Parex Resources Inc. press release

Parex Resources Announces 2025 Full-Year Results, Reserves Per Share Growth, and Declaration of Q1 2026 Dividend

2026-03-04

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

CALGARY, Alberta, March 04, 2026 (GLOBE NEWSWIRE) -- Parex Resources Inc. (“Parex” or the “Company”) (TSX: PXT) is pleased to announce its financial and operating results for the three- and twelve-month periods ended December 31, 2025, as well as the results of its independent reserves assessment as at December 31, 2025. Additionally, the Company declares its Q1 2026 regular dividend of C$0.385 per share and provides an operational update. All amounts herein are in United States dollars (“USD”) unless otherwise stated.

Key Highlights

Generated annual funds flow provided by operations ("FFO")(1)of $455 million and free funds flow(2)of $145 million in 2025. Increased both PDP and 1P reserves per share by 4% and 2P reserves per share by 8%, compared to 2024(3). Strong PDP, 1P, and 2P reserves replacement at 106%, 106%, and 152%, respectively(3). Delivered high capital efficiency, realizing strong FD&A recycle ratios of 2.0x or higher(3). Tracking to deliver FY 2026 average production guidance of 45,000 to 49,000 boe/d (47,000 boe/d midpoint); YTD average production is 46,150 boe/d(4). Declared a Q1 2026 regular dividend of C$0.385 per share(5)(C$1.54 per share annualized).

"In 2025, we delivered solid operational results, reserves growth, and strong shareholder returns," said Imad Mohsen, President & Chief Executive Officer.

“As we strengthen our foundation, we are encouraged by the progress across our portfolio, including at LLA-32, where we recently completed drilling one of Colombia's first multilateral wells, and in the Putumayo, where we are seeing positive results that are better than originally expected. Looking ahead, our high-quality inventory runway positions us to drive long-term organic growth, while pursuing disciplined, value-accretive M&A in Colombia.”

2025 Full-Year Achievements & Results

Delivered against core strategic goals and executed activity plan with success: Demonstrated the resilience of Cabrestero and LLA-34 core assets by flattening production decline via waterflood and polymer injection initiatives; Completed a tuck-in acquisition for the remaining working interest at LLA-32, raising peak production to over three times pre-acquisition levels and adding reserves through delineation; Successfully carried out a near-field exploration program with a 75% success rate, adding production and incremental reserves; Gained operational access in the Putumayo region, initiating drilling activities in late 2025; Established a full strategic alliance in the Llanos Foothills with Ecopetrol, strengthening the Company's position in a basin recognized for its world-class potential; and Returned $134 million to shareholders during the year, bringing total capital returned to over C$2 billion through dividends and share repurchases over the past eight years, while reducing the diluted shares outstanding by over 40%.

Average production of 44,701 boe/d(8), achieving FY 2025 guidance range of 43,000 to 47,000 boe/d. Realized net income of $255 million or $2.62 per share(7). Generated FFO(1)of $455 million and FFO per share(6)(7)of $4.68. Realized adjusted EBITDA(2)of $513 million. Produced an operating netback(6)of $35.52/boe and an FFO netback(6)of $28.00/boe from an average Brent price of $68.19/bbl. Incurred $310 million of capital expenditures(2), primarily from activities at LLA-32, LLA-74, LLA-34, Cabrestero and Capachos.

2025 Fourth Quarter Results

Average production was 48,606 boe/d(8). Realized net income of $75 million or $0.78 per share(7). Generated FFO(1)of $123 million and FFO per share(6)(7)of $1.28. Realized adjusted EBITDA(2)of $129 million. Produced an operating netback(6) of $32.10/boe and an FFO netback(6)of $28.19/boe from an average Brent price of $63.08/bbl. Incurred $85 million of capital expenditures(2), primarily from activities at LLA-32, VIM-1, Capachos, LLA-34, and Occidente. Generated $38 million of free funds flow(2); working capital surplus(1)was $28 million and cash was $58 million at quarter end.

