Harbour Energy PLC (LSE:HBR) has increased its full-year 2026 production guidance and raised its free cash flow forecast by $800 million to approximately $2.6 billion, following stronger operational performance and higher oil and European gas prices.
The energy company reported record average production of 501,000 barrels of oil equivalent per day (boepd) for the nine months ended 30 September 2026, representing a 6% increase from 473,000 boepd a year earlier.
Harbour also announced a further $150 million share buyback, bringing total repurchases announced during 2026 to $550 million, as it expects shareholder distributions to reach at least $1.2 billion for the year.
Nine-Month Production Reaches Record 501,000 Boepd
Harbour’s third-quarter production averaged 484,000 boepd, an increase of 9% compared with the corresponding period in 2025.
The improvement reflected contributions from the LLOG acquisition in the United States, completed in February, and the Waldorf acquisition in the UK, completed in July.
These additions more than offset the effects of asset disposals in Indonesia and Vietnam and natural production declines in the UK.
Production in Norway benefited from improved operational reliability, additional drilling at Njord and the early start-up of the Skarv satellite developments in August.
New wells also entered production in Argentina and the United States, where initial output from the latest Who Dat and Buckskin wells exceeded expectations.
Unit operating costs increased to $13.90 per barrel of oil equivalent, compared with $12.80 a year earlier.
Revenue Increases 29% as Free Cash Flow Doubles
Harbour reported revenue of $9.8 billion for the nine-month period, an increase of 29% from $7.6 billion in 2025.
EBITDAX rose 26% to $6.8 billion from $5.4 billion, supported by higher production and stronger realised commodity prices.
Post-hedging realised oil prices averaged $85 per barrel, compared with $71 a year earlier, while European gas prices increased to $16.10 per thousand cubic feet from $13.40.
Free cash flow doubled to $2.4 billion from $1.2 billion in the prior-year period.
Capital expenditure, including decommissioning, remained unchanged at approximately $1.6 billion.
The company reduced net debt to $5.1 billion at the end of September, compared with $5.4 billion at 30 June, while leverage declined to 0.6 times from 0.7 times.
Harbour also completed the refinancing of its $3 billion revolving credit facility, extending its maturity to 2031, and issued $750 million of bonds in August.
Further $150 Million Share Buyback Announced
Harbour announced an additional $150 million share repurchase programme, taking total buybacks announced during 2026 to $550 million.
Approximately $300 million of repurchases had been completed by 4 November, representing around 5% of the company’s issued share capital.
The company also paid an interim dividend of 8.05 cents per voting ordinary share in September, equivalent to approximately $150 million.
Based on its revised free cash flow outlook, Harbour expects to return at least $1.2 billion to shareholders during 2026.
This includes a $300 million annual dividend and at least $900 million in additional shareholder returns.
Harbour also reported that BASF’s shareholding declined from approximately 47% at the beginning of the year to around 16% at the end of September.
Norway and US Developments Support Production Outlook
Harbour continued to advance several infrastructure-led development projects during the period.
In Norway, the Gjøa North and Ofelia projects received approval during the second quarter, while five additional projects are targeted for final investment decisions before year-end.
The company said these developments could potentially replace all of its Norwegian reserves through new additions.
In the US Gulf of America, Harbour approved the Who Dat East project in August and added a second drilling rig in September to accelerate investment opportunities.
The Salamanca floating production system subsea pump project remains on track for a final investment decision before the end of 2026.
Harbour also secured 12 additional US offshore leases, including eight as operator, expanding its exploration portfolio near existing production infrastructure.
Argentina and Mexico Projects Advance
In Argentina, Harbour drilled three gas wells at its Aguada Pichana Este licence during the third quarter, with nine wells connected during the nine-month period.
The company is also progressing applications relating to the San Roque licence in the Vaca Muerta formation.
The proposed development could provide access to more than 200 additional drilling locations, supporting potential future oil production growth.
Harbour’s 15% interest in the Southern Energy liquefied natural gas project remains on schedule for an anticipated start-up around the end of 2027.
In Mexico, development work continued at the Zama and Kan projects.
A memorandum of understanding was signed for the Lakam Ha floating production, storage and offloading vessel, while invitations to tender were issued for major engineering packages.
Harbour continues to target readiness for final investment decisions at both projects around the end of 2027.
Carbon Storage Project Begins Operations in Denmark
Harbour reported that the Greensand carbon capture and storage project in Denmark achieved its first carbon dioxide injection in September.
The project, in which Harbour holds a 40% interest, has an initial planned storage capacity of up to 400,000 tonnes of carbon dioxide annually.
The company described Greensand as the first full-scale operational carbon dioxide storage site in the European Union.
Full-Year Production Guidance Increased to 500,000–505,000 Boepd
Harbour raised its full-year production forecast to between 500,000 and 505,000 boepd, compared with its previous guidance of 490,000 to 500,000 boepd.
Production averaged 511,000 boepd during October, despite maintenance activity and hurricane-related disruption in the United States.
The company maintained its full-year unit operating cost forecast at approximately $14.50 per barrel of oil equivalent.
Capital expenditure guidance also remained unchanged at between $2.2 billion and $2.4 billion.
Harbour increased its 2026 free cash flow forecast to approximately $2.6 billion from $1.8 billion, reflecting higher expected production and stronger commodity prices, partly offset by working capital movements and hedging effects.
The revised outlook includes approximately $1.8 billion in anticipated fourth-quarter tax payments.
Management said the improved financial outlook would support further debt reduction alongside shareholder distributions and investment in future production.
More About Harbour Energy
Harbour Energy PLC (LSE:HBR) is an international oil and gas exploration and production company with operations across Europe, the Americas, Africa and Asia. Its portfolio includes producing assets, exploration licences and development projects, alongside investments in carbon capture and storage infrastructure.
Leave a Reply