Capricorn Energy guides for broadly stable 2026 production

(Sharecast News) - Capricorn Energy reported a solid operational and financial performance for 2025 on Monday, underpinned by development drilling in Egypt and strengthened liquidity, as it guided broadly stable production for 2026 ahead of the anticipated ratification of its integrated concession agreement. Working interest production averaged 20,024 barrels of oil equivalent per day in 2025, comprising 40% liquids, above the midpoint of guidance of 17,000 to 21,000 boepd.

The London-listed firm said in its update that its exit rate was 21,003 boepd, supported by new development wells drilled since July and a positive response to a waterflood programme in the Badr El Din concession.

In total, 18 development wells were drilled across the portfolio during the year, alongside exploration activity in North Um Baraka, South East Horus and West El Fayoum.

"We have entered 2026 with strong momentum as our 2025 exit rate of 21,003 boepd and robust balance sheet position us to capitalise on development opportunities on the merged concession," said chief executive Randy Neely.

He added that the company's focus in 2025 had been to extract value from existing assets while pursuing the integrated concession agreement with EGPC and partners in Egypt, with positive exploration results in NUMB and SEH.

For the year ended 31 December, revenues totalled $119m on provisional entitlement sales volumes of 3.5 million barrels of oil equivalent, at an average realised oil price of $68.9 per barrel and gas price of $3.0 per mscf.

Production costs were $39m, or $5.4 per barrel of oil equivalent, while capital expenditure amounted to $77m.

Net cash inflows from Egypt operations after capex were $81m, with gross cash receipts of $217m.

Year-end receivables stood at $86m before expected credit loss adjustments, the lowest level since 2022.

Capricorn ended the year with group net cash of $103m, comprising $133m of cash and $30m of debt, following the early repayment and settlement of its senior debt facility.

The remaining junior debt facility balance of $30m was scheduled for repayment over the next three years.

Gross general and administrative costs were $24m, excluding non-cash charges and including $2m of legacy and non-recurring project spend.

In Egypt, production across the Obaiyed, Badr El Din, North East Abu Gharadig and Alam El Shawish West concessions averaged 20,024 boepd.

Gas output since October was supported by the BED15-31 well targeting the Lower Bahariya formation, which the company said highlights the benefits of the stacked reservoir system at BED.

An additional development rig was added in the second half to accelerate drilling and expand the waterflood programme.

Exploration results in 2025 supported continued activity in NUMB and SEH, with a development lease application progressing at NUMB following the NUMB-6 well, which was expected to be brought online in 2026.

At SEH, the SEH-6X well confirmed the extension of an active petroleum system, enabling progression to the next exploration phase.

The joint venture was relinquishing the West El Fayoum concession following drilling results.

Looking ahead, Capricorn said it expected formal ratification of the integrated concession agreement in the first quarter of 2026 and is guiding production of 18,000 to 22,000 boepd for the year, with around 43% liquids.

Output would be affected by two planned maintenance shutdowns at the BED facility and uncertainty over the timing of a change in working interest at North East Abu Gharadig related to Apache's withdrawal.

Capital expenditure was forecast at $85m to $95m, with operating costs of $5 to $7 per barrel of oil equivalent.

Neely said the company anticipated scaling operations in Egypt following ratification of the consolidated concession agreement, "taking advantage of the improved terms and ultimately returning significant value to shareholders," while continuing to evaluate value-accretive merger and acquisition opportunities in the UK North Sea, Egypt and the wider MENA region.

At 0901 GMT, shares in Capricorn Energy were down 0.4% at 261.45p.

Reporting by Josh White for Sharecast.com.