Petrus Resources (TSE:PRQ) reported higher second-quarter production, operating netback and funds flow as increased liquids output and stronger liquids pricing more than offset weaker natural gas prices, Chief Executive Officer Ken Gray said during the company’s second-quarter 2026 results call.
Gray said the company’s operating netback rose 92% from a year earlier to C$24.9 million. The increase reflected higher production, a greater proportion of liquids in the production mix and improved pricing for liquids. Hedging losses moderated the impact on reported funds flow, though quarterly funds flow still increased 32% year over year, according to Gray.
Production Reaches Record Monthly Level
Contribution from the company’s Harmattan acquisition was limited during part of the quarter because scheduled facility maintenance in April and May temporarily curtailed production. However, Gray said June represented the first month that included full contribution from Harmattan and the new wells.
Corporate production exceeded 12,000 BOE per day in June, which Gray described as the highest average monthly production in Petrus’ history.
Liquids represented 39% of production during the quarter. Oil prices increased 59% year over year and natural gas liquids prices rose 39%, Gray said, while natural gas prices declined 18%. The combined effect of pricing and the more liquids-weighted production mix resulted in a realized price of C$37.66 per BOE, up 46% from a year earlier.
Capital Spending Expected Near High End of Guidance
In response to an analyst question regarding capital spending, Gray said Petrus had spent C$33 million during the first six months of the year and expects full-year capital expenditures to come in toward the high end of its C$50 million to C$60 million guidance range, but below C$60 million.
He said the range was intended to provide flexibility for operational variability rather than reflecting a specific plan for additional spending. Under the current program, Petrus expects to maintain production at approximately 12,000 BOE per day or modestly higher through the remainder of 2026.
Gray said reaching an exit rate of 13,000 BOE per day would be welcome but is not currently expected. He added that the company could potentially accelerate wells originally included in its 2027 program into 2026 if market conditions and operating results supported that decision.
- Second-quarter production averaged 11,070 BOE per day, up 21% year over year.
- June production exceeded 12,000 BOE per day, a company record for average monthly output.
- Operating netback increased 92% year over year to C$24.9 million.
- Realized pricing rose 46% to C$37.66 per BOE.
- Full-year capital spending is expected near the upper end of C$50 million to C$60 million guidance.
Harmattan Well Results Awaited
Petrus has drilled and completed two oil wells in Harmattan, its first wells drilled in the area since the acquisition closed in the first quarter. The wells began production on Aug. 1 and were still in the cleanup phase at the time of the call.
Gray said the company is optimistic about the wells and will share results when available. Stronger-than-forecast results could support an accelerated development program in the area, he said.
The company also has one additional Ferrier well scheduled for completion and startup later in August. Petrus is currently drilling joint-venture Glock wells that are expected to begin production in October.
Gray said North Ferrier well performance has been in line with expectations, although infrastructure constraints require the company to pace activity in that area. He said Petrus will continue to assess drilling outcomes and adjust forecasts and capital plans based on current results, with the Harmattan wells representing the key near-term area of focus.
Management Cites Volatile Commodity Markets
Gray said oil prices have remained volatile and that the company does not expect that volatility to end soon. Natural gas prices remain weak, he said, although management sees a positive longer-term outlook for the commodity.
Despite changing commodity markets, Gray said Petrus is positioned to pursue opportunities through operational efficiency, disciplined capital investment and risk management, while continuing to pay what he described as a high-yield dividend to shareholders.
About Petrus Resources (TSE:PRQ)
Petrus Resources Ltd is a company that is engaged in the acquisition, development, exploration, and exploitation of energy business assets. The company receives maximum revenue from oil and natural gas. The company’s core operating areas are Ferrier, Central Alberta, and the Rocky Mountain foothills.