2025 Year-End Corporate Reserves Report: Highlights(3)

For the year ended December 31, 2025, the Company:

Fully replaced total 2025 production (approximately 16.3 mmboe), with reserve replacement ratios of: Proved developed producing ("PDP"): 106%, with reserve additions of 17.2 mmboe. Proved ("1P"): 106%, with reserve additions of 17.4 mmboe. Proved plus probable ("2P"): 152%, with reserve additions of 24.9 mmboe.

Increased both PDP and 1P reserves per share by 4% and 2P reserves per share by 8%, compared to 2024. Additions of 6 mmboe PDP at Cabrestero and LLA-34 from positive technical revisions and extensions. Additions of 7 mmboe PDP and 8 mmboe 2P at LLA-32 through positive technical revisions, extensions and acquisition. Additions of 3 mmboe PDP and 4 mmboe 2P at LLA-74 from successful near-field exploration drilling resulting in discoveries. Additions of 9 mmboe 2P at Occidente and CPO-10 through positive extensions. Consistent year-over-year evaluations of Capachos and VIM-1, with no notable variances.

Strong capital efficiency recognized. PDP, 1P and 2P finding, development and acquisition ("FD&A") cost per boe(6)of $17.74, $15.28, and $12.91, respectively. PDP, 1P and 2P FD&A recycle ratios(6)of 2.0x, 2.3x, and 2.8x, respectively.

Maintained a 2P reserve life index of 10 years while Q4 2025 average production increased by 7% over the comparative quarter in 2024. Based on GLJ Ltd. ("GLJ") forecast pricing, evaluated after-tax PDP, 1P and 2P net asset value per share(6)of C$23.61, C$29.16, and C$40.92, respectively. At a constant $70/bbl Brent oil price, or $65/bbl WTI oil price equivalent, GLJ evaluated after-tax PDP, 1P and 2P net asset value per share(6)of C$23.20, C$28.30, and C$38.97, respectively.

(1) Capital management measure. See “Non-GAAP and Other Financial Measures Advisory.” (2) Non-GAAP financial measure. See “Non-GAAP and Other Financial Measures Advisory.” (3) See "2025 Year-End Corporate Reserves Report" sections and "Oil & Gas Matters Advisory" for additional information. (4) See "Operational Update" for additional information. (5) Supplementary financial measure. See "Non-GAAP and Other Financial Measures Advisory." (6) Non-GAAP ratio. See “Non-GAAP and Other Financial Measures Advisory.” (7) Based on weighted-average basic shares for the period. (8) See "Operational and Financial Highlights" for a breakdown of production by product type.

