CALGARY, Alberta, Nov. 06, 2026 (GLOBE NEWSWIRE) — Parex Resources Inc. (“Parex” or the “Company”) (TSX: PXT) is pleased to announce its financial and operational results for the three-month period ended September 30, 2026, an operational update and an updated H2 2026 outlook, and the declaration of its Q4 2026 regular dividend of C$0.385 per share. All amounts herein are in United States Dollars (“USD”) unless otherwise stated.
“Parex is making strong progress toward closing out a transformational year, underpinned by a low-decline production base and exceptional recent exploration results,” commented Imad Mohsen, President & Chief Executive Officer.
“While wider differentials, energy costs, and foreign exchange are weighing on near-term cash flow expectations, our operational momentum remains strong. In the Eastern Llanos, LLA-111 is nearing one million barrels of cumulative production, highlighting its potential to become one of Parex’s most significant discoveries in recent years. At the same time, we are advancing our Foothills exploration program toward execution, while continuing to integrate Frontera and capture the value of the combined business. Together, these efforts build on the strength of our existing production base and advance the next phase of our growth.”
Key Highlights
- Recognized the first full-quarter results of the newly acquired Colombian assets from Frontera Energy, highlighting successful initial integration into the Company’s operations, with optimization and synergy realization initiatives underway.
- Updated H2 2026 production outlook to 85,500-87,500 boe/d, reflecting steady operational performance, and revised financial guidance to account for external factors and increased capital expenditures associated with successful exploration and development activities(1).
- Delivered positive operational momentum to begin Q4 2026, with October 2026 average production of approximately 85,800 boe/d(8).
- Began earning 50% production participation on roughly 14,000 bbl/d in late October 2026, following the start of initial activities in the Middle Magdalena (Casabe and Llanito)(1).
- Achieved strong 2026 near-field exploration results, with seven new discoveries to date and several awaiting infrastructure tie-in; success rates of 70% in the Eastern Llanos and 100% across three other prospects underscore growth potential and portfolio-wide repeatability(1).
- Advanced development in the Eastern Llanos (LLA-111), sustaining production above 6,000 bbl/d, with a further 2,000 bbl/d increase expected by YE 2026 and significant multi-field upside in 2027 as egress constraints are addressed and field drilling continues(1).
- Successfully drilled a near-field exploration well in the Lower Magdalena (VIM-1), which tested at 6,600 boe/d, further supporting the planned mid-2027 gas export pipeline that is expected to enable sales of up to 25,000 mcf/d into Colombia’s premium natural gas market(1).
- Declared Q4 2026 regular dividend of C$0.385 per share(2) (C$1.54 per share annualized).
Q3 2026 Highlights
- Average production was 83,264 boe/d(3), compared to 54,121 boe/d(3) in Q2 2026, with the positive step change primarily driven by the first full-quarter results from the Frontera E&P transaction that closed on June 1, 2026, and continued strong production from LLA-111.
- Recognized net income of $75 million or $0.78 per share basic(4) compared to net income of $50 million or $0.52 per share basic(4) in the comparative quarter of 2025, primarily attributed to an increased operating netback driven by higher crude oil prices and higher volumes.
- Generated Q3 2026 funds flow provided by operations (“FFO”)(5) of $196 million and FFO per share(4)(5) of $2.04; a build in crude oil inventories of 316,900 bbls resulted in an estimated $10 million temporary FFO impact, with the volumes sold post-Q3.
- Realized adjusted EBITDA(6) of $238 million.
- Produced an operating netback(7) of $37.25/boe and an FFO netback(7) of $26.33/boe from an average Brent crude oil price of $91.29/bbl; lower margins were primarily driven by wider crude oil differentials, increased production expense, and higher purchased oil costs related to the acquired Frontera E&P assets.
- Incurred $162 million of capital expenditures(6), primarily from activities at LLA-34, Quifa, LLA-111, VIM-1, and LLA-74; additional capital for certain projects was accelerated based on successful exploration outcomes.
(1) See “Operational Update” section.
(2) Supplementary financial measure. See “Non-GAAP and Other Financial Measures Advisory.”
(3) See “Operational and Financial Items” for a breakdown of production by product type.
(4) Based on weighted average basic shares for the period.
(5) Capital management measure. See “Non-GAAP and Other Financial Measures Advisory.”
(6) Non-GAAP financial measure. See “Non-GAAP and Other Financial Measures Advisory.”
(7) Non-GAAP ratio. See “Non-GAAP and Other Financial Measures Advisory.”
(8) Estimated average production; light & medium oil: ~25,416 bbl/d, heavy oil: ~55,655 bbl/d, conventional natural gas: ~16,805 mcf/d, natural gas liquids: 1,928 boe/d; rounded for presentation purposes.
