73349613 2023-01-01 2023-12-31 73349613 2023-01-01 2023-12-31 1 73349613 2023-01-01 2023-12-31 1 73349613 2023-01-01 2023-12-31 2 73349613 2023-01-01 2023-12-31 3 73349613 2023-01-01 2023-12-31 1 73349613 2023-01-01 2023-12-31 2 73349613 2022-01-01 2022-12-31 73349613 2023-12-31 73349613 2022-12-31 73349613 2022-12-31 fsa:ContributedCapitalMember 73349613 2022-12-31 fsa:RetainedEarningsMember 73349613 2022-12-31 fsa:ProposedDividendRecognisedInEquityMember 73349613 2023-01-01 2023-12-31 fsa:ContributedCapitalMember 73349613 2023-01-01 2023-12-31 fsa:RetainedEarningsMember 73349613 2023-01-01 2023-12-31 fsa:ProposedDividendRecognisedInEquityMember 73349613 2023-12-31 fsa:ContributedCapitalMember 73349613 2023-12-31 fsa:RetainedEarningsMember 73349613 2023-12-31 fsa:ProposedDividendRecognisedInEquityMember 73349613 2021-12-31 fsa:ContributedCapitalMember 73349613 2021-12-31 fsa:RetainedEarningsMember 73349613 2021-12-31 fsa:ProposedDividendRecognisedInEquityMember 73349613 2021-12-31 73349613 2022-01-01 2022-12-31 fsa:ContributedCapitalMember 73349613 2022-01-01 2022-12-31 fsa:RetainedEarningsMember 73349613 2022-01-01 2022-12-31 fsa:ProposedDividendRecognisedInEquityMember iso4217:DKK xbrli:pure Christian Vinten The Executive Board and the Board of Directors have today discussed and approved the annual report of INEOS E&P A/S for the financial year 1 January - 31 December 2023.The annual report has been prepared in accordance with the Danish Financial Statements Act.In our opinion, the financial statements give a true and fair view of the Company's financial position at 31 De-cember 2023 and of the results of the Company's operations for the financial year 1 January - 31 December 2023.In our opinion, Management's Commentary includes a fair review of the matters dealt with in the Manage-ment's CommentaryWe recommend the adoption of the annual report at the annual general meeting. Virum, Mads Weng Gade Erik Fantoft Magnesen David James Bucknall Mads Weng Gade Chairman Deputy chairman To the shareholder of INEOS E&P A/S We have audited the financial statements of INEOS E&P A/S for the financial year 01.01.2023 - 31.12.2023,which comprise the income statement, balance sheet, statement of changes in equity, notes, including a sum-mary of significant accounting policies. The financial statements are prepared in accordance with the Danish Financial Statements Act.In our opinion, the financial statements give a true and fair view of the Entity’s financial position at 31.12.2023and of the results of its operations for the financial year 01.01.2023 – 31.12.2023 in accordance with the Danish Financial Statements Act. We conducted our audit in accordance with International Standards on Auditing (ISAs) and additional require-ments applicable in Denmark. Our responsibilities under those standards and requirements are further describ- ed in the Auditor’s responsibilities for the audit of the financial statements section of this auditor’s report. We are independent of the Entity in accordance with the International Ethics Standards Board for Accountants' In-ternation Code of Ethics for Professional Accountants (IESBA Code) and the additional requirements applicable in Denmark, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Management is responsible for the preparation of financial statements that give a true and fair view in accor-dance with the Danish Financial Statements Act, and for such internal control as Management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.In preparing the financial statements, Management is responsible for assessing the Entity’s ability to continue as a going concern, for disclosing, as applicable, matters related to going concern, and for using the going concern basis of accounting in preparing the financial statements unless Management either intends to liquid-ate the Entity or to cease operations, or has no realistic alternative but to do so. Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs and the additional requirements applicable in Denmark will always detect a material mis-statement when it exists. Misstatements can arise from fraud or error and are considered material if, individu-ally or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.As part of an audit conducted in accordance with ISAs and the additional requirements applicable in Denmark, we exercise professional judgement and maintain professional scepticism throughout the audit. We also: • Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is suf- ficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, inten- tional omissions, misrepresentations, or the override of internal control.• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Entity’s internal control.• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by Management.• Conclude on the appropriateness of Management’s use of the going concern basis of accounting in prepa- ring the financial statements, and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Entity’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our au- ditor’s report. However, future events or conditions may cause the Entity to cease to continue as a going concern.• Evaluate the overall presentation, structure and content of the financial statements, including the disclosures in the notes, and whether the financial statements represent the underlying transactions and events in a man- ner that gives a true and fair view.We communicate with those charged with governance regarding, among other matters, the planned scope andtiming of the audit and significant audit findings, including any significant deficiencies in internal control that weidentify during our audit. Management is responsible for the management commentary.Our opinion on the financial statements does not cover the management commentary, and we do not expressany form of assurance conclusion thereon.In connection with our audit of the financial statements, our responsibility is to read the management commen-tary and, in doing so, consider whether the management commentary is materially inconsistent with the finan-cial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.Moreover, it is our responsibility to consider whether the management commentary provides the informationrequired by relevant law and regulations.Based on the work we have performed, we conclude that the management commentary is in accordance withthe financial statements and has been prepared in accordance with the requirements by relevant law and regu-lations. We did not identify any material misstatement of the management commentary. Copenhagen, DeloitteStatsautoriseret Revisionspartnerselskab 33963556 Lars Hillebrand Peter Kyhnauv-Vejgaard State-Authorised Public Accountant State-Authorised Public Accountant mne26712 mne42833 INEOS E&P A/S Teknikerbyen 5, 1. 2830 Virum www.ineos.com 73349613 Weidekampsgade 6 2300 København S Company OverviewINEOS E&P, CVR no. 73349613100%100%100%100% INEOS E&P 100% INEOS E&P (Petroleum INEOS E&P (Siri) INEOS Energy INEOS Energi (Norge) Denmark) ApSUK Ltd., (Lulita) DK A/S, (Syd Arne) ApSPetroleum DK ASCompany no. CVR no. CVR no. CVR no. Reg. no. 979 932 026500 06671453133162711773589118545100%Siri, branch of INEOS E&P (Siri) UK Ltd., CVR no. 20771593Key figuresIncome statement (DKKm)20232022202120202019Revenue 843 1,152 860 535 1,182EBITDA 148 303 175 237 689(Loss)/profit before financial income and expenses -67 533 589 399 114Net financial items -856 2,100 668 -651 247(Loss)/profit for the year-8122,4351,668-252352Balance Sheet (DKKm)Total assets 7,609 11,046 9,970 8,282 8,914Investment in property, plant and equipment 428 12 0 28 64Equity2,1865,9983,5631,8762,134Financial ratiosEBIT margin -7.92% 46.28% 68.45% 74.56% 9.66%Return on assets -0.88% 4.83% 5.91% 4.82% 1.28%EBITDA margin 17.54% 26.27% 20.32% 44.37% 58.27%None-financial dataAverage number of employees (FTE's) 265 245 183 195 210OSHA Recordable injury rate for Siri Area(per 200,000 hours)* 0.50 0.98 0.00 0.45 0.43Discharging of oil into the sea, tonnes* 2.43 2.87 0.99 1.10 1.65Rejection of produced water, %* 86.2% 87.0% 99.0% 98.8% 98.5%Gas flaring from platforms (flaring), million Nm3*2.932.081.782.092.48The financial ratios are calculated in accordance with the Danish Finance Society's recommendations and gui-delines. For definitions, see the summary of significant accounting policies.