Canadian Natural Resources Ltd. press release

Canadian Natural Resources Limited Announces 2026 Third Quarter Results

2026-11-05

TSX - Toronto Stock Exchange · Oil · Bitumen · Natural Gas Liquids · Natural Gas · Canada · Corporate Finance

Calgary, Alberta--(Newsfile Corp. - November 5, 2026) - Canadian Natural's (TSX: CNQ) (NYSE: CNQ) President, Scott Stauth, commented on the Company's third quarter results, "The strength of our well-‍balanced and diverse portfolio, combined with our continued focus on safe, effective and efficient operations, delivered another strong quarter. In Q3/26, we achieved production of approximately 1,217,000 bbl/d of liquids and 2.6 Bcf/‍d of natural gas, totaling approximately 1,652,000 BOE/d, inclusive of a planned turnaround at Horizon, reflecting the quality of our long life low decline asset base and disciplined operating culture.

Our thermal in situ operations achieved record quarterly production of approximately 300,000 bbl/d, an increase of 25,000 bbl/d from Q3/25 levels, driven by continued strong performance from new pads in Pike and Primrose. In our North American Conventional E&P assets, excluding thermal in situ operations, we also achieved record quarterly liquids production of approximately 358,000 bbl/d, an increase of 49,000 bbl/d from Q3/25 levels driven by accretive acquisitions and strong well performance.

At Horizon, subsequent to quarter end, the team safely and successfully completed the planned turnaround in 28 days, seven days earlier than budgeted, through strong execution, adding significant high value, high margin Synthetic Crude Oil ("SCO") production in Q4/26. Following the turnaround, Oil Sands Mining and Upgrading production has been strong, with current rates averaging approximately 640,000 bbl/d. At Horizon, we continue to build on the success of the 2024 reliability enhancement project that enabled us to move major turnarounds to once every two years from annually, and, combined with verified analysis of key parameters from the 2026 turnaround, we are now targeting to extend turnaround intervals at Horizon to once every three years, further increasing reliability and utilization. As a result, Horizon's three year average production capacity increases by an additional 5,000 bbl/d of high margin SCO, bringing total Oil Sands Mining and Upgrading production capacity up to approximately 597,000 bbl/d.

We are pleased to see the federal government designating the proposed West Coast oil pipeline, now known as Pacific Link, as a project of national interest. In addition, the federal government announced the Productivity Mega Deduction ("PMD"), which is expected to enhance competitiveness and investment in Canada. These measures, combined with the trilateral Memorandum of Understanding ("MOU") between the Oil Sands Alliance, the Government of Alberta and the Federal government, will support future economic growth, add additional egress opportunities, provide a clear pathway to reduce Greenhouse Gas ("GHG") emissions and enhance Canada's competitiveness for investment on a global scale. The next important step in this process is finalizing definitive agreements of the MOU, which will provide clarity on assessing our potential growth projects. If industry and governments are able to successfully complete and finalize the definitive agreements of the MOU, the result will be greater investments in the Canadian economy by the oil and gas industry, creating more jobs for Canadians and greater taxes and royalties for governments."

Canadian Natural's Chief Financial Officer, Victor Darel, added, "We achieved our net debt target of $13 billion in Q3/26, resulting in the Company now targeting to allocate 100% of free cash flow to shareholder returns through share repurchases. To further enhance visibility on share repurchases, effective immediately, the pace of monthly share repurchases is targeted at $800 million per month in both November 2026 and December 2026. As we move into 2027, shareholder returns are expected to remain strong as we now target to allocate 100% of free cash flow to share repurchases, subject to market conditions.

In the first nine months of 2026, we have returned a total of approximately $10.6 billion to shareholders, including $6.8 billion directly through dividends and share buybacks and $3.8 billion indirectly through reductions in net debt.

We delivered strong financial results during the quarter, generating adjusted funds flow of approximately $5.5 billion or $2.68 per share and adjusted net earnings of $3.4 billion or $1.67 per share, including the impact of a planned turnaround at Horizon and lower commodity prices relative to the second quarter, highlighting the quality of our assets and the effectiveness of our operational and capital allocation strategies. Additionally, sulphur pricing continued to strengthen, which contributed pre-tax net revenue of approximately $0.5 billion in Q3/26 and $0.9 billion year to date."

