Vår Energi IPO tests investor interest in Big Oil and Gas
The level of investor interest in fossil fuel energy generation in the era of climate change and ESG may be revealed when a minority stake in Vår Energi, the third-largest oil producer in Norway, floats.
Joint owners Eni and Point Resources Holding announced this week the intention to launch an initial public offering for Vår Energi on the Oslo Stock Exchange. The move is part of Eni’s strategy to boost the value of its assets and channel resources to accelerate its green energy transition.
Eni owns 69.85 percent of the North Sea exploration and production company. The remaining 30.15 percent is held by Norwegian private equity investor HitecVision via Point Resources Holding.
Eni is a $69 bn integrated energy group, headquartered in Rome. The group has a 30-year plan to achieve net-zero Scope 1, 2 and 3 emissions and zero relative emission intensity for the life cycle of sold energy products. The goals are in addition to its mid-term decarbonization efforts.
The partners said the listing would help diversify Vår Energi’s ownership and strengthen its shareholder base. Eni would retain its majority ownership.
Vår Energi, the largest Norwegian continental shelf (NCS) independent, was formed by a merger in 2018. It produces 247,000 barrels of oil equivalent per day from 36 fields. It is the second-largest natural gas exporter from the NCS.
A week before the IPO plan, Vår Energi announced it had been awarded 10 new exploration licenses around the three main oil and gas provinces in the NCS by the Norwegian government.
Eni expects its oil and gas production to reach about 2 mn barrels of oil equivalent per day in 2023, then peak at 2.05 mn-2.10 mn barrels of oil equivalent per day in 2025.
Industry watchers speculate Vår Energy’s IPO could be worth $10 bn-$13 bn, the largest since state-owned Saudi Aramco set a $25.6 bn record in 2019.