Prairie Operating (NASDAQ:PROP) executives said 2025 marked a “transformative year” as the company integrated acquired assets, expanded its DJ Basin footprint through multiple bolt-on deals, and significantly increased production and scale, while also outlining 2026 guidance that implies a lower starting point in the first quarter due to planned pad re-occupations and associated shut-ins.
2025 described as a “transformative year” with integration and acreage expansion
Interim President and CEO Rich Frommer said Prairie “successfully completed the full integration of the assets acquired from Bayswater Exploration & Production,” and continued to expand inventory at what he called “attractive economics.”
Operationally, he highlighted development activity and pads brought online during the year, including Noble, Simpson, Rauch, and Opal Coal Bank, which he said contributed meaningfully to production growth and positioned the company for momentum entering 2026.
Production ramp and year-end exit rate; pro forma details highlighted
Frommer reported full-year 2025 production of approximately 6.75 million BOE, or about 18,500 BOE per day on average, with an exit rate of about 28,000 net BOE per day.
He emphasized that the reported 18,500 BOE per day average did not include pro forma first-quarter production from the Bayswater assets, which had been incorporated into Prairie’s original guidance. Including those volumes, Frommer said full-year production would have been approximately 24,000 BOE per day, “representing almost a 4x increase in production year-over-year and in line with our guidance range.”
In the Q&A, CFO Greg Patton provided additional cadence around 2026 production expectations. Addressing why 2026 guidance is below the 28,000 BOE/d exit rate, Patton said the company is “reoccupying pads” in the first quarter to drill additional locations, which requires shutting in production. He cited the Blehm Schneider pad as an example where Prairie “had to go in and shut down the entire Blehm facility and operations,” and said first-quarter average production is expected to be “more in the 23-ish range” due to shut-ins, “not necessarily normal declines.”
Patton added that as shut-in volumes return and new wells add “flush production” in the second quarter, the company expects a “continual gradual increase throughout the year” and a “gradual incline from this point forward to the end of the year.” He also noted the company anticipates some offset fracs at the end of the second quarter, though he said they “don’t seem to be significant at this point in time.”
Financial results: revenue, Adjusted EBITDA, costs, and capital efficiency
CFO Greg Patton said Prairie generated approximately $242 million of total revenue in 2025, or about $315 million including the pro forma contribution from Bayswater for the first quarter. He said realized prices were $63.87 per barrel of oil, $17.93 per barrel of NGL, and $1.65 per Mcf of natural gas, “including the impact of derivatives.” Patton characterized the year-over-year revenue increase as “almost a 3,000% increase.”
Prairie posted a net loss attributable to common stockholders of $60.9 million, or $1.35 per share. Patton said the loss was “primarily reflecting non-cash expenses associated with a Series F Preferred in other financial instruments.”
Adjusted EBITDA totaled approximately $156 million for 2025, and Patton said that figure would have been approximately $220 million including Bayswater’s first-quarter pro forma contribution, which he described as “modestly below our guidance of $240 million.” Frommer similarly said pro forma revenue and EBITDA would have been approximately $315 million and $220 million, respectively.
Patton also pointed to capital efficiency versus prior expectations. He said Prairie achieved its production guidance “while deploying significantly less capital than originally planned,” with capital spending about 35% below stated CapEx guidance. Net cash provided by operating activities was $153.9 million, and capital expenditures were about $183.4 million, which Patton said was about $90 million below the midpoint of guidance.
On unit costs, Patton reported the following per-BOE metrics for 2025:
- Lease operating expense (LOE): $6.14 per BOE
- Transportation and processing: $1.32 per BOE
- Production and ad valorem taxes: $3.15 per BOE
- G&A: $7.50 per BOE (including $5.29 attributable to cash G&A)
Liquidity, hedging, reserves, and capital structure updates
Patton said Prairie ended 2025 with approximately $109 million of liquidity and had a borrowing base and elected commitment of $475 million under its credit facility.
He said the company’s hedging program is a “key component” of its strategy, with “a significant portion of expected production hedged at attractive prices through 2029,” which management said provides cash flow visibility and downside protection.
Patton said Prairie ended the year with 121.1 million BOE of proved reserves and a PV-10 value of approximately $1.2 billion.
Frommer noted that after year-end, Prairie received an extension on the anniversary warrant date from March 26, 2026 to April 7, 2026, as the company continues discussions related to its capital structure.
In the Q&A, Patton addressed questions around preferred-related dilution and share count. He said Prairie has been in communication with the preferred holder, identifying it as High Trail Capital/Hudson Bay Capital Management, and said the waiver “clearly indicates” that dialogue. Patton said that as of year-end, issued and outstanding shares were “in the low sixties,” and added that the share count “has increased from that low sixties number at the end of the year,” while declining to provide an exact current figure before concluding the first quarter.
2026 guidance and priorities: one rig, one frac crew, and balance sheet focus
Frommer said Prairie is initiating 2026 guidance calling for average production of approximately 25,500 to 27,500 BOE per day, capital expenditures of $200 million to $220 million, and Adjusted EBITDA of $240 million to $260 million, assuming a weighted average WTI price of $60 to $64 “including our hedges.”
In discussing capital allocation priorities, Patton told analysts Prairie expects “modest free cash flow generation” under its conservative assumptions, and said the board’s priorities include increasing liquidity and further deleveraging. While he said acquisitions remain part of the company’s aspirations—citing that Prairie has completed “nine acquisitions to date”—he emphasized a focus on accretive transactions and avoiding over-leveraging. Patton said prior deals were funded “predominantly through cash flow and small draws on the RBL to support PDP as we’ve acquired it,” and indicated a similar approach going forward.
Asked about flexibility if commodity prices remain elevated, Patton said Prairie’s 2026 plan centers on a “one rig, one frack crew program,” adding the rig is expected to outpace the frac crew, resulting in a roughly one-month rig hiatus during the year. He said the company’s goal is not to add a second frac crew, instead prioritizing free cash flow generation and balance sheet strengthening.
Patton also said Prairie does not anticipate midstream constraints affecting its development plan through 2026 or 2027, citing partnerships and contracts with NGL, Williams, and DCP, as well as “split connects” in some areas that provide optionality.
On well performance, Patton said Opal Coal Bank was an “above performer” and that Noble wells had been impacted by offset operator activity, “Chevron predominantly,” related to frac programs. He said Simpson wells took longer to bring online due to equipment timing—“predominantly our gas lift systems”—but said that after equipment arrived and flowback proceeded as planned, the wells were “performing at type curve.”
Finally, responding to a question about the management transition, Frommer said the board and management are aligned and he does not foresee changes in operations with the current team in place.
About Prairie Operating (NASDAQ:PROP)
Prairie Operating (NASDAQ: PROP) is a publicly traded independent exploration and production company focused on the acquisition, development and operation of onshore oil and natural gas properties in the United States. The firm seeks to identify and capitalize on undervalued or overlooked assets, applying a disciplined approach to drilling, completion and production optimization. By concentrating on core resource plays, Prairie Operating aims to deliver steady production growth and free cash flow.
The company’s asset base is concentrated in the Permian Basin region of West Texas and southeastern New Mexico, where it holds working interests in both conventional and unconventional reservoirs.
