DNO.OLDNO.OLOSL
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Jostein Lovas: Good morning, and welcome to DNO's Full Year 2025 Interim Results Earnings Call. My name is Jostein Lovas, and I am the Communication Manager here at DNO. As you may understand from the color photo, we've had a landmark year with lots of celebration. Recently, our Board of Directors and senior management were in Kurdistan, marking that 500 million barrels of oil have been produced from our operated Tawke license. This photo shows our 2 chefs, Executive Chairman, Bijan Mossavar-Rahmani, cutting the cake together with the chef at the Tawke field. Now back to Oslo and the results. Present with me here today are Managing Director, Chris Spencer; and CFO, Birgitte Wendelbo Johansen. And the Chairman is joining us online from New York, and we will kick off the presentation. Please, Bijan, go ahead.
Bijan Mossavar-Rahmani: Jostein, thank you, and good morning to everyone attending this call. We will, of course, be discussing the interim results for the fourth quarter of 2025 and for the full year, but also taking a peak look at the direction of the company in 2026, our goals, our targets, our plans and programs. As Jostein mentioned, 2025 has been a very transformative year for DNO with milestones and records. He mentioned the great milestone of 500 million barrels produced from the Tawke license that includes the Tawke field itself and the Peshkabir field. 500 million barrels produced is a lot of barrels. And this field has outperformed the expectations of many not necessarily ours. We've always known this is a very important license. And we produced 500 million barrels and many hundreds of millions of barrels still left to be produced from these 2 fields. So this has been a terrific asset for DNO. And I think we've managed it responsibly and safely and well over the more than 20 years that the DNO has been producing from this license. Going beyond that important celebration and visit that the Board and I and senior management paid to Kurdistan in January. I'll say a few words about other records reached by DNO in 2025. Our net production increased significantly by about 43% year-on-year to 110,700 barrels of oil equivalent per day. That is the highest level reached in the company's 54-year history, boosted in important respects in the second half of 2025, of course, by the transformative acquisition of Small Energy Group in Norway. Of that total, 110,000, 111,000 barrels a day equivalent, 54,300 barrels of oil equivalent per day was in the North Sea and an almost equivalent amount of 52,600,000 barrels of oil per day equivalent in Kurdistan. So the company is now about evenly balanced between the North Sea, most importantly, of course, Norway and also Kurdistan. So our 2 legs are now about equal size and both very strong and robust. We have a smaller leg in West Africa, where we produced last year 3,300 barrels of oil equivalent per day. Most of that is gas in the Ivory and in the Ivory Coast. The figures picked up in the fourth quarter of the year with net production of as much as 88,300 barrels of oil equivalent per day in the North Sea and 58,000 barrels of oil equivalent per day in Kurdistan. Our revenues in 2025 more than doubled year-on-year to close to $1.5 billion. That's a very significant figure, of course, for us, with cash from operations also nearly more than doubling to $929 million last year. Our operating profit was strong, increasing to $513 million, while net profit stood at a negative $25 million, that reflects importantly, the income tax in Norway and net financial expenses. And our CFO, Birgitte will go into some detail on those numbers. And Chris will -- in this coming presentation, go over our operational issues and then talk about both in more detail the figures that I just presented and our plans for 2026, which are very exciting as well. We now have a very strong platform coming out of 2025 to go into '26 and into the ensuing years. One final point for me. The Board of Directors yesterday approved another quarterly dividend of NOK 0.375 per share to be paid to our shareholders later this month. Last year, our total dividends paid to shareholders was $130 million, again, in 2025. And I should also note that we have been paying quarterly dividends consistently since August of 2022. And we're pleased to have that also as part of our ongoing targets is to prioritize our shareholders and pay quarterly dividends on the back of our performance. So with that introduction, I now pass this on to our Managing Director, Chris Spencer, to cover the operational issues, and I will stay, of course, in the meeting and happy to respond to questions together with my colleagues during the Q&A at the end of the presentation. So thank you. And Chris, if you would please resume the presentation.
