Vår Energi raises Q3 dividend; cuts 2026 output outlook to bottom of range

Investing.com -- Norway's Vår Energi on Wednesday raised its third-quarter dividend to $400 million and guided to the same payout for the fourth quarter, but narrowed its 2026 production outlook to the bottom of its previous range after outages at Johan Castberg and the Jotun platform.

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The company said it expects full-year output of around 390,000 barrels of oil equivalent per day (boepd), compared with its original guidance of 390,000 to 410,000 boepd. Production averaged 369,000 boepd in the third quarter, versus 376,000 in the second quarter.

Johan Castberg was hit by an offloading hose that had to be replaced and a power generation problem, while a failed gas compressor extended a July turnaround at the Jotun platform, the company said. It said none of the main impacts were reservoir related.

The third-quarter payout will be distributed in December. Full-year dividends would total $1.45 billion, versus $1.2 billion for 2025. The fourth-quarter payout requires general meeting approval and sufficient free equity.

Net profit fell to $304 million from $839 million in the second quarter, mainly because of lower pre-tax profit and higher income tax. Income tax expense was $1.79 billion; the effective tax rate was 85%, above the 78% marginal rate, mainly because of foreign exchange effects.

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Total income was $3.57 billion versus $3.72 billion in the second quarter, mainly due to lower crude oil and natural gas liquids revenue, partly offset by higher gas revenue. Operating profit was $2.21 billion versus $2.24 billion a quarter earlier.

Compared with the second quarter, the realised crude price fell 6% to $103 per barrel and the realised gas price rose 19% to $108 per barrel of oil equivalent.

Production costs are now seen at about $11 per barrel of oil equivalent for 2026, up from about $10, mainly because of a stronger Norwegian crown and higher fuel and power prices.

The company expects higher fourth-quarter output as new wells and the Balder Phase VI project start up.

Cash flow from operations was $1.52 billion versus $2.08 billion in the second quarter, mainly due to working capital movements and higher tax payments. A cash tax payment of about $1.70 billion is estimated for the fourth quarter.