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24 October 2023

Vår Energi reports third quarter 2023 results

Sandnes, Norway, 24 October 2023: Vår Energi ASA (OSE: VAR) delivers strong financial performance, material dividend distribution and is on plan to deliver high growth and value creation.

Strong financial performance

  • Total income in the quarter was USD 1 621 million, an increase of 13% from the second quarter
  • Achieved realised price of USD 85 per boe in the quarter with gas price realisation USD 27 per boe above spot market
  • Cash flow from operations (CFFO) was USD 975 million, an increase from USD 231 million in the previous quarter

Attractive and predictable shareholder distribution

  • Dividend of USD 270 million (NOK 1.204 per share) for the third quarter will be distributed on 16 November
  • Dividend guidance of USD 270 million for the fourth quarter of 2023, bringing total full-year distribution to approximately 30% of CFFO after tax

Delivering production and improved opex

  • Production of 210 kboepd in the quarter, an increase of 4% from the second quarter
  • On track to meet 2023 production guidance of 210-220 kboepd and exit the year at over 230 kboepd
  • Quarterly unit production cost at USD 14.0 per boe, below guidance of USD 14.5-15.5 per boe

Safety and ESG leadership

  • Continued safe operations with no serious incidents
  • Rated A+ in Position Green’s ESG100 ranking

On track for growth and value creation

  • Good progress on portfolio of 11 development projects, including start-up of Breidablikk and Tommeliten A ahead of schedule and on budget in October 2023
  • Balder X and Johan Castberg capex estimates revised, while maintaining targeted production start-up
  • Three successful exploration wells in the quarter, year-to-date success rate of around 80%
  • Neptune Energy Norway acquisition expected to close first quarter of 2024
  • Production target increased to around 400 kboed by end-2025, inclusive of the Neptune assets and expected portfolio optimisation

Nick Walker, who joined Vår Energi as the new Chief Executive Officer (CEO) in September:

“We are on plan to deliver on our strategy for growth and value creation. I’m pleased to report strong financial results in the quarter supported by good performance at our operated assets and increased commodity prices. We continue to provide a stable and predictable dividend in line with strategy and our growth trajectory will give increased capacity to sustain this.

Vår Energi is one of the fastest growing E&P companies in Europe, underpinned by a portfolio of quality development projects that are making good progress towards completion. With Breidablikk and Tommeliten Alpha coming on stream ahead of schedule this month we reached a key milestone to deliver value accretive growth. Together with the Neptune Energy Norway acquisition, set to close in Q1 2024, our production is expected to double to around 400 kboepd by the end of 2025.

Webcast and conference call

The company will today hold a webcast and conference call followed by Q&A at 10:00 CET hosted by CEO Nick Walker and CFO Stefano Pujatti.

You can follow the webcast with supporting slides, available on:
https://events.webcast.no/vaar-energi/quarterly-reports/EkaaxpJsr3rekrw2RRgX

The report, presentation and webcast will be available at www.varenergi.no.  

About Vår Energi

Vår Energi is a leading independent upstream oil and gas company on the Norwegian continental shelf (NCS). We are committed to deliver a better future through responsible value driven growth based on over 50 years of NCS operations, a robust and diversified asset portfolio with ongoing development projects, and a strong exploration track record. Our ambition is to be the safest operator on the NCS, the partner of choice, an ESG leader with a tangible plan to reduce emissions from our operations by 50% within 2030.

Vår Energi has around 1000 employees and equity stakes in 39 fields and the company produced net 209 kboepd in the first nine months of 2023. We have our headquarters outside Stavanger, Norway, with offices in Oslo and Hammerfest. To learn more, please visit varenergi.no.

Contact

Investor relations

Ida Marie Fjellheim, Head of Investor Relations

+47 90509291

ida.fjellheim@varenergi.no

Media relations

Andreas Wulff, Communication Manager

+47 92616759

andreas.wulff@varenergi.no

This announcement may include projections and other “forward-looking” statements within the meaning of applicable securities laws. Any such projections or statements reflect the current views of Vår Energi AS (“Var Energi”) about further events and financial performance. No assurances can be given that such events or performance will occur as projected and actual results may differ materially from these projections. Var Energi undertakes no obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this announcement.

This information is considered to be inside information pursuant to the EU Market Abuse Regulation and is subject to the disclosure requirements pursuant to Section 5-12 the Norwegian Securities Trading Act. This stock exchange release was published by Ida Marie Fjellheim, Head of Investor Relations at Vår Energi ASA, on 24 October 2023 at 07:00 CET.