Ovintiv — Third Quarter 2026 Earnings Summary

Financial Performance:

• Reported third quarter net earnings of $549 million ($1.99 per share diluted), compared to $192 million before tax in the prior year period.
• Generated cash from operating activities of $1.1 billion and Non-GAAP Cash Flow of $1.2 billion.
• Reported Non-GAAP Free Cash Flow of $680 million after capital expenditures of $563 million, up from $351 million in the third quarter of 2025.
• Net Debt stood at $3.4 billion as of September 30, 2026, with a Net Debt to Adjusted EBITDA ratio of 0.7x, down from 1.2x at December 31, 2025.
• Upstream operating expense was $3.43 per BOE, upstream transportation and processing costs were $8.12 per BOE, and production/mineral taxes were $1.03 per BOE (2.7% of upstream product revenue).
• Total liquidity was approximately $3.8 billion, including $3.5 billion in available credit facilities, $141 million in uncommitted demand lines, and $176 million in cash.

Guidance and Future Outlook:

• Maintained full year 2026 guidance for total production of 630–645 MBOE/d and capital investment of $2,250–$2,350 million.
• Issued fourth quarter 2026 guidance for total production of 615–640 MBOE/d and capital investment of $550–$600 million.
• Modestly increased expected NGL volumes for the full year 2026 to 85–87 Mbbls/d.
• Guidance assumes a third-party midstream outage in the Montney persists for the full duration of the fourth quarter.
• On pace for 8% to 9% oil and condensate production per share growth by year-end 2026, following 6% growth over the last six months.
• Full year 2026 shareholder returns are expected to exceed 60% of Non-GAAP Free Cash Flow.

Business Segments and Product Lines:

• Total average third quarter production was 631 MBOE/d, comprising 204 Mbbls/d of oil and condensate, 83 Mbbls/d of other NGLs, and 2,062 MMcf/d of natural gas.
• Permian segment production averaged 235 MBOE/d (77% liquids) with 31 net wells turned in line; full year 2026 capital investment expected at $1.375–$1.425 billion.
• Montney segment production averaged 395 MBOE/d (27% liquids) with 28 net wells turned in line; full year 2026 capital investment expected at $825–$875 million.
• Completed ground game acreage acquisitions totaling $457 million, adding approximately 120 net well locations in the Montney and 120 in the Permian.
• Acquired Logan Energy Corp. for C$1.40 per share in cash, with a total transaction value of approximately $890 million including assumption of Net Debt.

Market and Competitive Landscape:

• Realized price for oil and condensate (excluding hedges) was $84.89 per barrel (99% of WTI), while including hedges it was $80.69 per barrel (94% of WTI).
• Realized price for natural gas (excluding hedges) was $2.45 per Mcf (83% of NYMEX), while including hedges it was $2.70 per Mcf (92% of NYMEX).
• Total average realized price was $38.10 per BOE excluding hedges and $37.56 per BOE including hedges.
• Management highlighted operating advantages and top performance in the Permian and Montney basins with industry-leading low costs per undeveloped location.

Risks and Challenges:

• An ongoing third-party midstream outage in the Montney is impacting fourth quarter production volumes.
• Higher commodity prices have resulted in higher than originally expected royalty rates in the Montney, reducing fourth quarter oil and condensate production expectations.
• Forward-looking statements involve risks including future commodity prices, basis differentials, integration of Logan assets, access to credit facilities, and geopolitical factors.

Management Commentary and Tone:

• President and CEO Brendan McCracken stated the team is on track to achieve record annual free cash flow and is set to continue delivering superior and durable returns.
• Management emphasized enhancing drilling inventory and future growth optionality in the Permian and Montney at low costs.
• The tone reflects confidence in the company's ability to generate value and maintain a strong balance sheet.

Other Key Points:

• Returned approximately 69% ($467 million) of third quarter Non-GAAP Free Cash Flow to shareholders via share repurchases of $386 million (6.3 million shares) and dividends of $81 million.
• Year-to-date shareholder returns totaled approximately $1.1 billion (53% of Non-GAAP Free Cash Flow), consisting of $815 million in buybacks and $250 million in dividends.
• Repurchased approximately $109 million in principal amount of senior notes during the quarter.
• Board declared a quarterly dividend of $0.30 per share payable on December 31, 2026, to shareholders of record as of December 15, 2026.
• Capital investment for the quarter was $563 million, below the midpoint of the guidance range ($550–$600 million).
• Recognized net gains on risk management in revenues of $27 million before tax.