Christopher Spencer: Thank you very much, Bijan, and good morning from me from cold Oslo. So as Bijan mentioned, I'll take you through the operational aspects of our quarterly report. And as the title of the slide -- I'm starting in Kurdistan, obviously, and as the title of the slide indicates, we are putting our foot back on the accelerator in Kurdistan. As the previous slide mentioned, 2025, however, was characterized by tremendous resilience of our business in that region. And that's really the first couple of bullet points that we have on the slide are alluding to that. So notwithstanding the production deferment resulting from the drone strikes back in July, our team did a fantastic job recovering from that, and we managed to average 70,000 -- just over 70,000 barrels of oil equivalent per day throughout the year. And you can see that from the numbers how the recovery panned out because by fourth quarter, we were back at 77,000 barrels a day roughly. And that looking back, it's -- we highlighted it in several of the quarterly presentations last year, but it's a real credit to both the team and the quality of the assets that we have in the region [Audio Gap] and compares very favorably with the 2024 average production rate of about 79,000, so despite not drilling for 2 years, the team has kept pretty much a flat production apart from when we've been hit by drones. So as Bijan mentioned, we've been celebrating 500 million barrels, but I think that, that performance in the last couple of years has illustrated for us that there's plenty of potential left in the Tawke and Peshkabir fields. And that is one of the reasons why we've decided after a [ 3-month ] hiatus to get back to drilling. That has started already. We have -- in December, we kicked off our 2-rig 8-well program. So it's a little bit in '25, but mainly 2026. And that's the company-owned Sindy rig and one contracted rig from our long-term partner, DQE. Second contracted rig and third rig in total is now being signed up, another DQE rig. And so we -- by April or so, we should have 2 bigger rigs and Sindy all working in the Tawke license. That makes us by far the most active international operator in the region once again. Of course, that means increased CapEx this year. But that's good news, good money spent. It's going to have very short return on investment times. And of course, as a reminder to everyone, the cost that we -- all cost that goes into the company license is recovered as we spend it under the cost recovery mechanism in the PSC. But of course, that requires one to be paid, which I'll come back to. On the back of that resilience that we've seen from the assets and our ability to maintain production at around the 80,000 mark combined with the drilling program that we're now putting in place, we have our target to hit 100,000 barrels a day of gross operated production from the license which, of course, DNO share would represent 75,000 working interest. And as you will -- if you've read the press release, you will see we are guiding an average of 65,000 share from the Tawke license this year. As I touched on, the cost recovery, of course, requires one to be paid. And this is a key driver, as we discussed before, for the choice we made to continue to sell our oil to a local buyer where payment, we call it -- we call or use the shorthand cash and carry, but it's actually a bank transfer, international bank transfer, and we make sure the money hits our account before we hand over any oil. So we are -- we have that payment certainty in an uncertain region. We're not content with that. However, we're very pleased that [indiscernible] and other producers agreed to get back to using the export pipeline last year. I think that's very positive for the country. And the buyer of our oil puts it into the export pipeline as well. So with that reopening, we hope there are and aim to find a way to get back into export markets or export pricing for our own oil during 2026, and that's a key aim for us this year. Moving on to North Sea and a couple of general themes here. First of all, the slides talk to the business model of the North Sea, where we have -- we're turning exploration -- we're doing exploration and identifying upsides in existing assets, maturing those into resources, reserves, production and therefore, dollars. And as you know, DNO is pushing hard to fast track that process wherever we go, trying to shorten the cycle time from an actual investment to return on that investment. And that is one of the themes that runs through the slides we have for you. The other, of course, is the impact of the Sval acquisition on that business model for us and the operational financial synergies that we are realizing from that transaction. So we maintain our active but focused exploration portfolio. We're making discoveries and then we are impatient to get those on stream. We've guided 82,000 of net production for this year from the portfolio, which gives us that financial and tax efficiency for the fast track development model that we're pursuing. We just gave for your reference here the pro forma figures as if we had owned Sval throughout last year, just to give you a sense of where the assets stand. Of course, for DNO shareholders, this is the first year where we have the full effect of Sval production. So the increase in production that Bijan mentioned is the real number for DNO shareholders to consider, but the 81,000 just gives you a sense of where the assets have been performing and that we're tweaking those up this year as well. Many, many fields that we're involved in now as the slide says, the recent highlights of the start-up of [indiscernible] and Verdande. But as we show in the slides, this is part of conveyor belt of opportunities that we're working on ongoing