Tamarack Valley Energy Announces Strong Q4 2025 Results, Significant Growth in Clearwater Reserves and Operational Update

Executive Summary

• Tamarack Valley Energy reported Q4 2025 and full‑year 2025 results, delivering free funds flow of $390.1 M ($0.78 per share) – a 10% increase year‑over‑year despite a 14% drop in WTI prices.
• Proved developed producing (PDP) reserves grew 31% to 90 MMboe (185% replacement), with total proved + probable (TPP) reserves up 18% to 282 MMboe (274% replacement); recycle ratios improved to >5× and operating field netback reached $41.71/boe.
• The company announced a 2026 capital budget of $390‑$410 M, allocating ~45% to primary Clearwater development, 25% to Clearwater waterflood expansion, 20% to Charlie Lake, and 10% to de‑risk/exploration; production is forecast to rise 3% YoY to 69‑71 k boe/d with net operating expenses falling to ~$7/boe.

Key Details

• Production – Q4 2025 average: 68,635 boe/d (↑4% YoY); Clearwater contributed 50,049 boe/d (+16% YoY).
• Operating Costs – Net operating expense per boe fell 17% YoY due to water‑flood reinjection efficiencies and lower workover spend.
• Cash Flow – Q4 2025 cash from operations $175.6 M; adjusted funds flow $171.8 M; free funds flow $70.6 M ($0.14/share). Full‑year free funds flow $390.1 M ($0.78/share).
• Shareholder Returns – 36.2 M shares repurchased in 2025 for $185.3 M (≈$5.00 per share); total 2025 return to shareholders $262.3 M (~$0.52/share). Quarterly dividend of C$0.04 declared (payable 31 Mar 2026).
• Reserves Growth – PDP reserves +31% to 90 MMboe; TPP reserves +18% to 282 MMboe. Excluding acquisitions/dispositions, TPP grew 30% (413% replacement). Recycle ratios: PDP 5.15×, TP 5.21×, TPP 5.26×.
• Finding & Development Costs – $8.09/boe (PDP), $8.01/boe (TP), $7.93/boe (TPP).
• Capital Investments 2025 – $400 M total; Q4 2025 $99.3 M (24 Clearwater heavy‑oil wells, 6 injection wells). Capital spend down 11% YoY due to waterflood efficiency and pad drilling.
• Waterflood Expansion – End‑2025 water injection >40,000 bbl/d; target 60,000 bbl/d by end‑2026 with >35% of Clearwater oil under waterflood. 2026 waterflood budget $100 M (≈2× 2025).
• Land Holdings – Acquired two tuck‑in deals adding 145 net sections; total Clearwater land now >850 net sections (+25% YoY).
• Asset Dispositions – Sold non‑core Southern Penny & Eastern Alberta assets for $140 M cash; derecognized $55.3 M of AROs, reducing total AROs by $155.5 M since 2023.
• Charlie Lake Update – Q4 2025 production 17,610 boe/d (↑4% YoY); full‑year avg 17,071 boe/d. Operating netback $30.43/boe; free funds flow >$70 M. Drilled 4 net wells in Q4, brought on stream 3 net wells; 2025 total 15 net wells drilled, 18 net wells placed on production.
• 2026 Outlook – Capital budget $390‑$410 M; production target 69‑71 k boe/d; net operating expense $6.85‑$7.15/boe; free funds flow breakeven price ~US$35/barrel WTI. Expected production growth ≈3% YoY, with declining per‑barrel costs and expanded waterflood driving lower reinvestment ratios.
• Investor Call – Webcast scheduled for 9:30 AM MST (11:30 AM EST) on 25 Feb 2026 to discuss Q4 results and reserves.

Notable Quotes

“With a low‑cost structure, low corporate decline rate, and modest reinvestment needs, Tamarack is well positioned to continue delivering sustainable total returns for shareholders even in lower price environments.” – CEO Brian Schmidt

Materiality: Material – Positive (significant earnings growth, reserve additions, dividend declaration, and forward‑looking capital plan).