Hello, welcome to the BW Offshore Q4 2022 presentation. My name is Caroline, and I'll be your coordinator for today's event. Please note this call is being recorded, and for the duration of the call, your line will be on listen only mode. However, you will have the opportunity to ask questions at the end of the call. This can be done by pressing star one on your telephone keypad to register your questions. If you require assistance at any point, please press star zero and you'll be connected to an operator. I will now hand over the call to your host, Mr. Marco Beenen, the CEO, to begin today's conference. Thank you.
Thank you. Good morning, everyone. Welcome to our Q4 2022 update and our full year results presentation. Together with Ståle Andreassen, our CFO, I will run you through our presentation, and then we will conclude with a Q&A at the end. Please note our disclaimer, and then I continue with the highlights. Full year results came in with a solid $346 million EBITDA and an operational cash flow of $650 million, of which about half came from the lease prepayments for the Barossa FPSO. For the quarter, EBITDA was $105 million, and that includes a one-off from the Gato do Mato Limited Notice to Proceed, which was terminated. The Barossa project continues to progress well and is by now about 60% complete.
We continue to pay our dividend this quarter through a mix of cash dividend and dividend in kind with BW Energy shares like we did in the previous quarters. On an annual basis, this equates to $45 million, and it means we have returned capital to shareholders at a 9% dividend yield. Continue with an operational update. First of all, the Barossa project. The FPSO will now be named BW Opal. I'm very pleased with the safety performance, where we have now passed 10 million man hours without any LTI, any lost time incident. You can also see on the pictures that now the construction is really taking shape, both for the whole topsides as well as the turret.
This means engineering is nearing completion, and we're heading towards the phase of where we can actually assemble the mega blocks. Despite the inflation, the supply chain disruptions and design adjustments, the forecast of the project economics remains sound and they haven't changed since previous quarter. I'm proud of this team, which keeps the project on track for delivery in the H1 of 2025. I move on to fleet and HSE performance. I'm pleased with the trending down of our safety statistics, which now includes both the BW Offshore employees and also the man-hours of our contractors. We take the three HPIs that we recorded in the quarter, high potential incidents, we take them as opportunities to learn and improve. We are considering these HPIs as leading safety performance indicators and therefore we treat them very seriously.
On the uptime, the fleet average commercial uptime was above 99%, that is where it should be, without any planned shutdowns. I move to the backlog. 99% of the backlog is now from our core four FPSOs. We already talked about Barossa. Adolo is producing slightly below 10,000 barrels per day, this will change by the end of this quarter, when we expect first oil from the Hibiscus ridge development, we will also boost production from the Tortue field with a second gas lift compressor. The increased production will trigger additional income for the FPSO through a production tariff. Catcher in the UK delivered a strong quarter with 100% commercial uptime, the same applies for BW Pioneer in the Gulf of Mexico, nothing specific to report there really.
In total, with those four units, we are now having a backlog that stands at $7.1 billion of which 84% is firm. The rest of the fleet is in progress of recycling or divestments, and with the aim to conclude this divestment program in 2023. The exception is BW Opportunity, which is in the yard in Singapore. For that unit, we're progressing redeployment opportunities. I will elaborate a bit more about that after the financial section, but we'll hand over to Ståle first.
Thank you, Marco. Before I actually like to encourage everyone to take a look at our annual report, which is out today. It's a report we have spent a lot of time on, and it's a very good product for anyone who wants to get a better insight in what we do today, what is our financial situation, and where we are going as a company, and you will find the report on our website. Starting with the overview as usual, I'm quite pleased to state that we were able to finish 2022 with a quarter where we deliver good financial performance. As you can see, operating revenues came in at $211 million, and EBITDA was $105 million.
For this quarter, both revenues and EBITDA has been positively impacted as we have now invoiced Shell for settlement in incurred Settlement of incurred costs related to the work we have done under the Limited Notice to Proceed work arrangement for the Gato do Mato project that we were working on. At the same time, we have expensed off all the costs for work that was carried out in quarter four. Net off, as you can see, there was an impact of $13.6 million in the quarter. As I will get back to on the next slide, you will see that we have also written off all costs incurred in previous quarters related to this.
