From three juniors to one of Europe’s largest

As growth stories go, few can match the tale of the three minnows which through a series of mergers, acquisitions and organic growth became the largest private E&P company on the Norwegian Continental Shelf.

«We are pleased to announce that the book-building for the IPO (initial public offering) was successfully completed on the 15th February, with the addition of more than 19,000 new shareholders to the company. The Vår Energi share started trading on the Oslo Stock Exchange today.»

This press release was issued by Vår Energi on the 16th of February 2022, as the company reached yet another milestone on a journey that had its beginnings more than 50 years earlier, but which took a completely new course after the oil price fell from $110 per barrel to $30 in 2014-2016.

At the time HitecVision had three small, specialized oil companies in its portfolio; Core Energy, Spike Exploration, and Pure E&P. Core Energy was formed in 2010 as a start-up creating value through focusing on increased oil and gas recovery, near field exploration and adjacent field developments. Spike and Pure, formed in 2012 and acquired in 2015, respectively, were focused on exploration and appraisal – aiming to discover oil and gas, and then sell the discoveries. In the new market environment all of them needed to become more robust, both in terms of concepts as well as financially.

On Point
In 2016 HitecVision merged the three oil companies to create Point Resources, a robust independent oil company with a stated aim of engaging in the whole value chain – exploration, development and production.

Meanwhile, many of the international oil companies on NCS were shifting their focus to less mature prospects outside Norway, creating a market situation with a range of transaction opportunities for companies with a strong capital base. HitecVision therefore ensured that Point Resources was well capitalized for further growth through acquisition, as well as development of discoveries.

The first major acquisition
With a clear growth strategy and funds to implement it, the company in 2017 announced its first major acquisition: The operated business of ExxonMobil on the NCS. The number of Point employees was quadrupled to 350, as most of ExxonMobil’s upstream organization, with its more than 50 years of experience on the NCS, was transferred to Point Resources as part of the transaction. Point also acquired and moved into ExxonMobil’s office building close to Stavanger.

With this transformational acquisition, Point Resources became a fully integrated, mid-sized exploration and production (E&P) company and a significant player on the NCS, and crucially also an operator of producing fields.

Balder Future begins
Having completed the acquisition, Point immediately started working on the plans for the redevelopment of the Balder and Ringhorne fields. The USD 2 billion plan, coined «Balder Future», will extend the fields’ production lifetime to 2045, adding 140 million boe of recoverable reserves through increased oil recovery.

Although the project never made the priority list in ExxonMobil’s global portfolio, it was always deemed profitable, including from a societal perspective: It creates almost 30 000 man-years of work through the re-development and prolonged operations, and by utilizing existing infrastructure, it contributes to good resource management on the NCS.

In December 2019, Vår Energi submitted its Plan for Development and Operations (PDO) for the redevelopment to the Norwegian Ministry of Petroleum and Energy (MPE), and in 2020 the Jotun A floating production storage and offloading vessel was towed to shore for a refurbishment that will extend the vessel’s life by another two decades or more.

Enter Eni
Only eight months after Point completed the acquisition of the ExxonMobil assets a new announcement was made, one that would even more significantly alter the ownership structure on the NCS:

«Italy based energy company Eni and leading private equity investor HitecVision are pleased to announce an agreement to merge Point Resources AS and Eni Norge AS, and renaming the company Vår Energi AS.»

This was a new transformational transaction, more than tripling the company’s production and doubling its headcount. Vår Energi, owned 70% by Eni and 30% by HitecVision, started life with a portfolio of 17 producing oil and gas fields ranging from the Barents Sea to the North Sea. An ambitious further growth target was announced, based on ongoing development projects, revitalizing older fields such as Balder, and exploring for new resources. To achieve this, Vår Energi presented an investment plan of more than USD 7.5 billion.

Exit ExxonMobil
The next step came less than a year later: In 2019 Vår Energi acquired the remainder of ExxonMobil’s upstream assets in Norway: Ownership interests in more than 20 producing fields, operated mostly by Equinor. With this, Vår Energi became the largest independent E&P company on the NCS, with total reserves and resources of about 1,900 million boe and production of around 300,000 boepd, set to grow organically to more than 350,000 boepd in in the coming years.

With Vår Energi’s IPO in 2022, HitecVision’s role as a driving force in the creation of the company came to a natural conclusion. Through intimate market knowledge combined with structural creativity HitecVision – together with Eni and the company’s management and employees – has succeeded in building a dynamic growth company with about 1000 employees, superb ESG performance and excellent profitability.