Presentation

Noreco is a North Sea focused E&P company established in 2005. The company initially focused on Norway, before expanding into Denmark and the UK through strategic acquisitions. It divested its Norwegian assets in 2016 and in late 2018, Noreco acquired Shell’s 36.8% stake in the Danish Underground Consortium (DUC). This transformed the company into the second largest producer in Denmark, with net production of 28,500 bbl/day in 2020 and 2P reserves of 209 mill bbl. The company is listed on the Oslo Stock Exchange with a market cap of USD ~390m.

The DUC comprises 15 fields across four hubs – Dan, Gorm, Halfdan and Tyra. The two most important hubs are Halfdan and Tyra, which combined hold ~70% of the 2P reserves. The DUC is operated by Total, which acquired Chevron’s stake in the consortium in 2019. The DUC is the most important asset on the Danish Continental Shelf, delivering close to 90% of the country’s total oil and gas production.

Tyra is currently in a re-development phase including a full modernisation of the facilities to extend the life of the field and increase future production. The field is estimated to produce 60,000 bbl/day when it comes back on stream in Q2’23. The successful start-up of Tyra is expected to increase Noreco’s net production to ~50,000 bbl/day, resulting in strong cash flow generation and lift our estimated NAV to NOK >400/share.