Kolibri Global Energy's Share Repurchase Strategy: A Strategic Move to Enhance Shareholder Value Amid Energy Transition

Kolibri Global Energy Inc. (KGEI) has emerged as a compelling case study in strategic capital allocation, particularly through its aggressive Normal Course Issuer Bid (NCIB) share repurchase program. As the energy sector navigates the dual pressures of profitability and the energy transition, KGEI's actions signal a calculated approach to balancing shareholder returns with long-term growth.

Strategic Share Repurchases: A Vote of Confidence in Undervaluation

According to a report by Kolibri Global Energy, the company has repurchased 548,293 common shares since the inception of its NCIB program, with an average price of $5.27 per shareKolibri Global Energy Inc. Announces Corporate Update^[1]. In early September 2025, it added 267,637 shares at $6.38 per share, reflecting a growing conviction that the stock is undervaluedKolibri Global Energy Inc. Announces Corporate Update^[1]. This aligns with the Board's assertion that the current market price does not reflect the company's intrinsic valueEarnings call: Kolibri Global Energy reports strong Q3 growth^[2]. By allocating capital to repurchase shares, KGEI is effectively signaling to investors that it views its equity as a bargain, a move that can stabilize or even boost investor sentiment during volatile market conditions.

The NCIB's scale—approved for up to 1.7 million shares (5% of outstanding shares)—further underscores this strategyKolibri Global Energy Inc. Announces 2025 AGM Results^[3]. Such a large repurchase authorization is not merely a short-term tactic but a structural decision to consolidate ownership and enhance earnings per share (EPS) through reduced share counts. This approach is particularly relevant in the energy sector, where cyclical price swings often create mispricings.

Capital Allocation: Balancing Growth and Efficiency

KGEI's 2025 capital allocation strategy is a masterclass in prioritization. The company plans to spend $48–53 million on drilling nine wells, including 1.5-mile and 2-mile laterals, to drive production growthKolibri Global Energy Inc. Provides 2025 Guidance^[4]. These longer laterals have already demonstrated strong performance, with Q3 2025 production rising 11% to 3,032 BOE per dayEarnings call: Kolibri Global Energy reports strong Q3 growth^[2]. By focusing on high-impact projects, Kolibri is optimizing its capital to generate returns that outpace its cost of capital.

Simultaneously, the company is testing the economic viability of the Caney Formation on its eastern acreage through the Forguson 17-20-3H wellKolibri Global Energy Inc. Provides 2025 Guidance^[4]. This exploration effort, while speculative, aligns with the energy transition by potentially unlocking new, efficient resource plays. Kolibri's ability to reduce operating expenses by 10% per BOEEarnings call: Kolibri Global Energy reports strong Q3 growth^[2] further strengthens its financial flexibility, ensuring that capital is directed toward projects with the highest marginal returns.

Investor Confidence and the Energy Transition Narrative

The energy transition has created a paradox for traditional energy firms: investors demand both profitability and sustainability. Kolibri's strategy addresses this by combining operational efficiency with selective share repurchases. For instance, its 10% reduction in operating costsEarnings call: Kolibri Global Energy reports strong Q3 growth^[2] and 118% surge in Q3 net income to $5.1 millionEarnings call: Kolibri Global Energy reports strong Q3 growth^[2] demonstrate that profitability and prudence are not mutually exclusive.

This financial discipline has translated into strong shareholder support. At the 2025 AGM, over 96% of shareholders approved the amended Restricted Share Unit Plan and Stock Option PlanKolibri Global Energy Inc. Announces 2025 AGM Results^[3], reflecting confidence in the leadership's vision. Kolibri's participation in investor conferences, such as the Sidoti and Lytham events in September 2025Kolibri Global Energy Inc. Announces Corporate Update^[1], further reinforces transparency, a critical factor in maintaining trust during the energy transition.

Conclusion: A Model for Energy Sector Capital Allocation

Kolibri Global Energy's NCIB program is more than a tactical response to undervaluation—it is a strategic lever to align capital with shareholder interests while funding growth in a transitioning energy landscape. By repurchasing shares at a discount, optimizing drilling programs, and reducing costs, the company is creating a virtuous cycle of value creation. For investors, this represents a rare combination of defensive and offensive strategies, positioning KGEI as a resilient player in the evolving energy sector.