Ovintiv Inc. Q4 FY2025 earnings call

• Brendan McCracken discussed the completion of portfolio transformation with NuVista acquisition and Anadarko sale, resulting in a focused portfolio in Permian and Montney, achievement of debt target, and new shareholder return framework. • Corey Code talked about 2025 results showing execution excellence, free cash flow, debt reduction, and 2026 guidance including production volumes and capital investment. • Gregory Givens detailed Permian and Montney asset level development programs, including Permian's use of surfactants, real-time frac optimization, and Montney's integration of NuVista assets, well cost savings, and production plans.

In 2025, full year cash flow was $3.8 billion, free cash flow was over $1.6 billion with over $600 million returned to shareholders. Fourth quarter oil and condensate volumes averaged ~209,000 barrels per day, capital investment was $465 million. For 2026, the program includes oil and condensate run rates of ~120,000 barrels per day in Permian and ~85,000 barrels per day in Montney, total production volumes of 620,000 - 645,000 BOE per day with ~$2.3 billion capital investment. Permian has high productivity and low cost, with use of surfactants and real-time frac optimization improving performance. Montney has added depth and quality with NuVista assets, aiming for well cost savings and focus on different areas of acreage.

• 2026 plan to return at least 75% of free cash flows to shareholders, with longer term range 50% - 100%. • 2026 production volumes expected to be 620,000 - 645,000 BOE per day with ~$2.3 billion capital investment. • First quarter production expected to average ~670,000 BOE per day, capital spend highest in first quarter at ~$625 million. • Montney production in second quarter expected to be at lower end of 83,000 - 87,000 barrels per day range due to planned plant turnarounds.

• Montney production in second quarter could be impacted by planned plant turnarounds. • Commodity price volatility could affect the shareholder return framework and capital allocation. • Integration of new assets may face unforeseen challenges that could impact operations and cost savings.

Q: Elaborate on change to shareholder returns program in '26 and thoughts on post-2026 mix.

A: Brendan McCracken explained the shift to upper end of range this year due to equity value, and longer term range is to be flexible with commodity prices.

Q: Unpack surfactants program details.

A: Brendan and Greg discussed surfactants used in Permian completions to improve oil recoveries, focus on initial completions, and ongoing development.

Q: Talk about opportunity with in-basin sand.

A: Greg discussed in-basin sand use in Permian and Montney, with Permian at 100% local wet sand and Montney shifting to domestic sand.

Q: Compare NuVista versus Paramount acquisitions.

A: Greg talked about similar integration process but NuVista filling in jigsaw piece with quicker integration and strong results.

Q: Question on asset duration and free cash flow.

A: Brendan explained it's based on sustaining production and reoccupation strategy derisking inventory duration.

Q: On 15, 16 pads in Montney.

A: Greg discussed sequencing of completions and plans to apply design to other areas.

Q: On Montney plant turnarounds.

A: Greg explained normal plant turnarounds, impact on production, and efforts to minimize impact.

Q: On Permian lateral length and CapEx.

A: Greg explained efficiency gains on well costs and level-loaded program.

Q: On Montney surfactant use.

A: Greg discussed early stages of surfactant use in Montney with cross-border learnings.

Q: On Barnett, Woodford prospectivity.

A: Greg talked about rights on Permian acreage and plans to test.

Q: On LNG Canada ramping up.

A: Brendan talked about cautious view on AECO and interest in diversifying gas markets.

Q: On growth opportunity.

A: Brendan explained current maintenance mode due to market not begging for volumes and better cash flow per share from buybacks.

Q: On inventory and capital allocation.

A: Brendan talked about ground game adding low-cost inventory and balanced capital allocation.

Q: On innovation from NuVista teams.

A: Greg talked about learnings from NuVista on gas lift designs and landing zones applicable to existing assets