Northern Oil and Gas Lifts Third-Quarter Capital Spending
The non-operator booked $250.0 million to $253.0 million of third-quarter capital, up from $195.8 million in the second quarter, and said spending is expected toward the higher end of its 2026 range.
Northern Oil and Gas (NOG), the largest publicly traded dedicated non-operator in the United States, booked third-quarter capital spending of $250.0 million to $253.0 million, excluding non-budgeted acquisitions and other, citing acceleration in current and forward activity after oil strip prices rallied.
That sequential step-up from $195.8 million of second-quarter capital, excluding non-budgeted items, marked a faster deployment of development money than the prior quarter. Capital expenditures are expected to trend lower in the fourth quarter, absent significant non-budgeted activity, and NOG reiterated its 2026 capital-expenditure guidance, saying that, based on the current pace, spending is expected toward the higher end of the range.
Operationally, NOG described a clean quarter with minimal field disruptions and said all basins met internal expectations. Spend remained more heavily focused on near-term production in oil-focused basins, with nearly 85% of capital deployed to the Permian, Williston, and Uinta basins.
Ground-game activity slowed from the second quarter. NOG closed 19 deals in the third quarter, adding approximately 1,060 net acres and 2.8 net wells while deploying about $56.5 million in acquisition costs and associated development capital. In the second quarter, it had closed 30 deals, adding over 2,300 net acres and 6.2 net wells for $44.7 million.
Hedge results flipped from the second quarter. NOG expected third-quarter unrealized mark-to-market losses on derivatives of $300.0 million to $320.0 million, driven by changes in the value of its derivatives portfolio. Realized hedge losses were estimated at $51.0 million to $52.0 million, driven by crude oil hedges and partially offset by gas and basis hedges. In the second quarter, NOG had estimated unrealized mark-to-market gains of $155.0 million to $160.0 million and realized hedge losses of $85.0 million to $90.0 million.
Share repurchases slowed. In the third quarter, NOG bought 667,989 shares for a total of $16.0 million inclusive of commissions, at an average price of $23.96 a share. In the second quarter, it had repurchased 2.95 million shares at an average of $20.37. In July 2026, the board authorized a $150.0 million increase to the common-stock repurchase program, which provides remaining capacity of about $227.2 million after the third-quarter purchases. On August 4, 2026, NOG declared a $0.45 quarterly cash dividend, payable October 30, 2026.
The second-quarter print had already shown a recovery in volumes after Permian shut-ins. Second-quarter production averaged 145,659 Boe per day, 47% oil, with oil at 68,275 Bbls per day. Oil volumes were impacted by about 7,000 Boe per day of well shut-ins and three deferred turn-in-lines in certain Permian assets in April, May, and part of June; those wells were back on line, and the turn-in-lines were expected to come online in the third quarter. Second-quarter Adjusted EBITDA was $401.0 million, GAAP net income was $236.6 million, and cash flow from operations was $321.6 million.
As oil strip prices have rallied, NOG has seen incremental acceleration of development activity across its oil basins. The mix of that spending stayed concentrated in the same three oil-focused basins, with the Permian, Williston, and Uinta taking nearly 85% of third-quarter capital. NOG reiterated 2026 capital-expenditure guidance and said that, at the current pace, spending is expected toward the higher end of the range.