05:22 PM EDT, 09/08/2025 (MT Newswires) -- Headwater Exploration ( CDDRF ) after trade Monday increased its 2025 oil and gas production guidance, in conjunction with updated operational results.

he company said "exceptional" results across its portfolio including exploration in Greater Pelican and in the Grand Rapids formation in Marten Hills West, backstopped by improving declines from secondary recovery, have positioned Headwater to increase production guidance and re-allocate capital to additional exploration and sustainability initiatives.

According to the company, fourth-quarter production is expected to now average 23,500-24,000 boe/d representing a year over year increase of 11%. It said this results in annual production guidance increasing to 22,600 boe/d from 22,250 boe/d. Headwater's production increase is expected to be achieved with 33% less development wells and $35 million less capital than originally budgeted due to "exceptional results" and a sustainable downward trend towards half cycle well costs, it added.

HWX said yhe available capital within its current budget has allowed it flexibility to focus on accelerating sustainability initiatives including: $10 million of incremental secondary recovery spending including two water injection pilots in the Grand Rapids formation and a polymer pilot in Greater Pelican; and $10 million of incremental exploration drilling including two additional step-out locations in Greater Pelican and three incremental Grand Rapids step out tests in Marten Hills West; and also $15 million of incremental land expenditures allowing us to continue to build high quality drilling inventory for the future.

On outlook, the company said "timely" capital allocation adjustments in response to changing market conditions provide it the ability to continually optimize return on invested capital. Headwater said it remains focused on sustainability and maximizing total shareholder returns through organic expansion, enhanced oil recovery, dividends and strategic buybacks under its ongoing NCIB.

The company's shares closed down $0.01 to $6.64 on the Toronto Stock Exchange.