Harbour Energy Q2 Earnings Call Highlights

Harbour Energy LON: HBR reported record first-half production and raised its full-year free cash flow outlook, citing strong operational execution, contributions from newly acquired U.S. assets and elevated oil and European gas prices. Chief Executive Officer Linda Cook said the company averaged more than 500,000 barrels of oil equivalent per day during the first half, supported by Norway and the recently acquired LLOG Exploration business in the U.S. Gulf of Mexico. Harbour lifted production guidance for the second time this year to 490,000 to 500,000 boe/d for 2026. The company also increased its full-year free cash flow estimate to $1.8 billion from $1.4 billion previously. Cook said the improved outlook supported faster debt repayment and additional shareholder distributions, including a newly announced $250 million share buyback.

Cook said Harbour’s strategy has focused on building scale and diversification, initially in the U.K. and later through the 2024 Wintershall Dea acquisition. The company has since completed the acquisitions of LLOG Exploration and Waldorf, while exiting Indonesia and previously divesting its Vietnam assets. The LLOG transaction added operated, oil-weighted assets in the U.S. Gulf of Mexico, which has become a new core country for Harbour. The Waldorf acquisition, completed after the reporting period, increased Harbour’s interest in the operated Catcher field and is expected to produce financial and operational synergies, according to management. Chief Operating Officer Nigel Hearne said Harbour’s portfolio is now concentrated in five core countries, accounting for roughly 85% to 90% of production, reserves and resources. The company is increasingly weighted toward lower-cost and lower-tax basins, with future growth expected from the U.S., Norway, Argentina and, over time, Mexico.

First-half production averaged 509,000 boe/d, while July production averaged 510,000 boe/d. Hearne said strong reliability and new wells in Argentina, the U.S. and Norway supported the results. Norway outperformed during the period and remains Harbour’s largest producing business and a major supplier of gas to Europe. Harbour delivered first gas from the operated Dvalin North project ahead of schedule and under budget, Hearne said. Accelerated project activity raised the number of Norwegian developments expected online during 2026 to five from three. The company approved the Joya subsea project and is targeting final investment decisions on five additional Norwegian projects this year.

In the Gulf of Mexico, first-half production was 33,000 boe/d. Harbour expects U.S. output to rise to 65,000 to 70,000 boe/d by 2028. The company cited stronger-than-expected performance from the fifth Buckskin well and above-plan initial rates from a Who Dat sidetrack. It expects to approve the Who Dat East development during August and plans additional drilling following the arrival of a second rig. In Argentina, production averaged 74,000 boe/d, underpinned by...