Financial Results Managing through the cycle Eldar Stre, CFO 4Q - PowerPoint PPT Presentation

1 Financial Results Managing through the cycle Eldar Sætre, CFO 4Q and full year 2008 Helge Lund President and Chief Executive Officer Capital markets update, London 14 January 2009

2 Strong performance Merger Synergies Production Unit Production Cost 1 (million boepd, equity) (50% realised) (USD/boe) 1.925 1.9 guiding 1.839 1.925 NOK 1.839 6bn 2007 2008 Net Operating Income Resource Base 3 New resources 2 (NOK bn) (bn boe) (million boe) 199 >800 ~ 20 137 <600 ~ 18 2007 2008 2005-07 2008 2007 2008 1) Source: PFC Energy – 3 years rolling average 2005-07 (ranking against peer group) 2) Drill-out volumes including revisions in the exploration phase 3) Discovered resources based on resources at year-end plus Marcellus and Shtokman

3 Solid Financial Results Fourth Quarter NOK bn Full Year NOK bn 198.8 137.2 37.8 30.8 43.3 44.6 2.0 6.2 16.0 2007 2008 2007 2007 2008 2008 Net Operating Income Net Income Net Operating Income Net Income

4 Production growth of 5% + 3% + 5% 2 023 1 1 950 1 958 1 1 925 2 1 839 2 1 000 boepd equity production 793 746 725 674 1213 1230 1200 1165 4Q 2007 4Q 2008 2007 2008 2009 guidance Oil Gas 1) Average PSA effect is 166 000 boepd in 4Q 2008 compared to 140 000 boepd in 4Q 2007. 2) Average PSA effect is 174 000 boepd in 2008 compared to 115 000 boepd in 2007.

5 Improving HSE performance Serious incident frequency (Number of incidents per million workhour) 4 3 2 1 0 2004 2005 2006 2007 2008 EPN* EPN* EPN* 2008 4Q07 4Q08 *Exploration & Production Norway

6 Capturing the NCS value potential • Record production • Seven new projects on stream • More efficient operations • Exploration success Unique Kvitebjørn pipeline repair

7 Record international production • International production up 10% Equity production • Five new fields on stream Other Angola • Strengthened gas position in US Azerbaijan Algeria • Operator in Brazil Canada • Strengthened deepwater portfolio Venezuela GoM - USA 2001 2002 2003 2004 2005 2006 2007 2008

8 Attractive dividend Dividend per STL-share NOK Share buy-back Special dividend Dividend policy Ordinary dividend Proposed special dividend 7.25* • Average payout of 45-50% Proposed ordinary dividend of Net Income (IFRS) • Grow ordinary dividend year on year 2008 dividend proposal* 2001 2002 2003 2004 2005 2006 2007 2008 • 7.25 NOK per share Capital distribution >50%* • 4.40 ordinary % Capital distribution 53%* • 2.85 special % Proposed 2001 2002 2003 2004 2005 2006 2007 2008 * Dividend proposal, subject to approval by Annual General Meeting in May, 2009

9 Summary • Strong deliveries in 2008 • Continued production growth • Improved operational performance • Attractive dividend • Firm long-term strategy

Financial Results 4Q and full year 2008 Eldar Sætre Chief Financial Officer

11 Net Income Overview 2008 18.4 137.2 198.8 NOK bn 137.2 43.3 Taxes Net Operating Financial Net Income Net Operating Income Items 2008 Income 2008 2007

12 Net Income Overview 4Q 2008 5.9 12.1 45.1 43.7 NOK bn 23.7 2.0 Adjusted Adjusted Sum of Taxes Financial Net Income Earnings Earnings adjustments items 4Q 2008 4Q 2007 4Q 2008

13 Net Financial Items 4Q 2008 Currency Financial (22.9) bn income Net financial items 2.9 4Q 08 (8.5) (12.1) NOK bn Securities (14.4) 4.0 Financial expenses 3.9 Currency loss on long term debt Currency swaps for liquidity and currency risk management

14 Adjusted Earnings - E&P Norway 4th quarter: • Adj. Earnings down NOK 2.1 bn from 4Q 07 • Liquids price down 26% in NOK • USD/bbl down 41% 168.0 • NOK/USD up 25% • Gas transfer price up 52% 122.1 • Production increased by 3% • Liquids production up by 1% • Gas production up by 6% NOK bn • Adjustments NOK 4.7 bn for unrealised 37.3 35.2 derivatives, underlift, earn out loss, and reversed merger costs 2007 2008 4Q 2007 4Q 2008

15 Adjusted Earnings - International E&P 4th quarter: • Adj. Earnings down NOK 5.3 bn from 4Q 07 • Liquid prices decreased 26% in NOK 16.5 16.1 • Depreciations increased by NOK 1.5 bn NOK bn • Entitlement production down 3%, equity production up 3% • Adjustments NOK 1.9 bn for impairment and underlift 5.6 0.3 2007 2008 4Q 2007 4Q 2008

16 Adjusted Earnings - Natural Gas 4th quarter: 11.9 • Adj. Earnings up NOK 3.4 bn from 4Q 07 Marketing and • Natural gas price up 66% Trading • Strong trading result Processing and NOK bn 6.1 3,3 Transportation • Gas transfer price up 52% 6.5 • NOK weakening against EUR and USD 4.8 7.0 3.3 5.8 • Adjustments NOK (2.8 bn) for derivatives 1.4 and reversal of impairment 1.6 1.4 (0,3) (0.6) 2008 4Q 2007 4Q 2008 2007