* With effect from April 1, 2022, INEOS E&P A/S took over as the operator of the Syd Arne licence. Therefore, 2022 and 2023 numbers include both Syd Arne and Siri Area. Financial reviewThe Company's income statement for the year ending 31 December shows a loss of DKK 812 million, and the balance sheet end 31 December 2023 shows equity of DKK 2,186 million.Revenue totaled DKK 843 million, which is 310 million lower than in 2022. The decrease is primarily due to lower oil prices in the year compared to 2022. EBITDA decreased by DKK 155 million to DKK 148 million in 2023. The decrease was mainly due to lower revenue offset by cost reduction and lower payroll cost due to ca-pitalising onto the Solsort development project and Nini and Siri well workovers.EBIT decreased by DKK 600 million to DKK -67 million. The decrease is mainly due to a lower reversal of im-pairment compared to 2022.Profit before tax decreased by 3,556 million to -923 million. The decrease is mainly due to negative income from subsidiaries offset by higher financial income. The lower income from subsidaries is mainly related to im-pairment and write-down of deferred tax assets in INEOS Energy (Syd Arne) ApS and INEOS (Petroleum Den-mark) ApS, compared to 2022.Profit for the year decreased by 3,247 million to -812 million. The decrease is mainly due to the comments above offset by an adjustment of the deferred tax asset of 309 million to 111 million.Financial performance for 2023 was lower than expected due to the lower oil prices and the negative incomefrom subsidaries. Production, operations and development updateOperational performance remained relatively strong in the year with reliability of 92.8% (2022: 96.2%) on ourexisting operated fields. Sales averaged 8.0 kboe of oil and gas per day (2022: 8.9 kboe per day) with appro-ximately 81% from the operated field Syd Arne (2022: 79%), 19% from the operated fields Siri, Nini and Cecilie(2022: 21%) and 0% from the non-operated Lulita field (2022: 0%). Siri AreaThe Siri Area comprises the Siri field, where the processing platform and associated wells are located along with satellite tie-back fields Stine, Nini, Nini East and Cecilie. Oil is exported by tanker and gas and produced water reinjected into the Siri field. The Siri license, comprising of Siri and Stine is 100% owned and operated by the INEOS E&P A/S whereas the Nini (Nini and Nini East) and Cecilie licenses are joint ventures between the INEOS E&P A/S (Operator, 57.1% and 56.4% respectively) and Wintershall Dea International GmbH. Produc-tion from Siri commenced in 1999 with the satellite developments following in the next decade.Maintenance work during 2023 was focused on the 26-C compressor where fouling issues lead to the change of bundle and wash during June and October 2023. Two planned shutdowns were executed; first from the 26th to the 28th of April, and later from the 25th of October to the 1st of November. During the spring shutdown, main activities were related to wells and riser lift gas inflow tests, as well as main-tenance on the generator, replacing both the relay and the radiator. In addition, a satellite dish was installed be-low the atmospheric vent tip, required to establish a line-of-sight connection to the South Arne internet service.Siri AreaThe main activities of the autumn shutdown included repair of one of the Nini riser valve, pressure inspection on the B-separator, replacement of the existing flow meter in well SCA-01B and of both the buffer gas system flow control valve and flow meter. Additionally, a welding job along the turbine exhaust was performed and replace-ment of the junction box of the tractor belt were other relevant activities. The 2023 Annual Survey for Topside Facilities (ASTF) was carried out in October by a third-party verification company with a positive result. The ASTF concluded that the Certificate of Conformity (CoC) is maintained for the Siri complex.Syd Arne FieldThe Syd Arne field is a joint venture between the INEOS E&P A/S (Operator, 36.8%), INEOS Energy (Syd Arne) ApS (61.5%) and Danoil (1.7%). Production from the field commenced in 1999.2023 was the second full year with the Group responsible for the daily running of operations. Uptime of the fa-cilities was very high for the majority of the year. During the month of March, a planned turnaround was execu-ted successfully by the end of the month. However, significant compressor issues were encountered that re-quired change out of seals resulting in startup of the plant being delayed until the second half of April. The SA-02 producer well was shut in due to integrity issues and is planned to be converted into an injector well.Execution of the Solsort West Lobe tieback project to the Syd Arne facilities, for processing and export, con-tinued in 2024. A delay in the drilling program has led to first oil was 6 March 2024. Maturation of a Syd Arneinfill well in the Ekofisk West Flank area is ongoing with Sanction targeted for Q4 2024.Lulita FieldThe Lulita field is a joint venture between Total (Operator, 15.6%), INEOS E&P A/S (21.8%), INEOS Energy (Lulita) ApS (18.2%), Shell (18.4%), Noreco (10%), Nordsøfonden (10%) and Chevron (6%). Production com-prises a single well drilled from the Harald platform. The well liquids are processed on Harald and oil and gas are exported separately to the Tyra complex for onwards distribution. The Lulita license expires in 2026. Pro-duction is currently shut in and, according to TotalEnergies, expected to restart in first half of 2024 following completion of the Tyra Redevelopment Project which is a prerequisite for Lulita production to resume.Hejre FieldThe Hejre area comprises of licenses 5/98 (INEOS E&P A/S (60%), INEOS E&P (Petroleum Denmark) ApS (15%) and INEOS E&P (Norge) Petroleum DK AS (25%)) and 1/06 between INEOS E&P A/S (48%), INEOS E&P (Petroleum Denmark) ApS (12%) and INEOS E&P (Norge) Petroleum DK AS (20%) and Nordsøfonden (20%). Development and exploration activities takes place in license 5/98 whilst only exploration activities takes place in license 1/06.The ongoing Hejre development project is in the preparation for define phase. The plan is a tie-back to Syd Arne for processing and export of oil and gas. Based on encouraging results, a non-binding Plan for Develop-ment and Operation (PDO) was submitted to the authorities in December 2022 and was approved in April 2024. DUAL FEED was started in Q2 2024 and final investment decision is expected mid 2025 and with first oil ex-pected end 2027. Solsort FieldThe Solsort license is a joint venture between INEOS E&P A/S (35.1396%), INEOS E&P (Petroleum Denmark) ApS (27.66%), INEOS Energy (Syd Arne) ApS (4.7982%), Nordsøfonden (18.44%) and Danoil (13.9622%).Solsort FieldThe Solsort West Lobe is current under development (execution), consisting of 2 wells being drilled form the Syd Arne North Satellite platform and minor modifications to the Syd Arne facilities. The Noble Resolve Jack-up rig has been selected as drilling rig. The first well (producer well) has been drilled and first oil was 6 March2024, followed by the second well (injector well), which is expected to be completed in June/July 2024. The project was approved by INEOS and the Solsort Partnership in September 2022. Greensand ProjectThe Greensand CCS project on the Siri area, Nini West reservoir was further matured for CO2 storage in Pha-se 2 of the project with the operational part, offshore pilot ship-based injection of 4000 tons liquid CO2 and seis-mic monitoring of the CO2 plume in the reservoir in Q1, 2023. In addition, and in parallel, the technical, regula-tory and commercial maturation of the Greensand area has been ongoing throuhout the entire 2023 (and will continue in 2024) following the below 2 tracks: 1.Proof of Industrial Scale – Transport and store biogenic Biogas generated Co2, with transport taking place using a retrofitted production support vessel (PSV) with a capacity of up to 4000 MT liquid CO2 per ship load and storage in the Nini West reservoir facilitated by direct ship injection into an existing well, NA-3B. The aim with this concept is to store 400.000 tons of CO2 per year.2. Proof of commercial scale – Inclusion of additional Nini complex reservoir build further CO2 storage capacity and ramp to a capacity, provided permits and volumes contracted are in place, of up to 3 million tons per year. This concept entails more offloading points, more injection wells and charter-ing of new build custom made CO2 carriers with injection, heating and DP2 capabilities.Greenport Scandinavia CO2 Import and Export Harbor Terminal Hub ProjectThe project was during 2023 established and the scope of work developed in collaboration between the 7 part-ners including INEOS Energy and Wintershall Dea. Project funding was applied for mid-2023 and successful awarder to group of Partners in December 2023. The funding will support pre-FEED and FEED studies and ot-her relevant to be executed during 2024 and 2025. The Greenport Scandinavia is connected to Greensand as the first available storage site and split into 3 phases: proof of industrial scale, hub establishment and hub ex-pansion. Focus the next two years will be on the first 2 phases and includes a onshore pipeline connection to the