Northern Oil & Gas Raises 2023 Production Targets, Expects Q2 Production To Face Negative Impact

Northern Oil & Gas Inc NOG revised its 2023 guidance and provided Q2 2023 operational update.

The company raised 2023 production (Boe per day) to 96,000 - 100,000 (from 91,000 - 96,000), reflecting better-than-expected well performance, Forge and Novo acquisitions contribution, and changes to drilling and completion plans in 2023.

The company expects Q3 2023 production of 99,000 - 103,000 Boe per day.

The company raised the outlook for 2023 budgeted capital expenditures to $764 million - $800 million (from $737 million - $778 million), mainly on capital related to the Forge and Novo buyout.

On the other hand, the company revised per-unit production expenses to $9.35 - $9.55 (from $9.35 - $9.60) and cash G&A costs to $0.80 - $0.85 (from $0.80 - $0.90) for 2023.

Q2 2023 Update: The company expects production to be impacted by around 900 Boe per day (~90% oil) on curtailments and deferments of wells turned to sales in the Williston Basin due to lower oil prices.

NOG projects Q2 production volumes to be 90.5 to 90.8 Boe per day, with a lower Q/Q oil mix of about 60%, driven partly by improved gas production from higher capture rates and the high oil-cut Williston deferments.

The company anticipates capital expenditures (excluding the acquisition of the Forge assets) to be in the range of $231.0 million to $236.0 million, in line with previous guidance. 

"NOG remains focused on maximizing returns on our assets. We fully support our operating partners and the decisions driving some changes to the 2023 plan. We expect these changes to benefit our shareholders through higher realized prices and by driving down costs. Well performance continues to exceed our internal estimates, which sets the stage for further capital efficient growth as we look toward 2024. Our updated guidance also highlights the continued path of reducing unit costs and improving margins," said Nick O'Grady, Chief Executive Officer.

Also Read: Earthstone & Northern Oil & Gas Ink Acquisition Deal For Delaware Basin Permian Assets

Price Action: NOG shares closed higher by 2.77% at $38.15 on Tuesday.