Northern Oil and Gas sees Q3 DD&A rate 14.20 – $14.25 per Boe.

For the third quarter, the DD&A rate is expected to be $14.20 – $14.25 per Boe. The increase to the DD&A rate versus the second quarter is primarily driven by the closing of the Novo acquisition in the third quarter, and is in line with prior expectations. The Company enters into derivative agreements to hedge a portion of its commodity pricing exposure and makes mark-to-market fair value adjustments each quarter to the unrealized value of its unsettled commodity derivative portfolio. For the third quarter of 2023, mark-to-market losses on unsettled commodity derivatives are estimated to be approximately $205 million. Total net gains on settled commodity derivatives for the third quarter are estimated to be approximately $5M. Since its second quarter earnings release, NOG has added hedges for approximately 2.4 MMBoe of oil and 10.9 MMBtu of natural gas in the form of puts, costless collars and swaps for Q4-2023 through 2026, in addition to region-specific basis hedges. “As we enter the fourth quarter, we continue to focus capital on growth opportunities for next year and beyond,” commented Nick O’Grady, NOG’s CEO. “Our singular focus remains on executing on high return opportunities. In keeping with our practice, we have used recent commodity price strength to layer in additional oil and natural gas hedges, along with additional basis hedges, to protect our underwritten returns as we deploy capital.” “We had significant, counter-seasonal success in the Ground Game, especially early in the third quarter when oil prices were significantly lower,” commented Adam Dirlam, NOG’s President. “These projects should, at today’s pricing, deliver significantly higher returns than we originally underwrote. Additionally, we’ve seen notable increases in our Permian well proposal activity as commodity prices have improved. All of this points to increased growth prospects for 2024 and beyond.”