Q2 FY2026
Filed Aug 5, 2026Greenfire Resources Reports Second Quarter 2026 Results and Closes Acquisition of Connacher Oil and Gas Limited
Q2 2026 generated $21,913 ($ thousands) of adjusted funds flow and $35,573 ($ thousands) of cash provided by operating activities, but production, operating netback and adjusted funds flow were lower than both comparison periods shown. Capital expenditures of $56,662 ($ thousands) produced an adjusted free cash flow deficit of $(34,749) ($ thousands), while the Connacher acquisition added substantial new financing and rights-offering execution requirements.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| WTIother | US$92.79 / bbl | – | – |
| WCS Hardisty differential to WTIother | (US$14.66) / bbl | – | – |
| WCS Hardistyother | C$108.10 / bbl | – | – |
| Average FX Rateother | 1.3836 (C$ / US$) | – | – |
| Bitumen productionother | 13,607 bbls/d | – | – |
| Oil salesother | 179,408 ($ thousands) | – | – |
| Royaltiesother | (7,941) ($ thousands) | – | – |
| Realized gains (losses) on risk managementother | (39,867) ($ thousands) | – | – |
| Diluent expenseother | (69,635) ($ thousands) | – | – |
| Transportation and marketingother | (11,578) ($ thousands) | – | – |
| Operating expensesother | (21,154) ($ thousands) | – | – |
| Gross profit (loss)other | 73,021 ($ thousands) | – | – |
| Depletionother | 19,349 ($ thousands) | – | – |
| Gain (loss) on risk management contractsother | (23,270) ($ thousands) | – | – |
| Operating netback, excluding realized gain (loss) on risk management contractsnon-GAAP | 69,100 ($ thousands) | – | – |
| Operating netbacknon-GAAP | 29,233 ($ thousands) | – | – |
| Operating netbacknon-GAAP | $23.46/bbl | – | – |
| Net income (loss) and comprehensive income (loss)other | 53,462 ($ thousands) | – | – |
| Cash provided by operating activitiesother | 35,573 ($ thousands) | – | – |
| Adjusted funds flownon-GAAP | 21,913 ($ thousands) | – | – |
| Capital expendituresother | (56,662) ($ thousands) | – | – |
| Adjusted free cash flow (deficit)non-GAAP | (34,749) ($ thousands) | – | – |
| Common sharesother | 125,429 (’000 of shares) | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Expansion AssetProduction in Q2 2026 averaged 7,818 bbls/d, primarily due to the previously disclosed planned turnaround that was successfully and safely completed in May 2026. | not reported | 11% decrease from the prior quarter | – |
| Demo AssetProduction in Q2 2026 was 5,789 bbls/d, primarily due to base production declines. | not reported | 3% decrease from the previous quarter | – |
full-year 2026 outlook
- NoteProduction: 21,500 – 23,500 bbls/d
- Note2026 capital budget: $250 million
- NoteCurrent production, inclusive of the Acquisition: approximately 34,000 bbls/d
- NotePad 7 first steam injection: anticipated in Q3 2026
- NotePad 7 first oil: expected in Q4 2026
- NotePad 5SE first oil: anticipated in Q2 2027
- NotePad 8 drilling: expected to commence in Q3 2026
- NotePad 8 first oil: targeted for Q3 2027
- NoteGreat Divide annual cash flow synergies: $30 million by year-end 2026
What drove it
- WCS Hardisty was C$108.10 / bbl in Q2 2026, compared with C$74.00 / bbl in Q2 2025 and C$79.24 / bbl in Q1 2026.
- Gross profit (loss) was 73,021 ($ thousands), compared with 55,829 ($ thousands) in Q2 2025 and (80,660) ($ thousands) in Q1 2026.
- The Q2 2026 operating netback included realized losses on risk management of (39,867) ($ thousands).
- Operating expenses were (21,154) ($ thousands), compared with (31,823) ($ thousands) in Q2 2025 and (35,747) ($ thousands) in Q1 2026.
- Capital expenditures totaled $56.7 million, with the majority allocated to development of Pad 7.
- Drilling of all 14 well pairs at Pad 7 was successfully completed in Q2 2026.
Concerns
- Bitumen production was 13,607 bbls/d, compared with 15,748 bbls/d in Q2 2025 and 14,719 bbls/d in Q1 2026.
- Adjusted funds flow was 21,913 ($ thousands), compared with 33,843 ($ thousands) in Q2 2025 and 24,539 ($ thousands) in Q1 2026.
- Adjusted free cash flow was a deficit of (34,749) ($ thousands).
- The Company intends to repay the $575 million Bridge Facility with proceeds from an anticipated rights offering, whose subscription ratio, subscription price, record date, and other terms have not been determined.
