Northern Oil and Gas, Inc. Q1 FY2026 earnings call

Key points: Business activity stable. Potential 2026 activity changes TBD due to Iran war effect on AFE. Higher long-dated pricing may drive sustained activity. Reversal of curtailments in Williston boosts capital efficiency. Ground game had 41 deals in Q1. Geopolitical storm impacts oil differentials positively and gas negatively in Permian. Leasing program added over 70 net locations. Longer-gated strip improvements drive growth. Backlog improved in size and quality.

First quarter total average daily production was over 148,000 BOE per day, up 6% sequentially, a record for the company. Oil to gas ratio was 50-50. Natural gas realizations were weak in Q1, 72% of benchmark prices in Permian due to limited takeaway, but insulated by basis hedges. CapEx in the quarter was $270 million, balanced across regions. Gap net income impacted by non-cash mark-to-market loss on derivatives and impairment charge. If oil prices stay current, impairment charge may be last for year.

No updates to 2026 guidance given commodity price volatility. Currently trending towards higher end of low activity scenario laid out last quarter. Anticipate tightening ranges and narrowing guidance by second quarter call.

Risks include commodity price volatility, geopolitical factors like Iran war affecting AFE activity, potential for further asset impairments if oil prices fluctuate unfavorably.

Q: Morning, guys, for all the details. Nick, my first question is just on incremental activity...

A: yeah um thanks neil good morning um i'd say this one um you know when you think about our original guidance...

Q: Hey, good morning, and thanks for taking my question. So from the previous quarter, you guys kind of beat on natural gas pricing...

A: Yeah. Yeah. Well, as a two stream reporter, it's a little bit different, right? Because our NGL yields in there...

Q: Thank you. Good morning, everyone. Thanks for taking the call. I just wanted to quickly touch on you guys' hedge book...

A: Yeah. I don't think that you'll see much in terms of fireworks, in terms of the swaps. We don't really have that many swaps remaining this year...

Q: Hi, good morning. You know, I was wondering, and it's definitely interesting to hear about the different parties, the private side coming to the table and so forth...

A: Yeah. No, I don't know if I want to speak for them completely. I would say this, that Adam had talked extensively last year about that he thought that post a lot of this consolidation, we would see rationalization...

Q: Hey, thanks for the time. I just wanted to follow up on the earlier question about the oil swaptions and just ask about some of the accounting nuances for those swaptions...

A: yeah that's because of the that's because of the expiry right just as you just as you stated phillips right we have to because of when that expiry is being um in some instances or most instances 12 31 20 26 it's got to sit into the current the current the current bucket there