developments that have been sanctioned and are in halfway through the projects with start-ups in the next few years. And that's seeing -- that means that we need to ramp up the CapEx a little bit. Again, in Kurdistan, we have the cost recovered in Norway, as most of you know, these are tax deductible when you have a portfolio such as we have now with 82,000 barrels a day of production. We are also realizing cost synergies from the Sval acquisition. I would -- and we've just been through the painful process of downsizing and streamlining the team. That does realize cost synergies, but I think from my perspective, that's much more about getting the right team, streamlined efficient team in place to go after the business model we're pursuing. And I would say that we have a fantastic team. We've actually had to let some good people go in order to get the rightsized team because we believe that an efficient team is the way to run the business. And then back to the conveyor belt of exploration through to production and dollars. Right at the front end of that is, of course, the APA licensing rounds that we are very active in Norway. And again, we had a very successful round. I think we were ranked third in terms of the number of licenses received from the ministry. We move on to the next slide. This one, we think, speaks for itself. And I'm really pleased to show the progress that we've made since we announced the acquisition, which was the yellow dotted line here. So back in March, when we came to the market and then started raising money on the back of the acquisition, this is what we expected to achieve from the combined portfolios. And as you see, we've been, I was going to say pleasantly surprised, but we've also been working very hard to make this happen. So the projection now looks better. And of course, this is our daily work that we are seeking to improve this further. And again, you see from the different colors, this life cycle I'm talking about of working through from exploration and upsides are shown here through the 2C category into 2P and then out the back in production and dollars, which is what then comes back for capital allocation to dividends and reinvestment in the business. So I think that one speaks for itself as a very strong development for the outlook for our business. Subset of that is, of course, the 4 discoveries that I touched on earlier. The interesting thing here is that those are in a prime core area for us. This is one of the core areas that we highlighted for operational synergies, again, on the back of the acquisition, and you see that coming through. So we have very strong production from the Nova field, which is not actually labeled here, but is just to the southwest of the hub. And that is what also the Suttaka development is to be tied back to Nova and into. So great example of the operational synergies that we were hoping to achieve. And Suttaka is also the best example of fast tracking that we are looking for, where together with Aker BP, we are going to have that in production 3 years after discovery and that we are trying to replicate across the portfolio. Also, the -- as you see from the statistics on the slide, the fast track is not done at the -- by sacrificing sort of breakeven price for these developments. $40 to $45 per barrel seems to be very much part of the course on the NCS when I look around the industry. And as I've touched on a few times, we have many other discoveries in our portfolio where we're trying to unlock time lines and get fast track developments moving. And if I take the next slide, please. And then we go back to the ones that we're trying to add to our hopper. And so we're back very active exploration appraisal program again, $200 million spend, again, tax deductible. I have to be careful how I use that phrase because I don't want to give the impression that we don't care about costs. We are very cost focused, but investors should be aware that those hard spent dollars are still tax deductible in Norway. So very exciting wells coming up this year. I'm not sure what to touch on. But of course, there's 2 appraisals there of very significant discoveries that we've made, [indiscernible] and Norma. So I'm excited by the outcomes there and numerous exploration wells. [indiscernible] is worth just mentioning because that's a higher risk than many -- all of the others, but we have a carry arrangement there. So for us, financially, it's not such a high risk on the chance of success since we have the carry. We've added a column to this slide as well to talk to -- we try to express what we're working on, which is that one thing is whether you find something or not, which is the traditional geological chance of success on the left. The other is how quickly and efficiently you can bring that into production. And so we're trying to give you a sense of that on the chance of commerciality column. As you would expect from what we've been saying before, if we have discoveries, then we see the chance of commerciality for all of them is medium to high. And the second bullet point on the slide explains that a little bit more where there's 3 examples there where exploration prospects are going into licenses where you've already got discoveries that are heading towards development that they should be able to piggyback very quickly on the back of that. Another example is Carmen where the adjacent Atlantis discovery is being matured by Equinor to tieback to [indiscernible] , where we have a 19% interest. And so if the resources there are firmed up, that also should be able to hop on the back of Atlantis and be developed rapidly. In the interest of time, sorry, I could go on all day on these topics. Let's move on. And I think I'm now handing over to the CFO, Birgitte to take you through the numbers.
