Q1 2026 Consolidated Corporate Results
Production: Average production of 40,242 boe/d (98% Liquids), representing 7% (14% per share) growth year-over-year.
Cash Flow: Adjusted Funds Flow of $128 million ($0.27 per share). Cash flow from operating activities of $102 million. Free Cash Flow of $20 million from Athabasca (Thermal Oil) demonstrates the strength of its quality asset base.
Strong Netbacks: Quarterly Operating Netback of $46/bbl per barrel in Thermal Oil and $47/boe in Duvernay Energy. Significant margin growth was realized in March, supported by higher oil prices, with Operating Netbacks increasing to greater than $65/boe in all operating areas.
Capital Program: Total capital expenditures of $114 million, including $81 million at Leismer to support the expansion project and $22 million in Duvernay development.
Best-in Class Balance Sheet: $60 million Net Cash position and $406 million of Liquidity (including $291 million of cash). Athabasca continues to prudently manage its capital structure as operations increase in scale and the Company is committed to maintaining a best-in-class balance sheet.
2026 Outlook Increased on Stronger Cash Flow and Exit-Rate Momentum
Leismer Expansion On Track: The winter drilling program concluded in March with 12 new well pairs with 1,300, 1,600 meter lateral lengths. These wells pairs will begin steaming in the second half of the year on a phased basis following the facility turnaround in May, driving strong production growth in the back half of 2027. The $300 million expansion project is expected to reach 40,000 bbl/d in late 2027 with a capital efficiency of $25,000/bbl/d. Capital for this project will be ~90% complete by the end of 2026.
Hangingstone Resilience: Current production remains resilient at ~8,900 bbl/d. The Company is assessing capital efficient growth opportunities in 2027 to take advantage of available facility capacity.
Accelerating Duvernay Momentum: Recent Duvernay wells continue to demonstrate strong production results and free condensate yields. A four well pad at 7-15-64-17 W5 (30% WI) was completed in March and brought on stream in April with average IP21s of 1,635 boe/d per well (91% Liquids). The Company is accelerating the timing of a three-well 100% working interest pad into Q3 2026. Production from the pad is expected to commence in the fourth quarter, contributing to an expected exit rate of ~6,000 boe/d. The capital budget for Duvernay Energy has increased to $79 million, including the three-well pad and operational readiness for a continued growth program in 2027. Continued strong results and a robust commodity price environment are enabling the strategy of self-funded growth.
Exit Rate Momentum: Production growth will materialize in the second half of 2026 with an increased exit rate of ~45,000 boe/d, supported by the Leismer expansion project and additional Duvernay activity. Annual production is expected to be at the high end of guidance of 37,000, 39,000 boe/d (98% Liquids), inclusive of a ~2,500 boe/d impact of planned turnarounds across its assets. Strong operational momentum is expected to continue into 2027 as Leismer ramps up to 40,000 bbl/d and growth in Duvernay continues.
Increased Cash Flow Outlook: The Company has increased its consolidated 2026 Adjusted Funds Flow forecast to $550, $575 million1 reflecting higher oil prices. With operational momentum into 2027, Adjusted Funds Flow and Free Cash Flow are expected to grow significantly year over year. Every +US$1/bbl move in West Texas Intermediate ("WTI") and Western Canadian Select ("WCS") heavy oil impacts 2027 Adjusted Funds Flow by ~$19 million and ~$24 million, respectively.
Corner Readiness
Corner Project: The asset is an exceptional project with a high-quality reservoir in the McMurray sands containing an estimated 353 mmbbl 2P reserves and 520 mmbbl contingent resource (best estimate). The project area is highly delineated with over 300 vertical well penetrations, 3D seismic coverage and regulatory approval in place for a 40,000 bbl/d development. Corner is adjacent to the Company's Leismer asset with many operational synergies between the assets. Once developed, the asset is expected to rank among the best steam assisted gravity drainage ("SAGD") assets in Alberta.
Facility Development: Corner will be developed through a capital-efficient modular design with 15,000 bbl/d project phases. The Company has completed Class 3 cost estimates and is now evaluating lump sum bid proposals to enhance certainty over project cost and schedule.
Operational Advancement: Recent field activity included road and pad-site clearing during the winter construction season. The Company has secured long-term gas supply and power contracts and is evaluating multiple options for diluent supply and dilbit egress.
Sanction Ready: The Company anticipates the first 15,000 bbl/d phase to be sanctioned in the second half of 2026. Once sanctioned, the project is expected to reach first steam in 30 months, first oil in 34 months and a 15,000 bbl/d production rate by the end of 2029, with additional phases in subsequent years.
Self-Funded: The initial phase of the project is expected to cost ~$35,000/bbl/d with the majority of the capital allocated in 2027/28, following the current Leismer expansion project. The Corner project is expected to be self-funded while maintaining a strong balance sheet and a continued focus on shareholder returns.
Corporate Consolidated Strategy
Thermal Oil Growth: The Company's Thermal Oil division provides an oil focused platform underpinning funded growth to >60,000 bbl/d by 2030 including Phase 1 of Corner. The Thermal Oil assets have a resource base of 1.2 billion barrels of proved plus probable reserves and 1 billion barrels of contingent resource, providing optionality to reach over 90,000 bbl/d within current regulatory approvals.
