Obsidian Energy Announces Second Quarter 2025 Results
Press Release
- Achieved average production of 28,943 boe per day and funds flow from operations of $65.8 million ($0.94 per share)
- Active share buyback program with ~5.4 million shares (seven percent of outstanding shares) repurchased and cancelled for $36.6 million
Calgary, Alberta–( – July 30, 2025) – OBSIDIAN ENERGY LTD. (TSX: OBE) (NYSE American: OBE) (“Obsidian Energy“, the “Company“, “we“, “us” or “our“) is pleased to report our operating and financial results for the second quarter of 2025.
| Three months ended June 30 |
Six months ended June 30 |
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| 2025 | 2024 | 2025 | 2024 | |||||||||
| FINANCIAL | ||||||||||||
| (millions, except per share amounts) | ||||||||||||
| Cash flow from operating activities | $ | 55.2 | $ | 77.9 | $ | 151.9 | $ | 136.6 | ||||
| Basic per share ($/share)1 | 0.79 | 1.02 | 2.12 | 1.78 | ||||||||
| Diluted per share ($/share)1 | 0.75 | 0.98 | 2.04 | 1.71 | ||||||||
| Funds flow from operations2 | 65.8 | 115.2 | 165.9 | 199.6 | ||||||||
| Basic per share ($/share)3 | 0.94 | 1.51 | 2.31 | 2.60 | ||||||||
| Diluted per share ($/share)3 | 0.90 | 1.44 | 2.23 | 2.50 | ||||||||
| Net income | 15.3 | 37.1 | 30.7 | 49.0 | ||||||||
| Basic per share ($/share) | 0.22 | 0.48 | 0.43 | 0.64 | ||||||||
| Diluted per share ($/share) | 0.21 | 0.46 | 0.41 | 0.61 | ||||||||
| Capital expenditures | 40.2 | 59.2 | 168.6 | 173.5 | ||||||||
| Property acquisitions (dispositions), net | (210.9 | ) | 84.9 | (210.9 | ) | 84.9 | ||||||
| Decommissioning expenditures | 4.0 | 4.0 | 10.6 | 14.1 | ||||||||
| Long-term debt | 222.8 | 376.9 | 222.8 | 376.9 | ||||||||
| Net debt2 | $ | 270.2 | $ | 432.5 | $ | 270.2 | $ | 432.5 | ||||
| OPERATIONS | ||||||||||||
| Daily Production | ||||||||||||
| Light oil (bbl/d) | 6,314 | 13,782 | 9,503 | 13,430 | ||||||||
| Heavy oil (bbl/d) | 12,041 | 7,026 | 11,467 | 6,887 | ||||||||
| NGL (bbl/d) | 2,189 | 3,193 | 2,628 | 2,989 | ||||||||
| Natural gas (mmcf/d) | 50 | 71 | 60 | 70 | ||||||||
| Total production4 (boe/d) | 28,943 | 35,773 | 33,653 | 35,006 | ||||||||
| Average sales price (before hedging)1 | ||||||||||||
| Light oil ($/bbl) | $ | 91.09 | $ | 107.61 | $ | 96.66 | $ | 101.38 | ||||
| Heavy oil ($/bbl) | 61.27 | 79.73 | 65.46 | 70.26 | ||||||||
| NGL ($/bbl) | 39.42 | 48.92 | 47.60 | 49.62 | ||||||||
| Natural gas ($/mcf) | $ | 2.00 | $ | 1.33 | $ | 2.11 | $ | 1.85 | ||||
| Netback ($/boe) | ||||||||||||
| Sales price | $ | 51.83 | $ | 64.11 | $ | 57.09 | $ | 60.67 | ||||
| Risk management gain (loss) | (0.64 | ) | 1.20 | 0.17 | 1.22 | |||||||
| Net sales price | 51.19 | 65.31 | 57.26 | 61.89 | ||||||||
| Royalties | (6.03 | ) | (8.34 | ) | (7.27 | ) | (7.71 | ) | ||||
| Net operating costs3 | (13.54 | ) | (13.83 | ) | (14.78 | ) | (13.87 | ) | ||||
| Transportation | (4.49 | ) | (4.15 | ) | (4.69 | ) | (4.05 | ) | ||||
| Netback3 ($/boe) | $ | 27.13 | $ | 38.99 | $ | 30.52 | $ | 36.26 | ||||
(1) Supplementary financial measure. See ‘Non-GAAP and Other Financial Measures’.