Birgitte Johansen: Thank you very much, Chris, and good morning, everyone. Yes, let's dig into the financial results. We start with presenting the preliminary income statement for the full year of 2025. Our revenue was $1.474 billion, up 120% compared to 2024. The growth is strongly influenced by the acquisition of Sval Energi last year, which was consolidated into our accounts as of June. 86% of the group's revenue stems from the North Sea business in '25 compared to 65% in 2024. Operating expenses have increased also following the inclusion of Sval and operating profit ended at $513 million, also a substantial increase from 2024 and also previous years, as you can see. 2025 pro forma operational spend was $1.55 billion, which we expect to see climb to $1.65 billion in '26, as you've also read probably in the press release this morning. Net profit in '25 was negative $25 million, roughly at the same level as $27 million we had in 2024. And the large difference between the operating profit and net income is due to higher financing costs as well as tax rate above 100%, and I will explain the latter as a part of the quarterly results on the next slide, please. So we have an extra table here to give you some more details on the fourth quarter isolated. Our revenue in the fourth quarter was $481.6 million compared to $546 million in 2025. And the main drivers for the reduced -- the revenue decrease is reduced sales volumes and realized prices in the North Sea, partly offset by higher sales volumes in Kurdistan. And for the North Sea, it's worth mentioning, reminding you that we had a strong production growth in the quarter, 14% higher than the previous quarter. But as you know, revenue is recorded based on sold volumes, and we had a large underlift in the quarter -- in the fourth quarter of '25. Our operating profit was $177.1 million in the fourth quarter, down from $221.8 million in Q3. The main drivers are reduced revenue and increased exploration costs expensed in the North Sea, partly offset by the impairment reversal and gain on license transactions. And as you can see, we have a net impairment reversal of $56.8 million. And I've seen this morning that this has caused a little bit of a confusion amongst the analysts. I'll give you some more details on that. If you look at Note 7 in the report, we have the full description there with all details. And there, we see that the net impairment reversal contains a reversal relating to Bestla in the Brage area, and this reversal is subject to a 78% tax charge. Then we make some impairments related to other assets, but these are goodwill impairments. So there is no corresponding tax shield related to this. So with the combination of tax charge on the reversals and no tax shield on the impairments, we end up with a net impairment contributing positively to the pretax profit, as you can see, but negatively to the net profit. Move over to the cash flow, please. Thank you. Here's an overview of the full year main cash movements. And as you can see, they are quite substantial. Net cash moved from NOK 899 million at the end of '24 to NOK 454 million at the end of '25. Quite substantial movements also in between, as you can see on the waterfall on the slide. Our operational cash flow is strongly supported by the inclusion of the Sval numbers and totaled NOK 929 million in 2025 compared to NOK 433 million in '24. Sval is also the main change when we report our tax payments, which totaled NOK 264 million in '25 compared to only NOK 1 million the year before. Look at our investment activities, NOK 814 million out of the NOK 831 million you see on the bar there represents investments in organic and inorganic assets, including the Sval acquisition. And the rest is decommissioning with NOK 33 million and net cash from equity accounted assets in West Africa. For financing activities, it has been a very active year, as those of you following us would know. We've had a lot of moving parts in form of establishing new financing facilities as well as the redemption of the DNO04 bond and as Sval DNO RBLs. These activities have been covered in previous presentations as they mostly relate to quarters 1 to 3, so I'll not dig into the details there. But on the back of these numbers, we're also very pleased to announce that the Board has decided a dividend distribution for the 15th consecutive year in a row. So that's very good news for our shareholders. Balance slide, please. Thank you. You see the same effect here on the balance sheet. It's been a year of significant changes with much more assets, as you can see in the blue bar, balance sheet with a net debt position and a book equity supported by the hybrid bond. We still have a very solid and healthy balance sheet, well in compliance with all our bond covenants in addition to being a very strong basis for new potential M&A activities also with the financial toolbox we now have in place. So all in all, we have had a very strong quarter from DNO, -- no specific surprises or special items to take note of and not least a year with high activity, both operationally and on the business development side. So we're growing production in all 3 regions, and we are ready for an exciting year in 2026. So by that, I hand the word back to Jostein for the Q&A.
Jostein Lovas: And I believe I should give some instructions while people are lining first up. [Operator Instructions]. So -- but first up is Teodor Sveen-Nilsen.
