transition risks and physical risks. Opportunities related to resilience may be especially relevant for organisations with long-lived fixed assets or extensive supply or distribution networks; those that depend critically
on utility and infrastructure networks or natural resources in their value chain; and those that may require longer-term financing and investment.
Identified
risk
Description
of risk
Potential
impacts
Potential financial
impacts
The climate scenario in which
the risk is most relevant
Time
horizon
Mitigation
strategy
Strictly regulated sector The energy transition will result in
stricter regulations.
Changes in regulations, CO
2
taxes. • For those that are already in
line with the regulations it can
decrease the demand for
mitigation and adjustment
of strategy.
Most relevant in STEPS. Short, medium, and long term.
BlueNord is already part of a strictly
regulated sector that operates in
harsh weather conditions. Many
precautions and adaptations are
therefore already in place and could
be a competitive advantage.
Flexible future investments Future market developments will
greatly affect the return on
investments in fossil fuels.
Increase in future profits by
being dynamic and adjusting
investment strategy.
• Less risk of being locked in
outdated solutions and
demand scenarios; flexibility to
diversify and increase
profitability.
Most relevant in STEPS. Short, medium, and long term. BlueNord can choose to invest in more
gas-weighted projects or CCS
depending on how the market is
evolving. Currently, the market for gas
remains attractive and continues to
be a value fuel along with oil.
Appendix 1. Task Force on Climate-related Financial Disclosures (‘TCFD’) continued
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c. Scenario analysis
In line with the recommendations laid out by the TCFD, BlueNord conducted a qualitative scenario analysis in 2023 of all identified risks and opportunities as part of the climate risk assessment.
The Net Zero Emissions by
2050 Scenario (‘NZE’)
Limiting the global temperature rise to 1.5°C without a temperature overshoot (with a 50 percent probability). The NZE is a normative scenario, meaning it starts with a defined goal to achieve net-zero CO
2
emissions by 2050, and shows
an example of a pathway that could get the world to that target.
In this scenario, demand for oil falls by more than 2 mbpd per year between 2020 and 2050. Demand for natural gas grows to 2025, drops after 2025 and falls well below 2020 levels by 2030.
The Sustainable
Development Scenario
(‘SDS’)
IEA’s Sustainable Development Scenario (‘SDS’) is compatible with the Paris Agreement’s less ambitious ‘well-below 2°C’ goal. It assumes all energy-related SDGs and all current net-zero pledges are achieved, with advanced
economies reaching net-zero emissions by 2050, China by 2060 and all others by 2070 at the latest.
It has a 50 percent probability of limiting global temperature rise to 1.65°C, assuming no extensive net negative emissions. With some net negative emissions after 2070, temperature rise could be reduced to 1.5°C
by 2100.
The Announced Pledges
Scenario (‘APS’)
This scenario appears for the first time in the World Economic Outlook 2021. It assumes that all climate commitments made by governments around the world, including Nationally Determined Contributions and longer-term net-zero
targets as of mid-2021, will be met in full and on time.
In the APS, global oil demand peaks soon after 2025 and then falls by around 1 mbpd per year to 2050. Demand for natural gas also reaches its maximum level soon after 2025 and then declines slowly.
The Stated Policies
Scenario (‘STEPS’)
Rather than assuming that governments will reach all announced goals, this scenario reflects a sector-by-sector assessment of the specific policies that have been put in place, as well as those that have been announced by
governments around the world.
This scenario provides a more conservative benchmark for the future. In the STEPS, global oil demand exceeds 2019 levels by 2023 before peaking in the mid-2030s and then declining very gradually
to 2050. Demand for natural gas continues to rise after 2025 and is around 15 percent higher in 2030 than in 2020.
3. a., b., and c. Risk management
The identification, assessment and management of climate-related risks and opportunities is an integral part of BlueNord’s multidisciplinary risk and opportunity management. The BlueNord Board and management will
conduct regular reviews of the Group's activities for identifying, assessing, and responding to climate-related risks and opportunities. The risk management process will be reviewed on an annual basis.
