Tamarack Valley Energy (TVE) Q2 2024 earnings summary

Executive summary

• Q2 2024 production averaged 64,143 BOE/day, up over 3% sequentially, driven by rapid recovery from third-party outages and strong development in Clearwater and Charlie Lake assets.

• North Clearwater assets achieved record oil production of 19,500 BOE/day, a 26% year-over-year increase.

• Operational excellence enabled quick restoration of 6,200 BOE/day after the Mitsue third-party incident and Nipisi production ahead of facility recovery.

• Infrastructure projects, including the Northwest Connector pipeline and Rochester gas plant expansion, were completed on schedule and under budget, increasing throughput capacity.

• Adjusted funds flow reached CAD 226 million ($225.6MM), up 43% year-over-year, with free funds flow at CAD 137 million ($137.2MM), reflecting production outperformance and higher oil prices.

Financial highlights

• Total oil and natural gas revenue for Q2 2024 was $461.5MM, up 16% year-over-year.

• Net income for Q2 2024 was $94.9MM, up 269% year-over-year, with basic EPS of $0.17.

• Operating costs per barrel declined 9% year-over-year to $9.34/boe.

• Net debt reduced by CAD 491 million (36%) year-over-year, exiting Q2 at CAD 883 million.

• Shareholder returns in H1 totaled CAD 75 million ($74.8MM), including CAD 34 million in share repurchases and CAD 41 million in base dividends.

Outlook and guidance

• 2024 production guidance remains 61,000–63,000 BOE/day, with capital spending of CAD 390–440 million.

• Up to 60% of free funds flow will be allocated to dividends and buybacks, up from 40%.

• No incremental 2024 capital currently allocated to expand the Charlie Lake program; status to be updated in the fall.

• Potential incremental capital for CSV Albright Sour Gas plant expansion is under review, with updates expected in the fall.

• Approximately 50% of net after royalty oil production hedged for the remainder of 2024 with downside protection and upside participation.