BATON ROUGE, LOUISIANA (Steve Stewart, Energy Analytics Institute, 27.Feb.2025) — Veren Inc., which has started 2025 strong boasting production of 191,000 boe/d in Jan. 2025, has an eye on achieving average production of 188,000-196,000 boe/d (65% oil and liquids) in 2025. This, based on its development capital expenditures (Capex) budget of $1.48bn-$1.58bn.
Calgary-based Veren’s Capex program is weighted to the first-half 2025 (1H:25), while its production is weighted to the 2H:25 due to the timing of its development program and planned facilities downtime in early 2025, the company said on 27 Feb. 2025 in its year-end financial press release.
“The company will remain disciplined in the execution of its capital program, with the flexibility to adjust spending in response to market conditions in order to maximize long-term shareholder value,” Veren said in the release.
Approximately 85% of Veren’s 2025 budget is allocated to its short-cycle Alberta Montney and Kaybob Duvernay assets, which provide top quartile returns, scalability and quick well payouts. Veren’s remaining capital is allocated to its long-cycle, low-decline Saskatchewan assets, which generate significant excess cash flow.
“We are off to a great start in 2025 and remain focused on maximizing the long-term potential of our assets, supporting our commitment to shareholder returns and maintaining a strong financial position,” Veren president and CEO Craig Bryksa said in the press release.
Montney and Kaybob Duvernay highlights
In 2024, Veren brought 57 wells on stream across 11 multi-well pads in the Alberta Montney.
Looking ahead to Veren’s 2025 plans, the company looks to continue optimizing its completions by testing the SPE design in Karr and utilize SPE design in the Gold Creek area moving forward, as previously announced.
Within Veren’s Kaybob Duvernay asset the company continued to deliver consistent results throughout 2024, demonstrating the strength of its operational execution.
Veren brought 37 wells on stream across 8 multi-well pads in the volatile oil window. Veren’s 2024 development program included several successful delineation wells on the eastern and western portion of its land position, derisking drilling inventory in these areas.
Looking ahead, Veren’s 2025 development program includes additional delineation drilling in the liquids-rich and lean gas windows of the play.
Hedging and excess cash flow
Veren continues to hedge a portion of its production as part of its ongoing commodity marketing and diversification program. The company has hedged 35% of its oil and liquids production and 35% of its natural gas production for 2025, net of royalty interest.
In 2025, Veren expects to generate excess cash flow of $625mn-$825mn (US$70/bbl to US$75/bbl WTI and $2.25/Mcf AECO), which is weighted to the 2H:25 based on the timing of its development program and expected production growth.
Veren has also diversified its gas pricing exposure, resulting in the majority of its production through 2026 receiving a combination of fixed prices and pricing related to major US markets.
Veren is targeting the return of 60% of its annual excess cash flow to shareholders through the base dividend and share repurchases, with the remaining 40% directed toward the balance sheet. Veren plans to increase the percentage of excess cash flow returned over time as the balance sheet strengthens further, the company said.
“Last year marked a continued advancement in the execution of our long-term strategy as we significantly strengthened our balance sheet, consistently returned meaningful capital to our shareholders and achieved strong reserve additions,” Bryksa said.
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By Steve Stewart reporting from Baton Rouge. © 2025 Energy Analytics Institute (EAI). All Rights Reserved.
