Permian Resources Reports Strong Third-Quarter 2026 Results, Raises Oil Guidance
Permian Resources Corporation (NYSE: PR) reported strong financial and operational results for the third quarter of 2026, citing higher production, improved cash generation, disciplined costs and expansion in the New Mexico Delaware Basin. The company also revised its full-year outlook, raising its midpoint oil production guidance and updating capital expenditure expectations.
For the three months ended September 30, 2026, average daily production was 208,029 barrels of oil, 118,312 barrels of natural gas liquids (NGLs) and 787.1 million cubic feet of natural gas. Total production was 457,528 barrels of oil equivalent per day (Boe/d), up 22% quarter over quarter; oil, NGL and natural gas volumes increased 5%, 37% and 42%, respectively.
Stronger commodity prices supported oil production, while natural gas and NGL volumes benefited from returning high-gas-to-oil-ratio wells that had been curtailed amid negative regional gas prices.
Realized prices were $85.73 per barrel of oil, $24.22 per barrel of NGL and $0.74 per thousand cubic feet of natural gas. Additional firm transportation agreements increased natural gas sales into Gulf Coast and Dallas-Fort Worth markets. Higher prices and production contributed to a $141 million quarter-over-quarter increase in natural gas revenue, bringing it to $53 million. NGL revenue rose by $81 million to $264 million.
Cash provided by operating activities totaled $1.255 billion. Cash capital expenditures were $518 million, adjusted operating cash flow reached $1.364 billion and adjusted free cash flow was $846 million.
Cost management remained central to the results. Lease operating expense declined 8% quarter over quarter to $5.11 per Boe, while cash general and administrative expense fell 16% to $0.73 per Boe. Gathering, processing and transportation costs were $1.21 per Boe. Combined controllable cash costs reached a company-record low of $7.05 per Boe.
Management cited power and compression optimization for lower expenses and record runtimes. The Drilling team also achieved a company record, averaging more than 2,700 feet per day during the quarter.
Artificial intelligence is being used to monitor artificial lift systems and support development and drilling decisions.
Co-CEO Will Hickey said the company increased production across all three commodity streams while maintaining cost discipline and achieving record-low controllable cash costs. He said adjusted free cash flow of $846 million was significantly higher than in the second quarter despite lower oil prices.
Co-CEO James Walter cited increased working interests, accelerated workovers and shorter cycle times without increasing rig or fleet counts. Walter said the current plan is expected to generate approximately $300 million in additional 2026 free cash flow versus the original February plan, normalized for commodity prices.
Permian Resources continued acquiring assets in the core New Mexico Delaware Basin. It completed approximately 175 transactions, adding 24,000 net acres, 9,000 net royalty acres, 13,000 net 10,000-foot locations and 13,000 Boe/d of production. Upfront cash consideration was about $1.15 billion, subject to customary adjustments, plus potential oil-price-linked payments.
The largest deal was Ridge Runner Resources II, LLC and its affiliated royalty company, both EnCap Investments L.P. portfolio companies, acquired for approximately $1.025 billion. The assets adjoin its core New Mexico position and include high-net-revenue-interest acreage and long-lateral locations.
Additional bolt-on and ground-game transactions, primarily in New Mexico, totaled approximately $120 million.
Ridge Runner includes up to $125 million in potential contingent payments over two years beginning January 1, 2027. Payments are tied to quarterly West Texas Intermediate (WTI) prices. Quarterly payments in 2027 are $9.375 million above $70 WTI or $18.75 million above $80. In 2028, they are $6.25 million and $12.5 million, respectively.
For full-year 2026, the company raised the midpoint of its oil production guidance to 202.5 MBbls/d, 13.5 MBbls/d above its initial February outlook. The increase reflects well performance, higher working interests and workover activity. Ridge Runner was producing approximately 6 MBbls/d of oil when the transaction closed on October 30 and is expected to contribute around 4 MBbls/d in the fourth quarter.
The 2026 cash capital expenditure range is now $1.975 billion to $2.075 billion. This reflects higher working interests, workovers and approximately $20 million for Ridge Runner. Fourth-quarter oil production is expected to exceed 210 MBbls/d, with cash capital expenditures at a level similar to the third quarter.
Permian Resources maintained leverage of approximately 0.5 times. During the third quarter, it redeemed $325 million in principal of legacy Earthstone 9.875% senior notes due 2031. Together with $550 million of similar notes redeemed in the second quarter, the transactions are expected to reduce annual cash interest expense by approximately $75 million. Ridge Runner was funded after the quarter with cash on hand and commercial paper. The company expects year-end 2026 leverage below 0.5 times.
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