When removing the impact from settlement with Shell, we still delivered an EBITDA of $91.4 million in the quarter, which shows that underlying performance of key units have been good. I would in particular highlight Catcher, as we've been able to meet annual KPIs, and we had good commercial uptime on the unit in the quarter. That had an impact, as in quarter three, we had a partial kind of planned shutdown for the unit. Going to the income statement, you will see that as usual depreciation are stable quarter to quarter.
We have been capitalizing engineering costs since late 2021 related to Gato do Mato, as it was seen as an integrated part of the overall construction cost of the FPSO to be built. As the project has now been put on hold, we have expensed off all these costs that was earlier capitalized, and that is reflected now through an impairment of $15.8 million in the quarter. I think if you take the net effect of the $13.6 million, as was presented on the last slide, and you deduct this additional $15.8 million, you will see that we have spent slightly more than we've been compensated for the project as a whole.
Net interest expenses continues to be stable quarter and quarter as we are fully hedged on floating rate interest exposure. We have also hedged a significant part of our FX exposure to any currencies other than the US dollar, which includes our 900 million bond loan in the Norwegian kroner. Over the course of the quarter, US dollar has weakened significantly against currencies, particularly, Sing dollar, Norwegian kroner and euros, impacting us, and this has contributed to the majority of this $24.4 million gain on financial instruments reported in Q4. Other financial items were -$3.9 million in the quarter, and that is largely due to revaluation of bond loan issued in Norwegian kroner.
Share of loss from equity accounted investments were $2 million. That is a reflection of our relative share of the result delivered by BW Energy in Q4. When you take into account tax expenses, we delivered an overall profit of $41.3 million for forty-four. On the cash flow side, you see cash flow from operation was $175 million, which means when you exclude prepayments from Santos for the Barossa charter, we delivered cash flow from operation at $87 million. Again, good cash contribution from predominantly coming all from our core units.
We had net investments of $166 million in the quarter, of which $154 million is related to Barossa. Remaining is, to a large extent, related to still ongoing upgrade works for FPSO BW Adolo related to the tie-in for Ruche Phase 1. We did not draw any further on the project facility for the Barossa in the quarter. We injected $5 million more equity, that is also why you can see that our cash balance has reduced in quarter four, as we've been trying to minimize working capital held for the project and utilizing that cash. That allowed us not to draw on the project loan facility in the quarter and to delay that into quarter one 2023.
We did draw $33 million on the revolving credit facility we have. That was to a large extent to manage liquidity as we had scheduled installments related to the BW Catcher facility and the fact that we bought back $31 million in convertible bonds during Q4. That, when you take into account payment of interest, dividends and payments under the pressure arrangement with ICBC, we ended the quarter with $230 million in consolidated kind of cash position. The Barossa project has been progressing well during the quarter, as Marco has touched upon. Also reflected in the financing, as it is a good measure for progress on the project. As I mentioned on the previous slide, we have not drawn on the debt facility for this project in the quarter.
Normally, we will draw equity and debt throughout the base of forward-looking calculations of funding needed for the project. In quarter four, when factoring in prepayments from Santos, we had sufficient liquidity to push out any drawdown to the next quarter. The prepayments from Santos was based on the percentage measured completion of the project in the quarter and stood at approximately 53% of the total by end of the year, up from 44% by end of quarter three. Looking at our overall financial position, as you can see, net debt increased slightly in the quarter, now to $497 million. Although we have reduced overall consolidated debt levels, this is primarily driven by lower cash balance, as we've been utilizing cash on hand for Barossa in the quarter.
Despite this, we are still trending on a leverage ratio of 1.4 x last 12 months EBITDA. We have what we consider a comfortable leverage position. We are be supported by steady, strong cash flow from our core units. If you turn to the equity ratio, you see slightly down by just over 1% quarter-on-quarter. This is in line with expectations as our balance sheet continue to increase as progress or construction on Barossa moves forward. We do expect that this effect will continue until the project is completed, and then it will unwind and equity ratio will start trending upwards.
