Pieridae Releases Q4 and Full Year 2024 Financial and Operating Results
Press Release
Achieved Pivotal Strategic Milestones While Reducing Costs, Growing Third-Party Volumes, and Proactively Managing Production
CALGARY, ALBERTA – March 19, 2025 – Pieridae Energy Limited (“Pieridae” or the “Company”) (TSX: PEA) announces the release of its fourth quarter and full year 2024 financial and operating results and year-end reserves. Pieridae generated Net Operating Income (“NOI”) of $64.6 million and produced 27,763 boe/d (84% natural gas) during 2024. The Company posted Q4 NOI of $13.7 million and production of 22,568 boe/d, while 2024 exit production was approximately 25,558 boe/d.
The Company also filed its Annual Information Form (“AIF”) for the year ended December 31, 2024, including the 2024 independent oil and natural gas reserves evaluation as required under National Instrument 51-101 Standards of Disclosure of Oil and Gas Activities (“NI 51-101”). Pieridae’s 2024 NI 51-101 Proved Developed Producing (“PDP”) PV10 value is $621.4 million and Total Proved plus Probable (“TPP”) PV10 value is $1,252.2 million .
The Company’s AIF, management’s discussion and analysis (“MD&A”) and audited consolidated financial statements and notes for the year ended December 31, 2024 are available at www.pieridaeenergy.com and on SEDAR+ at www.sedarplus.ca.
“2024 was pivotal for Pieridae,” said Darcy Reding, President and CEO. “We divested our legacy LNG assets, repaid our high-cost bridge loan prior to its maturity, completed our Waterton turnaround on budget, and raised over $33 million in equity from existing shareholders and insiders to invest in value accretive production and optimization projects. Our strong hedge position, operating cost reductions, and proactive production curtailments helped the Company withstand deeply discounted natural gas prices in 2024. As we look towards 2025 and beyond, we continue our efforts to dramatically reduce costs and pay down debt, while capitalizing on new accretive opportunities. Key priorities for 2025 include repositioning the Company’s sulphur business to benefit from the upcoming expiry of the long-term sulphur marketing agreement on December 31, 2025, and working towards a commercial solution to consolidate approximately 75 MMcf/d of currently shut-in raw gas from a third-party facility into our Caroline Gas Plant. We continue to advance our strategy successfully and are very excited about 2025 and beyond.”
2024 ANNUAL HIGHLIGHTS
- Generated NOI of $64.6 million ($0.24 per basic and fully diluted share).
- Generated Funds Flow from Operations[1] of $18.1 million ($0.07 per basic and fully diluted share).
- Incurred operating expenses of $185.7 million, down 17% from 2023 on continued efforts to reduce field and facility operating cost structure.
- Produced 27,763 boe/d (84% natural gas), down 15% from 2023 due primarily to the voluntary shut-in of approximately 9,400 boe/d of uneconomic dry gas production during the second half of 2024.
- Incurred net loss of $38.9 million (-$0.20 per basic and fully diluted share).
- Grew third-party raw gas processing volumes to 63 MMcf/d, up 3.6% from 2023.
- Completed disposition of legacy Goldboro assets for gross cash proceeds of $12.0 million, simplifying the Company’s strategic focus.
- Completed a $4.5 million non-brokered private placement, resulting in the issuance of 12.8 million common shares to an existing shareholder.
- Settled convertible bridge loan for $24.0 million in advance of its December 13, 2024 maturity date.
- Completed a $29.0 million equity rights offering (the “Rights Offering”) resulting in the issuance of 118.5 million common shares to existing shareholders and insiders with net proceeds used to repay long term debt, fund working capital and invest in value accretive production and optimization projects.
- Incurred capital expenditures of $25.7 million in 2024, focused primarily on phase 2 of the Waterton facility maintenance turnaround, along with well and facility optimization projects.
- Recorded 2024 NI 51-101 TPP reserves of 244.3 MMboe and TPP PV10 reserve value of $1,252.2 million at the Jan. 1, 2025 IC4 price forecast.
