Valeura Energy Q1 Earnings Call Highlights

Key Points

• Valeura Energy said it is benefiting from higher oil prices, strong cash generation, and a growing reserve base, with reserves rising to about 58 million barrels and nearly 200% reserve replacement over the latest year.
• The company’s key growth project, the Wassana redevelopment, remains on schedule and on budget, while Valeura is also expanding in Thailand through a new rig contract, added well slots at Nong Yao, and a farm-in with PTTEP.
• Management said it is actively evaluating acquisitions and future shareholder returns, backed by a debt-free balance sheet and more than a quarter-billion U.S. dollars in cash, though Q1 revenue was temporarily hit by delayed oil sales shifting into April.

Valeura Energy TSE: VLE executives told shareholders at the company’s 2026 annual general meeting that the Thailand-focused producer is benefiting from higher oil prices, a growing reserve base and ongoing development work, while continuing to evaluate acquisitions and future capital returns.

President and CEO Sean Guest said Valeura’s business model was designed to generate “really good returns” at oil prices around $65 per barrel while preserving exposure to upside in stronger price environments. He said the company remains debt-free and unhedged, leaving it fully exposed to current oil prices.

Guest said Valeura’s market value has risen to just over $1 billion from just over $600 million a year earlier. He attributed part of the increase to stronger oil prices, while noting that much of the share price gain occurred before the more recent oil price moves.

Reserves and Thailand development remain central to growth plan

Guest highlighted Valeura’s reserve growth as a key achievement, saying the company delivered “almost 200% reserve replacement” in the latest year and increased reserves to about 58 million barrels. He said that equates to “just under eight years” of reserve life and is more than double the level when Valeura acquired the assets from Mubadala.

He said the company has produced “pretty well all of the oil” it originally bought in that transaction, while still more than doubling reserves. Guest described Thailand as a strong operating base for Valeura and said the company’s country entry has gone “very well.”

The CEO also pointed to the Wassana redevelopment as a major focus. Valeura took a final investment decision on the project roughly a year ago, and Guest said the new central processing platform and redevelopment remain on schedule and on budget. He added that the company expects the work to come in under budget and is evaluating whether it can be delivered early.

Guest said Valeura recently signed a three-year rig contract, with early work expected at Nong Yao before moving to Wassana. He said the timing of the tender was favorable because bids came in during a lower oil price environment, allowing Valeura to lock in pricing for three years.

Q1 revenue affected by timing of oil sales

Valeura released first-quarter results the morning of the meeting, and Guest said revenue for the quarter was lower because buyers pushed March oil sales into April. As a result, Valeura had no oil sales in March, which Guest noted was a period of higher prices.

He said the company generated $92 million of revenue in the first quarter, while April alone produced just over $90 million of revenue as deferred inventory was sold early in the month. Guest said the company was still seeing strong sales and prices in May.

Valeura ended the first quarter with just over a quarter billion U.S. dollars in cash, according to Guest. He said the cash balance was down from year-end, as expected, because the quarter included heavy investment in the Wassana platform and the purchase of one of the company’s floating storage and offloading vessels. He said inventory sold after quarter-end would have added roughly $60 million in cash after royalties if it had been received before the end of the quarter.

On 2026 guidance, Guest said production and operating expenses were tracking in line with expectations. He said operating expenses could rise if oil prices remain high because the company uses diesel, but added that higher revenue would more than offset that pressure. Capital spending is being increased because Valeura plans to bring a rig in about two months earlier than originally planned and expand Nong Yao A with four additional well slots.

PTTEP farm-in and Turkey testing remain in focus

Guest also discussed Valeura’s farm-in to the G1 and G3 blocks with Thailand’s national oil company, PTTEP. Valeura has a 40% interest in the blocks, while PTTEP holds 60%. Guest said the acreage position gives Valeura exposure to some of the largest producing areas in the Gulf of Thailand.

He said one block includes discoveries that have already been converted into a production area, and Valeura expects to move toward a final investment decision this year on two gas platforms. In another area near Nong Yao, Guest said Valeura and PTTEP plan to drill oil wells in the first quarter of next year, with the potential for tiebacks into Valeura’s existing Nong Yao facilities.

During the question-and-answer session, shareholder Keith McDonald asked about government approval for the G1 and G3 farm-in. Guest said the process had slowed because of Thailand’s election and formation of a new cabinet, but said Valeura understands the matter has moved to the energy minister’s desk. He said Valeura continues to work with PTTEP weekly on the projects.

Asked by shareholder Stuart Jeffery about testing in Turkey, Guest said the company was disappointed by the time needed to set up the program with TransAtlantic, the operator. He said the goal is to conduct a low-cost, longer-term test rather than a short test lasting weeks or months. Guest said the work is focused on an original vertical well, with a new fracture stimulation and test in a different zone than previously tested. He said there is no expectation of a high flow rate from the vertical well; instead, the aim is to assess sustainability and model the potential for a horizontal well.

Capital allocation and governance actions

Guest said Valeura’s capital allocation priorities remain reinvestment in existing assets, mergers and acquisitions, and shareholder returns. He said the company is focused on maintaining production from its original assets at roughly 20,000 to 25,000 barrels per day and has the cash flow to fund the Wassana redevelopment and future PTTEP-related platforms.

On M&A, Guest said Valeura is actively involved in some processes and is positioned to pursue “significant deal size” using its cash and access to debt. He said if suitable deals do not emerge in the second half of the year, management will likely discuss with the board how to handle excess cash and potential returns to shareholders.

Guest said Valeura has a share buyback policy in place, but its purpose is to manage dilution rather than materially reduce the share count.

At the formal portion of the AGM, shareholders approved Deloitte & Touche LLP Singapore as auditor. Shareholders also elected eight directors: William Sean Guest, Timothy R. Marchant, Russell J. Hiscock, Timothy N. Chapman, Lina Lee, Anna Green, Chalermchai Mahagitsiri and Joseph A. Tomkiewicz. The company also received approval for unallocated options under its stock option plan and unallocated performance share units and restricted share units under its performance and restricted share unit plan.

Emissions intensity reduced, no lost-time incidents reported

Guest said Valeura reduced emissions intensity by 30% during its first two years operating the Thailand assets. He said the reduction came while producing the same oil with lower emissions, in part by using less diesel, which also reduced operating expenses.

He also said Valeura has had no lost-time incident for nearly three years and reported no spills. Guest credited the company’s Thailand workforce, noting that Valeura has about 200 staff in the office, about 500 full-time offshore workers across two shifts and roughly five expatriates in the country.

Guest closed by saying Valeura will continue looking for growth in Thailand while evaluating where it can repeat its entry strategy in another country. “It’s going to be another exciting year,” he said, citing cash flow and growth opportunities.

About Valeura Energy TSE: VLE

Valeura Energy Inc is an upstream oil & gas company, with a clear strategy to add value for shareholders through growth. The Company is expanding operations organically and through acquisitions in Southeast Asia, focussing on assets with immediate or substantial near-term cash flow, with imbedded reinvestment opportunities.

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