THIRD QUARTER HIGHLIGHTS

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Generated quarterly net earnings of approximately $3.0 billion and quarterly adjusted net earnings from operations of $3.4 billion.

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Generated quarterly adjusted funds flow of approximately $5.5 billion.

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Captured strong SCO pricing that averaged a US$6.65/bbl premium to WTI in the quarter as a result of strong diesel pricing.

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Strong sulphur pricing and sulphur production contributed pre-tax net revenue of approximately $0.5 billion(1)in Q3/26 and $0.9 billion through the first nine months of 2026.

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The Company achieved its $13 billion net debt target in Q3/26, with 100% of free cash flow now targeted for allocation to share repurchases.

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Returns to shareholders were significant, totaling approximately $5.3 billion in Q3/26.

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Direct returns to shareholders totaled approximately $2.9 billion in Q3/26, comprised of $1.3 billion in dividends and $1.6 billion in share repurchases.

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Indirect returns to shareholders, through net debt reductions, totaled approximately $2.4 billion in Q3/26, with net debt decreasing to $12.1 billion as of September 30, 2026, below our $13 billion net debt target.

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Total quarterly production was approximately 1,652,000 BOE/d, an increase of 31,000 BOE/d or 2% from Q3/25 levels.

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Strong quarterly liquids production was approximately 1,217,000 bbl/d, an increase of 42,000 bbl/d or 4% from Q3/25 levels, inclusive of the planned turnaround at Horizon in Q3/26, which reduced volumes by approximately 75,000 bbl/‍d for the quarter.

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Record quarterly thermal in situ production of approximately 300,000 bbl/d, an increase of 25,000 bbl/d or 9% from Q3/25 levels.

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The two new Steam Assisted Gravity Drainage ("SAGD") pads at Pike 1 continue to exceed expectations, currently producing approximately 46,500 bbl/d at a Steam to Oil Ratio ("SOR") of 1.7x.

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Record North American Conventional E&P quarterly liquids production of approximately 358,000 bbl/d, an increase of 49,000 bbl/d or 16% from Q3/25 levels.

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Subsequent to quarter end, on October 6, 2026, the team safely and successfully completed the planned turnaround at Horizon in 28 days, seven days earlier than budgeted. This early completion of the turnaround will result in approximately 23,000 bbl/d of additional high margin SCO production in Q4/26 than originally budgeted. Oil Sands Mining and Upgrading production has been strong, with current rates averaging approximately 640,000 bbl/d.

SHAREHOLDER RETURNS

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On November 4, 2026, the Board of Directors approved a quarterly cash dividend of $0.625 per common share, payable on January 5, 2027 to shareholders of record at the close of business on December 15, 2026.

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This represents an annualized dividend of $2.50 per common share. Our dividend has grown for 26 consecutive years, demonstrating the confidence that the Board has in the sustainability of our business model, our strong balance sheet and the strength of our diverse, long life low decline reserves and asset base.

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Year to date, up to and including November 4, 2026, the Company has returned a total of approximately $8.9 billion directly to shareholders through $5.1 billion in dividends and $3.8 billion through the repurchase and cancellation of approximately 58.2 million common shares at a weighted average price of $65.85 per share.

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Included in year to date returns to shareholders is $728 million of share repurchases in October 2026.

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To further enhance visibility, effective immediately, the pace of monthly share repurchases is targeted at $800 million per month in both November 2026 and December 2026.

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As we move into 2027, shareholder returns are expected to remain strong as we now target to allocate 100% of free cash flow to share repurchases, subject to market conditions.

