OKEA (Hold, TP: NOK23.00) - Elevated risk at Statfjord
OKEA reported net production of 38.4kboed in Q2, compared to our 37.1kboed estimate (no reliable consensus). Although the realised liquids prices were slightly below Brent and realised gas prices were slightly above spot TTF prices in the quarter, we believe the results were overshadowed by the technical impairment at Statfjord due to a “change in risking of future projects”. We reiterate our HOLD but have cut our target price to NOK23 (28) as we have lowered our fair P/NAV from 0.80x to 0.65x due to an elevated risk of production outlook reductions related to Statfjord.Okea ASA is a Norway-based oil company engaged in the oil and gas exploration and production industry. The Company contributes to the value creation on the Norwegian continental shelf with development and operation systems through the utilization of the result of previous and ongoing exploration activities in order to bring undeveloped oil on stream in strategic cooperation with service companies. Its services do not involve the exploration for petroleum. The Company operates an office in Trondheim, Norway.
DNB Markets is the investment banking arm of DNB Bank ASA and is focused primarily on the Nordic region, as well as internationally on niches such as global shipping, energy and related services, and seafood. DNB Markets offers services in FICC, Equities and Investment Banking advisory from offices in Oslo, Stockholm, London, Singapore and New York. Equity research coverage is offered on c250 Nordic companies. DNB was ranked no.2 in Extel Nordic Research 2017. The DNB Markets’ Credit and FICC Macro & FX Research teams are repeatedly highly rated by Prospera Nordic Institutional Investor Surveys.
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