| Operational and Financial Highlights | Three Months Ended | Year Ended | | | | | | | | | | | | Dec. 31, | | Dec. 31, | | Sep. 30, | | December 31, | | | | | | | | 2025 | | 2024 | | 2025 | | 2025 | | 2024 | | 2023 | | | | Operational | | | | | | | | | | | | | | Average daily production | | | | | | | | | | | | | | Light Crude Oil and Medium Crude Oil (bbl/d) | 14,835 | | 9,550 | | 10,525 | | 11,635 | | 8,850 | | 8,417 | | | Heavy Crude Oil (bbl/d) | 32,267 | | 34,882 | | 32,026 | | 31,887 | | 40,336 | | 45,163 | | | Crude oil (bbl/d) | 47,102 | | 44,432 | | 42,551 | | 43,522 | | 49,186 | | 53,580 | | | Conventional Natural Gas (mcf/d) | 9,024 | | 5,190 | | 8,412 | | 7,071 | | 4,428 | | 4,656 | | | Oil & Gas (boe/d)(1) | 48,606 | | 45,297 | | 43,953 | | 44,701 | | 49,924 | | 54,356 | | | | | | | | | | | | | | | | | Operating netback ($/boe) | | | | | | | | | | | | | | Reference price - Brent ($/bbl) | 63.08 | | 74.01 | | 68.17 | | 68.19 | | 79.86 | | 82.18 | | | Oil & gas sales(4) | 57.05 | | 63.73 | | 62.41 | | 61.90 | | 69.80 | | 70.71 | | | Royalties(4) | (6.57 | ) | (9.43 | ) | (7.61 | ) | (7.80 | ) | (10.99 | ) | (12.31 | ) | | Net revenue(4) | 50.48 | | 54.30 | | 54.80 | | 54.10 | | 58.81 | | 58.40 | | | Production expense(4) | (13.09 | ) | (15.53 | ) | (15.36 | ) | (13.88 | ) | (13.93 | ) | (10.42 | ) | | Transportation expense(4) | (5.29 | ) | (3.87 | ) | (4.73 | ) | (4.70 | ) | (3.58 | ) | (3.43 | ) | | Operating netback ($/boe)(2) | 32.10 | | 34.90 | | 34.71 | | 35.52 | | 41.30 | | 44.55 | | | | | | | | | | | | | | | | | Funds flow provided by operations netback ($/boe)(2) | 28.19 | | 32.39 | | 26.04 | | 28.00 | | 33.95 | | 33.59 | | | | | | | | | | | | | | | | | Financial ($000s except per share amounts) | | | | | | | | | | | | | | | | | | | | | | | | | | | | Net income (loss) | 74,865 | | (69,051 | ) | 50,476 | | 255,083 | | 60,680 | | 459,309 | | | Per share - basic(6) | 0.78 | | (0.70 | ) | 0.52 | | 2.62 | | 0.60 | | 4.32 | | | | | | | | | | | | | | | | | Funds flow provided by operations(5) | 122,922 | | 141,201 | | 105,298 | | 454,985 | | 622,233 | | 667,782 | | | Per share - basic(2)(6) | 1.28 | | 1.43 | | 1.09 | | 4.68 | | 6.14 | | 6.29 | | | | | | | | | | | | | | | | | Capital expenditures(3) | 84,620 | | 82,110 | | 79,961 | | 310,325 | | 347,695 | | 483,343 | | | | | | | | | | | | | | | | | Free funds flow(3) | 38,302 | | 59,091 | | 25,337 | | 144,660 | | 274,538 | | 184,439 | | | | | | | | | | | | | | | | | EBITDA(3) | 104,764 | | (10,419 | ) | 113,648 | | 481,444 | | 545,362 | | 650,829 | | | Adjusted EBITDA(3) | 128,653 | | 137,312 | | 121,132 | | 512,937 | | 720,089 | | 817,280 | | | | | | | | | | | | | | | | | Long-term inventory expenditures, net of transfers and sales | (7,678 | ) | (2,569 | ) | (1,585 | ) | (17,578 | ) | 4,773 | | 39,430 | | | | | | | | | | | | | | | | | Dividends paid | 26,853 | | 26,658 | | 26,892 | | 107,671 | | 112,184 | | 118,676 | | | Per share – Cdn$(4)(6) | 0.385 | | 0.385 | | 0.385 | | 1.54 | | 1.53 | | 1.50 | | | | | | | | | | | | | | | | | Shares repurchased | 7,644 | | 16,408 | | 7,606 | | 26,514 | | 73,789 | | 105,068 | | | Number of shares repurchased (000s) | 580 | | 1,692 | | 620 | | 2,365 | | 5,495 | | 5,628 | | | | | | | | | | | | | | | | | Outstanding shares (end of period) (000s) | | | | | | | | | | | | | | Basic | 95,974 | | 98,339 | | 96,564 | | 95,974 | | 98,339 | | 103,812 | | | Weighted average basic | 96,239 | | 99,063 | | 96,874 | | 97,176 | | 101,414 | | 106,247 | | | Weighted average diluted | 96,374 | | 99,063 | | 96,956 | | 97,223 | | 101,414 | | 106,295 | | | | | | | | | | | | | | | | | Working capital surplus (deficit)(5) | 28,027 | | 59,397 | | (3,167 | ) | 28,027 | | 59,397 | | 79,027 | | | Bank debt(7) | 33,000 | | 60,000 | | 10,000 | | 33,000 | | 60,000 | | 90,000 | | | Cash | 58,328 | | 98,022 | | 69,810 | | 58,328 | | 98,022 | | 140,352 | |

