Battalion Oil Corp

F:RAQB

Production growth: Battalion said third-quarter average daily production rose almost 8% from the second quarter, helped by new wells coming online.

Profitability improved: Adjusted EBITDA increased 34% quarter over quarter to $24.3 million, the company’s highest level since 2019.

Pricing held up: Even though benchmark crude prices fell 15% quarter over quarter, realized oil pricing improved 11% because the company outproduced its hedges.

Operations ahead: Management said drilling and completions are running ahead of plan, with better drilling efficiency, stronger pump efficiency, and continued cost control.

Bone Spring test: Early results from a third Bone Spring test looked promising and could help expand inventory and support a multi-zone development plan.

Guidance mixed: Battalion reiterated guidance for capital activity, capital spending, and total production, but lowered its oil production outlook because oil cut came in slightly below plan.

Balance sheet note: The company said it amended its term loan after a current ratio issue at September 30 and is now back in compliance.