(1)Item is a component of 'Other income and revenue' in Note 17 Segmented Information in the Company's consolidated financial statements.

| HIGHLIGHTS | | Three Months Ended | | | Nine Months Ended | | | | | | | | | | | | | ($ millions, except per common share amounts) | | Sep 30 2026 | | | Jun 30 2026 | | | Sep 30 2025 | | | Sep 30 2026 | | | Sep 30 2025 | | | | Net earnings | $ | 2,997 | | $ | 4,503 | | $ | 600 | | $ | 8,848 | | $ | 5,517 | | | | Per common share | - basic | $ | 1.46 | | $ | 2.17 | | $ | 0.29 | | $ | 4.27 | | $ | 2.64 | | | | - diluted | $ | 1.45 | | $ | 2.15 | | $ | 0.29 | | $ | 4.24 | | $ | 2.63 | | | Adjusted net earnings from operations(1) | $ | 3,427 | | $ | 4,568 | | $ | 1,801 | | $ | 10,441 | | $ | 5,733 | | | | Per common share | - basic(2) | $ | 1.67 | | $ | 2.20 | | $ | 0.86 | | $ | 5.04 | | $ | 2.74 | | | | - diluted(2) | $ | 1.65 | | $ | 2.19 | | $ | 0.86 | | $ | 5.01 | | $ | 2.73 | | | Cash flows from operating activities | $ | 7,010 | | $ | 6,823 | | $ | 3,940 | | $ | 17,115 | | $ | 11,338 | | | | Adjusted funds flow(1) | $ | 5,522 | | $ | 6,866 | | $ | 3,920 | | $ | 16,762 | | $ | 11,712 | | | | Per common share | - basic(2) | $ | 2.68 | | $ | 3.30 | | $ | 1.88 | | $ | 8.08 | | $ | 5.59 | | | | - diluted(2) | $ | 2.67 | | $ | 3.28 | | $ | 1.87 | | $ | 8.04 | | $ | 5.57 | | | Cash flows used in investing activities | $ | 1,640 | | $ | 2,468 | | $ | 2,234 | | $ | 6,057 | | $ | 5,487 | | | | Net capital expenditures(1) | $ | 1,883 | | $ | 2,405 | | $ | 2,124 | | $ | 6,316 | | $ | 5,342 | | | | Net capital expenditures(1), excluding net acquisitions | $ | 1,885 | | $ | 1,643 | | $ | 1,318 | | $ | 4,783 | | $ | 4,312 | | | | Abandonment expenditures | $ | 248 | | $ | 182 | | $ | 189 | | $ | 677 | | $ | 570 | | | | Daily production, before royalties | | | | | | | | | | | | | | | | | | Natural gas (MMcf/d) | | 2,607 | | | 2,567 | | | 2,668 | | | 2,615 | | | 2,510 | | | | Crude oil and NGLs (bbl/d) | | 1,217,178 | | | 1,248,889 | | | 1,175,604 | | | 1,221,452 | | | 1,122,859 | | | | Equivalent production (BOE/d)(3) | | 1,651,720 | | | 1,676,754 | | | 1,620,261 | | | 1,657,243 | | | 1,541,127 | | | | (1) Non-GAAP Financial Measure. Refer to the 'Non-GAAP and Other Financial Measures' section of the Company's MD&A. (2) Non-GAAP Ratio. Refer to the 'Non-GAAP and Other Financial Measures' section of the Company's MD&A. (3) A barrel of oil equivalent ("BOE") is derived by converting six thousand cubic feet ("Mcf") of natural gas to one barrel ("bbl") of crude oil (6 Mcf:1 bbl). This conversion may be misleading, particularly if used in isolation, or to compare the value ratio using current crude oil and natural gas prices since the 6 Mcf:1 bbl ratio is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. | | | | | | | | | | | | | | | | |

OPERATIONS REVIEW

North America Oil Sands Mining and Upgrading

| | | Three Months Ended | | | Nine Months Ended | | | | | | | | | | | | | | Sep 30 2026 | | | Jun 30 2026 | | | Sep 30 2025 | | | Sep 30 2026 | | | Sep 30 2025 | | | Synthetic crude oil production (bbl/d) (1)(2) | | 543,089 | | | 624,754 | | | 581,136 | | | 585,099 | | | 546,635 | | | (1) SCO production before royalties and excludes production volumes consumed internally as diesel. (2) Consists of heavy and light synthetic crude oil products. | | | | | | | | | | | | | | | |

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Oil Sands Mining and Upgrading production averaged 543,089 bbl/d of SCO in Q3/26, a decrease of 7% from Q3/25 levels, reflecting the planned turnaround at Horizon, partially offset by the additional working interest acquired in the Albian mines in December 2025.

