Kvaerner ASA (KVAER), a Norwegian builder of oil platforms, climbed to a record in Oslo trading after saying the value of an agreement for the Ormen Lange gas-processing facility has almost doubled to 11 billion kroner ($2 billion).
The company rose as much as 5.8 percent to 18.40 kroner, the highest intraday level since its shares began trading in the Norwegian capital in July 2011. The value of the six-year deal with Royal Dutch Shell Plc (RDSA) for work at the Nyhamna onshore facility in Norway has increased from the 6 billion kroner announced on April 19, Kvaerner said today in a statement.
The deal, with Kvaerner upgrading Nyhamna to meet increased gas supply as new fields such as Aasta Hansteen start up, will lift annual revenue by about 1 billion kroner, Pareto Securities said by e-mail. That’s equivalent to earnings before interest, tax, depreciation and amortisation of 60 million to 70 million kroner assuming a margin of 6 percent to 7 percent, it said.
Kvaerner, holding its capital markets day in Oslo tomorrow, climbed 4.6 percent to 18.10 kroner by 2:55 p.m. in the city.
Nyhamna now processes gas from the Ormen Lange field, the main source of the fuel for the Langeled pipeline from Norway to the U.K. The field is expected to meet as much as 20 percent of U.K. demand for the next 40 years, according to shareholder Statoil ASA (STL), Norway’s largest energy producer.
Kvaerner, based at Fornebu near Oslo, was spun off from Aker Solutions ASA in July 2011. The company is up 32 percent since then, giving it a market value of 4.9 billion kroner.
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