Sandnes, Norway, 11 February 2024: Today, Vår Energi (OSE: VAR, the "Company") reports financial results for the fourth quarter and full year 2024. Vår Energi is also hosting its Capital Markets Update (CMU) to present an update on its strategy for growth, resilience and value creation towards 2030 through sustained high production, strong cash flow generation and increased dividends.

"Vår Energi reports strong operational and financial results for 2024. This is supported by production within guidance and capital and operating expenditure below the guided range due to cost discipline and efficient operations. With three new projects on stream in 2024, Johan Castberg nearing start-up and the Balder Jotun FPSO on track for production by the end of the second quarter, we continue to deliver high value growth. This is reflected in shareholder distributions for 2024 of around USD 1.1 billion and raised first quarter 2025 dividend guidance of USD 300 million," said Nick Walker, the CEO of Vår Energi.

"2025 is transformational for Vår Energi, with production set to grow above 400 thousand barrels of oil equivalent per day (kboepd) in the fourth quarter and remain at around 400 kboepd in 2026. Towards 2030, we plan to organically sustain production of 350 to 400 kboepd by capturing the value upside in our high-quality assets with a net resource potential of over 3 billion barrels," Mr Walker continued.  

"To deliver, we are stepping up the pace and activity level, moving more than 25 early-phase projects forward faster, with a target to sanction up to eight projects in 2025. Furthermore, we are accelerating infill drilling, increasing exploration activity, while becoming carbon neutral in our operational emissions by the end of this decade. We are delivering significant value creation through reduced costs, a high quality and flexible investments program, and incremental improvements throughout our operations. This provides resilience in a volatile business environment, strong cash flow generation and strengthens our long-term shareholder distribution capacity, as reflected in a raised dividend policy to 25 to 30% of cash flow from operations after tax," Mr Walker ends.

Delivering strong results in 2024:

Operational and financial performance in-line with expectations

• Full-year production of 280 kboepd, within guidance
• Cash flow from operations post tax of USD 378 million in the fourth quarter​ and USD 3 408 million for the year
• Full year unit production cost of USD 12.8 per boe, well below original guidance​
• 2024 capex of USD 2.6 billion, below original guidance
• Neptune Energy Norge transaction synergies increased to approximately USD 600 million post-tax, over time

Delivering growth and unlocking future value

• Progressing key projects Johan Castberg and Halten East towards start up in the first quarter 2025, and Balder Jotun FPSO by end second quarter 2025
• Moving projects into execution by sanctioning Balder Phase V in the fourth quarter 2024, targeting start-up in late 2025
• Six discoveries in 2024, including two in in fourth quarter, and near 50% exploration success rate for the year

Attractive and predictable dividends

• Dividend of USD 270 million (NOK 1.213 per share) for the fourth quarter will be distributed 25 February 2025
• Long-term dividend guidance raised to 25-30% of CFFO after tax
• Increased dividend guidance of USD 300 million for the first quarter of 2025, with full year planned dividend at the lower-end of the 25-30% range of CFFO after tax

CMU highlights - Delivering growth and value:

Stepping up the pace, sustaining high production towards 2030

• Fourth quarter 2025 production guidance increased to over 400 kboepd driven by project start-ups, with full year 2025 production expected at 330-360 kboepd
• Plan to maintain 2026 production at around 400 kboepd and organically sustain production between 350-400 kboepd towards 2030
• High-value barrels driving down production costs to approximately USD 10 per boe in fourth quarter 2025, with a target to sustain at this level in the future¹. Full year 2025 production cost guidance of USD 11-12 per boe
• Delivering high-value projects in 2025 with nine project start-ups, adding 180 kboepd at peak
• 2025 expected capex² of USD 2.3-2.5 billion, with average annual capex of USD 2-2.5 billion towards 2030
• A strong resource base with more than 2.1 billion boe of net proved plus probable (2P) reserves and 2C resources providing a solid foundation for long-term value creation
• Progressing more than 25 early phase projects targeting more than 500 million boe net 2C contingent resources, with around 8 new development project sanctions this year

Unlocking future value

• Maintained NCS exploration leadership, increasing activity to around 20 wells in 2025 (13 in 2024) and approximately USD 350 million of exploration expenditure
• Strong, diversified exploration portfolio with over 1 billion boe of net risked resources with around 50% to be drilled out in the next four years

Becoming carbon neutral by 2030

• Clear path to reduce Scope 1 operational emissions by over 50% by 2030
• Becoming carbon neutral in our net equity operational emissions by 2030 through direct investment in natural carbon capture offsets

Ensuring resilient and attractive shareholder returns

• Strong free cash flow generation of USD 5-9 billion over 2025-2030 period³ and a flexible investment program with approximately 70% of capex uncommitted
• Increased capacity for shareholder returns and raised long-term dividend policy

1. In real 2025 and NOK/USD at 10.5

2. Excluding exploration and abandonment

3. Scenario Brent 65 USD/boe and 85 USD/boe.

Presentation and webcast today at 14:00 CET

The CMU presentation followed by Q&A will be live webcasted from 14:00 CET, hosted by CEO Nick Walker, COO Torger Rød and CFO Carlo Santopadre.

The presentation material 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.

Safe and responsible operations are at the core of our strategy. Our ambition is to be the safest operator on the NCS, and to become carbon neutral in our net equity operational emissions by 2030.

Vår Energi has around 1400 employees and equity stakes in 40 producing fields. We have our headquarters outside Stavanger, Norway, with offices in Oslo, Hammerfest and Florø. To learn more, please visit varenergi.no.

Contact

Investor relations

Ida Marie Fjellheim, VP Investor Relations

+47 90509291

Ida.fjellheim@varenergi.no

Media relations

Andreas Wulff, VP Public Affairs

+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. Vår Energi ASA undertakes no obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this announcement.