| Operational and Financial Items | Three Months Ended | Nine Months Ended | ||||||
| (unaudited) | Sep. 30, | Sep. 30, | Jun. 30, | Sep. 30, | ||||
| 2026 | 2025 | 2026 | 2026 | |||||
| Operational | ||||||||
| Average daily production | ||||||||
| Light Crude Oil and Medium Crude Oil (bbl/d) | 24,665 | 10,257 | 14,515 | 17,676 | ||||
| Heavy Crude Oil (bbl/d) | 54,010 | 32,026 | 37,130 | 40,227 | ||||
| Natural gas liquids (boe/d) | 1,871 | 268 | 765 | 969 | ||||
| Crude Oil (bbl/d) | 80,546 | 42,551 | 52,410 | 58,872 | ||||
| Conventional Natural Gas (mcf/d) | 16,308 | 8,412 | 10,266 | 11,856 | ||||
| Oil & Gas (boe/d)(1) | 83,264 | 43,953 | 54,121 | 60,848 | ||||
| Operating netback ($/boe) | ||||||||
| Reference price – Brent ($/bbl) | 91.29 | 68.17 | 96.68 | 88.86 | ||||
| Oil & gas sales price ($boe/d)(4) | 84.97 | 62.41 | 90.84 | 82.63 | ||||
| Purchased crude oil(4)(7) | (6.80 | ) | — | (7.16 | ) | (5.27 | ) | |
| Oil and natural gas sales(2), net of purchased crude oil(4)(7) | 78.17 | 62.41 | 83.68 | 77.36 | ||||
| Royalties(4) | (11.59 | ) | (7.61 | ) | (14.22 | ) | (11.83 | ) |
| Net revenue(4) | 66.58 | 54.80 | 69.46 | 65.53 | ||||
| Production expense(4) | (22.13 | ) | (15.36 | ) | (17.69 | ) | (18.87 | ) |
| Transportation expense(4) | (7.20 | ) | (4.73 | ) | (6.63 | ) | (6.51 | ) |
| Operating netback ($/boe)(2) | 37.25 | 34.71 | 45.14 | 40.15 | ||||
| Funds flow provided by operations netback ($/boe)(2) | 26.33 | 26.04 | 25.74 | 26.65 | ||||
| Adjusted funds flow provided by operations netback ($/boe)(2) | 26.33 | 26.82 | 37.26 | 28.39 | ||||
| Financial ($000s except per share amounts) | ||||||||
| Net income | 75,255 | 50,476 | 444,296 | 524,140 | ||||
| Per share – basic(6) | 0.78 | 0.52 | 4.62 | 5.45 | ||||
| Funds flow provided by operations(5) | 196,341 | 105,298 | 132,054 | 442,097 | ||||
| Per share – basic(2)(6) | 2.04 | 1.09 | 1.37 | 4.60 | ||||
| Adjusted funds flow provided by operations(5) | 196,341 | 108,491 | 191,155 | 471,097 | ||||
| Per share – basic(2)(6) | 2.04 | 1.12 | 1.99 | 4.90 | ||||
| Capital expenditures(3) | 161,770 | 79,961 | 133,693 | 386,506 | ||||
| Free funds flow(3) | 34,571 | 25,337 | (1,639 | ) | 55,591 | |||
| EBITDA(3) | 242,588 | 113,648 | 487,551 | 825,969 | ||||
| Adjusted EBITDA(3) | 238,024 | 121,132 | 192,063 | 562,771 | ||||
| Dividends paid | 26,772 | 26,892 | 26,483 | 80,192 | ||||
| Per share – Cdn$(4)(6) | 0.385 | 0.385 | 0.385 | 1.155 | ||||
| Shares repurchased | — | 7,606 | — | — | ||||
| Number of shares repurchased (000s) | — | 620 | — | — | ||||
| Outstanding shares (end of period) (000s) | ||||||||
| Basic | 96,196 | 96,564 | 96,180 | 96,196 | ||||
| Weighted average basic | 96,185 | 96,874 | 96,179 | 96,119 | ||||
| Weighted average diluted | 96,440 | 96,956 | 96,440 | 96,352 | ||||
| Net debt(5) | 911,364 | 13,167 | 906,598 | 911,364 | ||||
| Cash | 142,725 | 69,810 | 163,286 | 142,725 | ||||
(1) References to crude oil or natural gas in the above table and elsewhere in this press release refer to the light and medium crude oil and heavy crude oil and conventional natural gas, respectively, product types as defined in National Instrument 51-101 – Standards of Disclosure for Oil and Gas Activities.
(2) Non-GAAP ratio. See “Non-GAAP and Other Financial Measures Advisory”.
(3) Non-GAAP financial measure. See “Non-GAAP and Other Financial Measures Advisory”.
(4) Supplementary financial measure. See “Non-GAAP and Other Financial Measures Advisory”.
(5) Capital management measure. See “Non-GAAP and Other Financial Measures Advisory”.
(6) Per share amounts (with the exception of dividends) are based on weighted average common shares. Dividends paid per share are based on the number of common shares outstanding at each dividend record date.
(7) Purchased crude oil cost includes ~$9.4 million of non-cash inventory fair value adjustment as a result of the purchase price allocation for the nine months ended September 30, 2026, equivalent to $0.56/boe.
Operational Update
2026 Guidance Update: Production Steady; Reflecting Wider Differentials and Increased Energy Expense
The Company is updating its H2 2026 guidance to reflect operating performance to date and its latest expectations for the balance of the year. Production remains in line with expectations, allowing the Company to narrow its H2 2026 production guidance range while maintaining the midpoint at 86,500 boe/d.
The revised outlook reflects evolving market conditions, including movements in benchmark oil prices and wider differentials across Brent, WTI and Colombia’s Vasconia benchmark. The current commodity price environment is also influencing operating costs, with higher oil prices driving increased diluent and diesel expenses, El Niño-related seasonal conditions raising power generation costs, and Colombian peso appreciation contributing to higher production expenses. Under more normalized market conditions, the Company would expect crude oil differentials and operating costs to moderate.
