Magnolia debt falls faster after WildFire close
Magnolia Oil & Gas ended the third quarter with about $1.9 billion of net debt, which the company said was more than a year ahead of its original deleveraging plan.
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Magnolia Oil & Gas (MGY) ended the third quarter of 2026 with approximately $1.9 billion of net debt, which the company said was lower than expected due to strong cash flow and proceeds from a non-core asset sale, and more than a full year ahead of its original deleveraging plan.
The producer closed the sale of non-core assets in Dimmit and Zavala counties for total consideration of $47.5 million plus 616 net acres in Gonzales County, increasing its average operated working interest in a contiguous Karnes-area block to 98 percent. The divested assets included approximately 1.4 Mboe/d (~84% oil) of next twelve-month production.
Magnolia implemented additional oil hedges during the third quarter using costless collars, with more than half of its oil production hedged through the second quarter of 2027. It expects to realize at least one-third of estimated >$100 million annual run-rate synergies by year-end 2026.
Production for the fourth quarter of 2026, the first full quarter pro forma for the WildFire acquisition, is expected to be 159 to 161 Mboe/d (49% to 50% oil), reflecting the WildFire acquisition and divested volumes. The company estimates 2027 production growth of 4 to 5 percent for both oil and total production, measured from a second-quarter 2026 pro forma production base after accounting for non-core asset sale volumes. Magnolia currently estimates D&C capital spending at $900 to $950 million during 2027, a range that the company said incorporates a modest amount of oil field service inflation.
During the third quarter, Magnolia purchased approximately 2.3 million shares after being restricted for a portion of the quarter. Total shares outstanding at the end of the third quarter are approximately 267 million shares.