(2) Non-GAAP financial measure. See ‘Non-GAAP and Other Financial Measures‘.
(3) Non-GAAP ratio. See ‘Non-GAAP and Other Financial Measures‘.
(4) Please refer to the ‘Oil and Gas Information Advisory’ section below for information regarding the term “boe”.
PRESIDENTS MESSAGE
“Our second quarter was foundationally strong for the Company as we closed on the disposition of our operated Pembina assets, which further strengthened our balance sheet and reduced our decommissioning liabilities, allowing us to make significant progress on our return of capital initiative through our active share buyback program”, commented Stephen Loukas, Obsidian Energy’s President and CEO. “Given the substantial discount that we believe our shares trade to intrinsic value, we accelerated share repurchases during the quarter which led to the cancellation of over seven percent of our outstanding shares. Since the inception of our share buyback program in 2023, we have repurchased and cancelled a total of ~20 percent of our shares, with 67.1 million currently outstanding.”
Mr. Loukas continued, “Operationally, the second quarter was a success as we brought all of our wells on production from our first half program, drilled our Clearwater waterflood pilot at the Dawson 4-24 pad and achieved our key guidance metrics. Our second half development program is well underway and started with three rigs operating in Peace River and plans to return to Willesden Green with a one rig program starting in August.”
SECOND QUARTER 2025 CORPORATE HIGHLIGHTS
- Funds Flow from Operations – The Company generated funds flow from operations (“FFO“) of $65.8 million ($0.94 per share basic) compared to $115.2 million ($1.51 per share basic) in the second quarter of 2024. Revenues declined as lower oil prices combined with lower production volumes due to the Pembina disposition led to reduced FFO in 2025. The reduction in FFO was partially mitigated on a per share basis given our active buyback program under our normal course issuer bid (“NCIB“).
- Capital Development – Second quarter capital expenditures totaled $40.2 million (2024 – $59.2 million) while decommissioning expenditures were $4.0 million (2024 – $4.0 million). Activity during the second quarter of 2025 was focused on bringing the wells we drilled in Peace River earlier in the year on production and drilling our 4-24 Dawson waterflood wells.
- Pembina Asset Disposition – On April 7, 2025, we closed our previously announced Pembina asset disposition (the “Disposition“) to InPlay Oil Corp. (“InPlay“). The Disposition had an effective date of December 1, 2024, and included all the Company’s assets in the Pembina area, except for our non-operated interest in the Pembina Cardium Unit #11.
- Share Buyback Program – The Company was very active during the second quarter of 2025 and repurchased and cancelled a total of 5.4 million shares under the Company’s NCIB for $36.6 million (at an average price of $6.80 per share).
- Net Operating Costs – Net operating costs of $13.54 per boe in the second quarter of 2025 compared to $13.83 per boe in 2024. The close of the Disposition and the removal of those higher cost properties from our portfolio led to a reduction to net operating costs which was partially offset by increased trucking costs due to expanded operations in our Peace River asset compared to 2024.
- General and administrative (“G&A“) Costs – G&A costs were $1.92 per boe in the second quarter of 2025 compared to $1.49 per boe in 2024. G&A costs in the second quarter of 2025 increased on a per boe basis given our lower production levels as a result of the Disposition.
- Net Debt – Net debt levels were $270.2 million at June 30, 2025, compared to $411.7 million at December 31, 2024. The cash proceeds associated with the Disposition were applied against bank debt which led to significantly lower net debt.
