Bengal Energy's Q3 2025 Results: Navigating Production Allocation Changes and Price Fluctuations

Bengal Energy Ltd. (TSX: BNG), a Calgary-based international junior oil and gas exploration and production company, recently announced its financial and operating results for the third quarter of fiscal 2025, ended December 31, 2024. The company's results reflect a mix of challenges and opportunities, with notable changes in production allocation and realized oil prices shaping its financial performance.



The most significant development in the third quarter was the material change in production allocation provided by the Cuisinier operator. This change led to a 29% decrease in Bengal Energy's share of total Cuisinier production, from 16,013 bbls (174 bbl/d) in Q3 fiscal 2024 to 11,420 bbls (124 bbl/d) in Q3 fiscal 2025. Consequently, oil lifted decreased by 22%, and crude oil sales revenue fell by 11% compared to the same period in the previous year. To address this issue, Bengal Energy has requested field support to clarify the nature of the change in allocation and is awaiting further information from the operator.

Despite the decrease in production and revenue, Bengal Energy reported a net loss of $0.4 million in the third quarter of fiscal 2025, compared to a net loss of $0.5 million in the same period in the previous year. This improvement was primarily due to lower royalties, operating, and G&A costs, which more than offset the decline in revenue. The company's funds from operations also improved to $23 thousand, compared to funds used in operations of $143 thousand in Q3 fiscal 2024.



The increase in realized oil prices also contributed to Bengal Energy's financial performance in the third quarter. More than half of the volumes sold in the quarter were sold in October at US$79.53/bbl., coupled with a stronger US dollar relative to the Canadian dollar, resulted in higher realized prices. This trend, however, may not be sustainable in the long term, as it is subject to various market and company-specific factors.

In conclusion, Bengal Energy's Q3 2025 results reflect a challenging quarter marked by changes in production allocation and price fluctuations. While the company has taken steps to address these issues, it is essential for investors to monitor the situation closely and consider the potential long-term implications. As Bengal Energy continues to navigate these challenges, its ability to maintain cost savings and adapt to market conditions will be crucial for its future success.