Teodor Nilsen: Congrats on a transformative 2025. A few questions for me. First, on the export in Kurdistan. You said that you expect exports during 2026. I just wonder how does it work? Are you able to join the current export deal? Or what do you need to see to put you in a place to join that export agreement? So that's the first question. Second question, that is on Tawke production. You mentioned 100,000 barrels per day. Could you share some more thoughts around the time line on that, when you will reach that or if it's already there? And final question, that is on 2026. Dividends, you talked about the 2025 dividends, but could you share some thoughts around 2026 dividends levels or whether that will be a percentage of cash flow or earnings or some other numbers? What we could expect for 2026 dividend would be useful.
Bijan Mossavar-Rahmani: Let me tackle the first and third questions, and I'll ask Chris to tackle the second one. On the first one, yes, of course, we can join the tripartite agreement any time we wish to do so. In a sense, we're partially doing that by the fact that, as Chris mentioned, that while we sell our oil on a cash and carry or deposit and bank account and carry basis, our oil does go into the pipeline. But we're not part of the agreement in the sense that we're not part of the review of the contracts by WoodMac as the other companies are and our payments again are made by our buyer and they're made in advance. So we have that certainty of payments, and we've been paid since the beginning of the opening of the pipeline, while the other participants had to wait some time to get paid, and they have a different arrangement. But we can join that agreement at any time we want. And I think the other participants, both the companies, certainly [ Somo ] would like that to take place. We still don't know how the tripartite agreement is going to work. We don't know the time line of the WoodMac study. We don't know what the WoodMac study is studying and what it will say and how that will be processed by the [ Baghdad ] and when that is still going through a time taking process of government formation, how the new government in place will view the agreement and its terms, we don't know. And when that will take place, we don't know. So our position is to wait and see what, in fact, that's going to look like and how that compares to the arrangement that we already have in place. That will take us probably until midyear, maybe it will drag on later depending on government formation. And by midyear, the existing pipeline agreement between Turkey and Iraq will expire, as you know. What will replace it? We don't know. And so that is another trigger for a decision by us as to what to do next. And of course, the tripartite agreement itself is constantly renewed. So there's uncertainty. And because we're making substantial investments in Kurdistan drilling and we're the only company doing it, we want to reduce that uncertainty as much as possible to be able to sustain our investments. Other companies are not investing because they're not quite sure what comes next. They're getting some payments now as we understand it. But the fact that they're not investing suggests that there's uncertainty in their minds. We don't have that uncertainty under our arrangements, and we're investing. And when the -- some of the cloud over this disappears, we will have more wells, more production, more reserves under production, and we will gain the benefit of that at that time later this year. But I expect that because of the changes that might come into play on the pipeline, the Iraq, Turkey pipeline, there may be other, again, ways that exports and export pricing will take place or because of a decision on our part once the uncertainty is removed to join or not join the tripartite agreement or have our own separate agreement with [ SOMO ]. That's a possibility as well that there will be the tripartite plus 1, much like OPEC+ 2 or 3, whatever OPEC+ is now. So that's another option, too. That's why we believe that in 2026, we will be either part of the export -- the current export arrangements or we will find another mechanism to be exposed to export pricing. I think we're pretty certain that's our aim anyway to either export or have our pricing approach export and global prices. So that's the answer to the first question. On the issue of dividends, again, we've been paying dividends since August of 2022, regular dividends and rising dividends. and we're pleased to do that. Birgitte, you might say some words as to what cumulatively we've done in terms of return to shareholders. But before I turn to her to do that, I will also say that the matter of dividends distributions is one for the shareholders. And each year in June, we come back to the shareholders, and we make a proposal for dividend policy and dividend payments and the shareholders will make the determination as to what level and or what discretion to give the Board to make decisions about shareholders moving forward. So we will make those recommendations for the next 12 months after our AGM. We'll make a recommendation to the shareholders. And ultimately, they will make the decision but we've established this record of shareholder returns and shareholders always vote in favor of dividends. So it's a question of what is a prudent level that allows us to continue this policy. And we've already signaled a number of times in the past several years that we've made this -- we've made prioritizing shareholder dividends an important part of the company. And of course, we've always prioritized our bondholders and have this incredible track record of over 2 decades of solid bond raises and solid bond returns. So this is not at the exclusion of bondholders, they are as much a stakeholder of DNO and have been for a long time as are our shareholders on the equity side.
Birgitte Johansen: Yes. My calculations are correct that we have paid $455 million in dividend and $60 million in share buyback after COVID. So that should total $515 million in distribution to our shareholders. So that's quite substantial.