- Net Income – Net income for the second quarter of 2025 was $15.3 million ($0.22 per share basic) versus $37.1 million ($0.48 per share basic) in 2024. Net income was impacted by the volatile commodity price environment and lower production from the Disposition, which led to lower revenues, during the second quarter of 2025.
HIGHLIGHTS SUBSEQUENT TO SECOND QUARTER 2025
- InPlay Share Disposition – In July, we announced that a third party made a non-binding offer to the Company to acquire our entire common share position in InPlay, consisting of 9,139,784 InPlay common shares (“InPlay Shares“). The offer price per InPlay Share is in excess of the closing price for such shares on the Toronto Stock Exchange as of July 15, 2025 of $9.59 per share.
- Share Buyback Program – We repurchased and cancelled an additional 0.6 million common shares at an average price of $8.01 per share for total consideration of $4.9 million under the NCIB up to July 29, 2025. In 2025, repurchases and cancellations total 7.1 million common shares at an average price of $7.15 per share for total consideration of approximately $51.1 million, resulting in 67.1 million common shares currently outstanding.
- Since the inception of the NCIB in 2023, we have re-purchased and cancelled a total of approximately 16.7 million common shares (20% of our outstanding shares) for total consideration of approximately $140.2 million.
SECOND QUARTER 2025 CAPITAL PROGRAM & HIGHLIGHTS
The Company had an active 2025 first half capital program focused on development and exploration/appraisal activities at Peace River, targeting both the Bluesky and Clearwater formations. Additionally, we commenced our first Clearwater waterflood pilot project in the Dawson field with water injection planned in the third quarter of 2025. Capital program highlights for the second quarter of 2025 were as follows:
- Completed First Half Development Program – We rig released all wells from our first half 2025 capital program by the end of June, including six (6.0 net) during the second quarter of 2025 in Peace River, inclusive of two (2.0 net) water-flood injection wells in our Dawson Clearwater acreage.
- Strong Initial Well Results – We brought on production 20 (16.7 net) wells during the second quarter of 2025, primarily in Peace River, with very encouraging initial production (“IP“) rates.
- Peace River (Bluesky):
- A total of eight (7.5 net) wells were brought on production in our Harmon Valley South (“HVS“), Walrus and Seal fields. Notable initial well results include the 546 boe/d IP30 rate (100 percent oil) achieved at our 1 (1.0 net) well HVS 14-07 pad and average IP30 rate of 395 boe/d (100 percent oil) per well at our 2 (2.0 net) well HVS 13-08 pad.
- Two (2.0 net) follow-up wells on the HVS 14-07 pad have been rig released as part of our second half program and will be on production in August.
- Peace River (Clearwater):
- During the second quarter, 7 (7.0 net) wells were brought on production in our Dawson Clearwater asset, including the 2 (2.0 net) single leg injector waterflood wells, which were placed on production prior to conversion to water injection in the third quarter. Regulatory approval for the waterflood project has been received and we plan to begin injecting water during the third quarter, in conjunction with starting two additional producing wells on the Dawson 4-24 pad.
- Notable initial well results include the 304 boe/d (100 percent oil) per well average IP30 achieved at the Dawson 4-24 waterflood pilot pad. At the Dawson 4-23 pad an additional 2 (2.0 net) wells were placed on production bringing the pad total to 4 (4.0 net) wells at an average IP30 per well of 253 Boe/d (100% oil).
- Pembina Cardium Unit #11:
- The five-well (2.2 net) non-operated program was drilled in the first quarter with the fifth and final well (0.45 net) brought on production in May with a gross IP30 of 317 boe/d (92% oil).
We started our second half 2025 capital program at the end of June with three rigs running in Peace River and will begin operations with an additional rig at Willesden Green in August. Thus far we have spud 6 (6.0 net) wells in Peace River, following up recent production success on the HVS 14-07 pad, Dawson 04-24 pad and the new Dawson 13-23 pad.
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