Northern Oil and Gas, Inc. (NYSE: NOG) (“NOG” or “Company”) has announced its third-quarter financial results, showcasing impressive oil production and financial growth despite challenges such as limited completion activity and weaker commodity prices.
Key Highlights from Management:
“During the third quarter, we generated record oil volumes and free cash flow, despite a period of weaker commodity prices and reduced completion activity,” said Nick O’Grady, CEO of NOG. “We also made significant strides with the acquisition of two high-quality growth assets. Our $220 million Point acquisition was completed on time, and our net debt only increased by approximately $50 million, demonstrating the strength of our cash generation and asset base. On October 1, we completed our largest and most accretive acquisition to date, XCL. With both assets now integrated and increased D&C activity, we’re well-positioned for continued growth and strong returns for our investors.”
Third Quarter Financial Results:
- Oil and Natural Gas Sales: $513.5 million
- GAAP Net Income: $298.4 million, or $2.96 per diluted share
- Adjusted Net Income: $141.1 million, or $1.40 per adjusted diluted share
- Adjusted EBITDA: $412.4 million, a 7% increase from Q3 2023
Production Details:
- Total Production: 121,815 Boe per day (a 19% increase year-over-year)
- Oil Production: 70,913 Bbls per day, up 2% from Q2 2024 and 12% from Q3 2023
- Natural Gas: Production declined due to reduced activity in the Appalachian region
- Wells Turned In-Line: 9.5 net wells, down from 30.1 in the prior quarter
Pricing Performance:
- WTI Crude Oil: $75.27 per Bbl
- NYMEX Natural Gas: $2.23 per Mcf
- Unhedged Net Realized Oil Price: $71.82, slightly improving from Q2
- Unhedged Net Realized Gas Price: $1.60 per Mcf
Operating Costs:
- Lease Operating Costs: $106.9 million, or $9.54 per Boe, 6% higher than Q2 2024
- Production Taxes: $14.7 million, down significantly from $48.6 million in Q2 2024 due to a prior-period accounting adjustment
- General & Administrative (G&A): $10.0 million, or $0.89 per Boe, a decrease from $1.21 per Boe in Q2 2024
Capital Expenditures and Acquisitions:
- Capital Expenditures: $198.0 million, with $187.0 million directed to drilling and completion activities
- Permian Basin: Represented 56% of total capital expenditures
- Ground Game Acquisitions: Six acquisitions totaling 1,259 net acres and 0.1 net development wells
Liquidity and Capital Resources:
- Total Liquidity: Exceeded $1.3 billion, including $1.2 billion available under the Revolving Credit Facility
- Cash Reserves: $59.9 million, with $34.4 million unrestricted and $25.5 million restricted for the XCL acquisition
Shareholder Returns:
- Stock Repurchases: 397,301 shares bought back at an average price of $36.38 per share in Q3; year-to-date repurchases totaled 1.8 million shares
- Dividend Declaration: Quarterly cash dividend of $0.42 per share, a 5% increase from prior levels
2024 Annual Guidance:
NOG reaffirmed its capital expenditure and production guidance, making adjustments for production taxes and oil and gas price differentials. The company has lowered per-unit cash G&A costs as it continues to streamline operations while benefiting from higher production volumes.