To manage a portion of its exposure to currency movements, the Company has implemented Colombian peso collars covering approximately 50% of its Colombian peso-denominated costs for Q4 2026 and has begun building a hedge position for 2027. In parallel, following the Frontera Transaction, the Company continues to advance operational integration and assess opportunities to optimize its operating model and realize efficiencies over time.
These measures and market considerations are reflected in the Company’s updated expectations for realized pricing and operating costs for the remainder of 2026. Partially offsetting these pressures, the Company expects improvements in its projected effective tax rate, providing a benefit to the financial outlook.
The Company’s revised outlook also reflects increased capital investment to support ongoing development activities in the Middle Magdalena (Llanito and Casabe) and advance exploration successes in the Eastern Llanos (LLA-111) and Lower Magdalena (VIM-1). This investment will support the advancement of farm-in commitments and progress infrastructure required to capitalize on positive exploration results, positioning the Company to support its 2027 outlook and longer-term growth objectives.
| Category | H2 2026 Guidance (May 12, 2026) |
Updated H2 2026 Guidance (November 6, 2026) |
| Brent Crude Oil Average Price | $90/bbl | $95/bbl |
| Average Production | 82,000-91,000 boe/d | 85,500-87,500 boe/d |
| Funds Flow Provided by Operations Netback(1) | $30-33/boe | $27-29/boe |
| Funds Flow Provided by Operations(2) | $475-525 million | $435-450 million |
| Capital Expenditures(3) | $275-295 million | $285-315 million |
| Free Funds Flow(3) | $215 million (midpoint) | $140 million (midpoint) |
(1) Non-GAAP ratio. See “Non-GAAP and Other Financial Measures Advisory”.
(2) Capital management measure. See “Non-GAAP and Other Financial Measures Advisory”.
(3) Non-GAAP financial measure. See “Non-GAAP and Other Financial Measures Advisory”.
The following table summarizes the key assumptions underlying the Company’s updated H2 2026 guidance:
| Category | H2 2026 Guidance (May 12, 2026) |
Updated H2 2026 Guidance(1) (November 6, 2026) |
| Differential (Vasconia) | $4.00/bbl | $8.00-12.00/bbl |
| Production Expense (Opex + Energy) | $16.00-20.00/boe | $22.00-23.00/boe |
| Effective Tax Rate | 12-15% | 7-10% |
(1) All other key H2 2026 assumptions unchanged: operational downtime: ~5%; transportation expense: ~$7.50/boe; G&A expense: ~$5.00/boe; finance expense: ~$2.50/boe; see “Non-GAAP and Other Financial Measures Advisory”.
For FY 2026, average production is expected to exceed the previous guidance range of 63,000 to 67,000 boe/d, while capital expenditure guidance is increased to $510 to $540 million.
Frontera E&P Update
Parex’s first full quarter following the June 1, 2026 acquisition of Frontera Energy’s Colombian exploration and production assets advanced as planned, with operational continuity maintained and integration progressing. Priorities include integrating teams and business processes, optimizing development and production across the combined asset base, and pursuing capital-efficient deployment to maximize returns from the portfolio.
The Company is advancing opportunities to enhance operating efficiency and realize synergies, primarily across administration, marketing, supply chain, and tax. Synergy realization remains on track, with Management expecting 2027 annualized run-rate synergies in excess of the previously disclosed $20 to $50 million range, as realization efforts ramp up in Q4 2026 to support long-term value creation.
Addition of Producing Assets in the Magdalena Basin Update
Parex commenced earning a 50% production participation interest in approximately 14,000 bbl/d of medium crude oil in late October 2026, following the initiation of activities in the Middle Magdalena at both the Casabe and Llanito blocks. In the near to medium term, the Company will focus on sustaining and optimizing production through waterflood management, reservoir optimization and targeted workovers, while advancing development opportunities including horizontal drilling, field re-patterning and enhanced oil recovery through the use of polymers and surfactants to support longer-term production growth.
Eastern Llanos Exploration Success
Field production in the Eastern Llanos has remained strong with volumes over 6,000 bbl/d of medium crude oil on natural flow. Current production is constrained primarily by infrastructure capacity and weather-related road access, rather than well performance. To support continued growth, Parex is advancing a phased egress expansion plan, with ongoing drilling results helping inform the timing and scope of infrastructure investment. As drier conditions return in Q4 2026, the Company expects to unlock a further 2,000 bbl/d of production by YE 2026.
Exploration success at LLA-111 is establishing the foundation for a new, growing multi-field production hub in the Eastern Llanos. Following four discoveries in early 2026, Parex is advancing development while continuing to pursue additional exploration opportunities, positioning the block to deliver further resource and production growth. Results to date also reinforce the significant potential of the Company’s over 1.6 million-acre position in the Eastern Llanos.
With strong momentum from recent discoveries and an extensive prospect inventory, Parex plans to drill approximately 20 additional exploration and development wells in the area over the next 12 months. This ambitious program is expected to be the largest single investment area in 2027, supporting the continued expansion of Parex’s production base in the area.
Lower Magdalena Exploration Discovery at VIM-1
In Q3 2026, the Company successfully drilled a near-field exploration well, resulting in a discovery within the same formation as the producing La Belleza field. To minimize gas flaring, the well was tested over a limited 35-hour period. During the final ten hours, following recovery of completion load fluids, the well flowed at average rates of 22,000 mcf/d of gas and 3,000 bbl/d of light crude oil (approximately 6,600 boe/d), with a 1% water cut. The well is currently being tied into the La Belleza gas facility, with completion expected by YE 2026.
