Panoro Energy ASA (OSE: PEN): Minor temporary production downtime in EG. Initiating a new share buyback programme.
• 2Q25 production averaged ~11,065 bbl/d, negatively affected by unplanned facilities-related downtime at the Ceiba field, as reported by Kosmos earlier this week. WI production in EG fell to 3,136 bbl/d (vs. 3,661 bbl/d in 1Q25). Remedial work is underway, with production expected to recover in 4Q25. The issue is linked to the subsea system, not reservoir performance.• WI production in Tunisia rose by ~100 bbl/d to 1,593 bbl/d in 2Q25, supported by successful well workovers.
• In light of the EG downtime, Panoro has adjusted its FY25 production guidance from 11–13 mbbl/d to 11–12 mbbl/d. We now forecast 2025 production at ~11 mbbl/d.
• We expect Gabon production to decline through 3Q26, before new activity lifts gross output back to ~40 mbbl/d. As a result, our FY26 production forecast remains flat versus 2025.
• Panoro held US$50.9 mm in cash at end-June, including US$20 mm in advances against future liftings. This is in line with our expectations.
• Panoro pays a dividend yielding ~13%. Share buybacks totaled ~NOK68 mm from January to August 2025, and a new NOK100 mm buyback program has been launched in June for 2025/2026. Assuming only a NOK100 mm program is executed in 2025, total shareholder yield would reach ~19%.
• We re-iterate our target price of NOK49 per share.
Looking ahead
We expect Panoro to begin providing greater clarity on its recently acquired assets, with particular focus on Block EG-23, which could prove highly material to the company. The block is estimated to contain 112 mmboe of WI 2C contingent resources in shallow waters (50–100 metres depth). Some of these resources may be incorporated into the YE25 resource statement. Block EG-23 includes seven discoveries—four oil, two gas, and one gas/condensate—several of which have already been tested. Select discoveries are being evaluated for potential development, offering meaningful upside to Panoro’s medium-term growth profile.
Valuation
Our Core NAV and ReNAV are unchanged at NOK39 per share and NOK49 per share respectively. Our capex forecast from 2026 onwards does not account for exploration spending. We estimate that the aggregate Free Cash Flow from 2025 to 2028 will be equivalent to ~120% of the current market cap.
Panoro Energy is an international independent oil and gas company engaged in the exploration and production of oil and gas resources in Brazil and West Africa. In Brazil, Co. participates in a number of oil and gas licenses located in the Santos basin outside the south-east coast of Brazil and in the Camamu-Almada basin in the state of Bahia. In West Africa, Co. participates in a number of licences in Nigeria and Gabon. As of Dec 31 2013, Co.'s commercial production is from the Manati field in Brazil.
Auctus Advisors is a specialist Equity Capital Markets and Advisory business with a focus in the Energy Sector.
The partners have complementary skill sets, with decades of experience across Equity Capital Markets, Investment Banking and the Energy industry. We have worked at Société Générale, Canaccord Capital, BMO Capital Markets and Schlumberger. Most recently we have worked together for many years at GMP FirstEnergy.
Auctus has been set up at the beginning of a new decade in which we see significant opportunities in the Energy space. Globally, demand for energy is at record levels and continues to grow. Conversely, investment in traditional energy sources has been severely constrained. We believe this imbalance creates opportunities for both companies and investors.
Auctus provides Corporate Broking, Equity Research and Investment Banking services.
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