Ovintiv Raises 2026 Oil Outlook After Anadarko Sale

The Tip Desk · July 24, 2026 · 4 min read

The company now expects 630 to 645 thousand barrels of oil equivalent a day for the year, up from a February range that started at 620, with capital unchanged.

Ovintiv Inc. (OVV) raised its full-year 2026 production outlook after the second quarter. It now expects average volumes of 630 thousand barrels of oil equivalent per day to 645 thousand barrels of oil equivalent per day, versus a February outlook that started at 620 thousand barrels of oil equivalent per day. The revision reflects higher expected oil and condensate production for the same capital investment, representing 4% production per share growth. Full-year capital remains $2.25 billion to $2.35 billion.

Oil and condensate guidance is 210 to 212 thousand barrels per day, NGLs 83 to 85 thousand barrels per day, and natural gas 2,025 to 2,075 million cubic feet per day. Third-quarter guidance is 615 to 640 thousand barrels of oil equivalent per day, 205 to 210 thousand barrels per day of oil and condensate, 75 to 80 thousand barrels per day of NGLs, 2,000 to 2,100 million cubic feet per day of natural gas, and $550 million to $600 million of capital.

Average second-quarter production was 615 thousand barrels of oil equivalent per day, down from 679 thousand barrels of oil equivalent per day in the first quarter, when volumes sat at the high end of guidance. Oil and condensate averaged 206 thousand barrels per day, above the high end of company guidance for the quarter, with 82 thousand barrels per day of other NGLs and 1,959 million cubic feet per day of natural gas.

Permian production averaged 231 thousand barrels of oil equivalent per day, 78% liquids, with 38 net wells turned in line. Montney averaged 374 thousand barrels of oil equivalent per day, 27% liquids, with 40 net wells turned in line. Full-year Permian capital is expected at $1.325 billion to $1.375 billion for about 5 rigs and 125 to 135 net wells; second-half oil and condensate is expected at about 125 thousand barrels per day and natural gas 280 to 305 million cubic feet per day. Montney capital is $875 million to $925 million for about 6 rigs and 130 to 140 net wells; second-half oil and condensate is 80 to 85 thousand barrels per day and natural gas 1.7 to 1.8 billion cubic feet per day.

Capital investment in the second quarter was $574 million, at the midpoint of the $550 million to $600 million range, down from $605 million in the first quarter. Upstream operating expense was $3.25 per barrel of oil equivalent. Transportation and processing costs were $9.47 per barrel of oil equivalent. Production, mineral and other taxes were $1.43 per barrel of oil equivalent, or 3.5% of upstream product revenue.

Excluding hedges, average realized prices were $97.50 per barrel for oil and condensate, 105% of WTI, $21.67 per barrel for other NGLs, and $1.71 per Mcf, 59% of NYMEX, for a total of $41.00 per barrel of oil equivalent. Including hedges, oil and condensate was $91.22 per barrel, 98% of WTI, and natural gas was $1.99 per Mcf, 69% of NYMEX, for a total of $39.79 per barrel of oil equivalent.

Reported net earnings were $456 million, or $1.62 a share diluted, including a $337 million before-tax loss on the Anadarko divestiture and a $122 million before-tax net gain on risk management in revenues. The first quarter had been a net loss of $630 million, or $2.35 a share diluted, including $1.2 billion in after-tax ceiling-test impairments.

Cash from operating activities was $1.6 billion and Non-GAAP Cash Flow approximately $1.3 billion. Non-GAAP Free Cash Flow was $682 million after $574 million of capital expenditures.

The company closed the sale of Anadarko assets for approximately $2.82 billion after preliminary closing adjustments and transaction costs. Net Debt was $2.995 billion as of June 30, 2026, with Net Debt to Adjusted EBITDA of 0.6 times. Total liquidity was about $4.4 billion, including $3.5 billion of credit facilities, $159 million of uncommitted demand lines, and $700 million of cash. Ovintiv redeemed its $700 million, 5.65% senior notes due May 15, 2028, on April 20, 2026, with annualized interest savings expected to be about $40 million.

Second-quarter shareholder returns totaled approximately $429 million, or about 63% of Non-GAAP Free Cash Flow, consisting of $345 million of share buybacks, or 6.1 million shares, and $84 million of dividends. Year-to-date returns were approximately $598 million, or about 45% of Non-GAAP Free Cash Flow. Ovintiv expects full-year 2026 shareholder returns to total more than 60% of Non-GAAP Free Cash Flow, versus the February framework that committed to at least 75% of full-year Non-GAAP Free Cash Flow. The board declared a quarterly dividend of $0.30 a share payable September 29, 2026.