Aker BP : Remuneration report

REMUNERATION REPORT 2021

CONTENTS

2	Context for the Remuneration Report	3	Remuneration of executive personnel
2	Organizational Development and Compensation	3	Fixed pay - Salary
	Committee	3	Fixed pay - Pension
3	Remuneration of the Board	3	Variable pay - Bonus
4	Variable pay - Long-term incentive plan
		6	Comparative information on the change of
			remuneration and company performance
		7	Governance
		7	Review of Remuneration Report
		7	Authorisation for the Board

1. CONTEXT FOR THE REMUNERATION REPORT

This Remuneration Report describes the principles for the remuneration of the members of the Board of Directors (the Board), the Chief Executive Officer (CEO) and of the members of Executive Management Team (EMT) of Aker BP ASA, and how these principles have resulted in actual remuneration.

The Remuneration Policy is designed to attract, retain and motivate the Board members, the CEO and the EMT at a competitive level. Remuneration is designed to align the interests of the executives with those of the shareholders.

The Remuneration Report complies with the requirements defined in the Norwegian Public Limited Companies Act § 6-16a and 6-16b.

ORGANIZATIONAL DEVELOPMENT AND COMPENSATION COMMITTEE

The Board has a an Organizational Development and Compensation Committee consisting of three Board members. This committee is established to ensure that remuneration arrangements support the strategy of the business and enable the recruitment, succession planning and leadership development, and motivation and retention of senior executives. It needs to comply with the requirements of regulatory and governance bodies, satisfy the expectations of shareholders and remain consistent with the expectations of the wider employee population. Further, the committee shall ensure that the overall organizational structure is set up to deliver on the company's strategy going forward. In 2021, the committee held three meetings.

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Aker BP Remuneration Report 2021

2. REMUNERATION OF THE BOARD

The remuneration of the Board members is not performance- based but based on a fixed annual fee. None of the shareholder-elected Board members have pension schemes or termination payment agreements with the company. The company does not grant share options to members of the Board.

The General Meeting decides the remuneration of the Board and the sub-committees. The Nomination Committee

proposes the remuneration of the Board to the General Meeting and ensures that it reflects the responsibility of its members and the time spent on Board work. The Board must approve any Board member's consultancy work for the company and remuneration for such work.

Information about all remuneration paid to individual Board members is provided in Note 7 to the annual accounts.

3. REMUNERATION OF EXECUTIVE PERSONNEL

The total remuneration consists of a base salary, a pension contribution, an annual bonus based on company performance, and a long-termshare-based incentive (LTIP). Members of EMT are covered under the same budget, guidelines, and limitations as other onshore personnel in the company. There is no share- based remuneration in the company,

FIXED PAY - PENSION

Pension is based on a defined contribution plan, and is capped at twelve times the National Insurance scheme basic amount (12G) for all employees including the executive management.

FIXED PAY - SALARY

Base salary levels are determined considering the nature of the individual role, individual considerations, the market positioning, and remuneration conditions at Aker BP. The base salary is reviewed annually to ensure that it is set at the right level and potential annual percentage increases are aligned with those of employees in general, except in specific circumstances. The CEO base salary is determined by the Board. Adjustment of the base salaries for other senior executives is decided by the CEO within the wage settlement framework adopted by the Board.

VARIABLE PAY - BONUS

The company's bonus system is designed to promote performance in line with the company's strategy. The bonus for all employees, including the CEO and EMT, is determined by the company's performance on a pre-defined set of key performance indicators (KPIs) and Company Priorities, which are important improvement initiatives or activities with clear deliverables that are critical for the company's future success.

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The KPIs and Company Priorities are each weighted 50 percent when estimating the bonus outcome. The final bonus outcome, following the formulaic assessment of performance relative to targets is specifically reserved as a matter for the CEO and the Compensation & Organisational Development Committee. Accordingly, the committee may exercise its discretion to adjust the outcome upwards or downwards. The CEO has maximum bonus potential corresponding to

100 percent of base salary. For other members of EMT, the maximum potential is 60 percent. The maximum bonus for employees outside the EMT varies from 10 percent to 30 percent depending on position level.

For 2021, bonus for the first half was pad in September 2021, while the bonus for the second half of the year will be paid in February 2022. The bonus was set to

70% of maximum potential based on approximately 35% performance on the KPI's, 95% performance on the priorities and a discretionary adjustment.

The KPIs and Company Priorities for 2021 are specified below. The targets and the stretch targets are labelled 'execute' and 'improve' respectively.