Looking at the consolidated debt, we have two debt facilities and two bonds that needs to be addressed over the next couple of years. As we're now entering 2023, we are now kicking off efforts on amending and extending the corporate facility and the BW Catcher facility, which both have maturity mid-2024 originally. We believe we have a very good starting point as the facilities are supported by our three core FPSOs, which we expect to be on lease to our clients for years to come, and that will provide good, steady cash flow visibility and support our efforts on extending the maturities on these two facilities, as I mentioned.
For the capital markets debts, our plan stays firm in the terms that we are expected to reduce the overall debt quite significantly from today's level of around $335 million down to $150 million-$200 million as we address the maturities on those. We continue to focus on divesting non-core assets in line with our strategy, and that shall ultimately allow us to simplify the organization, free up liquidity, and grow infrastructure FPSOs in the medium term. Divestment dialogue for non-core FPSOs are ongoing. We aim to close out these dialogues and close transactions within H1 of this year. Looking at the overall liquidity situation, it's very stable. We have a liquidity of $371 million at the end of Q4.
This has allowed us to, in addition to regular debt installments, repurchase more of the convertible bond debt in Q4. We repurchased approximately $31 million in the quarter. When you look at 2022 as a whole, we did repurchase bonds for just over $60 million. I might sound like a broken record, as I mentioned this before, but having 100% hedge coverage on debt does give us good protection against increased interest rates and give visibility on financing cost in what we still consider to be an inflationary environment. Summing up, delivering on the divestment program and managing liquidity through capital discipline is what we consider an enabler for delivering long-term value growth to our shareholders.
We do have an ambition to taking on new infrastructure FPSO projects. We do believe that building on the capital structure model that we established for Barossa does enable us to take on new projects without overstretching the balance sheet and creating a good risk-reward balance and creating long-term value for shareholders while we still deliver on our promise of paying steady dividends. With that, I'll give the word back to Marco.
Thank you, Ståle. I continue with an overview of the market. On this slide, you see ample opportunities for new FPSO projects for the remaining of the decade. While there are only four contractors actively pursuing these projects, we're still in a window of an attractive supply and demand balance in the FPSO space. Previous quarter, we advised you that we were heading towards a new opportunity with Gato do Mato. We assumed that by now we would have signed a contract with Shell for this project. While not fully concluded, we were quite far progressed with putting the debt finance for this project together, therefore we were caught by surprise as Shell suddenly decided that this was not the right time to proceed with the Gato do Mato project.
While this is obviously disappointing, the work done for the Gato do Mato project proved that we were ready for taking on these kind of projects with a quality stamp on our proposed execution plan and our financing plan, both by Shell and our lenders. Recycling of such projects happen in our business, and the project may come back in 12-24 months, as Shell advised. For now, it simply means that we are moving on with targeting new prospects, in particular with the focus on the redeployment of BW Opportunity. We're progressing with various prospects for her and aim for a contract award within 2023. That's a clear target.
We have identified a handful of potential FPSO infrastructure projects which meets our investments criteria, which are a firm contract of 15 years or more, solid NOCs or investment-grade counterparties, and teaming up with strategic and/or co-investing partners in the project. We're making preparations to be able to submit a tender when these opportunities come to the market in this year and coming years. Moving on to the floating wind market. This is a market that is now clearly emerging and taking shape. The floating offshore wind pipeline for the next three years tripled compared to 12 months ago, to 33 GW. Of that pipeline, BW Ideol has secured 1 GW in 2022, which is currently being developed as part of ScotWind. 3 GW of projects are substantiated and being targeted to specific leading partnerships.