2023 was the first year of implementation of the climate-risk management process recommended by TCFD. A material risk and opportunity matrix system developed by Tavler AS was used as a foundation for this
process. The identification and assessment processes were conducted through a workshop with EVP Finance and EVP Investor Relations, and ESG representatives from different organisational levels and
functions, providing a balanced picture of the risks and opportunities faced by BlueNord.
In the matrix, the impact (large, relatively large, relatively easy, easy) and likelihood (high/low) of each risk and opportunity are determined. Based on each risk’s categorisation, BlueNord will develop, review, and
implement response plans to mitigate risks and maximise opportunities.
4. a., b., and c. Metrics and targets
BlueNord works to reduce our carbon footprint while contributing to energy security. Our commitment is to a 50 percent reduction in emissions by 2027, and to achieving 80 percent power from renewables by
2029. BlueNord will also focus on investing in suitable and earlier-stage CCS projects.
As a non-operator, BlueNord will work to protect the environment to the greatest possible extent, both in its own operations and through the Company's partnership in the DUC. The data reported on climate and
nature have been supplied by the Operator Total Energies for the DUC. BlueNord will monitor and report on performance year-on-year as part of our sustainability strategy, which will be established later this year.
BlueNord is committed to independently verifying its direct and indirect emissions in 2024. The following metrics are used to assess climate-related risks and opportunities: CO
2
emissions, fuel consumption, flaring,
fugitive emissions, nitrogen oxides (‘NOx’) and sulphur oxides (‘SOx’) emissions, GHG emissions, and GHG intensity related to DUC operations.
Appendix 1. Task Force on Climate-related Financial Disclosures (‘TCFD’) continued
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Appendix 2. UN Sustainable Development Goals
UN Sustainable Development Goals
The United Nations Sustainable Development Goals (‘SDGs’) provide a blueprint for achieving a better and more sustainable future for all by addressing global challenges such as poverty, inequality, climate change,
environmental degradation, peace, and justice. BlueNord continues to identify our best solutions to contribute to the SDGs as we aim to address various environmental, social and economic challenges facing our
world today. Examples of our actions, programmes and the SDGs to which they relate are demonstrated here and throughout this report.
Sustainability impact area SDGs 2023 focus
People
BlueNord promotes the welfare and
rights of employees, communities,
and other stakeholders.
• Ensure safe operations along with DUC operator.
• Promote healthy and safe working environment.
• Respect Human and Labour Rights.
• Foster Diversity and Inclusion (D&I).
• Deliver continuous professional development for our employees.
• Create awareness and provide training in HSE, D&I and Feedback culture.
Climate and sustainable energy BlueNord identifies and invests in
initiatives that reduce emissions and
ensure secure access to locally
produced energy.
• Reduce GHG emissions (reduce and eliminate flaring, detect and reduce methane).
• Improve energy efficiency at DUC operations with pressure loss reductions and
increased uptime.
• Continue investing in CarbonCuts to contribute to Denmark’s CCS ambition and
net-zero target.
• Ensure access to locally produced, affordable, reliable, and secure energy for EU.
Environment BlueNord identifies and invests in
initiatives that reduce environmental
impact and promote sustainability.
• Support DUC’s ambition to locally recycle obsolete infrastructure (similarly to Tyra).
• Assess water biodiversity by evaluating cod populations around
Offshore infrastructures.
• Reduce DUC operations’ atmospheric emissions by 40 percent in 2030 compared
to 2015.
• Minimise chemicals and hydrocarbons from produced water discharged to sea in
strict adherence with discharge permits and environmental regulations.
Responsible and ethical business BlueNord’s Board of directors and
executives are expected to demonstrate
integrity, honesty, and accountability in
their decision-making.
• Promote Board diversity and independence.
• Demonstrate ethical leadership.
• Maintain transparency in market communication and disclosures.
• Comply with local legislations, reporting requirements and standards.
• Create shared economic value.
Partnerships BlueNord collaborates with DUC’s
partners, governmental bodies, civil
society, businesses, academia, and
NGOs to address challenges effectively.
• Engage with local communities.