In parallel, the Company is progressing arrangements for a dedicated gas export pipeline on the block, targeted to be operational by mid-2027. The pipeline will establish access to Colombia’s domestic natural gas market and enable the monetization of up to 25,000 mcf/d of gas currently being reinjected into the reservoir. Against a backdrop of constrained domestic gas supply, the project is expected to contribute incremental volumes to the Colombian market while providing the Company with an opportunity to capture attractive domestic natural gas pricing.
Llanos Foothills Exploration Update
Parex continues to advance its Foothills exploration strategy, focused on premier onshore prospects with transformational growth potential. The Company is progressing toward drilling at Piedemonte, where civil works are underway and spud is targeted before YE 2026. This represents a key near-term milestone in Parex’s big ‘E’ exploration program. Early-stage activities have also commenced at Farallones, the second planned Foothills prospect, with drilling anticipated in 2027.
2026 Capital Markets Day
Parex plans to host an investor presentation on December 9, 2026, beginning at 12:30 p.m. Calgary time (1:30 p.m. EST) in Bogotá, Colombia. The event will provide an overview of the Company’s strategy, transformed portfolio, and long-term vision and growth potential. A webcast will also be available, with access details to be provided in due course.
Q4 2026 Dividend
Parex’s Board of Directors has declared a Q4 2026 regular dividend of C$0.385 per share to shareholders of record on December 8, 2026, to be paid on December 15, 2026. This regular dividend payment to shareholders is designated as an “eligible dividend” for purposes of the Income Tax Act (Canada).
Q3 2026 Results – Conference Call & Webcast
Parex will host a conference call and webcast to discuss its Q3 2026 results on Friday, November 6, 2026, beginning at 9:30 a.m. Calgary time (10:30 a.m. EST). To participate in the conference call or webcast, please see the access information below:
Conference ID: 128 354 764
Participant Dial-In Number: 1-833-461-5787
Participant Toll-Free Dial-In Number: 1-585-542-9983
Webcast: https://events.q4inc.com/attendee/128354764
About Parex Resources Inc.
Parex is the largest independent oil and gas company in Colombia, focusing on sustainable conventional production. The Company’s corporate headquarters are in Calgary, Canada, with an operating office in Bogotá, Colombia. Parex shares trade on the Toronto Stock Exchange under the symbol PXT.
For more information, please contact:
Mike Kruchten
Senior Vice President, Capital Markets & Corporate Planning
Parex Resources Inc.
403-517-1733
investor.relations@parexresources.com
Steven Eirich
Senior Investor Relations & Communications Advisor
Parex Resources Inc.
587-293-3286
investor.relations@parexresources.com
NOT FOR DISTRIBUTION OR FOR DISSEMINATION IN THE UNITED STATES
Oil & Gas Matters Advisory
This press release contains a number of oil and gas metrics, including, operating netbacks and FFO netbacks. These oil and gas metrics have been prepared by management and do not have standardized meanings or standard methods of calculation; therefore such measures may not be comparable to similar measures used by other companies and should not be used to make comparisons. Such metrics have been included herein to provide readers with additional measures to evaluate the Company’s performance; however, such measures are not reliable indicators of the future performance of the Company and future performance may not compare to the performance in previous periods. Therefore such metrics should not be unduly relied upon. Management uses these oil and gas metrics for its own performance measurements and to provide security holders with measures to compare the Company’s operations over time. Readers are cautioned that the information provided by these metrics, or that can be derived from the metrics presented in this news release, should not be relied upon for investment or other purposes.
Any reference in this press release to short-term production rates is useful in confirming the presence of hydrocarbons; however such rates are not a determination of the rates at which such wells will continue production and decline thereafter and readers are cautioned not to rely on such rates in calculating the aggregate production of Parex.
The term “Boe” means a barrel of oil equivalent on the basis of 6 Mcf of natural gas to 1 barrel of oil (“bbl”). Boe’s may be misleading, particularly if used in isolation. A boe conversion ratio of 6 Mcf: 1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Given the value ratio based on the current price of crude oil as compared to natural gas is significantly different from the energy equivalency of 6:1, utilizing a conversion ratio at 6:1 may be misleading as an indication of value. Light crude oil is crude oil with a relative density greater than 31.1 degrees API gravity, medium crude oil is crude oil with a relative density greater than 22.3 degrees API gravity and less than or equal to 31.1 degrees API gravity, and heavy crude oil is crude oil with a relative density greater than 10 degrees API gravity and less than or equal to 22.3 degrees API gravity.
Non-GAAP and Other Financial Measures Advisory
This press release uses various “non-GAAP financial measures”, “non-GAAP ratios”, “supplementary financial measures” and “capital management measures” (as such terms are defined in National Instrument 52-112 – Non-GAAP and Other Financial Measures Disclosure), which are described in further detail below. Such measures are not standardized financial measures under IFRS and might not be comparable to similar financial measures disclosed by other issuers. Investors are cautioned that non-GAAP financial measures should not be construed as alternatives to or more meaningful than the most directly comparable GAAP measures as indicators of Parex’s performance. The forward-looking non-GAAP financial measures used in this press release have no significant difference from their equivalent historical non-GAAP financial measures.
These measures facilitate management’s comparisons to the Company’s historical operating results in assessing its results and strategic and operational decision-making and may be used by financial analysts and others in the oil and natural gas industry to evaluate the Company’s performance. Further, management believes that such financial measures are useful supplemental information to analyze operating performance and provide an indication of the results generated by the Company’s principal business activities.
