Canacol Energy Ltd. Reports Record Adjusted EBITDAX of $296 Million for the Year Ended December 31, 2024
CALGARY, Alberta, March 20, 2025 (GLOBE NEWSWIRE) -- Canacol Energy Ltd. ("Canacol" or the "Corporation") (TSX:CNE, OTCQX:CNNEF, BVC:CNEC)) is pleased to report its financial and operating results for the three months and year ended December 31, 2024. Dollar amounts are expressed in United States dollars, with the exception of Canadian dollar unit prices ("C$") where indicated and otherwise noted.
Highlights for the three months and year ended December 31, 2024
Adjusted EBITDAX increased 43% and 25% to $76.1 million and $296.1 million for the three months and year ended December 31, 2024, respectively, compared to $53.1 million and $236.8 million for the same periods in 2023, respectively. The increase is mainly due to an increase of natural gas and liquefied natural gas ("LNG") operating netback, offset by a decrease in realized contractual natural gas and LNG sales volume.
Adjusted funds from operations increased 68% and 43% to $52.1 million and $209.4 million for the three months and year ended December 31, 2024, respectively, compared to $31.0 million and $146.3 million for the same periods in 2023, respectively, mainly due to an increase in EBITDAX.
The Corporation's natural gas and LNG operating netback increased 39% and 32% to $6.12 per Mcf and $5.41 per Mcf for the three months and year ended December 31, 2024, respectively, compared to $4.39 per Mcf and $4.11 per Mcf for the same periods in 2023, respectively. The increase is due to an increase in average sales prices, net of transportation expenses, offset by an increase in royalties.
Total revenues, net of royalties and transportation expenses for the three months and year ended December 31, 2024 increased 23% and 16% to $98.3 million and $352.3 million, respectively, compared to $79.7 million and $304.9 million for the same periods in 2023, respectively, mainly due to higher average sales price, net of transportation expenses of $7.81 per Mcf and $6.99 per Mcf for the three months and year ended December 31, 2024, respectively, compared to $6.04 per Mcf and $5.41 per Mcf for the same periods in 2023, offset by a decrease in realized natural gas and LNG sales volume.
Realized contractual natural gas sales volume decreased 4% and 12% to 158.0 MMcfpd and 156.7 MMcfpd for the three months and year ended December 31, 2024, respectively, compared to 164.8 MMcfpd and 178.3 MMcfpd for the same periods in 2023, respectively.
The Corporation realized a net loss of $25.4 million and $32.7 million for the three months and year ended December 31, 2024, respectively, compared to a net income of $29.9 million and $86.2 million for the same periods in 2023, respectively. The decrease in net income for the three months and year ended December 31, 2024 is the result of recognizing a non-cash deferred income tax expense of $28.9 million and $77.2 million for the three months and year ended December 31, 2024, respectively, as compared to a non-cash deferred income tax recovery of $31.7 million and $103.6 million in 2023, respectively, offset by an increase in EBITDAX.
Net cash capital expenditures for the three months and year ended December 31, 2024 was $28.6 million and $122.3 million, respectively, compared to $72.2 million and $215.2 million for the same periods in 2023, respectively. The decrease is due to reduced spending on land and seismic, workovers, and drilling and completion.
As at December 31, 2024, the Corporation had $79.2 million in cash and cash equivalents and $45.5 million in working capital surplus.
Outlook
In 2025, the Corporation is focused on:
Maintaining and growing Canacol's EBITDA generation and reserves via both higher commodity pricing and investment in drilling, workover, and new facilities projects;
Exploring higher impact gas exploration opportunities in the Lower Magdalena Valley ("LMV");
Reducing debt;
Laying the groundwork to be able to commence operations in Bolivia in 2026; and
Continue the Corporation's commitment to its ESG strategy.
The Corporation expects that commodity pricing will remain strong for the remainder of 2025, and for this reason, in 2025, the Corporation lowered its take-or-pay volumes to maximize exposure to the spot sales market. In line with maintaining and growing Canacol's reserves and production in its core assets in the LMV, the Corporation plans to optimize its production and increase reserves by drilling up to 11 exploration and three development wells, installing new compression and processing facilities as required, and completing workovers of producing wells in its key gas fields. These development and exploration activities are planned to support the Canacol's robust EBITDA generation and allow the Corporation to capitalize on strong gas market dynamics in 2025. Planned development wells include the Clarinete-11, Siku-2 and Lulo-3 wells, all of which have already been successfully drilled and brought on production as of the date of this release. The exploration drilling plan includes 10 gas exploration wells in the LMV and one gas and condensate exploration well in the Middle Magdalena Valley ("MMV"). Notable exploration wells in the LMV include continuing operations at Natilla-2.
Over the last several years, the Corporation has assembled a significant acreage position in the MMV and in 2025, the Corporation plans to drill the Valiente prospect targeting a large shallow structure located approximately five kilometers to the south and up dip of the Opon gas field discovered in 1965 by Cities Services and later developed by Amoco in 1997.
The Corporation is also continuing its efforts with respect to the Pola exploration project located in the MMV. Pola is a large prospect targeting gas within Cretaceous aged reservoirs at depths close to 17,000 feet. Given the relatively high cost of the well, the Corporation is currently evaluating its options with respect to how to proceed with the project.
In Bolivia, the Corporation is awaiting ratification and formalization by Congress of three exploration contracts (Arenales, Ovai, and Florida Este) and one field redevelopment contract (Tita) in order to establish the effective date of all four contracts. The Corporation is currently preparing to apply for the environmental permit for Tita, along with formulating development plans, in order to commence field reactivation activities in 2026.
FINANCIAL & OPERATING HIGHLIGHTS (in United States dollars (tabular amounts in thousands) except as otherwise noted)
Financial
Three months endedDecember 31
,
Year endedDecember 31
,
2024
2023
Change
2024
2023
Change
Total revenues, net of royalties and transportation expense
98,339
79,718
23
%
352,252
304,854
16
%
Adjusted EBITDAX(1)
76,054
53,144
43
%
296,126
236,829
25
%
Adjusted funds from operations(1)
52,119
30,958
68
%
209,375
146,287
43
%
Per share, basic ($)(1)
1.53
0.91
68
%
6.14
4.29
43
%
Per share, diluted ($)(1)
1.53
0.91
68
%
6.07
4.29
41
%
Cash flows provided by operating activities