Key Performance Indicators for Aker BP 2021	Execute	Improve	Actual
Safety (SIF per million hours)	0.45	0.4	0
Production (mboepd)	215	220	209.4
Production cost (USD/boe)	8.5	8	9.2
Net reserve additions (mmboe)	44	75	36
Relative Shareholder Return1)	5 %	10 % -1.8 %
CO2 intensity - Equity based (kg/boe)	5	4.5	4.8
Value creation (change in risked NPV)	11%	13%	6.3%

1) Versus Index defined as average of Oslo Energy Index and Stoxx Europe 600 Oil & Gas

Company Priorities for Aker BP 2021:

• Deliver Ærfugl Phase II first gas at planned quality and cost
• Complete installation of Hod NUI and ensure readiness to start drilling
• Develop and execute portfolio procurement strategy
• Scale learnings from 2020 HSSEQ incident trends to all assets
• Complete implementation of offshore standardized organization
• Implement remote assistance/access/work for crane inspections
• Build and operationalize a subsurface data factory

• Improve energy efficiency to reduce annual emissions by 10 000 tonnes CO2
• End-to-enddigital transformation of maintenance and integrity process
• Improve drilling time & cost to deliver top quartile performance
• Improved follow-up of process safety and incidents with quality consequence
• Define governance mechanisms and tool for strategic workforce planning
• Get Valhall wells to full production
• Mature key early phase projects to meet 2022 PDO submission window
• Progress NOAKA to DG2 with break-even below USD 30 per barrel

VARIABLE PAY - LONG-TERM INCENTIVE PLAN

Certain members of the EMT participate in a five-year incentive program started in January 2019, through December 2023, linked to the relative performance of the Aker BP share price versus a benchmark index consisting of the average of the Oslo Energy Index and the Stoxx 600 Europe Oil & Gas index (each weighted 50 percent). The incentive program payment is calculated as a linear function of market outperformance, where an outperformance of 30 percent or more will result in a payment of the maximum cap. The market outperformance as of year end 2021 was 33%. The maximum total payment is capped at 200 percent of the executive's annual base salary. The CEO incentive program has the same mechanics and start/ end date and is capped at NOK 30 million.

There is no possibilities for the company to reclaim variable remuneration.

OTHER TERMS AND BENEFITS

The CEO and members of the EMT have 6 months mutual notice period. For all other employees, the notice period is 3 months.

Executives receive non-monetary benefits such as phones etc. aligned with local practice. In addition, executives may participate in customary employee benefit programmes, e.g. employee share programmes.

The below table shows the remuneration for the executive management team in Aker BP for 2021 and 2020. The bonus column does not include accruals in relation to the long term incentive plan described in section 3, as any potential payout will depend on the relative share price performance in future periods.

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Aker BP Remuneration Report 2021

Remuneration of senior executives in 2021 and 2020*

			FIXED REMUNERATION			VARIABLE REMUNERATION			Proportion
											of fixed
				Payments				Extraordinary	Pension	Total	and variable
USD (1000)			Salary	in kind	Other		Bonus**	items	expense	remuneration	remuneration
Chief Executive Officer
Karl Johnny Hersvik	2021		929	121	19	651	-	24	1 743	63% / 37%
2020		1 021	133	36	521	-	19	1 731	70% / 30%
Special Advisor
Øyvind Bratsberg1)	2021		344	1	-	91	780	12	1 228	29% / 71%
2020		409	2	-	156	-	19	586	73% / 27%
SVP Improvement
Per Harald Kongelf	2021		423	3	-	171	-	24	622	72% / 28%
2020		401	2	1	155	-	20	579	73% / 27%
SVP D&W
Tommy Sigmundstad	2021		380	12	7	154	-	24	577	73% / 27%
2020		356	4	20	139	-	19	538	74% / 26%
SVP Exploration & Reservoir Development
Evy Glørstad-Clark	2021		392	7	-	160	-	25	584	73% / 27%
2020		348	3	2	143	-	20	517	72% / 28%
SVP Strategy and Business Development
Lene Landøy2)	2021		340	5	6	451	-	16	818	45% / 55%
2020		327	6	-	130	-	19	481	73% / 27%
Chief Financial Officer
David Torvik	2021		384	6	3	154	-	23	570	73% / 27%
2020		346	5	-	139	-	19	508	73% / 27%
SVP HSSEQ
Marit Blaasmo	2021		287	3	-	111	-	24	425	74% / 26%
2020		254	2	0,4	103	-	20	379	73% / 27%
SVP Projects
Knut Arne Kristian Sandvik	2021		377	7	-	224	-	25	633	65% / 35%
2020		305	7	6	205	-	20	543	62% / 38%
SVP Operations & Asset Development
Ine Dolve	2021		369	5	6	130	-	25	535	76% / 24%
2020		294	5	1	91	-	20	410	78% / 22%
SVP Operations & Asset Development - NOAKA
Lars Høier	2021		359	4	1	138	-	24	527	74% / 26%
2020		278	1	5	89	-	19	393	77% / 23%
SVP Strategy and Business Development
Jan Rosnes3)	2021		209	4	-	49	-	24	287	83% / 17%

1. Special Advisor until 30.06.2021. Extraordinary items includes payments arising from a mutual agreement relating to Bratsberg leaving the company.
2. SVP Strategy and Business Development until 31.08.2021. Bonus includes accrued LTIP payment earned from 2019 to 2021 relating to Landøy leaving the company.
3. SVP Strategy and Business Development since 01.09.2021

• All remuneration to senior executives is paid in NOK and converted to USD using a yearly average USD/NOK-rate of 8.5991 and 9.4004, repectively for 2021 and 2020. For executives who been in the Executive Management Team only parts of the year, the figures include payroll for the full year.
• Numbers represent actual ordinary bonus earned in 2021, excluding LTIP

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