Low Break-evens: Long-life, low decline assets afford Athabasca with a sustaining capital and growth advantage. The Company's Thermal Oil assets have an operating break-even of ~US$40/bbl WTI, a sustaining break-even of ~$US45/bbl WTI and growth initiatives at Leismer and Corner are fully funded within cash flow at ~US$55/bbl WTI.
Duvernay Value Proposition: Athabasca's subsidiary company, Duvernay Energy Corporation ("DEC"), is designed to enhance value for shareholders by providing a clear path for self-funded production and cash flow growth in the Kaybob Duvernay resource play. DEC has an independent strategy and capital allocation framework with production growth to >15,000 boe/d by 2030 with ~20 years of future drilling inventory. Value crystallization for shareholders is expected once the asset has reached a material scale through its exceptional land base and drilling inventory.
Financial Resilience with Net Cash position: Athabasca is committed to maintaining a best-in-class balance sheet and the Company will prudently manage its capital structure as operations increase in scale. Athabasca (Thermal Oil) also has $2.1 billion in tax pools, including $1.5 billion of immediately deductible non-capital losses, sheltering cash taxes to 2030.
Exceptional Shareholder Returns: The Company has returned ~$1.1 billion to shareholders since 2021, including $386 million of debt reduction and ~$750 million of share buybacks. Athabasca's capital allocation framework remains anchored by a strong balance sheet, fully funded high-return growth and value-driven share buybacks, with incremental activity evaluated against share buybacks on a risk-adjusted per-share return basis. In 2026, Athabasca is committed to returning 100% of Free Cash Flow to shareholders through share buybacks and has purchased $40 million in stock year-to-date. Athabasca forecasts $1.5 billion1,2 of additional Free Cash Flow over the next five years while funding its growth initiatives at Leismer and Corner.
Focus on Per Share Metrics: Advancing attractive capital projects concurrent with share buybacks results in a >20% compounded annual growth rate in cash flow per share1 to 2030 and beyond.
Annual Shareholders Meeting
Athabasca will be hosting its Annual General Meeting of Shareholders ("Meeting") on Thursday, May 7, 2026 at 9:00 am (MT). The Meeting will be hosted virtually and shareholders and guests can listen via live webcast with details available at:
https://www.atha.com/investors/presentation-events.html
Footnote: Refer to the "Reader Advisory" section within this news release for additional information on Non‐GAAP Financial Measures (e.g. Adjusted Funds Flow, Free Cash Flow, Sustaining Capital, Net Cash) and production disclosure.1 2026 strip pricing (April 27): US$80.96 WTI, US$14.48 WCS diff, C$1.65 AECO, 0.73 C$/US$ FX. Pricing Assumptions: 2027+ US$70 WTI, US$12.50 WCS heavy differential, C$3 AECO, and 0.725 C$/US$ FX. 2The Company's illustrative multi-year outlook assumes 100% of Free Cash Flow is directed to share buybacks up to a 10% Normal Course Issuer Bid limit at an implied share price of 8x Enterprise Value/Debt Adjusted Cash Flow in 2027 and beyond.
Financial and Operational Highlights
Three months ended March 31,
($ Thousands, unless otherwise noted)
2026
2025
CORPORATE CONSOLIDATED(1)
Petroleum and natural gas production (boe/d)(2)
40,242
37,714
Petroleum, natural gas and midstream sales
$
396,277
$
367,844
Operating Income(2)
$
172,216
$
145,590
Operating Income Net of Realized Hedging(2)(3)
$
173,016
$
143,947
Operating Netback ($/boe)(2)
$
45.95
$
44.07
Operating Netback Net of Realized Hedging ($/boe)(2)(3)
$
46.16
$
43.57
Capital expenditures
$
113,962
$
63,333
Cash flow from operating activities
$
102,027
$
123,353
per share - basic
$
0.21
$
0.24
Adjusted Funds Flow(2)
$
128,025
$
129,675
per share - basic
$
0.27
$
0.25
ATHABASCA (THERMAL OIL)
Bitumen production (bbl/d)(2)
35,629
34,742
Petroleum, natural gas and midstream sales
$
393,863
$
362,375
Operating Income(2)
$
152,659
$
135,316
Operating Netback ($/bbl)(2)
$
45.80
$
44.56
Capital expenditures
$
92,125
$
50,376
Adjusted Funds Flow(2)
$
112,240
$
121,353
Free Cash Flow(2)
$
20,115
$
70,977
DUVERNAY ENERGY(1)
Petroleum and natural gas production (boe/d)(2)
4,613
2,972
Percentage Liquids (%)(2)
81
%
73
%
Petroleum, natural gas and midstream sales
$
28,535
$
17,619
Operating Income(2)
$
19,557
$
10,274
Operating Netback ($/boe)(2)
$
47.10
$
38.42
Capital expenditures
$
21,837
$
12,957
Adjusted Funds Flow(2)
$
15,785
$
8,322
Free Cash Flow(2)
$
(6,052
)
$
(4,635
)
NET INCOME AND COMPREHENSIVE INCOME
