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Investing.com -- Vår Energi (OL:VAR) stock rose 0.4% on Wednesday after the company announced it has taken the final investment decision on the Balder Phase VI project, marking another step in its plan to sanction eight tie-back projects this year.
The Balder Phase VI project aims to develop approximately 15 million barrels of oil equivalent (mmboe) of gross 2P reserves for a gross capital expenditure of $260 million, with Vår Energi holding a 90% stake.
The company highlighted the project’s strong economics, including a break-even point below $35 per barrel of oil equivalent, an internal rate of return exceeding 35%, and a payback period of less than a year at current prices. Production is expected to begin by the end of 2026.
Investors are also awaiting confirmation of first oil at Balder X, where the newly installed Jotun FPSO is undergoing commissioning and scheduled to start production by the end of this month.
This development remains crucial to the company’s production guidance of over 400,000 barrels of oil equivalent per day (kboe/d) for the fourth quarter of 2025.
Several additional early phase projects are being advanced in the Balder area, including Balder Next (LON:NXT), which targets additional gross contingent resources of approximately 55 mmboe.
The Balder Next project includes plans to take the Balder Floating Production Unit to shore for decommissioning in 2028, as part of a broader strategy to maintain field production at 70-80 kboe/d through 2030.
RBC maintained an Outperform rating on Vår Energi with a NOK44 price target, noting that the stock’s implied dividend yield of over 14% reflects ongoing investor concerns about the company’s ability to meet its production guidance and sustain its dividend if commodity prices remain low, especially when compared to peers.
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