17 Adjusted Earnings - Manufacturing & Marketing 4th quarter: 8.3 • Adj. Earnings up NOK 3.3 bn from 4Q 07 Other • Strong trading result Energy and Retail • Positive currency effect on Manufacturing Oil sales, trading commercial storage 5.2 and supply 4.2 • Successful turnaround at Mongstad N O K b n • Adjustments NOK 3.8 bn for derivatives, restructuring costs, and operational storage 0.9 2007 2008 4Q 2007 4Q 2008

18 Adjusted earnings by segment 2008 Adjusted earnings for the segments (in NOK billion) 2008 2007 E&P Norway 122.1 168.0 International E&P 16.5 16.1 Natural Gas 6.5 11.9 Manufacturing & Marketing 5.2 8.3 Other (1.1) (0.4) Adjusted Earnings for group 149.2 203.9

19 Competitive unit production cost Unit Production Cost NOK/boe • 7% cost increase since 2007 43.1 42.4 41.9 41.4 • Lower end of guided range 33.5 33.2 33.3 32.1 31.6 • Driven by increased activity 31.2 and cost inflation 4Q07 1Q08 2Q08 3Q08 4Q08 PUC* Grane gas purchase Restructuring costs *12 month rolling unit production cost based on equity volumes; excluding gas injection cost, merger restructuring cost, and loss on earn-out

20 Capital and exploration expenditures Capital expenditure Exploration activity 95 75 17.8 68 14.2 57 NOK bn 9.1 NOK bn USD USD ~ 16 bn 8.5 ~ 3.2 bn 8.7 5.7 2007 Actual 2008 Actual 2007 Actual 2008 Actual E&P Norway Natural gas E&P Norway E&P International Other E&P International Manufacturing & Acquisitions Marketing

21 Strong cash generation and balance sheet Cash flow 2008 Net Debt to Capital Employed 5 27 Sale of assets Dividend paid 17.5 % 25 Inorganic NOK bn Capex 12.4 % 66 109 Organic Funds from Capex Operations* Sources of funds Uses of funds 2007 2008 * Cash flows provided by operating activities after tax, including increase current financial investments

22 Growing resource base Proved Reserves 3 Reserve Development Resource Base 1 (bn boe) 6.1 6.0 5.6 Three year average reserve • replacement ratio is 60% ~ 20bn boe Reserves replacement ratio for • 2008 is 34% 2006 2007 2008 Resource base strengthened 3 Year Average RRR • through discoveries and acquisitions 81% 76% Proved reserves 2 60% Discovered resources 1 2006 2007 2008 1) Estimated discovered resources based on resources at year-end 2007 plus Marcellus and Shtokman 2) Proved reserves in accordance with SEC definitions 3) SEC reserves as per 31.12.2008

23 Guiding • Equity production • 2009: 1.95 million boepd • 2012: 2.2 million boepd • Capex 2009: USD ~13.5bn • Exploration 2009 • Expenditures: USD ~2.7bn • Activity: 65-70 wells • Unit Production Cost • 2009-2012: NOK 33-36/boe • 2009: Upper range

24 Supplementary information Net Operating Income per business area 25 Adjustments 26 Adjustments per segment 27 Segment taxes 28 Net financial items 2008 29 Adjusted earnings – 3Q08 vs 4Q08 30 Adjusted earnings – 4Q07 vs 4Q08 31 Adjusted earnings – 2007 vs 2008 32 Cash Flow 2008 33 Financial position 34 Operating costs 35 E&P Norway production per field – 4Q08 StatoilHydro operated 36 E&P Norway production per field – 2008 StatoilHydro operated 37 E&P Norway production per field – 4Q and 2008 partner operated 38 International E&P equity production per field – 4Q08 39 International E&P equity production per field – 2008 40 PSA effects on 2008 production (kboed) 41 Exploration expenditures 42 Reserves 43 Manufacturing & Marketing Refining margins and methanol prices 44 Manufacturing & Marketing Dated Brent development NOK vs USD 45 Manufacturing & Marketing Monthly NGL Cracks (NWE) 46 Reconciliation ROACE 47 Reconciliation of overall operating expenses to production cost 48 Normalised production cost per boe 49 Reconciliation net debt and capital employed 50 Forward looking statements 51 End notes 52 Investor relations in StatoilHydro 53

25 Net operating income & adjusted earnings by segment 4Q NOI 4Q Adjusted NOI 4Q Adjusted Business area 2008 Adjustments Earnings 2007 Adjustments earnings (NOK billions) E&P Norw ay 30.5 4.7 35.2 32.6 4.7 37.3 International E&P (1.6) 1.9 0.3 2.2 3.4 5.6 Natural Gas 7.6 (2.8) 4.8 (1.8) 3.2 1.4 Manufacturing & Marketing 0.4 3.8 4.2 (0.6) 1.5 0.9 Other (0.9) 0.2 (0.7) (1.3) 1.2 (0.1) Eliminations 1.9 (1.9) (0.3) 0.3 0.0 0.0 For the group 37.8 5.9 43.7 30.8 14.3 45.1