Set forth below is a description of the non-GAAP financial measures, non-GAAP ratios, supplementary financial measures and capital management measures used in this press release.
Non-GAAP Financial Measures
Capital expenditures, is a non-GAAP financial measure which the Company uses to describe its capital costs associated with oil and gas expenditures. The measure considers both property, plant and equipment expenditures and exploration and evaluation asset expenditures which are items in the Company’s statement of cash flows for the period and is calculated as follows:
| For the three months ended | For the nine months ended | ||||||||||
| Sep. 30, | Sep. 30, | Jun. 30, | Sep. 30, | ||||||||
| ($000s) | 2026 | 2025 | 2026 | 2026 | |||||||
| Property, plant and equipment expenditures | $ | 121,679 | $ | 59,002 | $ | 69,131 | $ | 239,092 | |||
| Exploration and evaluation expenditures | 40,091 | 20,959 | 64,562 | 147,414 | |||||||
| Capital expenditures | $ | 161,770 | $ | 79,961 | $ | 133,693 | $ | 386,506 | |||
Free funds flow, is a non-GAAP financial measure that is determined by funds flow provided by operations less capital expenditures. The Company considers free funds flow to be a key measure as it demonstrates Parex’s ability to fund return of capital, such as the normal course issuer bid and dividends, without accessing outside funds and is calculated as follows:
| For the three months ended | For the nine months ended | |||||||||||
| Sep. 30, | Sep. 30, | Jun. 30, | Sep. 30, | |||||||||
| ($000s) | 2026 | 2025 | 2026 | 2026 | ||||||||
| Cash provided by operating activities | $ | 138,228 | $ | 86,992 | $ | 199,235 | $ | 361,549 | ||||
| Net change in non-cash assets and liabilities | 58,113 | 18,306 | (67,181 | ) | 80,548 | |||||||
| Funds flow provided by operations | 196,341 | 105,298 | 132,054 | 442,097 | ||||||||
| Capital expenditures | 161,770 | 79,961 | 133,693 | 386,506 | ||||||||
| Free funds flow | $ | 34,571 | $ | 25,337 | $ | (1,639 | ) | $ | 55,591 | |||
EBITDA, is a non-GAAP financial measure that is defined as net income adjusted for finance income and expense, other expense, income tax expense (recovery) and depletion, depreciation and amortization.
Adjusted EBITDA, is a non-GAAP financial measure defined as EBITDA adjusted for non-cash impairment charges, share-based compensation expense (recovery), gain on acquisition, transaction costs, non-cash inventory fair value adjustment, unrealized foreign exchange gains (losses) and unrealized gains (losses) on risk management contracts and marketable securities.
The Company considers EBITDA and Adjusted EBITDA to be key measures as they demonstrate Parex’s profitability before finance income and expense, taxes, depletion, depreciation and amortization and other non-cash items. A reconciliation from net income to EBITDA and Adjusted EBITDA is as follows:
| For the three months ended | For the nine months ended | ||||||||||||||
| Sep. 30, | Sep. 30, | Jun. 30, | Sep. 30, | ||||||||||||
| ($000s) | 2026 | 2025 | 2026 | 2026 | |||||||||||
| Net income | $ | 75,255 | $ | 50,476 | $ | 444,296 | $ | 524,140 | |||||||
| Adjustments to reconcile net income to EBITDA: | |||||||||||||||
| Finance income | (1,781 | ) | (1,306 | ) | (2,740 | ) | (7,925 | ) | |||||||
| Finance expense | 36,281 | 5,796 | 17,219 | 60,265 | |||||||||||
| Other expense | 1,777 | 3,815 | 8,970 | 28,104 | |||||||||||
| Income tax expense (recovery) | 30,505 | 7,100 | (42,576 | ) | 7,163 | ||||||||||
| Depletion, depreciation and amortization | 100,551 | 47,767 | 62,382 | 214,222 | |||||||||||
| EBITDA | $ | 242,588 | $ | 113,648 | $ | 487,551 | $ | 825,969 | |||||||
| Share-based compensation expense (recovery) | 15,595 | 11,902 | (341 | ) | 33,921 | ||||||||||
| (Gain) loss on acquisition | 4,873 | — | (302,483 | ) | (297,610 | ) | |||||||||
| Transaction costs | — | — | 28,390 | 29,000 | |||||||||||
| Non-cash inventory fair value adjustment | — | — | 9,365 | 9,365 | |||||||||||
| Unrealized foreign exchange gain | (16,817 | ) | (4,246 | ) | (2,217 | ) | (18,093 | ) | |||||||
| Unrealized gain on risk management contracts | — | (172 | ) | (30,635 | ) | (1,281 | ) | ||||||||
| Unrealized (gain) loss on marketable securities | (8,215 | ) | — | 2,433 | (18,500 | ) | |||||||||
| Adjusted EBITDA | $ | 238,024 | $ | 121,132 | $ | 192,063 | $ | 562,771 | |||||||
Operating netback, is a non-GAAP financial measure that the Company considers to be a key measure as it demonstrates Parex’s profitability relative to current commodity prices. Parex calculates operating netback as oil and natural gas sales from production, less purchased crude oil, royalties, production, and transportation expense. Refer to “Financial and Operational Results – Consolidated Results of Operations” for the calculation of operating netback.