Bijan Mossavar-Rahmani: And Chris, on 100,000 barrels a day in Kurdistan?
Christopher Spencer: Thank you, Bijan. Yes, I just think it is a presentation of 500. So we're not just celebrating 500 million barrels but $500 million in shareholder distributions.
Bijan Mossavar-Rahmani: Excellent.
Christopher Spencer: Thank you, Bijan. On the 100,000 target, great question. Just start by reminding everyone, as I did in my presentation of the incredible performance that we've achieved on the 2 fields in the [indiscernible] license in the last 2 years without drilling. We used to get questions pretty much every quarter about the decline rates of Tawke and Peshkabir when we were drilling, what was the underlying decline rate? We were asked time and time again. Well, it's quite amazing, isn't it? -- because we've had 2 years without drilling and we haven't had any decline. Now I thank our team. They've done a brilliant job, but that obviously reflects on the quality of the assets underlying also. And that's what's given us the confidence to set ourselves this target of 100,000. And a key component of achieving that as we also wrote on the slide is that some of the wells we're going to drill are aiming to add reserves to what we already have booked on those fields. So that would be converting what's currently either in the contingent resource category or within the so-called 3P possible reserves into probable reserves and quickly into production. So the time of that depends on the success of the drilling program, and we haven't guided on when -- we haven't -- we're not guiding the market on when we'll hit 100. What we are guiding on is the average this year for DNO share production of 65,000, which you can simply do the math and figure out that, that is 86,000 to 87,000 barrels a day gross on average this year. So you can do the simple math to see that the trajectory is upwards from this quarter. And we are working to hit 100 as soon as we possibly can. But what we're guiding the market is that figure.
Jostein Lovas: Okay. With that, I believe [indiscernible] questions were answered. And we'll move on to another analyst, Tom Erik Kristiansen.
Tom Kristiansen: Congrats on last year. The performance in Norway particularly looks better than expected. Can you say anything more about how the portfolio has developed compared to your expectations in general and where is the upside being realized? And secondly, on the developments in Norway, you have focused of course, moving this forward at a higher pace than usual in this contract. What are the key drivers to achieve that? And is there also some corporate M&A aligning interests along with different blocks or discoveries would help in that regard?
Bijan Mossavar-Rahmani: Chris, do you want to put back on again, our expectations last year versus what it looks like today?
Christopher Spencer: Do you have the slide there.
Jostein Lovas: Yes, sorry.
Christopher Spencer: Yes. Thank you for the question. So as -- and the slide I hope will be coming up shortly, but as our production projection slide shows, Tom, it was -- we've been very pleased. So we are upgrading our outlook for North Sea production just, what, 10 months after the announcement. Now as we said in the -- I also mentioned in the slides, we have some 30 fields that we're now in. So it gets very long-winded if you go through all of the ups and downs. But clearly, the overall effect has been positive. I think on the production side, then the examples are [indiscernible] Brage, but they're all contributors. I don't want to spend too much time on that. I think really, when we're looking forward, what you see is this combination of the fast-tracking developments. I mean Kjottkake discovered in the Q1 last year and coming on production in 2028. That is a fantastic driver not only of the production, but also value. And that's underpinning the mid-life of this particular chart. And then as we said in -- when we announced the deal as well, you have the big assets getting bigger effect as well. So we're in the Martin Linge, the [indiscernible] rigs and Brage evening as well, where -- which is a huge field, and we keep finding a bit more -- as we're hoping to do in [indiscernible] and Peshkabir, we keep finding a little bit on the edge of the field that's adding up to making quite a big difference. So it's probably better to focus on those themes of turning the 2C into the -- turning the discoveries into 2C into 2P and the 2C that are in these big fields into 2P, and we're seeing positive developments on both of those fronts, and we're still working to achieve more. I'm glad you asked about the M&A because we announced -- we -- that's an important part of the -- not just the corporate strategy in terms of looking for more substantial M&A. But it's going to be a big part of the toolbox we have in the North Sea as well is optimization M&A. And that's what you saw us announce a couple of deals on in Q4, and we are working on more of those. So we're trying to adjust our growth profile on the back of M&A as well and high grade the portfolio to get out more cash spinning off the asset base that we have.
