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Whitecap Resources Inc. says the scale it gained with its acquisition of Veren Inc. helped drive a credit-rating upgrade, lowered borrowing costs and boosted reserves — helping it to secure new long-term supply deals linked to stronger U.S. and European gas prices.
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The oil and gas producer announced two 10-year natural gas supply deals alongside its fourth-quarter earnings. The contracts, totalling 85,000 million British thermal units per day, are tied to U.S. and European pricing benchmarks that have traded well above Western Canada’s chronically discounted gas prices.
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“What we’re looking to do is move about 50 per cent of our pricing outside of (Western Canada’s) AECO, and with these two contracts here, we would be increasing our exposure outside of AECO in that eight to nine per cent range,” Thanh Kang, Whitecap’s chief financial officer, said on an earnings call Tuesday.
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Western Canada’s AECO gas prices have periodically collapsed amid pipeline bottlenecks and chronic oversupply. Producers like Whitecap have weathered the volatility by focusing on oil and liquids-rich gas — streams that contain higher-value hydrocarbons such as condensate and propane. They’ve also moved more of their gas into U.S. and overseas markets through transportation contracts and long-term supply deals.
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Whitecap said its acquisition of rival Veren last May gives it an edge in securing long-term contracts with international buyers — contracts that smaller producers often struggle to obtain.
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Whitecap reported higher profit and record quarterly production in the final three months of 2025, even as its averaged realized oil price fell 18 per cent year over year.
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Net income was $307 million in the fourth quarter, compared to $234 million a year earlier, according to results released after markets closed Monday.
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Despite a tough price environment in 2025, the company said it generated its second-highest annual funds flow ever at $2.9 billion, or $2.95 per share, compared to $1.6 billion, or $2.73 per share, in 2024.
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Whitecap chief executive Grant Fagerheim also emphasized the broader trends he sees shaping the sector in the year ahead.
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“Improving market access for Canadian energy remains an important theme for maximizing economic value and strengthening North American energy security,” Fagerheim said during Tuesday’s earnings call.
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“Condensate fundamentals remain supportive and expanding (liquefied natural gas) and natural gas demand continue to provide long-term tailwinds.”
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English (US)