NOG maintains 2026 production outlook as Permian volumes recover
(WO) — Northern Oil and Gas (NOG) reaffirmed its 2026 production and capital expenditure guidance Monday after reporting improving production conditions in the Permian basin, continued acquisition activity and the closing of its previously announced Duvernay joint development transaction.
During the second quarter, approximately 7,000 boed of NOG production was temporarily shut in by operators, primarily on the company's Novo assets in Culberson County, Texas, and Eddy County, New Mexico. The curtailments occurred across April, May and part of June as sharply negative Waha natural gas pricing reduced wellhead economics despite otherwise strong oil prices.
The company also said approximately three net wells originally expected to come online during the quarter were deferred into the third quarter while completion operations were finalized.
Outside the Waha pricing region, however, production exceeded internal expectations. Output from the Williston basin surpassed forecasts by 4%, while production from the Uinta basin came in 11.5% above expectations.
As a result, NOG expects second-quarter oil production to average between 67.5 Mboed and 68.25 Mboed while also delivering record natural gas volumes despite the Permian curtailments.
Looking ahead, the company said production from the previously shut-in assets was returning as the second quarter ended, supported by improving Waha pricing. Combined with the deferred well turn-in-lines entering production during the third quarter, NOG expects higher oil production as market conditions continue to improve.
The company also reaffirmed its full-year 2026 production and capital spending guidance, citing its development schedule, improving field performance and capital execution.
NOG continued expanding its upstream portfolio through its Ground Game acquisition strategy during the quarter, closing 30 transactions that added more than 2,300 net acres and interests in 6.2 net wells. The company deployed approximately $45 million toward acquisitions and associated development capital, with nearly 80% of spending concentrated in the Permian, Williston and Uinta basins.
The company also completed its previously announced Duvernay joint development acquisition on June 1. The transaction included approximately CA$237 million in cash, including a previously paid deposit, and approximately 3.7 million common shares.
Including its Ground Game activity, NOG expects second-quarter capital expenditures of approximately $190 million to $200 million while maintaining what it described as a strong free cash flow outlook.
Although the company reported estimated unrealized mark-to-market derivative gains of $155 million to $160 million during the second quarter, driven by changes in the value of its hedge portfolio, it said those results are not expected to materially impact the second half of 2026, with only minimal hedge gains or losses anticipated at current commodity prices.
