$NOG earnings report

This filing is a preliminary third-quarter operational update rather than a comprehensive earnings release. NOG reported a clean quarter with minimal field disruptions, and said all basins met internal expectations. Management linked incremental acceleration of development activity across oil basins to rallied oil strip prices, indicating a more active operating environment during the quarter.

Ground game activity remained active. NOG closed 19 deals that added approximately 1,060 net acres and 2.8 net wells, while deploying approximately $56.5 million in acquisition costs and associated development capital. The capital mix was concentrated in near-term production opportunities in oil-focused basins, with nearly 85% of capital deployed to the Permian, Williston, and Uinta basins.

Capital spending is the principal operating item disclosed for the period. Total booked third-quarter capital spending is estimated at $250.0 to $253.0 million, excluding non-budgeted acquisitions and other. The company said accelerated current and forward activity drove increased sequential capital spend. It expects expenditures to trend lower in the fourth quarter absent significant non-budgeted activity, while reiterating 2026 capital-expenditures guidance and expecting spending toward the higher end of that undisclosed range.

Hedging results are the major offset in the update. NOG expects third-quarter unrealized mark-to-market losses on derivatives of $300.0 to $320.0 million, driven by changes in the value of its derivatives portfolio. It also estimates realized hedge losses of $51.0 to $52.0 million, driven by crude oil hedges and partially offset by gas and basis hedges. The filing provides no revenue, profitability, production, cash-flow, or balance-sheet figures, so the ultimate earnings and cash-flow effect of these items cannot be assessed from this document.

Capital returns continued through both dividends and buybacks. NOG declared a $0.45 quarterly cash dividend on August 4, 2026, payable on October 30, 2026. It repurchased 667,989 shares for $16.0 million inclusive of commissions at an average price of $23.96 per share. Following a $150.0 million authorization increase in July 2026, remaining repurchase capacity was approximately $227.2 million after the quarter's repurchases. All third-quarter information in the release is preliminary and subject to final closing adjustments.

NOG reported $670.8 million of oil and natural gas sales, GAAP net income of $236.6 million, and Adjusted EBITDA of $401.0 million in the second quarter. Adjusted EBITDA increased 17% from the first quarter of 2026, which the company attributed primarily to a 13% improvement in realized commodity price per boe. Cash flow from operations was $321.6 million, while Free Cash Flow was $159.0 million, up 424% from the first quarter of 2026 and 26% from the second quarter of 2025.

Production reached 145,659 Boe per day, up 9% year over year, led by record natural gas production of 464,330 Mcf per day, up 35%. Oil production was 68,275 Bbls per day, down 11% from the prior-year quarter. NOG attributed the oil-volume shortfall to approximately 7,000 Boe per day of well shut-ins and 3 deferred Permian turn-in-lines during April, May and part of June. The shut-in wells are back online and the deferred turn-in-lines are expected in the third quarter.

Pricing improved materially before hedges. The unhedged net realized oil price was $90.02 per Bbl, up 54% from $58.37 per Bbl, while the average differential to WTI was ($3.03), a 43% improvement from the second quarter of 2025. Natural gas and NGLs averaged $2.64 per Mcf, down 9%, and management cited weak Waha pricing for pressure on natural gas realizations. Settled commodity derivatives reduced realized price on a Boe basis by $6.51, and realized hedge losses were $86.3 million.

Operating costs showed a mixed pattern. Production expenses were $9.59 per Boe, down 4% year over year, and DD&A was 14.55 per Boe, down 14%. Production taxes increased to $45.7 million from $35.6 million due to higher oil prices. G&A expenses rose to $24.5 million, or 1.85 per Boe, largely reflecting $7.7 million of Duvernay transaction costs. Adjusted cash G&A was $12.4 million, or $0.94 per Boe.

Capital allocation combined development, acquisitions, repurchases and dividends. Capital expenditures were $195.8 million, including $151.0 million of D&C capital on organic assets and $44.7 million of Ground Game activity. NOG closed the Duvernay Light Oil Joint Development for $262.1 million, repurchased 2.95 million shares at an average price of $20.37, and increased repurchase capacity to approximately $243.0 million. The company maintained annual production, oil-production, capital-expenditure and well turn-in-line guidance, while revising LOE, oil-differential and gas-realization assumptions.