Canada's Tourmaline Q2 earnings fall, maintains 2026 production outlook

Overview

• Canada natural gas producer's Q2 production fell 4% yr/yr as activity was deferred

• Q2 cash flow per share and net earnings per share declined from prior year

• Company signed long-term LPG export deal and acquired Aduro Resources for C$100 mln

Outlook

• Tourmaline sees 2026 production at 620,000–640,000 boepd, with exit target of 660,000 boepd

• Company maintains 2026 EP capital budget at C$2.55 bln

• Tourmaline expects 2026 FCF of C$880 mln at current strip pricing

Result Drivers

• PRODUCTION DEFERRALS - Co deferred production and injected more gas into storage due to low Q2 natural gas prices, positioning for higher expected prices later in 2026

• COST REDUCTIONS - Operating costs per boe fell 10% yr/yr, helped by infrastructure buildout and efficiency measures

• MARKETING STRATEGY - Realized natural gas prices exceeded AECO benchmark by C$1.46/mcf, reflecting diversified marketing and hedging

Company press release: ID:nCNWHDcG4a

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 12 "strong buy" or "buy", 7 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the oil gas exploration and production peer group is "buy"

• Wall Street's median 12-month price target for Tourmaline Oil Corp is C$72.75, about 15.5% above its July 28 closing price of C$62.96

• The stock recently traded at 13 times the next 12-month earnings vs. a P/E of 15 three months ago

Reuters Recommended Reads

• July 29 - Comstock Resources Q2 oil and gas sales fall, EPS drops

• July 29 - Antero Q2 profit and EBITDA miss estimates despite record output

• July 29 - Germany's Uniper firms up 20-year LNG purchase deal with Canada

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)