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Investing.com -- Vår Energi shares rose Friday after the company reaffirmed its 2025 production target and projected a strong fourth quarter, despite reporting slightly below-consensus output for the first quarter.
Production in the first quarter averaged 272,000 boe/d, down 2% from the previous quarter and below both Jefferies and RBC Capital Markets estimates of 278,000 and 276,000 boe/d, respectively. Consensus had also stood at 277,000 boe/d.
Despite the shortfall, the company reiterated its full-year production guidance of 330,000–360,000 boe/d, targeting the midpoint.
That outcome, it said, will depend on the continued ramp-up of newly onstream fields and the timing of others coming online.
Johan Castberg and Halten East both started producing in March. The company said it remains on schedule to surpass 400,000 boe/d in the fourth quarter.
Total (EPA:TTEF) sales volumes reached 23.7 million boe in the quarter, resulting in a small underlift position.
Vår’s overall realized price for the quarter was $79/boe, driven by strong gas performance, with gas making up 35% of production.
Realized gas prices stood at $87/boe, or $14.5/mcf, beating Jefferies’ estimate of $14.4/mcf and outperforming Aker BP’s $14.2/mcf.
Liquids were realized at $76/bbl, with weighted average crude and NGL prices of around $75/bbl—above Jefferies' forecast of $72.
In the second quarter, the company has fixed-price contracts covering 24% of its gas volumes at $89/boe, and in the third quarter, it has fixed-price contracts covering approximately 20% at $84/boe.
In the quarter, currency movements contributed to a $340 million non-cash foreign exchange gain as the Norwegian krone strengthened.
In addition, a $23 million impairment was booked for technical goodwill in the Njord Area. In line with expectations, cash taxes totaled $212 million. A dividend of $270 million for the fourth quarter of 2024 was paid out in February.