potential future onshore storage sites in Denmark that are currently being tendered by the Danish Govern-ment. INEOS Energy has together with Wintershall Dea applied for one of the license areas offered in the ten-der that can be connected to Greenport Scandinavia.Market developmentCrude Brent and US dollarThe average price of crude brent in 2023 was approximately 83 USD/BBL, which is a 19 USD/BBL decrease compared to 2022. Brent crude started 2023 with a decent decrease during January with shifts from recoveryto downturn although first half of 2023. Brent crude recovered and reached the maximum of 98 USD/BBL du-ring September but decreased from october to through the rest of the year - ending with an end quote approxi-mately 4 USD/BBL lower than the opening quote. In 2024 the Brent Crude has been steadily increasing to reachthe 90 USD/BBL level in April.The USD exchange rate started 2023 at 6.97 DKK/USD but decreased during the year and closed at 6.74 DKK/USD.ProductionOil and gas production for INEOS E&P A/S totaled 1.7 million boe, down 5% from 2023. Decrease in produc-tion is due natural decline in reservior.InvestmentsInvestments held by INEOS E&P A/S consist of technical installations on South Arne and Siri. Further, in 2023 INEOS E&P A/S has started the Solsort development project and completed two succussfull well workovers on Siri and Nini. Capital expenditure in 2023 amounted to DKK 428 million, as compared to DKK 12 in 2022. Future outlookThe Company continues to monitor the ongoing military actions in Ukraine that may disrupt or curtail its opera-tions or development activities. The Comapny is actively monitoring any factors and events that could adversely affect the Company and mitigating measures are implemented where appropriate.The Company is reviewing its strategy but will continue to pursue growth opportunities through further develop-ments in Denmark.The Company looks forward to the coming years with optimism in developing near term resources in a safe, reliable and profitable manner.Based on the uncertainties related to oil prices, the Company expect a result before tax and income from sub-sidaries between DKK 350 million and DKK 450 million. Further, due to first oil from Solsort in 2024, we expectincrease in production by 45-55% in 2024.SubsidariesThe subsidaries in Denmark, UK, Greenland and Norway have contributed a loss of DKK 954 million in 2023. The loss is mainly related to INEOS Energy (Syd Arne) ApS and INEOS (Petroleum Denmark) ApS and relates to impairment and write-down of deferred tax assets.On the 28 March 2023 INEOS E&P Grønland A/S was liquidated.At the end of 2023, INEOS E&P A/S (including subsidiaries) had 11 licenses in Denmark.Special risksManagement of the business and the execution of the Company's strategy are subject to a number of risks. The key business risks affecting the Company are considered to relate to the safe and reliable operation of fields, specifically those for which the Company is operator, management of the impact of oil and gas price vola-tility on the revenues and cash flows, and the ability to find and exploit gas deposits in the DK sector of the North Sea. The Company deploys highly skilled and experienced resources to identify, evaluate and financially assess development opportunities, applies the best safety and environmental practices in the production of pro-ven oil and gas reserves and adopts robust financial management which, together with appropriate monitoring of business performance seeks to mitigate such risks.Financial riskThe Company's operations are exposed to a variety of financial risks that include effects of the commodity price risk, credit risk, liquidity and cash flow risk, currency risk and interest rate risk. The Company has in place a risk management programme that seeks to limit any adverse effects on the financial performance of the Com-pany where appropriate.The main financial risk which could affect the company are set out below:a) Commodity price risk: Oil and gas is traded commodities with open market prices. The Company is exposed to fluctuations in market prices to the extent that it has not entered into fixed price agree-ments. The directors regularly review cost-benefit of entering into price hedges to minimise risk. The company has no price hedging in place.b) Interest rate risk: The company has a mix of financing facilities including deposits to subsidiaries and shareholder deposit and loan facility. Deposits to subsidiaries and shareholders bears interest at variable rates based on SOFR and; the shareholder loan bear interest at variable rates based on CIBOR. The directors review the interest rate and assess the cost-benefit of interest rate hedging. The company has no interest rate hedging in place.c) Currency risk: The Company undertakes transactions in various currencies, and the Company ma-nages this risk by matching receipts and payments in the same currency (where possible) and mo-nitoring the movements in exchange rates. The Company also has shareholder and subsidiary loan and deposits facility in USD, GBP, NOK and DKK. Although the significant majority of transactions are denominated in USD and DKK (the Company's functional currency). The directors continue to review the cost-benefit of currency hedging. The company has no currency hedging in place.d) Credit risk: The Company has in place policies and procedures to mitigate the risk that customers default on amounts owed to the Company. Exposure to credit risk is further minimised by the na-ture of the customers with which the Company deals.e)Liquidity and cash flow risk: The Company's operating assets generate sufficient positive cash flows to cover the Company's costs and development activities and service the Company's own obliga-tions. The Company has access to liquidity, through participation in external financing and support from shareholders to manage such risks.Recognition and measurement uncertaintiesThe recognition of Deferred Tax, Fixed Assets (impairments) and decommissioning liabilities are all subject to a high degree of uncertainty due to the level and nature of assumptions made when estimating the outcome of subsequent events. The assumptions which would change future measurement includes: - General price development or development in market prices - Expected useful live of production assets - Weighted average cost of capital (WACC) and risk free rate - Exchange rates, etc. - Development of existing technologiesThe recognition and measurement of items in the financial statements is not subject to any other significant uncertainty.Unusual mattersThe Company's financial position at 31 December 2023 and the results of its operations for the financial year ended 31 December 2023 are not affected by any unusual matters.Business modelThe Company's main activity is exploration and production of oil and gas in the Danish part of the North Sea.Oil and gas are sold to primarily oil refineries in Europe.A part of our strategy is to transform the business into a leading North Sea oil and gas company in terms of returns and cash generation. Furthermore, we continue to assess other opportunities for value creation, with investments focused on field extensions or build-out near existing producing assets as well as already initiated developments. Report on payments to authoritiesPursuant to section 99c of the Danish Financial Statements Act, INEOS E&P A/S is obliged to account for pay-ment authorities. In 2023 INEOS E&P A/S has made payment of DKK 2.644 thousand regarding Nitrogen Oxide (NOx) fee. Main activityThe company’s objects are to engage in activities in the energy sector and ancillary activities, including subs-oil CO2 storage activities. Corporate social responsibilityINEOS publishes a group sustainability report in relation to the legal entity INEOS AG, which is prepared in accordance with GRI standards (GRI 1 Foundation 2021) and assured by KPMG. Our 2023 group report is available on our website: www.ineos.com/globalassets/sustainability/sustainability-reports/ineos_sustainabilityreport_2023_240430.pdfAs a subsidiary of INEOS AG, INEOS E&P A/S is included within the reporting boundary of the INEOS group sustainability report.Group-wide policies include our Code of Conduct, Supplier Code of Conduct, SHEQ policy, 7 Life-saving Rules, 20 Safety Principles, INEOS Group Guidance Notes and ESG procedures. INEOS’ climate targets to reduce operational emissions by 33% by 2030 (compared to 2019) and reach net-zero emissions by 2050 also apply at group level, as do our 2025 and 2030 polymer pledges.Human rightsWe refer to section 3.2, 3.2.1 and 3.2.2 in the INEOS Group sustainability report which is available on our web-site:www.ineos.com/globalassets/sustainability/sustainability-reports/ineos_sustainabilityreport_2023_240430.pdfAnti-Corruption