• Build partnerships.
• Cultivate technology and innovation within DUC and via funding of DOTC.
BlueNord’s contribution to the UN’s 2030 sustainable development agenda.
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Appendix 3. Environment – Climate
Table 1.
Performance status 2023: Atmospheric emissions
TOPIC DESCRIPTION
CO
2
emissions
Main CO
2
source is the fuel gas for production. Figure also includes flaring and other
fuels contribution.
Fuel
consumption
Fuel is consumed primarily by single cycle gas turbine powering generators, gas
compressors, and pumps. Diesel generators are being used when power cannot be
generated with fuel gas. This is typically the case on drilling rigs, during production
shutdown or on platforms without processing capacities and without power supply from
adjacent platforms.
Flaring
Flaring of natural gas is occurring on all hubs when required to allow safe operation
during production upsets and non-routine operation.
Fugitive
emissions
Venting of gas from production facilities is to ensure safe operation. Venting is primarily
relevant for systems operating at atmospheric pressure, but it also occurs during
facilities maintenance.
TOPIC DESCRIPTION
NOx and SOx
emissions
The operation of gas turbine drives and diesel engines offshore causes emissions of
nitrogen oxides and sulphur oxides.
CH4
CH4 and non-methane volatile organic compounds (‘nmVOC’) come directly from our gas.
They can originate from unburned parts of our fuel gas or flare gas (they do not burn at 100
percent efficiency) or from releases, i.e. process vents or tiny leaks that are below threshold
limits of our safety detection systems.
nmVOC
CH4 and nmVOC come directly from our gas. They can originate from unburned
parts of our fuel gas or flare gas (they do not burn at 100 percent efficiency) or from
releases, i.e. process vents or minor leaks that are below threshold limits of our safety
detection systems.
GHG
emissions
Greenhouse gases that are released to the atmosphere as a result of the operations.
Green house gases are gases that trap heat in the atmosphere and are responsible
for global warming. The following gases are considered GHG: Carbon dioxide
(CO
2
), Methane (CH4), Nitrous Oxide (N2O), Perfluorocarbons (PFCs), Sulphur
hexafluoride (SF6), Hydrofluorocarbons (HCFs), Chlorofluorocarbons (CFCs),
nitrogen oxides (NOx).
GHG intensity
GHG intensity corresponds to total GHG emissions in CO
2
equivalent over total
production expressed in barrel of oil equivalent.
ETS reporting
perimeter
DUC offshore fixed installations are subject to the EU Emissions Trading System.
The emissions included in the system are currently limited to CO
2
, which is emitted
as a result of fuel combustion (gas and diesel) and flaring.
152 Annual Report and Accounts 2023
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Appendix 3. continued. Environment – Nature
Performance status 2023: Discharge to sea
TOPIC DESCRIPTION
Discharge
to sea
Water is produced from the fields together with the hydrocarbons. For the fields
Dan and Halfdan, the produced water is discharged to the sea after separation and
cleaning. In the fields Gorm and Skjold, the water is reinjected. The water produced
is partly formation water and partly injected sea water. In 2023, 25.1 percent of the
produced water was reinjected. Oil is discharged to sea as part of the produced
water and the efficiency of oil/water separation is a key factor for the oil in water
concentration. The increase in concentration of oil in water and the higher discharge
from 2022 to 2023 is mainly due to separator issues on Dan. The level of discharge
is within the legal limit.
Spills
Spills from closed systems and from handling of various liquids are reported in
accordance with environmental regulation. In 2023, 15 oil and diesel spills and 20
chemical spills were reported, compared with 6 oil and diesel spills and 32 chemical
spills in 2022. Ongoing efforts are made to minimise the number and level of spills
that occur.
TOPIC DESCRIPTION
Chemical
usage
Chemicals are used for various purposes in the oil and gas industry. They are used to
drill, complete, stimulate and operate wells, as well as to enhance oil recovery. Some of
the chemicals help protect the production equipment and pipelines from corrosion,
scaling, souring etc.
Each chemical is categorised with a colour according to OSPAR representing how
harmful the chemicals are to the environment.
