Oslo-listed Vaar Energi, majority-owned by Italy’s Eni, kept its quarterly dividend unchanged on Tuesday after lifting its output target and posting a higher-than-expected operating profit, even as weaker oil and gas prices weighed on earnings.
Vaar's earnings before interest and tax for October to December fell 5.8% on the year to $947 million on lower oil and gas prices, beating the average $838 million forecast in a company-compiled poll of 13 analysts.
"We are pleased to have delivered transformational growth in 2025, doubling production in just two years," Vaar's CEO Nick Walker said in a statement.
Higher Output Goal, Rising Capex
Norway's third-largest listed oil and gas producer forecast full-year 2026 production in the range of 390,000 to 410,000 barrels of oil equivalent per day, up from 332,000 in 2025.
Vaar raised its long-term output target to more than 400,000 boed from 350,000-400,000 boed earlier.
"This is supported by a portfolio of 13 high value projects in execution, a flexible pipeline of around 30 early phase projects being matured, and a strengthened asset base with increased reserves and resources," Walker said.
Vaar plans to sanction up to eight new projects this year, expecting capital spending of $2.5 billion to $2.7 billion in 2026, and to average $2.5 billion per year over 2027 to 2032.
It aims to drill 12 exploration wells in 2026, down from 20 last year, with the exploration spending forecast at $250 million to $300 million.
Its previous target for capital expenditure was for $2 billion-$2.5 billion for 2026-2030.
Brokers DNB Carnegie said it could be difficult for Vaar to reach its revised long-term output goal with its current asset portfolio.
"While we consider the capex increase a negative, we believe the share price reaction today will depend on whether investors find the raised production target believable," DNB Carnegie said in a note to clients.
The company maintained a quarterly dividend of $300 million for the first quarter of 2026, after paying a total of $1.2 billion for the full year 2025. It did not provide dividend guidance for 2026.
(Reuters - Reporting by Nerijus Adomaitis, editing by Terje Solsvik and Louise Heavens)