Results for the year ended 31 December 2020

Results for the year ended 31 December 2020 and 2021 outlook

25 March 2021

Unless otherwise stated, all figures are on a Business performance basis and are in US Dollars.

EnQuest Chief Executive, Amjad Bseisu, said:

"Our quick and decisive actions in early 2020, combined with our reorganisation, have transformed the Company. We generated $211.1 million of free cash flow in the year, having significantly lowered our cost base and free cash flow breakeven, enabling us to reduce our debt to its lowest level since 2014. Capital and operating expenditures reduced by $295.6 million and free cash flow breakeven¹ for the year was $31.9/Boe, both in line with our targets. Our focus on safety enabled us to minimise successfully the impact of COVID-19 on our workforce and operations.

"The proposed acquisition of the low-cost Golden Eagle area will strengthen our business, providing additional production and strong cash flows which will partially utilise our UK tax assets.

"We successfully managed the unique set of challenges presented in 2020, taking decisive action to protect and enhance our business. Our focus on extending the useful lives of existing assets through operational improvements and reducing emissions is well suited to operating through the energy transition and I am confident that EnQuest is well placed to succeed in a changing world."

2020 performance

• Group production averaged 59,116 Boepd in 2020, in line with guidance (2019: 68,606 Boepd)
• Revenue of $856.9 million (2019: $1,711.8 million) and EBITDA of $550.6 million (2019: $1,006.5 million) reflect lower year on year production and realised oil prices of $41.3/bbl, partially offset by lower operating costs
• Cash generated from operations of $567.8 million (2019: $994.6 million); cash capital expenditure of $131.4 million (2019: $237.5 million)
• Strong free cash flow generation of $211.1 million (2019: $368.5 million)
• Cash and available bank facilities amounted to $284.1 million at 31 December 2020 (2019: $288.6 million), with net debt reduced to $1,279.7 million (2019: $1,413.0 million)
• Statutory reported basic loss after tax was $625.8 million reflecting non-cash impairments, including tax, of $630.3 million, (2019: loss after tax of $449.3 million)

2021 performance and outlook²

• Year to date February production averaged 46,635 Boepd, affected by outages, repairs and opportunistic maintenance at Magnus and Kraken, which are now complete
• Hedges in place for c.5 MMbbls of oil with an average floor price of c.$55/bbl and an average ceiling price of c.$64/bbl
• Full year average production expected to be between 46,000 to 52,000 Boepd, excluding Golden Eagle which will add c.10,000 Boepd on a pro forma basis
• Full year operating expenditure of c.$265 million
• Combined cash capital and abandonment expenditure of c.$120 million³

¹ Based on the Group's aggregate cash outflows prior to any debt repayments and $37.3 million of Magnus-related third-party gas purchases divided by net working interest production

²Existing portfolio

³ Excludes the costs associated with the PM8/Seligi riser incident repair which are expected to be largely covered by insurance

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