Non-GAAP Ratios
Operating netback per boe, is a non-GAAP ratio that the Company considers to be a key measure as it demonstrates Parex’s profitability relative to current commodity prices. Parex calculates operating netback per boe as operating netback divided by the total equivalent produced oil and gas sales volumes before consumption for oil and natural gas sales price, oil and natural gas sales price, net of purchased crude oil, royalties, production and transportation expense per boe.
Funds flow provided by operations per share or FFO per share, is a non-GAAP ratio that is calculated by dividing funds flow provided by operations by the weighted average number of basic shares outstanding. Parex presents funds flow provided by operations per share whereby per share amounts are calculated using weighted-average shares outstanding, consistent with the calculation of earnings per share. The Company considers funds flow provided by operations per share or FFO per share to be a key measure as it demonstrates Parex’s profitability after all cash costs relative to the weighted average number of basic shares outstanding.
Funds flow provided by operations netback per boe or FFO netback per boe, is a non-GAAP ratio that includes all cash generated from operating activities and is calculated before changes in non-cash assets and liabilities, divided by produced oil and natural gas sales volumes before consumption. The Company considers funds flow provided by operations netback per boe to be a key measure as it demonstrates Parex’s profitability after all cash costs relative to current commodity prices.
Adjusted funds flow provided by operations per share or adjusted FFO per share, is a non-GAAP ratio that is calculated by dividing adjusted funds flow provided by operations by the weighted average number of basic and diluted shares outstanding. Parex presents basic and diluted adjusted funds flow provided by operations excluding non-recurring transaction-related costs and realized (gains) losses on commodity risk management contracts per share whereby per share amounts are calculated using weighted-average shares outstanding, consistent with the calculation of earnings per share. The Company considers basic adjusted funds flow provided by operations per share or FFO per share to be a key measure as it demonstrates Parex’s profitability after all cash costs relative to the weighted average number of basic and diluted shares outstanding excluding items that may not reflect ongoing operating performance, relative to current commodity prices.
Adjusted funds flow provided by operations netback per boe or adjusted FFO netback per boe, is a non-GAAP ratio calculated as funds flow provided by operations before changes in non-cash assets and liabilities, adjusted to exclude non-recurring transaction-related costs and realized (gains) losses on commodity risk management contracts, divided by produced oil and natural gas sales volumes before consumption. The Company considers adjusted FFO netback per boe to be a key measure as it demonstrates Parex’s profitability after cash costs, excluding items that may not reflect ongoing operating performance, relative to current commodity prices.
Capital Management Measures
Funds flow provided by operations or FFO, is a capital management measure that includes all cash generated from operating activities and is calculated before changes in non-cash assets and liabilities. The Company considers funds flow provided by operations to be a key measure as it demonstrates Parex’s profitability after all cash costs.
Adjusted funds flow provided by operations or adjusted FFO, is a capital management measure calculated as funds flow provided by operations, adjusted to exclude non-recurring transaction-related costs and realized (gains) losses on commodity risk management contracts. The Company considers adjusted funds flow provided by operations to be a key measure as it demonstrates Parex’s profitability after cash costs, excluding items that may not reflect ongoing operating performance.
A reconciliation from cash provided by operating activities to funds flow provided by operations and adjusted funds flow provided by operations is as follows:
| For the three months ended | For the nine months ended | |||||||||||
| Sep. 30, | Sep. 30, | Jun. 30, | Sep. 30, | |||||||||
| ($000s) | 2026 | 2025 | 2026 | 2026 | ||||||||
| Cash provided by operating activities | $ | 138,228 | $ | 86,992 | $ | 199,235 | $ | 361,549 | ||||
| Net change in non-cash assets and liabilities | 58,113 | 18,306 | (67,181 | ) | 80,548 | |||||||
| Funds flow provided by operations | $ | 196,341 | $ | 105,298 | $ | 132,054 | $ | 442,097 | ||||
| Transaction costs | — | — | 28,390 | 29,000 | ||||||||
| Realized loss on commodity risk management contracts | — | 3,193 | 30,711 | — | ||||||||
| Adjusted funds flow provided by operations | $ | 196,341 | $ | 108,491 | $ | 191,155 | $ | 471,097 | ||||
Working capital (deficit), is a capital management measure which the Company uses to describe its liquidity position and ability to meet its short-term liabilities. Working capital (deficit) is defined as current assets less current liabilities.
| For the three months ended | |||||||||||
| Sep. 30, | Sep. 30, | Jun. 30, | |||||||||
| ($000s) | 2026 | 2025 | 2026 | ||||||||
| Current assets | $ | 689,676 | $ | 224,109 | $ | 602,247 | |||||
| Current liabilities | 725,652 | 227,276 | 685,469 | ||||||||
| Working capital (deficit) | $ | (35,976 | ) | $ | (3,167 | ) | $ | (83,222 | ) | ||
Net debt, is a capital management measure which the Company uses to monitor leverage and manage capital. Net debt is defined as working capital, less bank debt, unsecured notes and long-term customer prepayments:
| For the three months ended | ||||||||
| Sep. 30, | Sep. 30, | Jun. 30, | ||||||
| ($000s) | 2026 | 2025 | 2026 | |||||
| Working capital deficit | $ | 35,976 | $ | 3,167 | $ | 83,222 | ||
| Bank debt | 82,499 | 10,000 | — | |||||
| Unsecured notes | 792,889 | — | 792,265 | |||||
| Customer prepayments – long-term | — | — | 31,111 | |||||
| Net debt | $ | 911,364 | $ | 13,167 | $ | 906,598 | ||
Supplementary Financial Measures
“Dividends paid per share” is comprised of dividends declared, as determined in accordance with IFRS, divided by the number of shares outstanding at the dividend record date.