Chemical
discharge
Some chemicals will be discharged to sea with the discharged produced water after
separation or unintentionally through spills. The discharge of chemicals is highly
regulated through discharge permits and operators must follow regulation and best
practices to minimise the environmental impact.
Table 2.
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Account of the due diligence assessment
BlueNord ASA (‘BlueNord’) is committed to respecting fundamental human and labour rights, both in
operations and in relations with business partners. At BlueNord, we comply with all applicable laws and
regulations, including the Norwegian Transparency Act, entered into force on 1 July 2022. The Act’s
intention is to promote companies’ respect for fundamental human rights and decent working conditions.
We recognise that our activities can cause, contribute, or be linked to negative human rights and other
social impacts. BlueNord operates in a low-risk environment regarding human rights abuse, as all our
operations are in Denmark. Furthermore, most of our vendors are based in Denmark or other low-risk
countries. However, we are aware of potential human and labour rights risks that may occur in our
operations or further up or down in our supply chain.
In cases where BlueNord operations might have caused or contributed to adverse human rights impact,
we will provide or cooperate in providing appropriate remediation to affected stakeholders.
Organisation
BlueNord is a material independent E&P company with a ‘see to it’ duty, meaning an obligation to ensure
that the operator carries out its work in accordance with the regulatory requirements while reducing risks
and environmental impact to a minimum.
The executive management is responsible for overall risk management with the Chief Corporate Affairs
Officer responsible for the work carried out regarding the Transparency Act. This work is included in
BlueNord’s ESG work. In 2020, an ESG Committee was established to support BlueNord’s commitment
to ESG and to evolve its contribution in the energy transition.
Guidelines and routines
BlueNord has developed guidelines to prevent violations of human rights, indecent working conditions,
damage to the environment, and involvement with corruption. The relevant guidelines are described in
Corporate Social Responsibility Guidelines, including the Code of Conduct as well as HSE policy,
approved by the Board of Directors.
In October 2022, BlueNord conducted an overall due diligence assessment in accordance with the
requirements of the Transparency Act based on a methodology including ISO Standard 31000 for
managing risks. The due diligence is an on going risk management process to identify, assess, prevent,
and mitigate human rights risks across the entire value chain of the business. This process applies to
BlueNord’s operation including subsidiaries, where BlueNord has operational control, associated
activities within the value chain, and relevant stakeholders e.g., employees, suppliers, and subcontractors.
The Company is committed to perform an annual review of the due diligence assessments on
these topics to monitor and manage actual and potential adverse impacts on human rights and
working conditions.
Findings as of 2023
BlueNord performed an overall strategic risk assessment including risks associated with its operator.
The Company only holds interest in the DUC, which is operated by TotalEnergies.
In the risk assessment, BlueNord focused on the following five categories and related activities in their
business value chain: exploration, appraisal, development, production, and abandonment. Business
partners who provide the Company with goods and services that are not a direct part of the value chain
were also part of the assessment. These non-negligible expenditures are related to acquisition of seismic
data, IT and digitalisation services, office services, such as cleaning and canteen services, and
professional services, such as insurance, accounting, legal and other commercial or technical advisers
and hire of in-house technical specialists.
No negative consequences were discovered during the recent due diligence assessment, given that
BlueNord has limited activity in the various categories and operates within strong sector regulations.
When prioritising risks while identifying uncertainties, BlueNord highlighted yard activities, input factors
used in construction, and dismantling and managing steel and waste disposal when brought to shore, as
the most severe risks that may occur.
Measures
Concrete measures and initiatives have been identified to manage the identified severe risks that may
occur. Therefore, BlueNord approves all contractors proposed by the operator with a contract value
above DKK 100 million. If the contractor is based outside the EEA or the UK, the operator shall
demonstrate the contractor adheres to human rights and working conditions prior to such approval. In
addition, BlueNord shall visit the relevant yards when applicable. For the time being, BlueNord is not
involved in any activities which was highlighted during the due diligence assessment. In the case of new
activities or projects within one of these categories, there will be a need for assessing risks of human
rights and decent working conditions.