(1) Reference to crude oil or natural gas in the above table and elsewhere in this press release refer to the light and medium crude oil and heavy crude oil and conventional natural gas, respectively, product types as defined in National Instrument 51-101 - Standard of Disclosure for Oil and Gas Activities ("NI 51-101"). (2) Non-GAAP ratio. See “Non-GAAP and Other Financial Measures Advisory”. (3) Non-GAAP financial measure. See "Non-GAAP and Other Financial Measures Advisory". (4) Supplementary financial measure. See "Non-GAAP and Other Financial Measures Advisory". (5) Capital management measure. See "Non-GAAP and Other Financial Measures Advisory". (6) Per share amounts (with the exception of dividends) are based on weighted-average shares. Dividends paid per share are based on the number of common shares outstanding at each dividend record date. (7) Borrowing limit of $240.0 million as of December 31, 2025.

Operational Update

For the period of January 1, 2026, to February 28, 2026, estimated average production was 46,150 boe/d(1).

With the initial phase of the 2026 program progressing steadily, the Company has recently added multiple production-adding wells. These additions are focused at LLA-32, where a multilateral horizontal well was just completed, and in the Putumayo region, where operations are delivering encouraging results across multiple plays. Notable activities include:

Completed a multilateral horizontal well at LLA-32, which is expected onstream imminently. The multilateral well features four legs, positioning it among the first of its kind in Colombia, and represents a significant technical milestone as Parex seeks to maximize reservoir contact and further enhance its capital efficiency.

Scaling operations in the Putumayo, where initial results are ahead of Management's expectations and are expected to support the addition of meaningful new inventory at strong economics. Orito: The initial appraisal, horizontal well was drilled to roughly 2,900 feet, and recently brought onstream at approximately 600 bbl/d of medium crude oil (gross)(2); the follow-up horizontal injection well is currently being drilled, with initial waterflooding expected to begin by the end of Q1 2026. The Company is advancing its field development planning using multilateral producer and injector well patterns, leveraging Parex's direct drilling experience, and drawing on established North American plays such as the Clearwater formation, to unlock sizable oil in place and drive scalable growth.

Area Sur: initial production rates from a recent recomplete have been roughly 1,500 bbl/d of medium crude oil (gross)(2), with a string of additional efficient, low-cost production opportunities actively being targeted. Occidente: results from the first well are positive, with logging results indicating that the oil accumulation likely extends further down dip than originally expected, expanding future drilling inventory.

Began the 10-well exploration program at LLA-111, utilizing a fit-for-purpose drilling rig with streamlined well design. The innovative exploration program is expected to cost approximately $20 million in total, and if successful, could significantly expand reserves and unlock new development inventory ahead of 2027. The first well of the program has shown positive log results and is scheduled for further testing.

Drilling a near-field exploration well at Capachos, with results expected in Q2 2026. The well is being drilled as a carry well to satisfy previously announced agreements, specifically a block extension.

Optimizing performance at Cabrestero and LLA-34, alongside continued advancement of the waterflood and polymer injection programs. Cabrestero is fully on polymer injection with results within expectations. LLA-34 development drilling is ongoing, waterflood activity continues to ramp up, and polymer injection has been successfully implemented in two of the four patterns planned for 2026.