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The Company's Oil Sands Mining and Upgrading operating costs are industry leading, averaging $25.80/‍bbl (US$18.44/bbl) of SCO in Q3/26. Operating costs on a per barrel basis primarily reflect lower production as a result of the turnaround at Horizon.

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Subsequent to quarter end, on October 6, 2026, the Company safely and successfully completed the planned turnaround at Horizon in 28 days, seven days earlier than budgeted. This early completion of the turnaround will result in approximately 23,000 bbl/d of additional high margin SCO production in Q4/26 than originally budgeted. Following the turnaround, Oil Sands Mining and Upgrading production has been strong, with current rates averaging approximately 640,000 bbl/d.

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At Horizon, we continue to build on the success of the 2024 reliability enhancement project that enabled us to move major turnarounds to once every two years from annually, and, combined with verified analysis of key parameters from the 2026 turnaround, we are now targeting to extend turnaround intervals at Horizon to once every three years, further increasing reliability and utilization.

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As a result of moving to a three year turnaround cycle, Horizon's average production capacity over the three year period increases by an additional 5,000 bbl/d of high margin SCO barrels, bringing total Oil Sands Mining and Upgrading production capacity up to approximately 597,000 bbl/d.

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The Company's Naphtha Recovery Unit Tailings Treatment ("NRUTT") project at Horizon remains on track with capital on budget and targeted incremental annual production of approximately 6,300 bbl/d of SCO, following mechanical completion in Q3/27.‍‍

North America Exploration and Production

| Thermal In Situ Oil Sands | | | | | | | | | | | | | | | | | | | Three Months Ended | | | Nine Months Ended | | | | | | | | | | | | | | Sep 30 2026 | | | Jun 30 2026 | | | Sep 30 2025 | | | Sep 30 2026 | | | Sep 30 2025 | | | Bitumen production (bbl/d) | | 299,632 | | | 275,607 | | | 274,752 | | | 283,396 | | | 278,046 | | | Net bitumen wells drilled | | 45 | | | 38 | | | 11 | | | 114 | | | 53 | |

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Record thermal in situ production of 299,632 bbl/d was achieved in Q3/26, an increase of approximately 25,000 bbl/d or 9% from Q3/25 levels, reflecting strong production from the recently added SAGD pads and the new Cyclic Steam Stimulation ("CSS") pad at Primrose that came on production in July 2026.

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Jackfish achieved record quarterly production of 143,039 bbl/d in Q3/26, exceeding its facility nameplate capacity by approximately 23,000 bbl/d as a result of strong performance from the Pike 1 pads.

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The two new SAGD pads at Pike 1 continue to exceed expectations, currently producing approximately 46,500 bbl/d at a SOR of 1.7x. The Pike 1 SAGD pads are top tier in industry, driven by high-quality resource and continuous improvement in technology and execution.

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Thermal in situ operating costs averaged $10.19/bbl (US$7.28/bbl) in Q3/26, a decrease of approximately 2% compared to $10.35/bbl in Q3/25, reflecting higher production, partially offset by higher energy costs.

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Canadian Natural has decades of robust, capital ‍efficient drill‍ ‍to ‍fill opportunities across its long life low decline thermal in situ assets. The Company is on track with its 2026 budget, with the following pad additions:

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At Primrose, two Cyclic Steam Stimulation ("CSS") pads are targeted to come on production in Q1/27 and Q2/27.

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At Kirby, the Company is drilling a SAGD pad, which is targeted to come on production in Q3/27.

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Canadian Natural has been piloting solvent enhanced oil recovery technology on certain thermal in situ assets with an objective to increase bitumen production while reducing the SOR and GHG emissions, at the same time optimizing solvent recovery. This technology has the potential for application throughout the Company's extensive thermal in situ asset base.