PolicyWe refer to section 4.1 - 4.1.2 and 4.1.4 in the INEOS Group sustainability report which is available on our web-site:www.ineos.com/globalassets/sustainability/sustainability-reports/ineos_sustainabilityreport_2023_240430.pdfSocial and employee conditionsWe refer to section 3.1 and 3.1.1 - 3.1.3 in the INEOS Group sustainability report which is available on our web-site:www.ineos.com/globalassets/sustainability/sustainability-reports/ineos_sustainabilityreport_2023_240430.pdfEnvironmental and climate changeWe refer to section 2.1 - 2.4.3 in the INEOS Group sustainability report which is available on our website:www.ineos.com/globalassets/sustainability/sustainability-reports/ineos_sustainabilityreport_2023_240430.pdf Data ethicsWe refer to section 2.1 - 2.4.3 in the INEOS Group sustainability report which is available on our website:www.ineos.com/globalassets/sustainability/sustainability-reports/ineos_sustainabilityreport_2023_240430.pdf Statement on the underrepresented genderINEOS policy on gender diversity is to explain the target we as a company have set to increase gender diver-sity and the proportion of women at all management levels in our organization and the initiatives we have im-plemented and plan to implement to support this development. This also constitutes the element of fulfilling the legal requirement on reporting of targets and policy for the gender composition of management.Therefore, INEOS has focus on three areas to increase the numbers of females on the Board of Directors:Recruitment:1. All available positions are advertised online, and/or promoted internally to ensure that everyone has equal opportunities to apply for the job. 2. Job adds are written in an unbiased language to secure an interest in INEOS E&P A/S as a workplace and the specific position, for all qualified applicants. 3. When qualified female applicants have responded to a specific job posting (external or internal), Managers must always, if possible, invite all qualified female applicant for an interview.Talent Development & Succession Planning:1. Each year when the Performance & Development Review has been completed, women with special leader- ship potential are identified, and individual action plans are prepared for them.2. To increase transparency the evaluation in connection with the People Review takes place in manager groups, to ensure that everyone is evaluated in a uniform matter based on equal parameters.3. Twice a year, all employees have a Performance & Development Dialogue with their immediate manager. This ensures that all employees know how they are performing and that they have a structured dialogue about development wishes and possibilities. It is expected of the managers to pay close attention to diver- sity and the gender goals set for INEOS E&P A/S.Management focus:1. The development of women in management is monitored through continuous reporting by HR and on at least quarterly basis the Board receives an overview of the gender distribution of management in our organi- zation to ensure appropriate focus and efforts to increase the proportion of female managers.2. Further all Managers are expected to focus on building diverse teams, and opportunities and support for fe- males to advance.3. HR ensures awareness of the gender distribution in relation to promotions, aiming at a gender distribution among the management that reflects the overall gender distribution within the organization.Board of DirectorsCurrently the Board of directors consist of 3 members of whom 0 is women. Therefore, the company is requi-red to set a target for the underrepresented gender in according to The Financial Statements Act section 99 b. Our target is that the Board of Directors should consist of at least 1 woman before end of 2024. While this target was not achieved in 2023, it remains a key focus for INEOS to be delivered before the 2024 target date is reached.Other management levelTo improve the diversity in other management level INEOS has decided to set goals for the highiest level underthe Board of Directors (DK leadership team) and the next level (Leading leaders)At the end of 2023 composition of other management level was as below.Female MaleDK Leadership team 18% 82%Leading Leaders 20% 80%Based on the above INEOS only succeeded in raising the DK leadership team from 16-18% but the ambition is still to increase the management level to 25% females. The oil and gas industry is a male dominated industry and we believe we have set an ambitious goal, since only 18% of the employees as today are female. We hope that through our focus areas we will be able to reach the goals. When we have reached the 25% INEOS Energy will set new goals so we over time will be able to equal composition of female and male.During 2023, we have strived to increase the numbers of women in other management level through our focus areas with good progress but we have still not reached our goals. The Company will continue working towards amore equal composition of men and women in other management levels in 2024 through our focus areas. 842656000 1152393000 30154000 31872000 49276000 -9795000 525733000 630506000 297801000 563554000 150040000 260858000 214520000 -230594000 -66759000 533290000 -953885000 2073041000 241543000 199137000 144157000 172351000 -923258000 2633117000 -111000000 198000000 -812258000 2435117000 116761000 94163000 116000 314000 116877000 94477000 30000 384000 2390529000 2200084000 285414000 8925000 247315000 270220000 2923288000 2479613000 1235847000 3219947000 988455000 4208597000 336000000 225000000 2560302000 7653544000 5600467000 10227634000 25697000 58110000 150389000 161815000 1132375000 117152000 190317000 184642000 11766000 11766000 154933000 46250000 1665477000 579735000 343226000 238809000 2008703000 818544000 7609170000 11046178000 500000000 500000000 1685620000 2497878000 0 3000000000 2185620000 5997878000 4368608000 4052188000 226453000 248850000 4595061000 4301038000 34931000 32761000 332546000 119873000 21744000 196716000 251838000 199572000 187430000 198340000 828489000 747262000 5423550000 5048300000 7609170000 11046178000 500000000 2497878000 3000000000 5997878000 0 -812258000 0 -812258000 0 0 3000000000 3000000000 500000000 1685620000 0 2185620000 500000000 3062761000 0 3562761000 0 2435117000 0 2435117000 0 -3000000000 3000000000 0 500000000 2497878000 3000000000 5997878000 RevenueType of goods/servicesOil and gas 796,124 1,076,163 Other income relating to oil and gas production 46,532 76,230 Total842,6561,152,393Geographical information by location of customersDenmark 32,639 92,466 Rest of EU 247,084 - Rest of world 562,933 1,059,927 Total842,6561,152,393Timing of revenue recognition from customersAt a point in time 812,522 1,124,819 Over time 30,134 27,574 842,6561,152,393 Other operating incomeChange in decommissioning provision- 1,102 Income from subleasing right-of-use assets 28,753 30,770 Sale of materials 1,149 - Other 252 - 30,15431,872 Staff costsWages and salaries 309,846 290,785 Pensions 25,692 21,845 Other social security costs - - Other staff costs 1,719 122 337,257 312,752 Payroll capitalised and charged to partners etc. -187,217 -51,894 150,040260,858 265 245 According to section 98 B(3) of the Danish Financial Statements Act, Remuneration to the Executive Board has not been disclosed. 2023 2022DKK'000 DKK'000Depreciation, amortisation and impairment of intangible assetsand property, plant and equipmentAmortisation of intangible assets 198 449 Depreciation of tangible assets 284,900 162,700 Impairment 276,187 86,993 Reserval of impairment of tangible assets -382,981 -519,537 Depreciation of leased assets 36,215 38,801 214,519-230,594 Income from investments in subsidiariesNet profit/loss for the year -953,885 2,073,041 -953,8852,073,041 Financial incomeBank interest 7,157 1,471 Interest received from group companies 234,165 197,666 Other interest income 221 - 241,543199,137 Financial expensesBank interest 1 591 Financial expenses to group companies 18,313 41,368 Other financial expenses 4 26,750 Exchange loss 13,468 81,901 Lease interest 9,117 8,339 Interest element, provision 103,254 13,402 144,157172,351 Tax on profit for the yearDeferred tax for the year -111,000 198,000 -111,000198,000 0 3000000000 -812258000 -564883000 -812258000 2435117000 Intangible assetsSoftware Intagible TotalDKK'000 DKK'000 DKK'000Cost at 1 January 35,782 94,163 129,945 Additions for the year - 75,712 75,712 Disposals for the year - -53,114 -53,114 Cost at 31 December 35,782 116,761 152,543 Impairment losses and amortisation at 1 January 35,468 - 35,468 Amortisation for the year 198 - 198 Impairment losses and amortisation at 31 December 35,666 - 35,666 Carrying value at 31 December116116,761116,877 Tangible assetsOther fixtures and fittings, Production