Results
BlueNord is constantly working to strengthen our work on human rights and decent working conditions.
We aim to review and revise our Corporate Social Responsibility Guidelines in accordance with OECD’s
guidelines and clarify our expectations to business partners. Furthermore, the measures will help us
establish governance documents, routines and instructions related to due diligence processes and our
supply chain to ensure that we apply the highest standards of professional and ethical standards in
the conduct of our business affairs. In addition, Total Energies has in 2023 provided a letter of comfort
related to their compliance programme. The main part of the Company’s supply chain has been
assessed with this.
The operator did not enter any major contracts, i.e. above 100 MDKK, with contractors outside EEA
or UK in 2023.
Appendix 4. BlueNord | Transparency Act Report
154 Annual Report and Accounts 2023
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The overview below indicates where to find more relevant information to cover the reporting
requirements according to Section 5 of the Act in the Sustainability.
Requirement Page reference
A general description of the enterprise’s structure
and area of operations. 6-8
Guidelines and procedures for handling actual and
potential adverse impacts on fundamental human
rights and decent working conditions. 39-43
Information regarding actual adverse impacts and
significant risks of adverse impacts that the
enterprise has identified through its due diligence. 35
Information regarding measures the enterprise has
implemented or plans to implement to cease actual
adverse impacts or mitigate significant risks of
adverse impacts, and the results or expected results
of these measures. 41, 43
Oslo
11 April 2024
Riulf Karsten Rustad
Executive Chair
Marianne Lie
Board member
Robert J. McGuire
Board member
Peter Coleman
Board member
Tone Kristin Omsted
Board member
Colette Cohen
Board member
Jan Lernout
Board member
Appendix 4. BlueNord | Transparency Act Report continued
155 Annual Report and Accounts 2023
BlueNord
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ESEF information:
Name of reporting entity or other means of identification BlueNord Group
Explanation of change in name of reporting entity or other means of
identification from end of preceding reporting period NA
Domicile of entity Norway
Legal form of entity ASA
Country of incorporation Norway, UK, Denmark
Address of entity's registered office Nedre Vollgate 1, 0158 Oslo, Norway
Principal place of business Oslo
Description of nature of entity's operations and principal activities Oil and gas
Name of parent entity BlueNord ASA
Name of ultimate parent of group BlueNord ASA
Head Office BlueNord
Headquarter Nedre Vollgate 1, 0158 Oslo, Norway
Telephone +47 22 33 60 00
Internet
www.bluenord.com
Organisation number NO 987 989 297 MVA
Financial Calendar 2024
4 May Annual General Meeting
07 May Q1 2024 Report
10 July Q2 2024 Report
31 October Q3 2024 Report
Board of Directors
Riulf Rustad Chair
Marianne Lie
Tone Kristin Omsted
Colette Cohen
Robert J. McGuire
Jan Lernout
Peter Colman
Management
Euan Shirlaw Chief Executive Officer
Jacqueline Lindmark Boye Chief Financial Officer
Marianne Eide Chief Operating Officer
Cathrine Torgersen Chief Corporate Affairs Officer
Investor Relations
Phone +47 22 33 60 00
E-mail
investorrelations@bluenord.com
Annual Reports
Annual reports for BlueNord are available on www.bluenord.com
Quarterly publications
Quarterly reports and supplementary information for investors and analysts
are available on www.bluenord.com. The publications can be ordered by
e-mailing investorrelations@bluenord.com.
News releases
In order to receive news releases from BlueNord, please register
on www.bluenord.com or e-mail investorrelations@bluenord.com.
BlueNord
Org. number: 987 989 297
LEI Code: 5967007LIEEXZXGE3C16
Photographs provided courtesy of TotalEnergies, Helena Lopes and Tom Jersø’
Information about BlueNord
Oslo
Nedre Vollgt. 1
0158 Oslo,
Norway
London
25 Upper Brook Street
London,
W1K 7QD,
United Kingdom
Copenhagen
Lyngbyvej 2
2100 Copenhagen Ø,
Denmark
www.bluenord.com