Veren Inc.

Veren reported 2024 annual average production of 191,000 BOE/d and Q4 production of 189,000 BOE/d. It generated over CAD640 million of excess cash flow in 2024, with nearly one-third realized in Q4, and reduced net debt by 35% or CAD1.3 billion. Management said 2024 organic 2P production replacement was 173%, with a recycle ratio of 2.1x based on 2P F&D costs including change in FDC. For 2025, the company guided to production of 188,000 to 196,000 BOE/d, capital expenditures of CAD1.48 billion to CAD1.58 billion, and excess cash flow of CAD625 million to CAD825 million at $70 to $75 WTI and $2.25 per Mcf AECO. Management also said January production was 191,000 BOE/d and that growth is weighted to the second half of the year due to early-year facility downtime and pad timing.

Craig Bryksa emphasized that 2024 was a year of successful integration, reserve growth, debt reduction, and stronger capital returns, saying the company is now positioned around a strategic mix of short-cycle Alberta assets and long-cycle Saskatchewan assets. He was upbeat about the Montney and Duvernay well results, highlighting stronger-than-type performance and high liquids content, but said the company will keep optimizing completions rather than assume one design fits everywhere. His tone on 2025 was confident but measured: management is comfortable with guidance, expects production to ramp later in the year, and is focused on execution, balance sheet strength, and shareholder returns.

Ken Lamont said Veren ended 2024 with roughly CAD2.5 billion of absolute debt and is very comfortable at about 1x debt-to-cash flow, while still targeting lower leverage over time. He pointed to 2025 organic deleveraging of CAD250 million at US$70 WTI and said the company expects to retain 40% of excess cash flow for the balance sheet, while the base dividend remains sustainable at lower oil prices and all cash returns above that go to share repurchases. He also framed the longer-term setup as favorable, citing 7% CAGR production growth and 15% growth in excess cash generation.

Analysts pressed on whether the strong early performance of the single-point entry wells should lead to higher guidance, but management said it is still early and they are comfortable with the 188,000 to 196,000 BOE/d range for now. Questions also focused on why some plug-and-perf wells showed lower gas-oil ratios; management said the wells may not have achieved enough height growth, drawdown is currently low, and they are looking at ways to optimize drawdown and possibly adjust completions further. Another area of focus was M&A and the Saskatchewan portfolio: management said it is not interested in near-term acquisitions and views Saskatchewan as a steady, low-decline excess-cash-flow asset with ongoing EOR work and some open-hole multilateral activity.