tools and Production assets under equipmentassetsconstructionTotalDKK'000 DKK'000 DKK'000 DKK'000Cost at 1 January 1,800 17,112,300 6,894,530 24,008,630 Additions for the year - 177,745 250,397 428,142 Change in decommissioning provision - 180,482 36,062 216,544 Transfers for the year 1,225 -1,225 - Cost at 31 December 1,800 17,471,752 7,179,764 24,653,316 Impairment losses and depreciaiton at 1January1,416 14,912,216 6,885,605 21,799,237 Depreciation for the year 354 284,546 284,900 Impairment - 267,442 8,745 276,187 Reversal of impairment - -382,981 - -382,981 Impairment losses and depreciaiton at 31December1,770 15,081,223 6,894,350 21,977,343 Carrying amount at 31 December302,390,529285,4142,675,973Interest expenses recognised as part of cost of assets - - - - Due to change in key assumptions and the fact that Syd Arne and Solsort now is seen as one GCU (Syd Arne Area) a reserval of impairment of 383 million is recognised related to Syd Arne Area. Further, a impairment of 276 million has been recognised related to the Siri area and Hejre.Lease assetsLand and Furniture and buildingsequipmentTotalDKK'000 DKK'000 DKK'000Cost at 1 January 170,554 194,934 365,488 Lease modifications 13,310 - 13,310 Disposals - -973 -973 Cost at 31 December 183,864 193,961 377,825 Depreciaiton at 1 January 39,017 56,251 95,268 Depreciation for the year 10,212 26,003 36,215 Disposals - -973 -973 Depreciaiton at 31 December 49,229 81,281 130,510 Carrying amount at 31 December134,635112,680247,315The Company leases a number of assets as part of its activities. This primarily includes its offices, storage and vessel charter. Some leases will have payments that vary with market interest or inflation rates. The Company’s obligations are secured by the lessors’ title to the leased assets for such leases. Amount recognised in profit and loss2023 2022DKK'000 DKK'000Expense relating to short-term leases for which recognition exemption is applied 217,966 4,149 Expense relating to low value leases for which recognition exemption is applied 104 - Income from subleasing right-of-use assets 28,418 30,770 Interests on lease debt expensed in profit (loss) were DKK 9.1 million in 2023 (2022: DKK 8.3 million).Lease liabilitiesMaturity analysis - contractual undiscounted cash flowsWithin 1 year 43,078 41,402 Between 1 and 5 year 149,019 165,078 Over 5 years 121,220 131,907 Less: impact on discounting -51,933 -56,776 Balance at 31 December 2023261,384281,611Current 34,931 32,761 Non-current 226,453 248,850 Total261,384281,611Commitment to short term leases as at 31 December 169,667 104 Commitment to low value leases as at 31 December 108 218,324 Total commitment169,774218,428 2023 2022DKK'000 DKK'000Investments in subsidiariesCost at 1 January 2,320,981 2,320,981 Additions for the year - - Disposals for the year -325,000 - Cost at 31 December 1,995,981 2,320,981 Revaluations at 1 January 898,966 -1,174,075 Exchange adjustments - 8 Net profit for the year -953,885 2,073,033 Impairment - - Dividend -1,030,215 - Disposals for the year 325,000 - Revaluations at 31 December -760,134 898,966 Carrying amount at 31 December1,235,8473,219,947Investments in subsidiaries are specified as follows:Votes and Net profit/loss for the NameownershipPlace of registered officeEquityyearINEOS E&P (Siri) UK Ltd. 100% -86,214 -118,585 London, United KingdomINEOS Energy (Lulita) A/S 100% 76,920 634 Virum, DenmarkINEOS E&P Grønland A/S* 100% - 58 Nuuk, GreenlandINEOS Energy (Syd Arne) ApS 100% 838,966 -557,837 Virum, DenmarkINEOS E&P (Petroleum Denmark) ApS Virum, Denmark 100% 584,850 -248,358 INEOS E&P (Norge) Petroleum DK AS Stavanger, Norway 100% -178,675 -29,797 1,235,847 -953,885 *INEOS E&P Grønland A/S was liquidated 28 March 2023 2023 2022DKK'000 DKK'000Receivables from group enterprisesBetween 1 and 5 years 988,455 4,208,597 Non-current portion 988,455 4,208,597 Other short-term debt to subsidiaries 1,132,375 117,152 2,120,8304,325,749 2023 2022DKK'000 DKK'000Deferred tax assetDeferred tax asset at 1 January 225,000 423,000 Amounts recognised in the income statement for the year 111,000 -198,000 Deferred tax at 31 December336,000225,000Property, plant and equipment (chapter 2 taxes) - - Other provisions (chapter 2 taxes) - - Tax loss carry-forward (ordinary taxes) - - Decommissioning (chapter 2 taxes) 336,000 225,000 336,000225,000INEOS E&P A/S has recognized a deferred tax assets of DKK 336 million (2022: DKK 225 million).The basis for the recognition has been the model applied to determine impairment of non-financial assets adjust-ed for certain items to determine the future estimated taxable income. The increase in recognised deferred tax assets is primarily due to expected higher long-term oil prices compared to last year. The recognised deferred tax asset is related to Hydrocarbon chapter 2 taxable income.The recognised deferred tax assets relates to tax losses and timely diffreences, which will be utilised to offset future ordinary income and future chapter 2 income in jointly taxed subsidiaries. There is a non-recognized deferred tax assets of DKK 18,266 million (2022: DKK 18,071 million), which relates partly to unutilised losses DKK 9,939 million (2022: DKK 9,473million) in hydrocarbon income and partly to timely differences DKK 8,327 million (2022: DKK 8,598million). It is considered more likely than not, that these losses and timely differences can not be utilised in the future. Cash at bank and in handAvailable cash 546 652 Licenses and restricted cash 342,680 238,158 EquityThe share capital consists of 500,000 shares of a nominal value of DKK 1,000. No shares carry any special rights.The share capital has developed as follows:2023 2022 2021 2020 2019DKK'000 DKK'000 DKK'000 DKK'000 DKK'000Share capital at 1 January 500,000 500,000 500,000 500,000 500,000 Reduction for the year - - - - - Share capital at 31December500,000500,000500,000500,000500,000 2023 2022DKK'000 DKK'000ProvisionsBalance at 1 January 4,250,528 4,918,374 Provision made during the year 45,454 53,114 Provision used during the year -69,148 -1,052,075 Provision made / (reversed) 1,849 98,149 Change in estimated, interest and other factors 327,355 232,966 Balance at 31 December4,556,0384,250,528Provsions by category:Decommissioning obligations 4,382,838 4,066,030 Onerous contracts 74,100 128,797 Other provisions 99,100 55,701 4,556,0384,250,528The expected due dates of other provsions are:Within one year 187,430 198,340 Between 1 and 5 years 2,206,570 2,064,413 Over 5 years 2,162,038 1,987,775 4,556,0384,250,528Provisions comprises of decommissioning obligations relating to demolition and decommissioning of the Com-pany's oil and gas fields, provision for onerous contracts and other provision. Decommissioning obligations are measured at the present value of the future liability in respect of decommissioning and restoration as expected at the balance sheet date. The value of the decommissioning provision is recognised in property, plant and equip-ment and depreciated together with the associated asset. The values of the provision for onerous contracts is re-cognised in the Income Statement as impairment of tangible assets. Payables to group enterprisesBetween 1 and 5 years - - Non-current portion - - Other short-term debt to subsidiaries 21,744 196,716 21,744196,716 Fee to auditors appointed at the general meetingDeloitteAudit fee 938 827 Other services 25 19 963846 Subsequent eventsNo events have occurred after the balance sheet date which could significantly affect the Company's financial position. Contingent assets, liabilities and other financial obligationsContingent liabilitiesAccording to legislation, INEOS E&P A/S are liable to pay compensation for any environmental accidents or other types of damage caused by our oil and gas activities, even when there is no proof of negligence (strict liability). We have taken out insurance to cover any such claims.Contingent assets, liabilities and other financial obligations (continued)INEOS E&P A/S is taxed jointly with all Danish subsidiaries. As management company, the company has unlimi-ted and joint and several liability together with the other jointly taxed companies for Danish income taxes and with-holding taxes on dividends, interest and royalties within the jointly taxed companies.GuaranteesINEOS Holdings AG has furnished the Danish Ministry for Economic Affairs and the Interior with guarantees for fulfilment of obligations and liability in damages towards the Danish State or third parties incurred by INEOS E&P A/S in connection with the company’s participation in exploration and production licences, irrespective of whether the obligations and liability rest on INEOS E&P A/S alone or jointly and severally with others. The guarantees are not capped, but cannot exceed a sum corresponding to twice