For example, the EDF Renewables and Maple Power partnership with BW Ideol is targeting the three French tenders that are currently ongoing. Together with BW Offshore, BW Ideol is engaged in multiple feasibility studies for floating wind turbine solutions, targeting accelerated revenue generation through EPCI activities in the coming years. The focus of the company is on preserving and expanding the technology leadership, building on the day-to-day experience gained from the two full-scale floating wind turbines in the water in Japan and in France, and optimizing the project execution and strengthening the competencies to ensure project readiness. Project readiness for either FIDs for developments or for EPCI tenders by other developers. Disciplined operational management is being applied with full year operational revenue in 2022 of EUR 6.6 million and a net cash burn of EUR 3.4 million.
Together, we are working on a long-term financing plan for closing, targeted in the H1 of 2023, and that includes a $10 million convertible shareholder loan from BW Offshore. Moving on to BW Energy. BW Energy is progressing towards a step change in production, as mentioned in connection to the BW Adolo FPSO update. First of all, from the Hibiscus development, and then followed by an increase in production from the Tortue field with a new gas lift compressor. In addition, BW Energy works on the closing of the Golfinho acquisition in Brazil, and this is expected to close this quarter as well, and will then immediately add because this is existing production. The company is further looking at maturing the Guido gas field with 3D seismic.
This is triggered by the nearby discoveries made by a couple of oil majors. This may point at a whole new offshore oil and gas region. Exciting months ahead for BW Energy, and therefore also for BW Offshore. Presenting this Q4 results justifies a summary of last year as well, where we have shown disciplined delivery to our strategic priorities. These priorities are, first, accelerate and maximize the value extraction from the legacy fleet, and we did that through divestment and ownership transfer of five units. This allowed us to increase shareholder returns to $45 million over the year, which was partly done through dividend in kind with BWE shares as well. Secondly, we want to invest in new and better backlogs through infrastructure type FPSO projects.
We're progressing the Barossa FPSO project in accordance with the schedule. That is despite the difficult circumstances in the global supply chain. The Gato do Mato tender, the fact that we have been selected and have reached project kickoff readiness, which was built on this experience from Barossa. It confirmed our ability to develop a robust execution plan and the sourcing that is required to fund this kind of projects. We will also build on that for the next opportunities in the FPSO infrastructure arena. Thirdly, we want to position and invest in adjacent business to capture the opportunities in the energy transition. That has materialized to securing the 1 gigawatt offshore floating wind acreage in the Scotland leasing round.
We're pleased with the progress that we made in 2022, and this forms a very good basis to continue in 2023. With that, I can conclude with an outlook. The Barossa FPSO project safe and timely delivery remains our top priority. We will take the benefit of a healthy FPSO market with a window of attractive demand supply balance, and we will pursue the next energy infrastructure FPSO project, leveraging the proven capabilities in the Barossa project. We'll support BW Ideol in pursuing floating wind opportunities, in particular for the first EPCI tenders which are due to come to the market, as well as floating wind power to platform opportunities. The fleet divestment program will be concluded in 2023, and we continue with a substantial shareholder return program. Thank you, and now we open for questions from the operator.
Thank you. As a reminder, if you would like to ask a question, please signal by pressing star one on your telephone keypad. We currently have no questions coming through. Thank you.
Yeah. Thank you. Then I think we can take a couple of the questions that came in via the web. I'll start with the first one, which came from Georgiy Dodov from Brooks Macdonald. He's asking, what proceeds are you expecting to raise from the four FPSOs for sale? I guess, Ståle, will you take that?
Yeah, well, that's an ongoing process, so it's a bit difficult to be and not appropriate to be too exact. We're expecting something between $50 million and $75 million.
Okay. We got another question from Tushem from Borea. He's asking how much of the revenue backlog is related to BW Catcher options. I can take that one, how much it is.
The firm backlog is $6 billion and what we call the probable backlog is $7.1 billion, and that includes some option. And in the $7.1 billion, $650 million is related to Catcher as a whole. Roughly $650 million. That is all the questions I have on the web at the moment. Back to you.
As a reminder, if you would like to ask a question, please signal by pressing star one on your telephone keypad. It appears there's no further question. Thank you.
Okay. I think we conclude this conference call. Thanks everyone for your interest for this presentation and for BW Offshore, and hope to talk to you next quarter. Thank you very much.