\nNorthern Oil and Gas, Inc. (NYSE: NOG) (the \u201cCompany\u201d or \u201cNOG\u201d) today announced a fourth quarter 2024 operations update and is providing initial 2025 capital and production guidance.<\/p>\n
HIGHLIGHTS<\/b><\/p>\n MANAGEMENT COMMENT<\/b><\/p>\n \n\u201cOur platform delivered over 25% production growth in 2024 despite an unusual confluence of events that dampened production in the fourth quarter and heading into 2025. Despite these events, we are optimistic about our positioning for the future,\u201d commented Nick O\u2019Grady, NOG\u2019s Chief Executive Officer. \u201cOur 2025 capital budget is strategically designed to build momentum throughout the year and accelerate development into 2026. This positions us for standout growth on a multi-year basis. At NOG, we maintain a long-term focus, planning for multiple years of sustainable growth. We believe this disciplined approach will enhance our capacity for increased shareholder returns and drive superior total returns over time.\u201d<\/p>\n \n\u201cIn the fourth quarter, NOG took advantage of the seasonal weakness in the A&D market. We signed our joint development agreement in Appalachia, had our busiest quarter of the year with our Ground Game, and in February signed another Midland Basin joint venture. We continue to see a multitude of opportunities across our respective basins as we head into 2025 and are encouraged with the prospects ahead of us,\u201d added Adam Dirlam, NOG\u2019s President.<\/p>\n FOURTH QUARTER OPERATIONAL UPDATE<\/b><\/p>\n \nProduction volumes in the fourth quarter of 2024 are estimated to have averaged 131.0 \u2013 132.0 MBoe per day, implying volumes toward the high end of NOG\u2019s annual guidance. Oil volumes are estimated at 78.5 \u2013 78.9 Mboe per day, up ~11% sequentially. Oil volumes were affected by disruptions from forest fires, curtailments and deferrals of completed wells from price-sensitive private operators in the Williston Basin, as well as downtime from third-party crude takeaway in the Uinta Basin. Despite logistical issues in the Williston and Uinta, Permian Basin volumes were strong and grew an estimated 12% quarter over quarter, producing record oil and total volumes. Production from the recent Point acquisition continues to exceed internal expectations.<\/p>\n \nNOG had an estimated 25.8 net wells turned-in-line (\u201cTIL\u201d) in the fourth quarter and 90.7 for 2024, and while drilling proceeded as expected, a number of completed wells were deferred due to lower prices experienced in the quarter. The Company had 50.4 net wells-in-process at the end of the fourth quarter.<\/p>\n \nNatural gas price realizations increased in the fourth quarter as regional pricing improved. Realized prices for natural gas are estimated to be 80% \u2013 81% of average NYMEX Henry Hub prices for the fourth quarter. Oil differentials were modestly wider in the fourth quarter, as expected. Realized prices for oil for the fourth quarter are estimated to be at a discount of approximately $3.86 per Bbl compared to average NYMEX WTI benchmark prices. Lease operating costs were an estimated $9.60 \u2013 $9.70 per Boe, slightly higher than in the third quarter.<\/p>\n GROUND GAME, LEASEHOLD AND CAPITAL EXPENDITURES UPDATE<\/b><\/p>\n \nNOG closed 14 elective leasehold and Ground Game transactions totaling approximately $27 million during the fourth quarter. The transactions are spread across all of NOG\u2019s respective basins and are expected to add 0.7 net producing wells, 3.2 net in-process wells and approximately 2,274 net acres with significant future drilling locations. For the year, NOG\u2019s Ground Game added an estimated 10.7 net producing or in-process wells along with approximately 7,013 net acres with significant future drilling locations across 37 transactions with attractive full cycle returns.<\/p>\n \nCapital expenditures, excluding non-budgeted transactions and other, for the fourth quarter are estimated to have been $231 \u2013 $232 million, inclusive of D&C capital, refracs, and workovers. The Company continues to see elevated levels of refracs and workovers, with approximately $12 million allocated to refracs in the fourth quarter. Total capital expenditures, inclusive of elective Ground Game and leasehold acquisitions, was $258 \u2013 $259 million.<\/p>\n HEDGING UPDATE<\/b><\/p>\n \nUnrealized mark-to-market losses on derivatives for the fourth quarter were an estimated $59.0 \u2013 $60.0 million and realized hedge gains were an estimated $25.0 \u2013 $25.5 million. The Company continues to execute its policy of protecting its capital program by periodically entering into financial derivative instruments with counterparties to lock in future commodity prices on a portion of its expected production.<\/p>\n FIRST QUARTER BOLT-ON ACQUISITION<\/b><\/p>\n \nOn February 11, 2025, NOG entered into a definitive agreement to acquire assets in Upton County, TX with one of NOG\u2019s existing private operating partners for an unadjusted purchase price of $40 million in cash, subject to customary closing adjustments. These assets include approximately 2,275 net acres in the Midland Basin. NOG has entered into a multi-year joint development agreement on the properties. The Company expects to close the transaction in the second quarter. The obligations of the parties to complete the transactions contemplated by the purchase agreement are subject to the satisfaction or waiver of customary closing conditions. The associated 2025 development costs post-closing for these assets have been included in NOG\u2019s initial capital expenditure guidance.<\/p>\n INITIAL 2025 PRODUCTION AND CAPITAL EXPENDITURE GUIDANCE, 2026 POTENTIAL<\/b><\/p>\n \nThe Company anticipates total production volumes for 2025 of 130,000 \u2013 135,000 Boe per day, with oil production accounting for 75,000 \u2013 79,000 Bbls per day of the total. The Company currently anticipates 2025\u2019s development cadence helping to drive an additional ~10% total production growth in 2026 and ~14% oil production growth on a similar or lower sequential capital budget versus 2025 levels.<\/p>\n \nThe Company currently expects total capital spending for 2025 of $1.05 \u2013 $1.20 billion. The 2025 capital budget is expected to support a drilling program in 2025 with increased natural gas activity, in part driven by NOG\u2019s recently announced Appalachian joint development program. The capital budget anticipates allocating additional capital to workovers and refrac activity to support future production given the natural aging of wells. Additionally, the Company anticipates a significant increase to the wells-in-process list in 2025, with 106 \u2013 110 net well spuds anticipated to exceed completions of 97 \u2013 99 net wells. Natural gas completions are expected to account for 8.0 \u2013 10.0 net wells, a significant increase from 2024, with the majority of these completions in the second half of 2025.<\/p>\n\n
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