INEOS E&P A/S’s share of each obligation or liability. Related parties and group informationTransactions with related partiesAccording to the Danish Financial Statement Act section 98 c transactions with related parties are not disclosed as all transactions have been affected at arm's length.Group informationINEOS E&P A/S immediate parant company is INEOS UK E&P Holdings Limited, United Kingdom (100 percent ownership). The ultimate parent is INEOS Limited, a company incorporated in the Isle of Man.INEOS E&P A/S is included in the consolidated financial statements prepared by INEOS UK E&P HoldingsLimited, United Kingdom.The consolidated financial statements of INEOS UK E&P Holdings Limited can be obtained by contacting INEOS E&P A/S or at:https://beta.companieshouse.gov.uk/company/SC200459 License overviewOil and gas Producing field under Oil and gas field Ownership Oil and gas develop-under evaluation LicenseOperatorInterestfieldmentincluding CCS1/06 Hejre Extension 48.00%INEOS E&P xA/S1/90 Luita 43.59%INEOS E&P xA/S3/09 Solsort 35.00%INEOS E&P xA/S4/95 Nini Field 57.14%INEOS E&P xA/S4/98 Solsort 35.00%INEOS E&P xA/S5/98 Hejre 60.00%INEOS E&P xA/S6/95 Siri 70.00%INEOS E&P xA/S7/86 Lulita Part 43.59%INEOS E&P xA/S7/89 Syd Arne Field 36.79%INEOS E&P xA/S16/98 Cecilie Field 56.41%INEOS E&P xA/SC2023/1 Iris (CCS) 40.00%INEOS E&P xA/S Basis of preparationThe annual report of INEOS E&P A/S for 2023 has been prepared in accordance with the provisions of the Dan-ish Financial Statements Act applying to large enterprises of reporting class C as well as selected provisions of the International Financial Reporting Standards approved by EU.The annual report for 2023 is presented in Thousand Danish Kroner (DKK '000).In pursuance of Section 96(3) of the Danish Financial Statements Act, the company has omitted providing in-formation on audit fees as the company is fully consolidated in INEOS UK E&P Holdings Limited's consolidated financial statements, in which the audit fees for the Group as a whole are disclosed.Basis of recognition and measurementIncome is recognised in the income statement as earned, including value adjustments of financial assets and liabilities. All expenses, including amortisation, depreciation and impairment losses, are also recognised in theincome statement.Assets are recognised in the balance sheet when it is probable that future economic benefits will flow to the company's and the value of the asset can be measured reliably.Liabilities are recognised in the balance sheet when it is probable that future economic benefits will flow from the company's and the value of the liability can be measured reliably.On initial recognition, assets and liabilities are measured at cost. On subsequent recognition, assets and liabi-lities are measured as described below for each individual accounting item.Certain financial assets and liabilities are measured at amortised cost using the effective interest method. Amortised cost is calculated as the historic cost less any instalments and plus/less the accumulated amorti-sation of the difference between the cost and the nominal amount.On recognition and measurement, allowance is made for predictable losses and risks which occur before the annual report are presented and which confirm or invalidate matters existing at the balance sheet date.Income statementSegment informationInformation is provided on business segments and geographical markets. The segment information is provided in consideration of the company's accounting policies, risks and management control.RevenueThe Company has chosen IFRS 15 as basis of recognition and measurement.Revenue, which is stated net of value added tax, represents oil and gas products sold to third parties. Contracts for goods and services are analysed to determine the distinct performance obligations against which revenue should be recognised. The amount to be recognised is determined from the standalone selling prices for goods and services, allocated to the performance obligations.Revenue is recognised when (or as) the performance obligations are satisfied by transferring a promised good or service to a customer. For sales resulting from hydrocarbon production, this generally occurs when the pro-duct is physically transferred into a vessel, pipe or other delivery mechanism. Revenue resulting from hydro-carbon production from properties in which the Company has an interest with partners in joint arrangements is recognised on the basis of the Company’s volumes lifted and sold. Lifting or offtake arrangements for oil and gas produced in certain of the Company’s oil and gas properties are such that each participant may not receive and sell its precise share of the overall production in each period. The resulting imbalance between cumulative entitlement and cumulative volume sold less inventory is an “underlift”’ or “overlift”. Underlift and overlift are va-lued at cost price and included within receivables and payables respectively. Movements during an accounting period are adjusted through cost of sales in the income statement. Other income relating to gas production include technical service to third or related parties, and revenue arised from tariffs for third or related parties use of owned pipelines and infrastructure. Tariffs are recognised at the end of the month for pipeline movements during the month and are based on quantity transported through the pipeline.Raw materials and consumablesExpenses for raw materials and consumables comprise the raw materials and consumables consumed to achi-eve revenue for the year.Other operating income and expensesOther operating income and other operating expenses comprise items of a secondary nature relative to the company's activities.Other external expensesOther external costs comprise expenses for distribution, sales, advertising, administration, premises, bad debts,operating leases, etc.Over-/under lift is recognised at cost price. Over-/under lift refers to the situation in which the Company partici-pates in producing fields with several participants and where the Company has lifted and sold more or less crude oil from a producing field than what the Company is entitled at the time of lifting.Other external expenses also comprise cost for exploration and appraisal wells that do not qualify for capitalisa-tion.Employee costsEmployee costs comprise wages and salaries as well as payroll dependent expenses, including pensions, so-cial security costs and other employee related costs.Depreciation, amortisation and impairment lossesDepreciation, amortisation and impairment losses comprise the year's depreciation, amortisation and impair-ment losses on intangible assets and property, plant and equipment.Financial income and expensesFinancial income and expenses are recognised in the income statement at the amounts relating to the financialyear. Financial income and expenses comprise interest income and expense, gains and losses and liabilities and foreign currency transactions. It also includes realized and unrealized gains and losses on hedge interestrate and currency risks that are not hedges of net sales, cost of sales or fixed assets.Income from investments in subsidiariesThe income statement includes the pro rata share of the net profit after the elimination of intercompany profit/-losses and amortization of goodwill under the item "Results from investments in subsidiaries". Investments in subsidiaries are recognised and measured using the equity method. Further gains and losses due to sale of subsidiaries are included.Joint venturesJoint venture represent contractually agreed arrangements on joint economic activities where there is no under-taking involved, and exists only when the strategic financial and operating decisions relating to the activity requi-re the unanimous consent of the parties sharing control (the venturers). Each of the venturers recognises in itsindividual financial statements the assets that it controls and the liabilities and expenses that it incurs and its share of the income that it earns from the sale of goods and services. The Company’s exploration, development and production activities are generally conducted as co-licensee in joint operations with other companies (Joint Venture).Tax on profit for the yearTax on profit/loss for the year, consisting of current tax for the year and deferred tax for the year, is recognised in the income statement to the extent that it relates to profit/loss for the year and directly in equity to the extent that it relates to entries made directly in equity. The company is subject to the Danish rules on compulsory joint taxation. Subsidiaries are included in the joint taxation from the date they are included in the consolidation in theconsolidated financial statements and up to the date on which they