2024 RESERVES
Deloitte, Pieridae’s independent, qualified reserves evaluator, performed reserves evaluations on the Company’s assets at December 31, 2024 and 2023. The following table summarizes those reserves based on the Deloitte NI 51-101 reserve report using the January 1, 2025 and January 1, 2024 IC4 price forecasts, respectively:
2024 Reserve Reconciliation
Selected 2024 Reserve Highlights
- Reserve Life Index (“RLI”) increased to 25.1 years from 20.4 years in 2023.
- 2025 forecasted PDP base decline of 7.3% when the volatility created by seasonally shutting-in uneconomic dry gas production is excluded.
- The negative impacts of lower pricing were offset by positive technical revisions including lower operating costs, higher 3rd party revenue and higher forecasted NGLs.
Refer to the Company’s Annual Information Form for the year ended December 31, 2024, for more information on Pieridae’s 2024 reserves.
Q4 2024 HIGHLIGHTS
- Generated NOI of $13.7 million ($0.05 per basic and fully diluted share).
- Incurred capital expenditures of $5.8 million, primarily for phase 2 of the Waterton facility turnaround, and initiated spending on value accretive optimization projects using Rights Offering proceeds.
- Generated Funds Flow from Operations of $2.8 million ($0.01 per basic and fully diluted share).
- Incurred net loss of $20.9 million (-$0.08 per basic and fully diluted share).
- Produced 22,568 boe/d (83% natural gas); and
- Grew third-party raw gas processing volumes to 71.5 MMcf/d, up 6.2% from Q4 2023.
OUTLOOK
Pieridae’s priority remains strengthening our balance sheet while safely sustaining production, increasing the utilization of the Company’s gas processing facilities by attracting incremental third-party volumes, implementing cost reduction initiatives, optimizing infrastructure, and executing non-core asset dispositions to maintain profitability during all periods of the commodity cycle.
The Company’s 2025 guidance remains unchanged as follows:
Pieridae’s specific priorities for 2025 are:
- Sustain a safe and regulatory compliant business
- Minimize facility outages to maximize sales and processing revenue
- Further grow the third-party gathering and processing business at our operated facilities
- Meaningfully reduce operating expenses to improve corporate netback
- Deliver attractive ROI on value adding optimization projects included in the 2025 capital program
- Reduce long term debt to improve financial flexibility
During the second and third quarters of 2024, several low margin, dry gas properties in Northern AB, Northeast BC, and Central AB which all produce to third-party facilities were shut-in due to low AECO natural gas prices and high variable operating costs. Since these decisions were made, AECO pricing has improved. As a result, approximately 1,000 boe/d of production in Northern AB and 800 boe/d of production in Northeast BC was brought back on production in February and March 2025, respectively, but may be shut-in once again if sustained AECO pricing does not justify ongoing production. Currently, shut-in production in Central AB representing approximately 7,500 boe/d, or 20% of the Company’s production capability, is expected to remain shut-in throughout 2025, which is reflected in the 2025 production guidance of 23,000 to 25,000 boe/d.
An ongoing strategic corporate priority is to continue to grow third-party gathering and processing revenues at our operated facilities. In the third quarter of 2024, work was completed to debottleneck the de-methanizer tower at the Caroline Gas Plant which added 3,000 e3m3/d to plant raw gas processing capacity. Plans are also underway to debottleneck the gathering system at Caroline, providing capacity for an additional 1,200 e3m3/d of third-party volumes in 2025. Management continues to see strong upside potential for cash flow growth from the third-party gathering and processing business, particularly in the Caroline region.
Pieridae has hedged 110,000 GJ/d of its 2025 natural gas production at a weighted average fixed price of $3.32/GJ, and 1,679 bbl/d of its 2025 condensate production with a weighted average floor price of CAD$84.42/bbl and a weighted average ceiling price of CAD$92.32/bbl. The Company’s aggregate hedge position for 2025 totals 19,055 boe/d or approximately 80% of the above production guidance range.
