Paramount Resources Announces Third Quarter 2025 Results, Sanctioning of Sinclair Montney Development, 2026 Budget and Production Outlook

Executive Summary

• Paramount Resources reported Q3 2025 sales volumes of 36,087 Boe/d (48% liquids), exceeding prior guidance by ~5,000 Boe/d, driven by strong runtime at the new Alhambra Plant.
• The Company sanctioned its Sinclair Montney gas development, targeting >50,000 Boe/d plateau rate and ordering long‑lead items for a 400 MMcf/d processing plant with 24 net wells slated for start‑up.
• 2025 production guidance was raised to 41,000–42,000 Boe/d (midpoint) and capital spend narrowed to $795–$825 million; 2026 capex budget set at $1.05–$1.15 billion with major allocations to Willesden Green Alhambra Phase‑2 ($360 M) and Sinclair Montney ($360 M).
• Free cash flow was negative ($117 M) while cash from operations was $42 M; net cash position stood at ~$629 M after a $296 M NuVista share sale.

Key Details

• Q3 2025 Operating Highlights
• Sales volumes: 36,087 Boe/d (48% liquids); Central Alberta 13,550 Boe/d, Kaybob 21,155 Boe/d.
• Cash from operating activities: $42 M ($0.30 per basic share).
• Adjusted funds flow: $97 M ($0.67 per basic share).
• Free cash flow: –$117 M (–$0.82 per basic share).
• Operating expense: $10.18/Boe (down from $12.39/Boe Q2).

• Capital expenditures: $207 M (Willesden Green Alhambra Phase‑1 start‑up, drilling/completion of 9 net wells; Kaybob North Duvernay 5 net wells on production).

• Sanctioning Sinclair Montney Development

• Plateau design >50,000 Boe/d sales gas for ≥20 years.
• Sinclair Plant capacity: up to 400 MMcf/d raw gas; long‑lead items ordered.
• Firm service sales contracted: 335 MMcf/d commencing Q4 2027.

• Planned well inventory: 24 net wells ready at start‑up.

• Guidance Updates

• 2025 Production (midpoint) – 41,000–42,000 Boe/d (47% liquids).
• 2025 Capital Expenditure – $795–$825 M (narrowed range).
• 2026 Capital Expenditure – $1.05–$1.15 B; allocation: Willesden Green Alhambra Phase‑2 $360 M, Sinclair Montney $360 M, Kaybob $65 M, Northeast Alberta Heavy Oil $20 M, Other $25 M.

• 2026 Production Outlook – 45,000–50,000 Boe/d (≈50% liquids).

• Long‑Term Production Outlook

• Target >100,000 Boe/d by end‑2027 (35% liquids).

• 2027 average: 60,000–65,000 Boe/d; year‑end exit >100,000 Boe/d.

• Financial Position

• Net cash (including NuVista proceeds): $629 M as of Sep 30 2025.
• Revolving credit facility ($500 M) undrawn.

• NuVista share sale: 18.5 M shares for $296 M cash; investment carrying value pre‑sale $317 M.

• Dividend

• Board declared cash dividend of $0.05 per Class A common share payable Nov 28, 2025 (eligible dividend).

• Hedging

• Oil: 10,000 Bbl/d WTI swaps at CAD $105/Bbl (Nov‑Dec 2025).

• Natural gas: 10,000 MMBtu/d Citygate/​Malin swap (sell at Citygate‑$0.97/MMBtu, buy Malin) through Oct 2028.

• Other Notable Items

• $5 M insurance claim settlement for 2023 Alberta wildfire losses recognized in Q3 revenue.
• $4 M asset retirement obligations settled in Q3.
• Water‑recycling system construction at Willesden Green commenced; expected operational H1 2026, reducing future water‑related capex and OPEX.

Notable Quotes

• “Our third‑quarter performance reflects the successful ramp‑up of the Alhambra Plant and validates our strategic focus on high‑value gas assets,” – Jim Riddell, President & CEO.
• “Sanctioning Sinclair Montney positions us to deliver a low‑cost, long‑life natural gas supply that will be a cornerstone of our growth through 2027,” – Rodrigo Sousa, EVP Corporate Development & Planning.