- The Company identified integration of Connacher's business and operations and realization of anticipated synergies as risks.
What to watch
- First steam injection at Pad 7 anticipated in Q3 2026 and first oil expected in Q4 2026.
- Drilling at Pad 5SE commenced in Q3 2026, with first oil anticipated in Q2 2027.
- Pad 8 drilling is expected to commence in Q3 2026, with first oil targeted for Q3 2027.
- Implementation of Greenfire's action plan to achieve $30 million of annual cash flow synergies at Great Divide by year-end 2026.
- The amended and restated prospectus and terms of the rights offering intended to repay the Bridge Facility.
- Full-year 2026 production guidance of 21,500 – 23,500 bbls/d and the increased 2026 capital budget of $250 million.
Balance sheet and cash flow
- Cash at June 30, 2026: 2,962 ($ thousands); December 31, 2025: 41,974 ($ thousands); March 31, 2026: 544 ($ thousands).
- Face value of long-term debt at June 30, 2026: (26,500) ($ thousands); December 31, 2025: -; March 31, 2026: (4,148) ($ thousands).
- Net surplus (debt) at June 30, 2026: (13,509) ($ thousands); December 31, 2025: 49,746 ($ thousands); March 31, 2026: 21,742 ($ thousands).
- Undrawn Senior Credit Facility capacity at June 30, 2026: 248,500 ($ thousands); December 31, 2025: 275,000 ($ thousands); March 31, 2026: 270,852 ($ thousands).
- Available funding at June 30, 2026: 261,491 ($ thousands); December 31, 2025: 324,746 ($ thousands); March 31, 2026: 296,742 ($ thousands).
- Working capital surplus (deficit) at June 30, 2026: (4,962) ($ thousands); December 31, 2025: 53,358 ($ thousands); March 31, 2026: (57,958) ($ thousands).
- On August 5, 2026, the borrowing base under the Senior Credit Facility was upsized to $1.0 billion and the Company was fully drawn on its $575 million Bridge Facility.
- The Acquisition was financed with a draw on the $1.0 billion Senior Credit Facility and a $575 million Bridge Facility.
Analysis
Greenfire reported Q2 2026 bitumen production of 13,607 bbls/d, versus 15,748 bbls/d in Q2 2025 and 14,719 bbls/d in Q1 2026. The Expansion Asset averaged 7,818 bbls/d, an 11% decrease from the prior quarter due primarily to a planned turnaround completed in May 2026. Demo Asset production was 5,789 bbls/d, a 3% decrease from the prior quarter attributed primarily to base production declines.
Commodity pricing was materially higher in the reported quarter, with WTI at US$92.79 / bbl and WCS Hardisty at C$108.10 / bbl. Oil sales were 179,408 ($ thousands), while gross profit was 73,021 ($ thousands), compared with 55,829 ($ thousands) in Q2 2025 and a gross loss of (80,660) ($ thousands) in Q1 2026. Operating netback was 29,233 ($ thousands), or $23.46/bbl, with realized losses on risk management of (39,867) ($ thousands) constraining the realized result.
Cash provided by operating activities was 35,573 ($ thousands), and adjusted funds flow was 21,913 ($ thousands). Capital expenditures of (56,662) ($ thousands), primarily directed to Pad 7, resulted in an adjusted free cash flow deficit of (34,749) ($ thousands). Pad 7 drilling was completed during Q2, with first steam injection anticipated in Q3 2026 and first oil expected in Q4 2026.
The Company closed the Connacher acquisition and increased its 2026 capital budget from $210 million to $250 million. Financing included the Senior Credit Facility and a $575 million Bridge Facility. On August 5, 2026, the Senior Credit Facility borrowing base was upsized to $1.0 billion and the Company was fully drawn on the Bridge Facility. Greenfire intends to use an anticipated rights offering to repay the Bridge Facility, supported by a standby commitment of at least $575 million from Waterous Energy Fund.
Updated guidance calls for full-year 2026 production of 21,500 – 23,500 bbls/d, while current production inclusive of the acquisition is approximately 34,000 bbls/d. Near-term execution centers on safely integrating Great Divide, developing infill wells at Pod One and Algar, advancing Pad 7, Pad 5SE and Pad 8, and delivering $30 million of annual cash flow synergies by year-end 2026.
Not in the filing
stated, not guessed- Total revenue
- GAAP or IFRS earnings per share
- Non-GAAP earnings per share
- Total debt carrying value
- Dividend amount
- Share repurchases
- Revenue guidance
- Gross margin guidance
- Operating expense guidance
- Tax-rate guidance
- Prior-period outlook for comparison
AlphAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.