“Net revenue per boe” is comprised of net revenue, as determined in accordance with IFRS, divided by the total equivalent produced oil and gas sales volumes before consumption.
“Oil and natural gas sales price per boe” is comprised of total commodity sales from oil and natural gas production, as determined in accordance with IFRS, divided by the total equivalent produced oil and gas sales volumes before consumption.
“Oil and natural gas sales price, net of purchased crude oil per boe” is comprised of total commodity sales from oil and natural gas production less purchased crude oil, as determined in accordance with IFRS, divided by the total oil and natural gas sales volumes including purchased oil volumes.
“Production expense per boe” is comprised of production expense, as determined in accordance with IFRS, divided by the total equivalent produced oil and gas sales volumes before consumption.
“Purchased crude oil per boe” is comprised of purchased crude oil expense, as determined in accordance with IFRS, divided by the total equivalent produced oil and gas sales volumes before consumption.
“Royalties per boe” is comprised of royalties, as determined in accordance with IFRS, divided by the total equivalent produced oil and gas sales volumes before consumption.
“Transportation expense per boe” is comprised of transportation expense, as determined in accordance with IFRS, divided by the total equivalent produced oil and gas sales volumes before consumption.
Distribution Advisory
The Company’s future shareholder distributions, including but not limited to the payment of dividends and the acquisition by the Company of its shares pursuant to a normal course issuer bid, if any, and the level thereof are uncertain. Any decision to pay further dividends on the common shares (including the actual amount, the declaration date, the record date and the payment date in connection therewith and any special dividends) or acquire shares of the Company will be subject to the discretion of the Board of Directors of Parex and may depend on a variety of factors, including, without limitation the Company’s business performance, financial condition, financial requirements, growth plans, expected capital requirements and other conditions existing at such future time including, without limitation, contractual restrictions and satisfaction of the solvency tests imposed on the Company under applicable corporate law. Further, the actual amount, the declaration date, the record date and the payment date of any dividend are subject to the discretion of the Board. There can be no assurance that the Company will pay dividends or repurchase any shares of the Company in the future.
Advisory on Forward-Looking Statements
Certain information regarding Parex set forth in this document contains forward-looking statements that involve substantial known and unknown risks and uncertainties. The use of any of the words “plan”, “expect”, “continue”, “believe”, “should”, “anticipate”, “estimate”, “guidance”, “potential”, “position”, “target”, “pending” or other similar words, or statements that certain events or conditions “may” or “will” occur are intended to identify forward-looking statements. Such statements represent Parex’s internal projections, estimates or beliefs concerning, among other things, future growth, results of operations, production, future capital and other expenditures (including the amount, nature and sources of funding thereof), competitive advantages, plans for and results of drilling activity, environmental matters, business prospects and opportunities. These statements are only predictions and actual events or results may differ materially. Although the Company’s management believes that the expectations reflected in the forward-looking statements are reasonable, it cannot guarantee future results, levels of activity, performance or achievement since such expectations are inherently subject to significant business, economic, competitive, political and social uncertainties and contingencies. Many factors could cause Parex’s actual results to differ materially from those expressed or implied in any forward-looking statements made by, or on behalf of, Parex.
In particular, forward-looking statements contained in this document include, but are not limited to: statements with respect to the Company’s operational and financial position; the Company’s plans, strategy and focus; the potential of LLA-111 becoming one of Parex’s most significant discoveries in recent history; the Company’s positioning to build on this year’s growth and deliver on longer-term growth ambitions; the Company’s updated H2 2026 guidance, including anticipated Brent crude oil average price, average production, funds flow provided by operations netback, funds flow provided by operations, capital expenditures and free funds flow; the Company’s anticipated activities at certain of its locations, including the anticipated timing thereof; the Company’s updated FY 2026 guidance, including its average production and expected capital expenditures; the Company’s expected development, exploration and production plans as well as the anticipated benefits derived therefrom and timing thereof, including in connection with the Frontera assets and assets in the Magdalena Basin, Eastern Llanos (LLA-111), Lower Magdalena (including La Belleza), and the Llanos Foothills (including Piedemonte and Farallones); the anticipated terms of the Company’s Q4 2026 regular quarterly dividend, including its expectation that it will be designated as an “eligible dividend”. In addition, statements relating to “reserves” are by their nature forward-looking statements, as they involve the implied assessment, based on certain estimates and assumptions that the reserves described can be profitably produced in the future. The recovery and reserve estimates of Parex’s reserves provided herein are estimates only and there is no guarantee that the estimated reserves will be recovered.