are no longer included in the consolidation.INEOS E&P A/S is the management company for the joint taxation and consequently settles all income tax payments with the tax authorities.In connection with the settlement of joint taxation contributions, current Danish income tax is allocated amongthe jointly taxed Danish companies in proportion to their taxable income. In this connection, Danish subsidiaries with tax losses receive joint taxation contributions from the parent company equivalent to the tax base of the tax losses utilised (full allocation), while companies that utilise tax losses in other Danish companies pay joint ta-xation contributions to the parent company equivalent to the tax base of the utilised losses.INEOS E&P A/S is covered by the Danish Hydrocarbon Tax Act. Hydrocarbon taxes are recognised under tax on profit/loss for the year. INEOS E&P A/S is the management company responsible for the carbon tax joint taxation and thus settles all hydrocarbon tax payments with the tax authorities.The company is jointly taxed with Danish Hydrocarbon group enterprises. The Hydrocarbon tax is distributed among the enterprises in proportion to their taxable incomes.Intangible assetsSoftware is measured at cost less accumulated depreciation or the recoverable amount, whichever is lower. Software is amortized over 3-5 years.Cost includes direct and indirect costs associated with acquisition and implementation up to the date when the asset is ready for use.Intangible assets (continued)Costs of development projects comprise salaries and other expensens directly or indirectly attributable to the Company's development activities. As of the date of completion, capitalised development cost are amortised on a straight-line basis.Tangible assetsTangible assets are measured at cost less accumulated depreciation and impairment losses.Cost comprises the purchase price and any expenses directly attributable to the acquisition until the date the asset is ready for use. In the case of assets of own construction, cost comprises direct and indirect expenses for labour, materials, components and sub-suppliers.Cost is increased by estimated expenses for dismantling and removing the asset and restoration to the extent that they are recognised as a provision.Exploration comprises recognised expenses for drilling successful exploration and appraisal wells where deve-lopment of the field has yet to commence. Expenses are recognised using the successful efforts method. Under the successful efforts method, expenses for drilling specific exploration wells are recognised in the balance she-et. Acquired licences where discoveries have been made, including acquired reserves, are also recognisedunder exploration. General exploration expenses and expenses for unsuccessful exploration wells are recog-nised in the income statement. Recognition in the balance sheet is maintained pending determination of com-mercial viability. Where a discovery is found not to be commercially viable, the drilling expenses incurred are recognised in the income statement as Other external costs. Other exploration expenses are recognised in the income statement as Other external costs as incurred.In the case of oil and gas production assets, cost is depreciated using the unit-of-production method based on the ratio of current production to estimated recoverable reserves by individual field.Exploration assets and production assets under construction is not depreciated until production of oil and gas is started.Interest expenses on loans raised directly for financing the construction of property, plant and equipment are capitalized over the period of construction. All indirectly attributable borrowing costs are recognised in the in-come statement.The basis of depreciation is determined as cost reduced by any residual value, and depreciation is charged on a straight-line basis over the expected useful lives of the assets, which are:Other fixtures and fittings, tools and equipmentInvestments in subsidiariesInvestments in subsidiaries and associates are measured at the proportionate share of the net asset value of the entities, calculated on the basis of the group's accounting policies, less or plus unrealised intra-group gains or losses and plus or less any remaining value of positive or negative goodwill made up according to the pur-chase method.Investments in subsidiaries (continued)Investments in subsidiaries and associates with a negative net asset value are measured at DKK 0, and the carrying amount of any receivables from these entities is reduced to the extent that they are considered irre-coverable. If the parent company has a legal or constructive obligation to cover a deficit that exceeds the recei-vable, the balance is recognised under provisions.Net revaluations of investments in subsidiaries and associates are taken to the net revaluation reserve accor-ding to the equity method to the extent that the carrying amount exceeds the cost. Dividends from subsidiaries which are expected to be declared before the annual report of INEOS E&P A/S is adopted are not taken to the net revaluation reserve.Acquisitions are accounted for using the purchase method.Impairment of fixed assetsThe carrying amount of intangible assets, property, plant and equipment and investments in subsidiaries are reviewed annually to determine whether there is any indication of impairment.If there are indications of impairment, an impairment test is carried out for each asset or group of assets. Im-pairment is made to the lower of the recoverable amount and the carrying amount.The recoverable amount of the asset is calculated as the higher of the net selling price and the value in use. The value in use is calculated as the present value of expected net cash flows from the use of the asset or group of assets and the expected net cash flows from the sale of the asset or group of assets after the end of their useful lives.InventoryInventories consist of petroleum, condensate, liquid petroleum gas. Inventories are valued at the lower of cost and net realisable value.Cost is determined as lifiting cost for the month.ReceivablesReceivables are measured at amortised cost, which normally corresponds to nominal value. Provisions for bad debts are made.PrepaymentsPrepayments comprise costs incurred concerning subsequent financial years.The item also includes underlift of crude oil, which is measured at realisable value. Because producing fields have several partners, situations may arise in which a partner has lifted and sold more or less oil than its rela-tive entitlement at the point of lifting. Such situations are described as overlift or underlift, repectively. Overlift of crude oil is recognised as deferred income in current liabilities.EquityDividendProposed dividends are disclosed as a separate item under equity. Dividends are recognised as a liability at the date of declaration by the annual general meeting.ProvisionsProvisions are recognised when - in consequence of an event occurred before or on the balance sheet date - the company has a legal or constructive obligation and it is probable that economic benefits must be given up to settle the obligation.In measuring provisions, the expenses required to settle the liability are discounted to net present value, if this has a significant effect on the measurement of the liability. A pre-tax discount rate is used that reflects the gen-eral interest rate level in the market. The change in present values for the financial year is recognised as finan-cial expenses.Provisions for decommissioning of production assets and restoration are measured at the present value of the future liability in respect of decommissioning and restoration as estimated at the balance sheet date. The amount provided is determined on the basis of existing requirements and estimated expenses, which are dis-counted to present value. If specific risks are deemed to be attached to a provision, the estimated expenses are recognised. A discount rate is used that reflects the general interest rate level in the market. These liabili-ties are recognised as they arise and are adjusted on a regular basis to reflect changes in requirements, price level, etc. The value of the provision is recognised within property, plant and equipment and depreciated toget-her with the relevant assets. The increase in time of the present value of the provision is recognised in net profit for the year as financial expenses.A provision for onerous contracts is recognised when the expected benefits to be derived by the Company from a contract are lower than the unavoidable cost of meeting its obligations under the contract. If it is considered unlikely that an outflow from the Company of resources embodying economic benefits will be required to settle an obligation, or if the obligation cannot be measured reliably, the obligation is accounted for as a contingent liability that is not recognised in the balance sheet. Material contingent liabilities are disclosed in the notes.LeasesAt inception of a contract, the Company assesses whether the contract is, or contains, a lease. If a contract is, or contains a lease, the Company applies IFRS 16 when accounting for such contracts. For all other contracts, it applies other IFRSs as appropriate. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. The Company assesses whether:At inception or on reassessment of a contract that contains a lease component, the Company allocates the consideration in the contract to each lease component on the basis of their relative standalone prices.The Company, as lessee, has availed the exemption from lessee accounting for its short-term leases and leases of low-value items. Accordingly for these leases, it recognises the lease payments as an expense, on either a straight line basis over the lease term or another systematic basis if that basis is more representative of the pattern of the Company's benefit.The Company recognizes the full lease liability, rather than its working interest share, for leases entered into on behalf of a joint operation if the Company has the primary responsibility for making the lease payments. For contracts in scope, the Company, as the lessee, recognises a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located, less any lease incentives received.Leases (continued)The right-of-use asset is subsequently depreciated using the straight line method from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term.The estimated useful lives of right-of-use assets are determined on the same basis as those of property and equipment. In addition, the right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain re‐measurements of the lease liability. The lease liability is initially measured at the present value of lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Company’s incremental borrowing rate.Lease payments included in the measurement of the lease liability comprise the following:- Fixed payments, including in‐substance fixed payments;- Variable lease payments that depend on an index or a rate, initially measured using- the index or rate as at the commencement date;- Amounts expected to be payable under a residual value guarantee; and- The exercise price under a purchase option that the Company is reasonably certain to exercise, lease pay- ments in an optional renewal period if the Group is reasonably certain to exercise an extension option, and penalties for early termination of a lease unless the Group is reasonably certain not to terminate early.The lease liability is measured at amortised cost using the effective interest method. It is re-measured when there is a change in future lease payments arising from a change in an index or rate, if there is a change in the Company’s estimate of the amount expected to be payable under a residual value guarantee, or if the Company changes its assessment of whether it will exercise a purchase, extension or termination option.When the lease liability is re-measured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.Income tax and defered taxCurrent tax payable and current tax receivable are recognised in the balance sheet as tax calculated on the taxable income for the year, adjusted for tax on previous years' taxable income and taxes paid on account.Deferred tax is measured using the balance sheet liability method in respect of temporary differences arising between the tax bases of assets and liabilities and their carrying amounts on the basis of the intended use of the asset and settlement of the liability, respectively.Deferred tax assets, including the tax base of tax loss carry forwards, are measured at the value at which the asset is expected to be realised, either through elimination against tax on future earnings or through offsetting against deferred tax liabilities.Deferred tax is measured on the basis of the tax rules and tax rates that will be effective under the legislation enacted at the balance sheet date when the deferred tax is expected to materialise as current tax. Where the tax base can be determined applying alternative tax rules, deferred tax is measured on the basis of the intend-ed use of the asset or settlement of the liability, respectively.Any changes in deferred tax due to changes to tax rates are recognised in the income statement. For the cur-rent year a tax rate of 25% on hydrocarbon activities and 22% on corporate tax has been applied.LiabilitiesFinancial liabilities such as mortgage loans and loans from credit institutions are recognised at the date of in-ception at the proceeds received net of transaction costs. In subsequent periods, the financial liabilities are measured at amortised cost, corresponding to the capitalised value, using the effective interest rate. The differ-ence between the proceeds received and the nominal value is recognised in the income statement over the term of the loan.Mortgage debt is measured at amortised cost, which for cash loans corresponds to the debt outstanding. For bond loans, amortised cost corresponds to the debt outstanding calculated as the underlying cash value of theloan at the date of inception, adjusted for depreciation charged over the repayment period on the market value adjustment of the loan at inception.Other payables are measured at amortised cost, corresponding to nominal value.Deferred incomeDeferred income comprises payments received in respect of income in subsequent financial years.Foreign currency translationTransactions in foreign currencies are translated on initial recognition at the exchange rates applicable at the dates of transaction. Exchange differences arising between the exchange rate applicable at the transaction date and at the date of payment are recognised in the income statement as financial income or expenses.Receivables and payables and other monetary items denominated in foreign currencies are translated at the exchange rates at the balance sheet date. The difference between the exchange rates at the balance sheet date and the date at which the receivable or payable arose or was recognised in the latest financial statementsis recognised in the income statement as financial income or financial expenses.Non-current assets acquired in foreign currencies are measured at the transaction date rates.Derivative financial instrumentsDerivative financial instruments are initially recognised in the balance sheet at cost and subsequently measur- ed at fair value. Positive and negative fair values of derivative financial instruments are recognised under other receivables and other payables, respectively.Changes in the fair values of derivative financial instruments that are classified as and meet the criteria for hed-ging of future transactions are recognised directly in equity. On realisation of the hedged transactions, the ac-cumulated changes are recognised in the relevant items.Changes in the fair values of derivative financial instruments that are classified as and meet the criteria for hed-ging of the fair value of a recognised asset or a recognised liability are recognised in the income statement to-gether with value adjustments of the hedged asset or the hedged liability.For derivative financial instruments that do not meet the criteria for designation as hedging instruments, chang- es in fair value are recognised in the income statement.Changes in the fair values of derivative financial instruments that are used to hedge net investments in separate foreign subsidiaries are recognised directly in equity.Financial HighlightsDefinitions of financial ratios.EBIT marginProfit/loss before financials x 100RevenueReturn on assetsProfit/loss before financials x 100Total assetsEBITDA marginEarnings before interest, taxes, depreciation and amortisation x 100Revenue In pursuant of Section 112 of the Danish Financial Statements Act, the company has not prepared consolidated financial statements as the company is included in the cash flow statement of the INEOS UK E&P Holdings Limited. In pursuance of Section 86(4) of the Danish Financial Statements Act, the company has omitted preparing a cash flow statement as the company is included in the cash flow statement of the INEOS UK E&P Holdings Limited. Annual report Auditor's report on audited financial statements ParsePort XBRL Converter 2023-01-01 2023-12-31 2022-01-01 2022-12-31 2024-06-20 Reporting class C, large enterprise 2024-06-20 33963556 Deloitte Statsautoriseret Revisionspartnerselskab Weidekampsgade 6 2300 København S Opinion Basis for Opinion 2024-06-20 33963556 Deloitte Statsautoriseret Revisionspartnerselskab Weidekampsgade 6 2300 København S