Bijan Mossavar-Rahmani: Also on that point, I'll add that as we wrote in our press release today, 2026 could be a year of opportunity for us. The market is going to be nervous. We've already seen that because of geopolitical issues and trade issues and so on and the price of oil has been uncertain and it could go up, it could slide back down again depending on events outside of our control, but it is going to be a nervous year for oil markets and could be a difficult year for some companies, especially prices come back down again into the low 60s for Brent, perhaps even lower. So there could be opportunities for us to move quickly to pick up assets. And we've said that this will be a 2026 is a nervous year because of uncertainty and maybe pressure on some companies because of oil prices, but that it will also be a risky year. There will be an opportunity and the DNO is a risky company. We can move quickly as we've demonstrated. Decision-making is rapid at DNO, and we're opportunistic. And we have a line of -- effectively a line of credit with the arrangements we have in place with ENGIE on our gas and also ExxonMobil and Shell on our oil. And we can tap into sale of those funds and other resources to move quickly to make acquisitions, and we're poised for that as well. So we will be on the lookout and able to move quickly because of the way we're organized and because we have perhaps we're better positioned in terms of our balance sheet and our access to credit than other companies of our size or smaller or maybe even somewhat larger to move quickly to acquire opportunities if they fit and look attractive to us, primarily in the North Sea, but not limited to the North Sea.
Jostein Lovas: Okay. Are you happy, Tom? It seems Teodor has a follow-up question.
Tom Kristiansen: Very happy. Just a short follow-up for me as well. Is it correct to assume that with those facilities you mentioned the cash on balance sheet and also, of course, some leverage capacity on assets you buy, especially if they are producing in the North Sea that you could do a deal of $2 billion, $3 billion without issuing any equity, if it's producing assets in the North Sea. Do you think that's kind of a range of what you can take on right now without any equity issues? Or could you make some adjustments to that?
Bijan Mossavar-Rahmani: I don't want to comment on that because we don't know what those opportunities are. When I said that we can move fast on -- to acquire assets that are a bit more distressed, I had a smaller size assets in mind because of smaller companies. But there could be larger companies that may have want to divest from Norway or reduce their assets, and we'll be on the lookout for those. And I think we will be positioned and we'll have market support and to do acquisitions. We're not fearful of those acquisitions of that size. That's the small acquisition that we made was in that category, and we were able to execute and quickly. And with that now under our belt, we are able to go even larger. So we are -- there are some assets we have -- we've been on our radar. But whether or not they become available opportunistically, I don't know. But my point was this will be a year, I think, of nervous market reactions to price movements, especially on the downside, and that could happen. But it could happen that prices will jump for some geological -- geopolitical reasons. But we're on the lookout, and we are open to doing those and certainly have the appetite and the wherewithal and the mindset, the mood and the emotional sort of riskiness. We want to do deals, we want to get bigger. So...
Tom Kristiansen: Sounds very good.
Jostein Lovas: With that, I think Teodor Sveen will get the last question as there are no other people on the list now. So please, Teodor.
Teodor Nilsen: Actually, 2 new questions and follow-ups. You talked about exploration and definitely a [indiscernible] exploration prospects. I just wonder whether you can discuss the most promising ones or maybe pick up a couple of favorite wells. So that's the first question. The second one is on just the technicality on the Bestla reversal of impairment. I assume that forward curves on oil price is slightly down past year, but still you reversal of impairment. Could you just explain us the drivers behind that reversal?
Christopher Spencer: Can maybe put up the exploration slide again. Thank you for the question. I hate to pick favorites as you know, because the implication for the other wells is what people take away. But I would just say that as -- Bijan has spoken about in previous quarters, as we have grown as a company, our ambition is actually to have a higher working interest in these opportunities. And because those are the ones that will really move the dot on -- for DNO. And so when I look at that right-hand column, then you can see that if I were using that criteria as a favorite, then you would be looking at the ones where we are 30% or 20% rather than 10%, having said that, all of these investment decisions have come across my desk, and I wouldn't have been positive to them if I didn't think that they were going to add value to the shareholders. And of course, exploration is a funny game. Sometimes the one you're not expecting to come in comes in and the one you're banking on doesn't. And we've all seen that many times over our career. So it's tough to figure out. I'm personally, I guess I'm very interested to see the appraisal results on Carmen and Norma. Those are 2 of the most exciting discoveries we made over the last few years and have substantial potential even [indiscernible] as well as being close to infrastructure. And when we talked about exploration strategy in the past, we've said, yes, we are close to infrastructure, ensuring we have rapid routes for commerciality. But we've also been looking for new play types in this new infrastructure area. [indiscernible] is an example of that to mention that one again. But Carmen and Norma also are in that category. And so they have a greater potential volume-wise than some of the others. But I don't just look at last year, when you were in Brage and you hit 10 million barrels, I mean, the value of that is tremendous because you can produce it next year. So yes, lots and lots of factors. I'm excited by the program is the way I'll finish that. The other question an impairment question, Birgitte.