Progressing initial works activity in the extended area of the Piedemonte Convenio, with the target of beginning civil works in Q2 2026. The Foothills prospect will be drilled to the north of the producing Floreña field, with an expected spud in mid 2026.

Progressing initial works activity at Farallones, the second planned Foothills prospect, with the target to start civil works in H2 2026.

As previously disclosed, Management expects capital expenditures to be elevated in H1 2026 in line with a front-end weighted activity plan, with more moderate spending anticipated for the remainder of the year.

(1) Estimated average production for January 1, 2026 to February 28, 2026; light & medium crude oil: ~14,085 bbl/d, heavy crude oil: ~30,637 bbl/d, conventional natural gas: ~8,568 mcf/d; rounded for presentation purposes. (2) Short-term production rate. See "Oil & Gas Matters Advisory."

Return of Capital

Q1 2026 Dividend

Parex’s Board of Directors has approved a Q1 2026 regular dividend of C$0.385 per share to shareholders of record on March 18, 2026, to be paid on March 25, 2026. This regular dividend payment to shareholders is designated as an “eligible dividend” for purposes of the Income Tax Act (Canada).

Normal Course Issuer Bid

In 2025, Parex repurchased 2.4 million shares, representing roughly 2% of the current public float and a return of $27 million to shareholders.

On January 20, 2026, Parex announced the approval of its normal course issuer bid for between January 22, 2026, and January 21, 2027.

2025 Year-End Corporate Reserves Report: Discussion

The following tables summarize information contained in the independent reserves report prepared by GLJ, a qualified independent reserves evaluator, dated March 3, 2026, with an effective date of December 31, 2025 (the "GLJ 2025 Report")(1)(2)(3).

(1) All December 31, 2025 reserves presented are based on GLJ's forecast pricing effective January 1, 2026; all December 31, 2024 reserves presented are based on GLJ's forecast pricing effective January 1, 2025; and all December 31, 2023 reserves presented are based on GLJ's forecast pricing effective January 1, 2024. GLJ pricing is available on their website at www.gljpc.com. (2) All reserves are presented as Parex's working interest before royalties and in certain tables set forth below, the columns may not add due to rounding. (3) Additional reserve information as required under NI 51-101 is included in the Company's Annual Information Form for the 2025 fiscal year, which is available on SEDAR+.

Gross Reserves Volumes Per Share(1)

| | | Dec. 31 | Change over Dec. 31, 2024 | | | | | | | 2023 | 2024 | 2025(1) | | | | Year-End Basic Outstanding Shares (000s) | | 103.8 | 98.3 | 96.0 | (2 | %) | | PDP (boe/share) | | 0.80 | 0.73 | 0.76 | 4 | % | | 1P (boe/share) | | 1.08 | 1.14 | 1.18 | 4 | % | | 2P (boe/share) | | 1.62 | 1.72 | 1.86 | 8 | % |

(1) 2025 net reserves after royalties are: PDP 64,514 Mboe, proved developed non-producing 3,153 Mboe, proved undeveloped 31,935 Mboe, 1P 99,603 Mboe, and 2P 157,362 Mboe.

Reserve Replacement Ratio and Reserve Life Index

| | | Dec. 31, 2023(1) | Dec. 31, 2024(2) | Dec. 31, 2025(3) | 3-Year | | | | | | PDP Reserve Replacement Ratio | | 99 | % | 41 | % | 106 | % | 82 | % | | PDP Reserve Life Index | | 3.9 years | 4.3 years | 4.1 years | 4.1 years | | | | | | 1P Reserve Replacement Ratio | | 9 | % | 98 | % | 106 | % | 68 | % | | 1P Reserve Life Index | | 5.4 years | 6.8 years | 6.4 years | 6.1 years | | | | | | 2P Reserve Replacement Ratio | | (62 | %) | 106 | % | 152 | % | 59 | % | | 2P Reserve Life Index | | 8.1 years | 10.2 years | 10.0 years | 9.3 years | | | | |