These forward-looking statements are subject to numerous risks and uncertainties, including but not limited to, the impact of general economic conditions in Canada and Colombia; determinations by OPEC and other countries as to production levels; volatility in commodity prices; industry conditions including changes in laws and regulations including adoption of new environmental laws and regulations, and changes in how they are interpreted and enforced, in Canada and Colombia; competition; the risk that the Frontera assets and Magdalena, Eastern Llanos and Llanos Foothills assets may not yield their expected benefits; the risk that Parex’s FY 2026 average production may be less than anticipated; the risk that Parex’s H2 2026 average production may be less than anticipated; lack of availability of qualified personnel; the results and timelines of exploration and development drilling, test, monitoring and work programs and related activities; obtaining required approvals of regulatory authorities, in Canada and Colombia; risks associated with negotiating with foreign governments as well as country risk associated with conducting international activities; the risk that tariffs, taxes, restrictions or prohibitions on import or export of certain goods including oil and gas may have on the Company, the oil and gas industry or the global economy; volatility in market prices for oil; fluctuations in foreign exchange or interest rates; environmental risks; changes in income tax laws or changes in tax laws and incentive programs relating to the oil industry; changes to pipeline capacity; ability to access sufficient capital from internal and external sources; risk that Parex’s evaluation of its existing portfolio of development and exploration opportunities is not consistent with its expectations; that production test results may not necessarily be indicative of long term performance or of ultimate recovery; the risk that Parex may not commence exploration activities in the Llanos Foothills, Lower Magdalena, Eastern Llanos or the Magdalena Basin areas when anticipated, or at all; the risk that Parex’s financial and operating results may not be consistent with its expectations; the risk that Parex may not have sufficient financial resources in the future to provide distributions to its shareholders; the risk that the Board may not declare dividends in the future or that Parex’s dividend policy changes; and other factors, many of which are beyond the control of the Company.
Readers are cautioned that the foregoing list of factors is not exhaustive. Additional information on these and other factors that could affect Parex’s operations and financial results are included in reports on file with Canadian securities regulatory authorities and may be accessed through the SEDAR+ website (www.sedarplus.ca).
Although the forward-looking statements contained in this press release are based upon assumptions which Management believes to be reasonable, the Company cannot assure investors that actual results will be consistent with these forward-looking statements. With respect to forward-looking statements contained in this document, Parex has made assumptions regarding, among other things: current and anticipated commodity prices and royalty regimes; availability of skilled labour; timing and amount of capital expenditures; future exchange rates; the price of oil, including the anticipated Brent oil price; the impact of increasing competition; conditions in general economic and financial markets; availability of drilling and related equipment; effects of regulation by governmental agencies; receipt of partner, regulatory and community approvals; royalty rates; future operating costs; uninterrupted access to areas of Parex’s operations and infrastructure; recoverability of reserves and future production rates; the status of litigation; timing of drilling and completion of wells; on-stream timing of production from successful exploration wells; operational performance of non-operated producing fields; pipeline capacity; that Parex will have sufficient cash flow, debt or equity sources or other financial resources required to fund its capital and operating expenditures and requirements as needed; that Parex’s conduct and results of operations will be consistent with its expectations; that Parex will have the ability to develop its oil and gas properties in the manner currently contemplated; that Parex’s evaluation of its existing portfolio of development and exploration opportunities is consistent with its expectations; current or, where applicable, proposed industry conditions, laws and regulations will continue in effect or as anticipated as described herein; that the estimates of Parex’s production and reserves volumes and the assumptions related thereto (including commodity prices and development costs) are accurate in all material respects; that Parex will be able to obtain contract extensions or fulfill the contractual obligations required to retain its rights to explore, develop and exploit any of its undeveloped properties; that Parex will have sufficient financial resources to pay dividends and acquire shares pursuant to its normal course issuer bids in the future; that Parex is able to execute its plans with respect to the Company’s drilling program and related activities as disclosed herein; and other matters.
This press release contains information that may be considered a financial outlook under applicable securities laws about the Company’s potential financial position, including, but not limited to: the Company’s 2026 guidance, including anticipated funds flow provided by operations netback, funds flow provided by operations, capital expenditures and free funds flow; and the anticipated terms of the Company’s Q4 2026 regular quarterly dividend including its expectation that it will be designated as an “eligible dividend”. Such financial outlook has been prepared by Parex’s management to provide an outlook of the Company’s activities and results. The financial outlook has been prepared based on a number of assumptions including the assumptions discussed above and assumptions with respect to the costs and expenditures to be incurred by the Company, including capital equipment and operating costs, foreign exchange rates, taxation rates for the Company, general and administrative expenses and the prices to be paid for the Company’s production.
Management does not have firm commitments for all of the costs, expenditures, prices or other financial assumptions used to prepare the financial outlook or assurance that such operating results will be achieved and, accordingly, the complete financial effects of all of those costs, expenditures, prices and operating results are not objectively determinable. The actual results of operations of the Company and the resulting financial results will likely vary from the amounts set forth in the analysis presented in this press release, and such variations may be material. The Company and Management believe that the financial outlook has been prepared on a reasonable basis, reflecting the best estimates and judgments, and represent, to the best of Management’s knowledge, Parex’s expected expenditures and results of operations. However, because this information is highly subjective and subject to numerous risks including the risks discussed above, it should not be relied on as necessarily indicative of future results. Except as required by applicable securities laws, the Company undertakes no obligation to update such financial outlook. The financial outlook contained in this press release was made as of the date of this press release and was provided for the purpose of providing further information about the Company’s potential future business operations. Readers are cautioned that the financial outlook contained in this press release is not conclusive and is subject to change.
The following abbreviations used in this press release have the meanings set forth below:
| bbl | one barrel |
| bbl/d | barrels per day |
| boe | barrels of oil equivalent of natural gas; one barrel of oil or natural gas liquids for six thousand cubic feet of natural gas |
| boe/d | barrels of oil equivalent of natural gas per day |
| mcf | thousand cubic feet |
| mcf/d | thousand cubic feet per day |
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