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As a result of continued strong production performance from new wells at the Kirby South pilot, the Company is targeting to begin solvent injection using diluent in the first half of 2027.

| Crude oil and NGLs - excluding Thermal In Situ Oil Sands | | | | | | | | | | | | | | | | | | | Three Months Ended | | | Nine Months Ended | | | | | | | | | | | | | | Sep 30 2026 | | | Jun 30 2026 | | | Sep 30 2025 | | | Sep 30 2026 | | | Sep 30 2025 | | | Crude oil and NGLs production (bbl/d) | | 358,484 | | | 338,138 | | | 309,873 | | | 341,848 | | | 285,931 | | | Net crude oil wells drilled | | 108 | | | 80 | | | 78 | | | 271 | | | 192 | |

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Record quarterly North America E&P liquids production, excluding thermal in situ operations, of 358,484 bbl/d was achieved in Q3/26, an increase of approximately 49,000 bbl/d or 16% from Q3/25 levels. This record reflects accretive Charlie Lake light crude oil acquisitions and strong organic growth in heavy crude oil, light crude oil and NGLs.

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Strong primary heavy crude oil production averaged 95,621 bbl/d in Q3/26, an increase of 9% from Q3/25 levels, reflecting growth in our quick payout, high return multilateral wells.

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Canadian Natural's highly successful multilateral drilling program, driven by continuous improvement in execution and technology advancements, continues to unlock opportunities on our 3 million net acres of high quality, multizone land throughout our primary heavy crude oil assets.

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Operating costs in the Company's primary heavy crude oil operations averaged $18.02/bbl (US$12.88/‍bbl) in Q3/26, an increase from $16.46/bbl in Q3/25, reflecting increased weather related road maintenance and higher diesel costs.

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In the Company's Pelican Lake polymer flood area, production averaged 45,514 bbl/d in Q3/26, an increase of 8% from Q3/25 levels, reflecting strong results from Driftwood and the long life low decline nature of these assets.

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Operating costs at Pelican Lake averaged $10.45/bbl (US$7.47/bbl) in Q3/26, an increase from $9.00/bbl in Q3/25, reflecting increased trucked production from Driftwood.

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Record quarterly production of 217,349 bbl/d was achieved in North America light crude oil and NGLs in Q3/26, an increase of approximately 37,000 bbl/d or 21% from Q3/25 levels, primarily reflecting accretive acquisitions and strong drilling results.

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Operating costs in the Company's North America light crude oil and NGLs operations averaged $12.85‌‌/‍‍bbl (US$9.18/bbl) in Q3/26, comparable to Q3/25 levels.

| North America Natural Gas | | | | | | | | | | | | | | | | | | | Three Months Ended | | | Nine Months Ended | | | | | | | | | | | | | | Sep 30 2026 | | | Jun 30 2026 | | | Sep 30 2025 | | | Sep 30 2026 | | | Sep 30 2025 | | | Natural gas production (MMcf/d) | | 2,602 | | | 2,563 | | | 2,658 | | | 2,611 | | | 2,498 | | | Net natural gas wells drilled | | 11 | | | 23 | | | 17 | | | 58 | | | 58 | |

North America natural gas production averaged 2,602 MMcf/d in Q3/26, a decrease of 2% from Q3/25 levels, reflecting natural field declines partially offset by accretive acquisitions completed in 2026 and strong liquids‍-‍rich natural gas drilling results. North America natural gas operating costs averaged $1.14/Mcf in Q3/26.

International Exploration and Production

| | | Three Months Ended | | | Nine Months Ended | | | | | | | | | | | | | | Sep 30 2026 | | | Jun 30 2026 | | | Sep 30 2025 | | | Sep 30 2026 | | | Sep 30 2025 | | | Crude oil production (bbl/d) | | 15,973 | | | 10,390 | | | 9,843 | | | 11,110 | | | 12,247 | | | Natural gas production (MMcf/d) | | 5 | | | 4 | | | 10 | | | 4 | | | 12 | |

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International E&P crude oil production volumes averaged 15,973 bbl/d in Q3/26, an increase of 62% compared to Q3/25 levels. The increase reflects the return of production at Baobab in Offshore Africa in June 2026 following completion of the refurbishment of the floating production storage and offloading ("FPSO") vessel, partially offset by the planned North Sea abandonments conducted as part of the previously announced decommissioning activities.