Vaar Energi, one of Norway’s biggest oil and gas producers, and a joint venture between Italian energy giant Eni and Norwegian private equity Hitec Vision, is planning to launch the listing of a an initial public offering (IPO) in Oslo.

This news comes as the market has started seeing a sharp increase in energy prices and rising investor interest amidst the European gas shortage, offering the most attractive climate in years for an oil and gas listing.

Analysts value the company, which is the third-biggest oil producer in Norway behind state-controlled Equinor and Petoro, at about $10 billion to $15 billion, based on the $11 billion valuation of its nearest independent equivalent, Aker BP. Vaar Energi had average production of 247,000 barrels per day during the third quarter, ahead of Aker BP’s 210,000.

Shares held by Eni and HitecVision indicate a 69.85% and 30.15% respetively of Vår Energi AS.

“We believe oil and gas will continue to be part of the energy mix for decades to come and the current gas market developments in Europe confirm our view that a reliable and safe supply of natural gas from Norway to Europe will be crucial.”
Torger Roed, CEO, Vaar Energi

Vaar’s IPO to be largest Oil and gas listing

Vaar Energi’s IPO could, depending on its size and market value, be the largest oil and gas listing since Saudi Aramco’s mammoth 2019 flotation raised $25.6 billion at a $1.7 trillion valuation, according to data provider Dealogic cited by the Financial Times.

Vaar Energi is the second private equity backed Sea-focused oil producer to consider going public following Harbour Energy in 2021, which took over Premier Oil before adopting its listing.

Norway is home to Western Europe’s biggest oil and gas producer, and in recent years, some super majors have left offshore operations such as Exxon Mobil and Chevron, but also the likes of Vaar Energi and Aker BP have added more assets to their portfolio.

As stated in a press release by Eni, “the IPO will provide access to the Norwegian and international capital markets, allow the Company to diversify its ownership structure and create a strong long-term shareholder base”.

Eni’s Strategy towards Energy Transition

The move forms part of Eni’s strategy of enhancing its assets and free up new resources to be towards its energy transition agenda. Meanwhile, the company will continue to maintain its majority share ownership in Vaar Energi, the statement indicated.

Several Petroleum IPOs have not had strong patronage in the past few years as investors place premium on sustainability even as oil prices have increased in recent months, reaching record levels in recent times.

The joint venture plans to be carbon neutral in its production by 2030, as Norway looks to electrify its oil platforms, which currently use gas turbines for power. It is also considering to boost its production to 350,000b/d by 2025.

“The Norwegian Continental Shelf (NCS) will remain one of the most attractive regions for exploration and production globally due to cost competitiveness, a stable regulatory environment and low emissions. With a robust and diversified portfolio of operations and assets across all parts of the NCS, we have set ambitious growth targets.”
Torger Roed, CEO, Vaar Energi

Vaar Energi, established in 2018 through the merger of Eni Norge and Point Resources, is currently the largest pure-play Norwegian Continental Shelf independent. The company was awarded 10 new licenses in Norway last week, in a concession round that went under criticisms by environmentalists and left wing parties in Oslo.