Pieridae’s legacy fixed price sulphur contract, which was entered into in 2019, expires on December 31, 2025. Under this contract, the Company receives a net fixed price of approximately $6/tonne for the majority of its sulphur production capability of approximately 1,400 tonnes per day. Beginning January 1, 2026, the Company will receive market price for all sulphur production, less normal deductions for transportation, handling, and marketing. This represents a significant potential revenue opportunity; as of March 19, 2025, the spot west coast sulphur price was approximately US$200/tonne, prior to transportation and marketing costs.
The $25 to $30 million 2025 capital budget includes approximately $10 million of high-impact well and facility optimization expenditures funded with the equity raised during Q4 2024. These high return, short payout capital projects are expected to increase sales revenue, improve facility efficiency, reduce operating cost and fuel gas consumption, and lower GHG compliance costs. Spending on this program commenced in Q4 2024 and will continue throughout 2025.
The remainder of the 2025 capital program is focused on routine capital maintenance, field operating technology upgrades, and site closure / decommissioning expenditures in Alberta and BC. Notably, Pieridae has not scheduled major maintenance turnaround activity at any of the Company’s deep-cut, sour gas processing facilities during 2025 given the successful completion of gas plant turnarounds and other maintenance projects in 2023 and 2024. The next major maintenance turnaround is scheduled for 2026.
Due to the current outlook for North American natural gas prices, Pieridae is not planning to resume drilling operations in 2025. The Company will only exploit its portfolio of high impact conventional Foothills drilling opportunities once natural gas prices sustainably recover and the Company has achieved its deleveraging target.
HEDGE MONETIZATION
In March 2025, Pieridae completed a hedge monetization transaction for net proceeds of $10.2 million (the “Hedge Monetization”), with proceeds used to repay a portion of the Company’s senior term loan. Approximately 30% or 25,000 GJ/d of in-the-money financial hedges were unwound for the period of January 2026 through May 2027; for the period from June 2026 through May 2027, the strike price on the remaining financial hedges was reduced to $3.40/GJ from $3.78/GJ.
Impact of the Hedge Monetization:
- Acceleration of $10.2 million of cash flow from 2026 and 2027 to Q1 2025.
- Reduced senior debt by approximately $10.0 million.
- Increased exposure to 2026 and 2027 AECO natural gas prices through a 30% reduction in fixed price contracted volume.
- Reduced mark to market value of commodity hedge book by 22%.
HEDGE POSITION
Pieridae hedges to mitigate commodity price, interest rate and foreign exchange volatility to protect the cash flow required to fund the Company’s operations, capital requirements and debt service obligations, while allowing the Company to participate in future commodity price upside. Pieridae continues to execute its risk management program governed by its hedge policy and in compliance with the thresholds required by senior secured lenders. As of December 31, 2024, the Company is hedged in accordance with the requirements of the senior loan agreement. The discounted unrealized gain on the Company’s hedge portfolio at March 19, 2025 was approximately $45.1 million using the forward strip on March 18, 2025.
CONFERENCE CALL DETAILS
A conference call and webcast to discuss the results will be held on Thursday, March 20, 2025, at 8:30 a.m. MDT / 10:30 a.m. EDT. To participate in the webcast or conference call, you are asked to register using one of the links provided below.
To register to participate via webcast please follow this link:
https://edge.media-server.com/mmc/p/4gnbdki4
Alternatively, to register to participate by telephone please follow this link:
https://register.vevent.com/register/BI2b233016526f4daea915722f8796db53
A replay of the webcast will be available two hours after the conclusion of the event and may be accessed using the webcast link above.
ABOUT PIERIDAE
Pieridae is a Canadian energy company headquartered in Calgary, Alberta. The Company is a significant upstream producer and midstream custom processor of natural gas, NGLs, condensate, and sulphur from the Canadian Foothills and adjacent areas in Alberta and in northeast British Columbia. Pieridae’s vision is to provide responsible, affordable natural gas and derived products to meet society’s energy security needs. Pieridae’s common shares trade on the TSX under the symbol “PEA”.
For further information, visit www.pieridaeenergy.com, or please contact:
Darcy Reding, President & Chief Executive Officer
Telephone: (403) 261‐5900
Adam Gray, Chief Financial Officer
Telephone: (403) 261‐5900
Investor Relations
investors@pieridaeenergy.com
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