(1) Calculated by dividing the amount of the relevant reserves category by average Q4 2023 production of 57,329 boe/d annualized (consisting of 9,700 bbl/d of light crude oil and medium crude oil, 46,760 bbl/d of heavy crude oil and 5,214 mcf/d of conventional natural gas). (2) Calculated by dividing the amount of the relevant reserves category by average Q4 2024 production of 45,297 boe/d annualized (consisting of 9,550 bbl/d of light crude oil and medium crude oil, 34,882 bbl/d of heavy crude oil and 5,190 mcf/d of conventional natural gas). (3) Calculated by dividing the amount of the relevant reserves category by average Q4 2025 production of 48,606 boe/d annualized (consisting of 14,835 bbl/d of light crude oil and medium crude oil, 32,267 bbl/d of heavy crude oil and 9,024 mcf/d of conventional natural gas).

Summary of Reserve Metrics

| | | 2025 | 3-Year | | | | | | PDP | 1P | 2P | PDP | 1P | 2P | | F&D Costs ($/boe)(1) | 17.51 | 14.99 | 12.77 | 25.22 | 32.59 | 71.00 | | FD&A Costs ($/boe)(1) | 17.74 | 15.28 | 12.91 | 25.19 | 27.85 | 34.84 | | Recycle Ratio - F&D(1) | 2.0 x | 2.4 x | 2.8 x | 1.6 x | 1.3 x | 0.6 x | | Recycle Ratio - FD&A(1) | 2.0 x | 2.3 x | 2.8 x | 1.6 x | 1.5 x | 1.2 x |

(1) Non-GAAP ratio. See “Non-GAAP and Other Financial Measures Advisory”.

Reserves Net Present Value After Tax Summary – GLJ Brent Forecast(1)(2)

| | | NPV10 | NPV10 | NAV | CAD/sh Change over | | | | | | | | December 31, | December 31, | December 31, | | | | | | | | | | 2024 | | 2025 | | 2025 | Dec. 31, | | | Reserve Category | | (000s)(2) | (000s)(2) | (CAD/sh)(3) | 2024(4) | | | | | | PDP | | $ | 1,702,405 | $ | 1,658,027 | $ | 23.61 | (5 | %) | | Proved Developed Non-Producing | | | 96,252 | | 44,213 | $ | 0.56 | (60 | %) | | Proved Undeveloped | | | 319,610 | | 344,684 | $ | 4.85 | 4 | % | | 1P | | $ | 2,118,266 | $ | 2,046,925 | $ | 29.16 | (6 | %) | | 2P | | $ | 2,907,013 | $ | 2,870,673 | $ | 40.92 | (4 | %) |

(1) Net present values ("NPV") are stated in USD and are discounted at 10 percent. The forecast prices used in the calculation of the present value of future net revenue are based on the GLJ January 1, 2025 and GLJ January 1, 2026 price forecasts, respectively. The GLJ January 1, 2026 price forecast is in the Company's Annual Information Form for the 2025 fiscal year. (2) Includes future development capital ("FDC") as at December 31, 2024 of $23 million for PDP, $440 million for 1P, and $595 million for 2P; FDC as at December 31, 2025 of $3 million for PDP, $379 million for 1P, and $590 million for 2P. (3) 2025 NAV calculated, as at December 31, 2025, as after tax NPV10 plus working capital of USD$28 million (converted at USDCAD=1.3706), less bank debt of USD$33 million, divided by 96 million basic shares outstanding as at December 31, 2025. Non-GAAP ratio. See “Non-GAAP and Other Financial Measures Advisory”. (4) 2024 NAV calculated, as at December 31, 2024, as after tax NPV10 plus working capital of USD$59 million (converted at USDCAD=1.4389), less bank debt of USD$60 million, divided by 98 million basic shares outstanding as at December 31, 2024. Non-GAAP ratio. See “Non-GAAP and Other Financial Measures Advisory”.