Birgitte Johansen: Yes.
Christopher Spencer: All I know as an engineer is that we have moved closer to the startup of ore production, so the NPV has gone up. Is that part of it?
Birgitte Johansen: Yes, that's part of it. The significant development work has been completed, including drilling of production wells. So we have a new assessment that led to a $30 million impairment reversal that is post tax. You asked about the input we use or the commodity prices we use. It's worth mentioning that there were some movements on commodity prices since we delivered our annual report or quarterly report for fourth quarter of '24 until we announced the acquisition of Sval. So the input in our impairment assessments will be different from '24 to when we did the Sval PPA, which was, I guess, in March, was before my time, but that's also worth mentioning. So we haven't reduced our expectation when it comes to the input we use on the commodity prices since we -- since March, quite stable. And we follow our peers and the forward curve, as you mentioned also, Teodor. There's also a lot of details in the notes. We have at least one page, even more, I think, on Note 7 in the report. So there's also quite a lot of information. There you also find a table with a lot of details on each adjustment we have done in Q4 '25.
Teodor Nilsen: Okay. Have you increased any reserves or resources in the latest assessment?
Birgitte Johansen: Not reserves, I think, no.
Christopher Spencer: That's no material change in the reserves. The wells have confirmed what we were expecting.
Bijan Mossavar-Rahmani: Jostein, would you put that exploration slide you just had on back on the screen, please? -- comments. And I'd point to 2 columns, both of which Chris has talked about. One is the DNO interest, which here we have this 10%, 15% interest and then the 30% interest. That shows the evolution of DNO as a North Sea player. When we returned to Norway several years now about 4, 5 years ago, we came in and started up as a pure exploration company. We took small interest or were awarded small interest in blocks and the target was to make discoveries. As we've matured, -- we've now -- we're now taking a larger interest and being awarded larger interest in assets. And this is significant because as a larger company, then discoveries will be more meaningful for us. Plus with larger interest, we have the ability to farm down. And for example, then reduce our exposure in terms of CapEx. We don't want to do that, but at least with larger interest, we have the ability to sell down if that makes sense for whatever reason or combination reasons. So that's been a change. And you'll see, again, that moving forward, our interests are going to be 30%, 40% in that range larger than was the case when we were a small exploration-only company with more limited resources and less of a track record. We've also added importantly this chance of commerciality. The point isn't just to make discoveries, it's to make discoveries of commercial molecules, both oil and gas. And that's now a consideration as we decide which wells to drill. It's first, what is the geological chance of success. And the second is having made the discovery, how quickly can we bring it to market. And that better be under 5 years. It hopefully will become 2 to 3 years, and that's what we're targeting. And that means we have to have discoveries made near infrastructure which we've been doing now for a number of years, but also that it's not just near infrastructure, but it's near accessible infrastructure that we are able to get into that infrastructure and to do all of this in very rapid time in terms of the time between discovery and production. So our business model has changed in that sense as we've matured. And you see that here, and you'll see it in successive quarters when we show these slides again that you'll see more wells that have high or medium to high chance of commerciality and where the DNO interest is larger, and that's -- that shows the evolution of DNO as a small exploration-focused company to a more mature company that focuses on exploration, but with access to infrastructure already, importantly, through the small acquisition of the small assets and the fact that, again, we are -- have this fast-track mentality and developing fast-track partnerships that you'll see us continue to mature and that will make us even more successful as a North Sea player than we have been because of exploration, will make us more successful because of development and then larger production volumes. So I think you see this evolution in this slide, you'll see it further in the future quarters as well.
Jostein Lovas: Well, then, ladies and gentlemen, that's a wrap. And thanks to all for participating, and see you again in a couple of months.
Christopher Spencer: Thank you.
Birgitte Johansen: Thank you.