Touchstone Exploration (LSE:TXP) delivered a significant improvement in its second-quarter 2026 financial performance, returning to profitability as stronger commodity pricing lifted revenue, operating margins and cash generation.
Funds flow from operations increased to $7.13 million, while net income reached $2.34 million, reversing the loss recorded in the previous quarter. Petroleum and natural gas sales climbed 39% sequentially to $17.47 million as realised prices strengthened across crude oil, natural gas liquids and natural gas.
The improvement came despite average production declining 5% from the previous quarter to 4,433 barrels of oil equivalent per day, largely reflecting planned maintenance at Atlantic LNG.
Stronger netbacks support debt reduction
Touchstone’s operating netback increased 77% to $24.37 per boe, providing additional cash generation and helping the company reduce net debt by 10% to $68.71 million.
Capital expenditure totalled $1.52 million during the quarter, with investment directed towards projects including the FR-1836 oil well and the Cascadura booster compressor.
Touchstone also completed a multi-jurisdictional financing during the period. The subsequent repayment and full conversion into equity of an $8.40 million debenture simplified the group’s capital structure and provided additional financial flexibility to pursue future growth initiatives.
Cascadura compressor begins operations
Operational activity progressed across several of Touchstone’s Trinidad and Tobago assets. The Cascadura booster compressor was commissioned and started operations, while two development oil wells were completed on the WD-8 block.
The company also successfully recompleted the BRE-1 well on the Central block, adding to efforts to strengthen production capacity and optimise its existing asset base.
Gas output from Cascadura and Coho was temporarily restricted by third-party pipeline constraints associated with the Atlantic LNG Train 4 outage. However, early performance from the Cascadura compressor has exceeded expectations.
Touchstone is carrying out several optimisation programmes across its operations and expects to have the potential to increase production as regional pipeline pressures return to more normal levels.
More about Touchstone Exploration
Touchstone Exploration Inc. is a Calgary-based oil and gas producer focused primarily on operations in Trinidad and Tobago, where it produces crude oil, natural gas and natural gas liquids.
Its portfolio includes the Ortoire and Central blocks as well as gas-focused developments such as Cascadura and Coho. The company targets both liquids-rich and dry natural gas reservoirs while selling production into regional energy markets, including infrastructure connected to Atlantic LNG.
Touchstone’s strategy combines onshore oil development with natural gas projects, production optimisation and investment in supporting infrastructure. The company is also focused on reducing leverage and strengthening its balance sheet to support longer-term growth.
Its production mix is approximately one-third liquids and two-thirds natural gas, giving Touchstone exposure to both international oil prices and Caribbean gas market conditions. As a result, regional pipeline availability and LNG infrastructure uptime remain important factors affecting production and financial performance.
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