Northern Oil and Gas, Inc. Q4 FY2025 earnings call

• Nick provided introductory remarks, reflecting on 2025, discussing 2026 plans, and sharing views on the macro oil and gas environment. Adjusted EBITDA was up 1% in 2025 despite oil prices down 14% on average. Natural gas spending increased and oil spending declined. 2025 ground game focused on long - term development. In 2026, ground game execution will pivot from leasing to drill - ready projects. - Adam reviewed Q4 operational details, noting Q4 came in line with expectations with activity ramping exiting the year. Added 24.2 net wells to production, wells in process draw down 7.8 net wells, finishing the year with 45.6 net wells. Appalachia was top - performing basin. 2026 activity levels expected to be roughly split with Permian at 40%, Appalachia at 25%, Williston at 25%, and Uinta at 10%. Mentioned engaged in M&A, with integrated upstream and midstream Utica transaction closed and excited about fifth major joint acquisition. - Chad reviewed financial results, noting Q4 adjusted EBIT was $367 million and free cash flow was $43 million. Year - total adjusted EBIT was $1.63 billion with free cash flow of $424 million. Adjusted net income in Q4 was $82 million or $0.83 per diluted share. Discussed accounting method evaluation for more comparability with peers, and recent actions to enhance liquidity and maturity wall like extending revolver maturity, upsizing borrowing base, issuing notes, and redeeming notes.

In Q4 2025, adjusted EBITDA was $367 million and free cash flow was $43 million. For the year, adjusted EBIT was $1.63 billion with free cash flow of $424 million. Fourth quarter total average daily production was 140,000 BOE per day, up 7% from Q3 2025 and 6% vs Q4 2024. Year - total average daily production was 135,000 BOE per day, up 9% vs 2024. Q4 oil production increased 3% sequentially but was 5% lower year over year. Gas production in Q4 was 392 MMCF per day, up 11% sequentially and 24% vs Q4 2024. For full year 2025, oil production was 75,646 barrels per day and gas production was 356 MMCF per day. Oil differentials in Q4 averaged $5.05 per barrel vs $3.89 in Q3. Natural gas realizations in Q4 were 58% of benchmark prices vs 79% in 2024. Lease operating costs per BOE in Q4 were $9.30, improved by 5% q - q and 3% y - y. CapEx in Q4, excluding non - budgeted acquisitions and other, was $270 million, with 44% to Permian, 26% to Williston, 8% to Uinta, and 22% to Appalachian Basin. Total capex to 2025 was $1 billion, inclusive of $174 million of ground game investment.

Providing two ranges for 2026: low activity environment where some reduction in oil volumes but much more dramatic reduction in spending, generating substantially larger free cash flow at today's strip while deferring high value development; high activity environment where some acceleration of activity, reduction in curtailment, and higher till count, with free cash flow lower at today's prices but driving higher future production. Activity levels for 2026 expected to be roughly split with Permian at 40%, 25% to Appalachia, 25% to Williston, and 10% to Uinta. Spending forecasted to be a bit more front - end loaded with a 60 - 40 split.

Risks include matters described in earnings release and SEC filings, such as those related to commodity pricing, operator behavior, and market uncertainties that could cause actual results to differ from forward - looking statements. Also, the non - cash impairment charges dictated by weaker oil prices year over year, and the uncertainty in predicting operator behavior and the timing of activity changes.

Q: Neil Dingman asked about when the consented but not spud wells will be drilled and completed.

A: Nick and Adam responded that it's dictated by commodity pricing, especially oil, and historical examples like 2020 were mentioned.

Q: Charles Mead asked how to know if tracking low or high activity scenario.

A: Nick said onus is on them to communicate throughout the year, and it's affected by ground game activity and curtailments.

Q: Question about Appalachia's performance in 1Q and with joint Infinity assets.

A: Adam gave an overview that performance has been strong, but completions expected in April.

Q: Scott Hanold asked about uncertainty in high and low cases between private and public operators.

A: Nick said it's still reasonable to have two cases now, and there's alignment with operators but timing is needed for clarity.

Q: Noah Hungness asked to quantify EBITDA or free cash flow upside from coiled spring and CapEx in low vs high activity scenarios.

A: Nick said there's about $100 to $150 million upside with $5 a barrel change, and about 150 to 200 million between the two in CapEx related to ground game spend vs standard DNC