Vår Energi (OB:VAR) Is Up 8.3% After Askeladd West Gas Boost Secures Hammerfest LNG Output

• Production from the Equinor-operated Askeladd West field in the Barents Sea began recently, adding roughly 15 billion standard cubic metres of gas reserves and ensuring stable output at the Snøhvit field and Hammerfest LNG plant.
• The expansion strengthens Norway’s position as a key supplier of liquefied natural gas to Europe and is set to help maintain the Hammerfest facility’s annual output, meeting around two percent of EU gas demand.
• To understand the impact of this production boost on Vår Energi’s long-term outlook, we’ll examine its influence on future growth drivers.

This technology could replace computers: discover 26 stocks that are working to make quantum computing a reality.

Vår Energi Investment Narrative Recap

For investors considering Vår Energi, the core thesis centers on material near-term production growth, driven by project ramp-ups and robust European gas demand, which underpins both revenue prospects and high dividend yields. The recent Askeladd West production start is a positive for ensuring stable output at Hammerfest LNG and future cash flow visibility, but at this stage does not materially alter the most important short-term catalyst: the continued successful ramp-up of new assets like Jotun FPSO. The primary risk remains the long-term challenge of mature asset decline and the need for ongoing investment to sustain output beyond 2030.

One recent announcement closely tied to short-term growth catalysts is the Jotun FPSO achieving peak production ahead of schedule. This development matters because, alongside Askeladd West, it fortifies Vår Energi’s ability to meet its updated production guidance for late 2025 and underpins its capacity to fund dividends. While these achievements support the operational outlook, investors should keep an eye on whether organic production growth can consistently offset declines from the company’s legacy North Sea assets.

However, investors should also be alert to...

Read the full narrative on Vår Energi (it's free!)

Vår Energi's narrative projects $8.9 billion in revenue and $1.0 billion in earnings by 2028. This requires 7.8% yearly revenue growth and a $389 million earnings increase from the current $610.6 million.

Uncover how Vår Energi's forecasts yield a NOK37.05 fair value, a 4% upside to its current price.

Exploring Other Perspectives

Simply Wall St Community members provided five fair value estimates for Vår Energi, ranging from NOK37 to NOK90.54 per share. Even with this spread, it is vital to consider that sustaining output as core North Sea fields mature may affect future earnings and cash flows, so it pays to consult different viewpoints when assessing your stance.

Explore 5 other fair value estimates on Vår Energi - why the stock might be worth just NOK37.00!

Build Your Own Vår Energi Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Vår Energi research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.
• Our free Vår Energi research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Vår Energi's overall financial health at a glance.

Curious About Other Options?

Opportunities like this don't last. These are today's most promising picks. Check them out now:

• AI is about to change healthcare. These 31 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10b in market cap - there's still time to get in early.
• These 12 companies survived and thrived after COVID and have the right ingredients to survive Trump's tariffs. Discover why before your portfolio feels the trade war pinch.
• Uncover the next big thing with financially sound penny stocks that balance risk and reward.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com